updated 4/12/2006 11:00:05 PM ET 2006-04-13T03:00:05

Prime Minister John Howard said Thursday his senior advisers did not alert him to warnings that Australia’s monopoly wheat exporter was allegedly paying kickbacks to Saddam Hussein in the discredited U.N. oil-for-food program.

Howard, who spent just 50 minutes on the stand, was the most senior of three government ministers to testify this week at a so-called Royal Commission into alleged bribes paid to Baghdad by the Australian Wheat Board — and all three denied being told of the multimillion dollar corruption until U.N. officials began investigating the company now known as AWB Ltd.

In his written statement, Howard said he is bombarded with some 68,000 cables each year from his foreign affairs and trade ministry, and that four senior advisers vetted them and only told him about the ones they deemed important enough.

“I believe that the contents of the relevant cables were not brought to my attention at any time during the relevant period,” Howard said.

Questioned by inquiry lawyer John Agius about a January 2000 cable from an Australian official warning Canberra that another country — since identified as Canada — had complained to the United Nations about the AWB possibly being involved in oil-for-food corruption, Howard said his advisers likely would have dismissed it.

“There was absolutely no belief anywhere in the government at that time that AWB was anything other than a company of great reputation,” Howard said.

And asked by Agius why his advisers did not pass on a U.S. army captain’s 2003 warning that Saddam was demanding kickbacks on all oil-for-food contracts, Howard replied that they probably did not consider it new information.

“Mr. Agius, the issue of whether the former regime had been corrupt and had corrupted programs was not contentious to me,” he said.

‘Never crossed my mind’
Wrapping up his testimony, Howard said: “I had always believed the best of AWB ... it never crossed my mind that it would have behaved corruptly.”

The commission’s chairman, retired judge Terence Cole, who went to law school with Howard, refused to allow a lawyer for AWB executives to question the prime minister, saying the issues he wanted to raise already were covered by Agius’ questions.

Howard is the first prime minister to appear at such a high-level inquiry since Bob Hawke testified at a probe into Australia’s intelligence agencies in 1983.

The prime minister, a former lawyer, strode confidently into the inquiry in a downtown Sydney courtroom amid tight security. Ahead of his appearance, guards searched the bags of everybody entering the room and sniffer dogs checked for explosives.

Speaking to reporters before testifying, Howard said his appearance and that of two senior ministers who took the stand earlier this week underscored the probe’s transparency.

$220 million in kickbacks alleged
Howard followed Deputy Prime Minister and Trade Minister Mark Vaile and Foreign Minister Alexander Downer onto the inquiry’s witness stand to outline what he knew about allegations AWB gave Saddam $220 million in kickbacks to secure grain contracts worth $2.3 billion between 1997 and 2003.

The inquiry was called to examine whether any AWB executives acted unlawfully in their oil-for-food dealings. Cole does not have the power to file charges but can recommend that executives be prosecuted if they are found to have broken Australian laws.

On Tuesday, Cole said the ministers were only being questioned because any evidence that the government knew about corruption could be used as a defense by AWB executives if they are found to have deliberately paid kickbacks.

Opposition lawmakers accuse the government of rigging the inquiry’s powers to ensure it cannot hold ministers accountable for failing to stop the alleged corruption.

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