SIR PETER ABELES
FOUR CORNERS 2 NOVEMBER 1987
Reporter: Marian Wilkinson
Producer: Paul Williams
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The following is a transcript of the Australian ABC TV Four Corners' investigation into the business activities and ethics of Australian entrepreneur, Sir Peter Abeles, screened in Australia on 2nd Nov 1987. The program provides an insight into the political power and influence employed by Sir Peter Abeles with such devastating results against his pilots during the Australian Pilots Dispute of 1989, less than two (2) years after the program was first aired.
LINK TO AUSTRALIAN PILOTS DISPUTE OF 1989
ANDREW OLLE (Studio) Thanks for joining me.
Power and influence can be pretty hard to measure. The name Abeles appears on the first page of 'who's who' - but four of the seven names that go before him - two Abba's and a couple of Abbots are given more space. The bald facts say little for the real clout of Emil Herbert Peter Abeles, Transport Supremo and Knight Batchelor.
Sir Peter Abeles' TNT now operates in more than 80 countries. In Australia alone it gets the lion's share of a 12 billion dollar transport market, and with the government of his old friend Bob Hawke poised to de-regulate the Airline Industry, Sir Peter seems set to consolidate his dominance.
Tonight's report from Marian Wilkinson is about de-regulation and the move to sell off the publicly-owned Australian Airlines. Inevitably, it's also about the power and influence of Sir Peter Abeles.
MARIAN WILKINSON In remote sparsely populated Australia, where history has been shaped by the tyranny of distance, there is one iron law. Transport is the lifeline of the nation. The corporate giant that dominates transport has within its grasp enormous economic and political power.
FILM - Ansett Jet Turning
MARIAN WILKINSON There is one transport giant that dominates Australia today -this is just one of its many faces. Behind Ansett is the international empire of TNT - headed by the Mr. Big of transport.
STILL OF SIR PETER ABELES AND RUPERT MURDOCH
MARIAN WILKINSON Sir Peter Abeles, a Hungarian who emigrated to Australia after the war. He has spent 30 years fighting and charming his way to the top. For the last 8 years, media baron Rupert Murdoch has been Abeles' partner in Ansett - together, they're a formidable combination of political and financial clout.
SIR PETER ABELES I see very little of Rupert, but the little I see and the times I hear him on telephone, he's an exciting partner to through the ball up and down the road and my experience has been - mind you we always have been very fair and good partners on our side, that he always was 100 percent sticking to his commitments and his undertakings with us.
MARIAN WILKINSON Abeles has managed to keep a low public profile next to the high-flying Murdoch. But today, all that is changing - Abeles' influence and his empire are in the political spotlight.
FILM - shots featuring TNT
MARIAN WILKINSON Few people realise the power TNT commands over the nation's transport. Whole government trains work daily for TNT. It/s trucking fleet is so huge, it competes against itself under different names. Even its shipping fleet boasts TNT is the nation's biggest.
When you consider that seven (7) out of every one hundred (100) dollars is spent on transport, you begin to understand the power of Sir Peter Abeles and TNT.
Around the globe, TNT operates in over 80 countries, it is the largest diversified transport company in the world.
FILM - TNT Twin Towers Sydney
MARIAN WILKINSON This empire stands behind Ansett Airlines, and it's why Ansett could well dominate the skies now the government has decided to end its control over the Airline Industry by 1990.
GARETH EVANS - Federal Transport Minister The Australian Airline Industry is a world leader in technical excellence and standards of service. It's had 35 years of prolonged coddling, a very protracted childhood and adolescence by any standards and it now deserves to be given the key of the door - the sky won't fall in when it is.
MARIAN WILKINSON Transport Minister Gareth Evans has the job of selling the new airline policy. It will mean no-holds barred competition between the airlines, it's called 'de-regulation' a buzz word in today's Labor Party.
GARETH EVANS The decision to de-regulate the domestic airline industry arguably rates in terms of its scope and importance, second only to the Hawke Government's historic decision to de-regulate the financial system and to float the dollar.
FILM - Melbourne Airport
MARIAN WILKINSON The Two Airline Agreement that protected both Ansett and the government owned Australian Airlines against competition has been dumped. But as the two prepare for battle in 1990, Ansett is already out in front and outmanoeuvring Australian. Ansett is putting into place a top-line fleet, while the government airline, starved of cash, can't afford the planes it wants. Ansett has also moved swiftly to buy out its only other serious competitor, East West.
But all that has not sparked the controversy, what has is the proposal to sell the government airline to private enterprise.
Soon there could be an airline a lot fewer Australians call their own. The Prime Minister, Bob Hawke among others, has suggested selling Australian Airlines to private enterprise by 1990, and it's this issue that threatens to become the biggest controversy in the Labor Party since the Uranium debate.
FILM - Bob Hawke at Victorian ALP Conference
MARIAN WILKINSON To many in the Labor Party, state enterprises like Australian Airlines are sacred cows - part of Labor's heritage, but just after the election, Bob Hawke stunned the Party by calling for a debate on privatisation - the sale of state enterprises.
BOB HAWKE (Film clip) The question should be not why should we sell a given enterprise but why should we continue to tie up our resources in it?
MARIAN WILKINSON The Party will debate privatisation next June, but the lobbying is already intense. Ansett's boss, Peter Abeles has made it clear he wants Australian sold before 1990. In the hot seat, Gareth Evans insists that Ansett's demands won't influence his decision to sell or not sell Australian.
GARETH EVANS We've taken our de-regulation decision without any regard to the privatisation suggestion or claim or demand that Ansett was publicly making.
FILM - James Strong with Australian Plane in Background
MARIAN WILKINSON The sale of Australian is however a real possibility - if anyone can still afford it. Its General Manager is believed to be backing a sale - James Strong won't discuss that publicly, but he knows Australian needs money to take on Ansett, from the taxpayers or from private enterprise.
JAMES STRONG - General Manager, Australian Well, we certainly don't have the amount of capital that we need, and that requirement becomes more profound as time goes on because we are part way through a re-equipment programme. Obviously that involves hundreds of millions of dollars, and you can't just go on gearing up a debt to cover that sort of acquisition, so there has to be attention to the capital base.
FILM - Planes
MARIAN WILKINSON Control of the skies in 1990 is what the fight is all about. Ansett is poised to dominate. If the government sells Australian, it will have no hope of guaranteeing that Ansett faces any serious competition - that's according to its opponents.
John MacBean is leading the fight against the sale, he's on the board of Australian, but he's also a key figure in the Labor Party, the ACTU and Prime Minister Hawke's own faction.
JOHN MACBEAN - Secretary, NSW Labor Council Unless Australian Airlines remains in the hands of the government in the post de-regulation area period, then I am concerned that Ansett will have a dominance in the Airline industry; over dominance in the industry to a point which would be in my view unfair competition.
FILM - Labor Left Meeting in Canberra
MARIAN WILKINSON A meeting of the Party's Left Wing just two weeks ago pledged to fight the sale of Australian and any State enterprise. And opposition is spreading across the board, Right, Left and now Centre.
PETER COOK - ALP Centre Left The purpose of having a public enterprise airline in Australia is to in fact, to quote the Democrats 'keep the bastards honest', that is if you've got a big private enterprise airline that could become a monopoly, you need a public umpire if you like in the airline system, competing and making sure fares are kept down and the services that ought to be provided to the Australian travelling public are improved.
INTERVIEW WITH JOHN MACBEAN
JOHN MACBEAN The government, if they're going to seek to privatise Australian Airlines and Qantas, will face a very severe backlash by rank and file members of the Party across Australia, and I think that's where the showdown will occur next June or July at the ALP conference.
MARIAN WILKINSON What if it was put to you that you'd cause the Prime Minister to be rolled on this issue, would you back off?
JOHN MAC BEAN I can't be held responsible for the Prime Minister setting off on a course which in my view is a suicidal course in trying to turn around the whole Labor Party on this question of public ownership, so that's a matter for the Prime Minister to consider, not myself.
FILM - Bob Hawke & Sir Peter Abeles at the Economic Summit
MARIAN WILKINSON The Prime Minister's very public friendship with Sir Peter Abeles has already become an issue in the debate. The Economic Summit back in 1983 was the first time many saw that friendship on display. But Abeles has freely offered personal and political advice to Hawke over 15 years. Hawke rejects any suggestion that his friendship with Abeles disqualifies him from deciding Aviation policy.
INTERVIEW WITH BOB HAWKE AT PRESS CLUB
ROBERT HAUPT - Reporter Should you be returned on Saturday your government will face another policy decision of momentous financial importance to another of your close friends, I refer to the new Aviation policy and your friend Sir Peter Abeles, head of Ansett, and I ask - to avoid even the appearance of favourable treatment for Sir Peter because of his intimate and long-standing connection with you, will you absent yourself from the Cabinet's discussion of this policy, and if not what other action do you propose to take to allay public concern?
BOB HAWKE I will not absent myself from the room when this is discussed. We as a Cabinet will discuss the future of Aviation policy with the full integrity that we discuss all issues that come before the Cabinet....
END OF INTERVIEW
MARIAN WILKINSON Evans too has come under fire over the Hawke/Abeles friendship, but he says his decisions on aviation will stand on their merits:
GARETH EVANS I take the view that any decision that I make, and any decision the government makes on any of these issues has to be credible and has to be publicly defensible, so whatever the ways in which conversations are held and whatever the degree of accessibility or influence that particular people might be perceived to have, at the end of the day all these issues have to be resolved on their merits, because to do it any other way would just put you in an impossible - quite apart from anything else - it would put you in an impossible political position - has to be credible - has to be defensible - the arguments have to be there - the justification has to be there and if you approach it in that way I mean it's no more different handling these people with all their very high-profile and all the baggage of public reputation and controversy that goes with it - it's no more difficult handling these people than it is much less highly profiled people.
FILM - TNT logo
MARIAN WILKINSON The Union Rotorua slips into Sydney Harbour. It belongs to TNT which runs the largest shipping fleet in this country. A transport empire doesn't grow this big being ignored by governments. Everything TNT does depends on government decisions - whether it's port charges, road taxes, rail freights or leasing terminals. Peter Abeles' outstanding achievement is his ability to handle governments. TNT's first chairman, Ken Thomas recognised this ability in Abeles from the beginning:
KEN THOMAS - TNT's Founder The fact that he's a brilliant man - a brilliant businessman with a superb brain, especially for the big league. He used to describe it as 'the world of wheeling and dealing', and there's nothing wrong with that of course - most big businessmen are involved up to their ears in wheeling and dealing.
FILM - Archival Footage/Sydney in the 50's
MARIAN WILKINSON Sydney in the 1950's. It was here Abeles started his transport empire with two trucks. He called them Samson and Delilah. But it didn't take the new immigrant long to learn the value of connections.
INTERVIEW WITH KEN THOMAS
KEN THOMAS So that he became spiritually an Australian very very quickly. Mind you, it was also extraordinary after being in the country only a few years, he appointed as his chairman the former Governor-General of Australia, Sir William McKell - he'd only been in the country a couple of years.
MARIAN WILKINSON How did he do that, I mean how did?
KEN THOMAS I don't know how he did it (laughs) - as I say, it's not my league - it's not my scene to work in that sphere - nothing wrong with it mind you.
ARCHIVAL FOOTAGE Melbourne
"The biggest investiture for many years at Government House in Melbourne, the Governor-General Sir William McKell confers 130 honours and decorations.
MARIAN WILKINSON Abeles appointed McKell some years after he retired as Governor General, but seconding the former Queen's Representative and New South Wales Premier was just the beginning. In those years, Abeles was one of the few corporate chiefs to admit donating to political parties.
SIR PETER ABELES ... yes we have made minor contributions to all political parties. I don't know what others do but we certainly don't expect favours because we are not very political minded mind you, but it's not only companies, we are talking of companies, unions, trade unions, individuals, so the whole community's really trying to silence the electoral process.
FILM - 1965 Footage/Sir Robert Askin Speech
MARIAN WILKINSON The 1960's in New South Wales was the decade of Sir Robert Askin - an era of conservatism, of big opportunity, and big calls on government spending.
SIR ROBERT ASKIN (1965) Last year I said 'man is getting ready to go to the moon', and we still haven't got sewerage in my electorate. This year I'm able to say 'he's actually been on the moon - and we still haven't got sewerage'
MARIAN WILKINSON Premier' Askin soon became close to Peter Abeles. He found in Abeles a man the State could do business with, and the two became friends.
MILTON MORRIS - NSW Transport Minister(May, 1965-January, 1975) I believe they were good friends, and there were times when I met Sir Peter Abeles and our Premier in the Premier's office or at Parliament House when representations were being made about one of a number of transport matters - yes, I believe they were very good friends.
FILM - TNT Loading and Unloading
MARIAN WILKINSON TNT grew at a feverish pace in the Askin era. TNT's interest were the interests of the State, whether it was bulk rates on the railways or low road taxes. New South Wales laid the foundation for TNT's worldwide expansion. Askin's Transport Minister, Milton Morris still believes that what helped Peter Abeles, helped the State.
MILTON MORRIS He, I felt, was trying to sit in my chair, and seeing what I could agree to and I tried to sit in his chair and see to what extent we might be able to assist. I was in Transport for 10 years and people like Sir Peter Abeles and others . . . well I often asked them to assist us in an inquiry or by providing an executive to undertake some work for the government because these people did employ top line operators and they could be very useful in assisting the government.
MARIAN WILKINSON Before Askin left the floor of politics, he nominated Abeles for a Knighthood. Abeles in turn hosted a farewell party for Askin at his mansion. A year later Askin became a director of TNT - and the holder of 110 thousand TNT shares.
MILTON MORRIS I saw my former Premier at his office at the TNT building on many occasions because I had enormous regard for Bob Askin. I wasn't affronted by the fact that he was appointed a director of TNT and knowing Bob Askin, I don't think he would have been compromised in any way.
FILM - TNT Towers Sydney
MARIAN WILKINSON The New South Wales Railways underpinned TNT's success in the State. The company's imposing headquarters were built on an attractive 99 year lease on State Railway land. In these offices Robert Askin spent his retirement.
FILM - Wran Election
MARIAN WILKINSON The King is Dead, Long Live the King', it's a dictum followed by most sensible businessmen, and Sir Peter Abeles is no exception.
KEN THOMAS Peter was always on side with the party in power. He used to give $100 a plate dinners for the Liberal Party when it . . when the position was appropriate in the days of Billy McMahon. And now he's.- he gets along very well with the senior men in the Labor Party. And if it were - if they were both followed by a Callithumpian party - Peter would get along supremely well with the current party.
FILM - Neville Wran (1976) /Still of Alex Carmichael
MARIAN WILKINSON When Neville Wran first came to power in 1976, Labor had few friends in the big end of town. Abeles moved swiftly to win Wran's trust and to co-operate with the new government.
For the next decade an extraordinary range of key government jobs were filled with executives and directors from the TNT empire. Among them were Alex Carmichael, Roland Hoy and Ross Cribb. Carmichael is Chairman of the Darling Harbour Authority. He has also been Chairman of the State Railways, Chairman of the Lotto Control Board, Vice-Chairman of the State Dockyard, has headed a Government Inquiry into the dockyards and into the Grain Handling Authority. Carmichael is no longer an executive of TNT, but remains on the Ansett Board. He describes himself as a professional director.
STILL - Roland Hoy & Ross Cribb
MARIAN WILKINSON Roland Hoy, boss of TNT's shipping company is also head of the Maritime Services Board. Ross Cribb is TNT's General Manager and he became head of the New South Wales TAB.
FILM - Newcastle Dockyards
MARIAN WILKINSON Listening to the New South Wales politicians over the years, you could believe that what's been good for Sir Peter Abeles and TNT, has been good for the State. But here in Newcastle there's another side to that story, it's a story about TNT, government and the State Dockyards. A story that ended in financial disaster for both the taxpayers and the Newcastle Dockyards.
The dockyard was shut down by the New South Wales government last year, described as a monument to failed government enterprise. But the yard suffered some of its worse losses over a contract with TNT shipping arm, 'Bulkships' back in 1979.
FILM - Neville Wran and Peter Abeles
MARIAN WILKINSON The 13 million dollar contract was signed by Peter Abeles and Premier Wran - another milestone of co-operation. The dockyards would build two TNT ships.
NEVILLE WRAN Ladies and gentlemen, on behalf of the government and the people of New South Wales, I wish the ship, its owners 'Bulkships' Limited, and the dockyard, good fortune.
FILM - Ships Under Construction
MARIAN WILKINSON Jobs for Newcastle. Back in 1979 it all sounded too good to be true - and it was. But back then, no-one publicly questioned how the struggling State Dockyards could build TNT ships at the most attractive, most competitive price in the State.
Building the TNT ships was a big risk for the dockyard, and an experienced executive should have sounded a warning, but the dockyard's highly qualified, government appointed vice chairman, Alex Carmichael, said nothing - he couldn't. Just months before he had stepped down as Managing Director of TNT bulkships and was still a director of the company. He declared his conflict of interest in the contract and stood back.
FILM - Launch of the ship 'Atlas Dampier'
MARIAN WILKINSON By the time the first TNT ship, the 'Atlas Dampier' was launched, the contract had put the dockyards in big financial trouble, costs had overrun by millions of dollars. By 1982, the New South Wales Auditor General found that the TNT. contract had cost the taxpayer over 7 million dollars - his conclusion: Either the dockyards tender price was: "Grossly under stated" or there was "unsupportable deterioration in performance" at the yards.
MARIAN WILKINSON Mike Stojanov was the dockyard's man in charge of putting together figures for the TNT tender, but he says the dockyard management didn't take his advice:
MIKE STOJANOV Well the price - the price the dockyard put in I understand was lower than what the price that I estimated.
MARIAN WILKINSON Why - do you know why that happened?
MIKE STOJANOV I don't know why - that again is a management decision.
FILM - Inside the Dockyards
MARIAN WILKINSON Among those who worked inside the dockyards, no-one could give 'Four Corners' an explanation of why the tender for the TNT ships was so low.
The senior ship-builder with the yards and a senior board member told us they were not consulted before the tender went in.
Alex Carmichael couldn't tell us, and would not be interviewed. But in a written reply to 'Four Corners' he said "my duty was clear, not to become involved in the TNT contract".
The dockyard's ship-building arm was ordered closed within months of the debacle over the TNT contract, a major blow to the future of the yards.
In his written statement to 'Four Corners', Alex Carmichael said he felt no conflict of duty over the contract, it was a matter for the other board members.
Ironically, just last week, a consortium including TNT has proposed taking over the yards to build under contract 12 new war-ships for the Australian and New Zealand Governments.
FILM - Umpire at Grand Final
MARIAN WILKINSON Every year at the Grand Final in Sydney, TNT advertises to the country its ability to handle people. More often than not, the public and the politicians look on with admiration.
In the rough and tumble world of industrial relations, face to face contact and managing people is TNT's style.
Mike O'Grady experienced TNT's industrial relations first-hand. He used to be a senior official with the Storeman and Packers Union until a bitter falling out with Victoria's Labor Right forced a career switch. Personal contact, O'Grady remembers, was the key to TNT's style:
MICHAEL O'GRADY It was different in as much as that you could, on relatively small issues, - you could always get to the top bloke. Most other companies you deal through a hierarchy, but with TNT - not only them, but in later years with Ansett you could always get to talk to Sir Peter about any problems you might have.
MARIAN WILKINSON Tasmanian Labor leader, Neil Batt worked for TNT for six years, often dealing with industrial problems:
NEIL BATT The style is - the style is, and I think it's Peter Abeles' own style - is, he says to you "make things work - organise things". He doesn't want - he doesn't like the system of anybody bureaucratising the relationship.
MARIAN WILKINSON Michael O'Grady has experienced the company style himself:
MICHAEL O'GRADY Well if you were flying Ansett, after a while if you flew a lot you flew both airlines. There would be a VIP booking scheme so that you were marked on the computer as a . . I'm sorry, it's not VIP, it's commercially important customers - CIP. That was marked on the computer against your name, you get quick bookings, quick baggage recovering, upgraded to first class as I say, and that was done automatically, you didn't have to apply for that treatment it was there as a result of a computer entry against your name.
FILM - Trucks at Egg Corporation
MARIAN WILKINSON The union that controls the men who drive TNT's trucks across the nation is crucial to the company's fortunes. It's the Transport Workers Union, and some 60 percent of TNT workers belong to that union.
In New South Wales the union has on the whole, good relations with TNT. Harry Quinn is Secretary of the TWU in New South Wales, and for most of the years he's been a union official his wife has held shares in TNT. Today, they number 8368.
In Queensland, the former secretary of the union, Arch Bevis, hired out as an industrial relations consultant to a TNT subsidiary in Brisbane.
FILM - Transport House
MARIAN WILKINSON From the union's Sydney headquarters, Harry Quinn declined an interview with 'Four Corners' about one of his former organisers who failed to deal at arms length with TNT. The organiser was Stewart Parnell who's been under investigation for receiving favours from Edwards & Sons Transport Company.
FILM - Egg Corporation
MARIAN WILKINSON Parnell was also the TWU organiser at the New South Wales Ego Corporation. For over 20 years independent drivers had carted eggs in New South Wales. But in November, 1984, the corporation. announced that TNT's Alltrans company would be taking over the cartage contract - the drivers would now work for TNT.
MARIAN WILKINSON John O'Lauchlin was one of those drivers. Until then he'd had an Egg Run worth 100 thousand dollars. On the morning of November 16, be was told he would lose his run and be offered a job with TNT.
JOHN O'LAUCHLIN It was like a bombshell, everybody being told that TNT were taking over from that morning. The remaining carriers would be much better off, and the whole thing was obviously organised beforehand and they were very successful in keeping it a closely guarded secret.
MARIAN WILKINSON From who?
JOHN O'LAUCHLIN Well certainly from the carriers. I knew nothing about it and I don't know of anybody else that did.
FILM - Egg Corporation/Parnell Still
MARIAN WILKINSON What Parnell didn't tell the drivers was that he, the Egg Corporation and TNT had been discussing the new arrangements for months. Neither were they told that Parnell and TNT Alltrans boss, John Doig were not at arms length. That year Doig became a shareholder in Parnell's family company as trustee.
Documents from the New South Wales Corporate Affairs Commission show that Forbes Nell Pty. Ltd. was Parnell's family company. By December 1984, 98 percent of its shares were held by TNT's John Doig.
Doig now runs TNT's Bulk Transport Division - he refused to answer any questions from 'Four Corners .
Stewart Parnell is now believed to be in New Zealand.
FILM - Spinning TNT Globe/San Francisco Skyline
MARIAN WILKINSON San Francisco, gateway for TNT's expansion to America. Here, TNT struck an industrial relations dilemma, self-interest meant handling a union with its own unique set of values.
The all-powerful Teamsters, the American Union that covers the Transport Industry coast to coast. It's big, it's politically powerful and it has close ties to the American mafia.
Back in the 1970's, Rudy Tham was a West Coast vice-president of the Teamsters Union and he soon developed a close working relationship with TNT. Mike O'Grady took a working visit to the United States in the 70's in his role with the Storeman and Packers Union, he saw first hand the relationship at work.
MICHAEL O'GRADY Oh.. very very friendly . . both on the East Coast and the West Coast and you've got to understand there is a political difference between the East Coast and the West Coast as far as unions are concerned, but TNT seemed to bridge that gulf and they had a very friendly arrangement between themselves and the union, far more friendly than I would expect a union and management to be normally.
STILL OF RUDY THAM, JIMMY FRATIANNO
MARIAN WILKINSON Rudy Tham and the Teamsters caused a public relations problem for TNT. He introduced Sir Peter and his general manager Ross Cribb to the boss of the West Coast mafia, Jimmy Fratianno:
JIMMY FRATIANNO You know, he's gotta give up money for them to help them, and he got in trouble with this - on the docks and he gave 'em 25 thousand to straighten it out. And now I think - the way he gives 'em money every year, although they do a lot for him, they get him work, they get him business, you know, Peter Abeles gives 'em the money legitimately, he don't give it to 'em under the table, he gives it to a corporation which - he declares it you know, he's not doin' anything wrong.
MARIAN WILKINSON Abeles says he wasn't aware that Fratianno was a mobster and a hit-man until some years later. He says neither he, nor TNT ever paid money to Fratianno.
A mafia lieutenant on the East Coast, Benny Mangano, was also introduced to TNT. TNT paid 300 thousand dollars to companies associated with Mangano and a shipping clerk. TNT's general manager has testified that the payments were for shipping advice. The company says they were neither illegal nor improper.
FILM - TNT's Spinning Globe/London/Wapping
MARIAN WILKINSON TNT's style is about permanent interests. Across the Atlantic in Britain, the company's industrial relations policy switched. When Abeles' partner, Rupert Murdoch decided to take on the militant Left-Wing printers at Wapping in Britain, TNT stood with him shoulder to shoulder using their trucks to break through picket-lines and deliver Mr. Murdoch's newspapers.
TNT's contract with Murdoch's News Limited was worth 100 million dollars, and it helped transform TNT into one of the leading transport companies in Britain. While Murdoch now produces 30 percent of Britain's newspapers, TNT Newsfast delivers them. Wapping coincided with a deepening relationship between Abeles and Murdoch - a powerful partnership and powerful friendship:
SIR PETER ABELES I always believed that one has to have human relationships, that's the key to business, - to industrial relations, to. everything, and as one travels along one meets people who one likes and one gets friendly. with them, not because of any great purpose - look I can - the most outstanding example for instance in Bob Hawke.
Look when I met Bob Hawke, true he was already a leading industrial leader, but I knew very little about the ACTU, I didn't even know what it is, and one day somebody suggested to me that we are a growing organisation, I should meet this dangerous man Mr. Hawke. So I just rang and said could I have an appointment, and he rang me back - I remember in Melbourne and said "look I have a dreadful cold, would you mind coming home?" So I went home to him and I can say within 12 months we were the closest friends which was in a way an inhibiting factor, because one thing we never did again, we didn't discuss industrial problems.
FILM - Hawke Election - 1983/Cheers from Crowd
MARIAN WILKINSON When Bob Hawke was elected Prime Minister in 1983, he ushered in a new era in Federal Labor politics - consensus between government, unions and business. The Hawke/Abeles friendship took on a public profile.
Neil Batt, a mutual friend of both men dismisses criticisms in some Labor circles that Hawke is too influenced by Abeles:
NEIL BATT I know that he likes and personally admires Bob Hawke, so it's not surprising that they have a good personal relationship, but in my own experience the image that Sir Peter's sitting on Bob Hawke's shoulder telling him what to do is just unrealistic and I think totally fanciful.
FILM - Neil Batt in WA with Sir Peter Abeles
MARIAN WILKINSON Neil Batt should know Abeles' style, he worked for him for 6 years in Western Australia and Victoria. Batt was a former Tasmanian Transport Minister and ALP President. He's one of many politicians, public servants and others who have cross-fertilised the TNT/Ansett empire.
New South Wales Liberal Premier Bob Askin sat on TNT's board. Sir Lennox Hewitt, former senior public servant and Qantas boss joined the Ansett Board. Former Qantas executive Jill Wran is now on the board of Ansett New Zealand. Ex New South Wales Premier Neville Wran is chairman of the company awarded Ansett's million dollar cleaning contract. Wran's former Press Secretary, David Hurley is now Press Advisor to Peter Abeles. The Prime Minister's daughter Ros Hawke, helps run Ansett's VIP lounge in Canberra. And the man who would be Tasmanian Labor Premier, Neil Batt.
NEIL BATT Part of the reason why I got a job why he . why he gave me a job was that be saw from my political experience that I had a capacity for working with people and he always makes a very strong point that working with people is perhaps the most - important business characteristic.
FILM - Abeles in China
MARIAN WILKINSON A 1985 visit to China by Sir Peter first raised the controversy of the Prime Minister's friendship with Abeles.
Abeles had been asked to lead a high-level transport mission to China and with government backing Sir Peter had access to the most senior Chinese power brokers including party chief Hy Yaobang.
The government defended the mission saying Abeles' role had been agreed to by the Chinese and he was the most qualified person for the job. Abeles' qualifications have also led the Hawke government to appoint him to the Reserve Bank Board, the Commission for the Future and the Defence Industry which monitors local participation in government defence contracts.
That appointment came as Ansett is breaking into the defence business. Last year Ansett Technologies was sub-contracted to help install a new RAAF surveillance system. Ansett has now set up a joint partnership with a big Italian electronics company, Salenia. Other government contracts are in the pipeline, including a design for new Air Traffic Control Systems.
Transport Minister Gareth Evans, who has to deal with aviation decisions, says be hasn't felt pressure from Ansett's lobbying:
GARETH EVANS No, not especially I mean I find it quite pleasant to talk and do business if you like with some of these characters at the absolute top of the tree and enjoying the sort of profiles they do, they've got where they are because of their intelligence, their decisiveness, their capacity to grapple with complex issues and to respond in a flexible way when they see what the constraints and the difficulties are from the government's point of view in meeting whatever it is they're about. There are far more problems and difficulties in negotiating and dealing with sort of middle-level management and people with less of a track record behind them than you do with a lot of these mega-stars.
FILM - Sir Peter Abeles & Rupert Murdoch/Jet Touching Down
MARIAN WILKINSON Rupert Murdoch and Peter Abeles are set to demonstrate to the government just how powerful they are. In the last two years, they have become a world presence in the aviation industry, ready for a show of force in the Australian skies.
JACK GAMBLE - Boeing Corporation Sir Peter, a name that's instantly recognised around the world as a knowledgeable, experienced, very professional aviation and financial mind. Rupert Murdoch is interesting because on a round the world basis he's mostly known as a media person. He doesn't have that instant recognition as an aviation or an airline person.
FILM - Spinning Globe/Seattle
MARIAN WILKINSON The giant Boeing aircraft factory in Seattle Washington. Here they make it their business to know about Peter Abeles and Rupert Murdoch.
Seventy seven planes that come off the production line at the Boeing factory over the next few years will be bought by Ansett. Most will never fly in Australia. They'll be used in a bold new venture by Ansett - an international leasing company called 'Ansett Worldwide Aviation Services', or AWAS. It will hire out planes to airlines around the world.
Varig in Brazil will be a customer, so will Malev in Hungary, Polynesian Airlines, Ansett New Zealand, Transcorp Hong Kong and America West, itself part-owned by Ansett.
JACK GAMBLE Among the leasing companies, Ansett Worldwide leasing right now is the number two leasing company customer we have, very close it's very close between number two and number three. If you add the Ansett Airlines and Ansett Worldwide Leasing, they're very definitely the number two.
FILM - British Aerospace
MARIAN WILKINSON In June this year, TNT had another aviation coup. An order for seventy two (72) "Quiet Trader" aircraft from the giant British Aerospace Corporation, the entire production line for the next 5 years. It is the largest order in the history of civil aviation in Britain. The plane's key feature is low noise, allowing it to overcome airport curfews, and it can be easily converted for passengers. Many of the planes will be used by Ansett's international leasing arm, AWAS.
JOHN KING - Aviation Consultant It doesn't advantage them in the Australian market, but it does advantage them in the sense that they're able to have the most modern aircraft at any time in Australia. They can change the fleet quite rapidly, if a third entrant comes in somebody brings in an aeroplane like a Boeing 757 which has a very low seat-mile cost, then AWAS has now ordered 757's, it could switch those into Australia very rapidly in a de-regulated environment where there are no import controls on large aircraft and line up alongside that new entrant.
FILM - Abeles' Arrival at East West
MARIAN WILKINSON Abeles' decision to take over East West Airlines, Ansett's fiercest competitor, took both the company and the public by surprise. The takeover came just as the Open Skies policy was announced, and just as East West was preparing to become a public company.
JOHN HARTLEY - Ex-Managing Director, Fast West The timing was the only thing that surprised me when it actually happened. We would have been the only publicly quoted airline company in Australia, we would have been in fact cashed-up and we would have been a very attractive take over target for another group. I think Sir Peter Abeles recognised that and probably was one of the reasons that he moved before we actually got the float underway.
FILM - Commuter Airlines
MARIAN WILKINSON Key commuter airlines around the country are also being gobbled up by Ansett. These airlines could have provided a base for a new competitor.
JOHN KING The takeover of Fast West and the strength in this commuter airline industry means that some of the options to get into aviation in Australia are now only available to Ansett. There is almost no significant commuter airline remaining which could be the base of a third level - of a new third entry into the major airline scene.
FILM - Ansett
MARIAN WILKINSON As Ansett plots its course for Australia in 1990, it does so with the advantages of a global network, and the needs of a multinational company. With all its resources, Ansett has been training for deregulation for the last 5 years.
With capital for the most modern aircraft, engineering and maintenance facilities, many in the industry believe Ansett will wipe the floor with its competition. A fight back by Australian Airlines either under government or private ownership is crucial - otherwise our airline industry could end up with less competition rather than more by 1990.
GARETH EVANS Australian provided its given some time to gird its loins and provided it's freed up of the public service constraints which are pretty much strangling it at the moment, and provided it can solve somehow the problem of capital injection, when that falls due, I see absolutely no reason why Australian shouldn't be a very effective competitor indeed.
FILM - ALP Conference - Hobart
MARIAN WILKINSON The national conference of the ALP - the party's democratic decision-making body. It will decide the future of Australian Airlines next June, and the future of competition in the airline industry.
Bob Hawke and some of his senior ministers believe Australian could stand a better chance competing if it was owned by private enterprise, many others like John MacBean disagree:
JOHN MACBEAN In the final analysis this matter will be determined by the party membership next year - June or July of the ALP national conference, and those who are supporting privatisation at that stage if there are any left of course, will be roundly and soundly defeated on the floor of the conference, now if that means the Prime Minister's gotta go under - well so be it.
GARETH EVANS: My position is that my judgement will be formed as to whether or not Australian should be sold, or Qantas should be sold or whatever, I'll form that judgement on the weight of the argument as it's presented, so I can't wait to get into the arguments and the analysis and the assessment of the data, that seems to me to be what's relevant, and that's what I'm going to have my judgements based upon.
FILM - Bob Hawke on VIP Jet
MARIAN WILKINSON The Prime Minister has a timely example of Ansett's strength. His government has just called tenders to replace the VIP fleet. Ansett's international leasing arm is widely expected to win with the most attractive offer. A lot will rest with the Prime Minister during the debate on privatisation next year. He's proposing to over-turn Labor tradition with the sale of government enterprises. In doing so, he is also helping to decide who will be Sir Peter Abeles' competitor in 1990.
Like many politicians before him, Hawke will have to separate his friendship and respect for Abeles from his public duty.
ANDREW OLLE (Studio) Marian Wilkinson reporting.
It was quite a feat putting together fifty odd minutes of television without the co-operation of the central character. We first approached Sir Peter Abeles for an interview 5 weeks ago, but he couldn't find the time.
Sir Peter seems to have been remarkably camera shy down the years for one so prominent. When we tried to substitute for his non-appearance with a little archival footage, we found the cupboard was virtually bare. About the only film available was in China - that scene you saw of the TNT boss leading an Australian Transport delegation to the People's Republic.
Well we were almost denied that footage too. The Chinese were extremely reluctant to part with it because the man greeting Sir Peter was none other than former party boss Hy Yaobang - who's since fallen from favour. I trust history will be kinder to Sir Peter Abeles.
Goodnight. See you next week.
CLOSING THEME AND CREDITS
Copyright Australian Broadcasting Commission (ABC) 1987
ABOUT Alex PATERSON
Alex PATERSON is an Australian airline pilot by profession. He writes articles and advises on issues pertaining to aviation, politics, sociology, the environment, sustainable farming, history, computers, natural health therapies and spirituality.
He can be contacted at:
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