The Liberal senator Hollie Hughes is performing paid consulting work for a for-profit biofuels company.
The work has been disclosed on her register of interests through a trust assisting “charitable organisations”.
Hughes has insisted she properly declared her interest as a potential beneficiary of the SLN Services Trust, claiming her work for PBFH Pty Ltd will help the Australian company setting up in Papua New Guinea to “reinvest in local communities”.
But use of a trust appears to have helped Hughes side-step the requirement to declare “any other substantial sources of income” on her register of interests, as she was advised would otherwise likely be necessary by the Senate clerk.
There is no suggestion by Guardian Australia that Hughes has breached any rules by using the trust in this manner.
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Guardian Australia has surveyed the register of interests of all members and senators to audit their use of trusts in the wake of Christian Porter declaring that his defamation legal fees were part-paid by the Legal Services Trust with funds from undisclosed donors.
Although the privileges committee of both houses have been asked to consider clarifying the rules around financing legal cases, Labor’s complaint about Porter raises the broader issue that trusts declared by parliamentarians can be used to receive fees or donations for private purposes from unknown sources.
Parliamentarians declared an array of trusts including for investment purposes, self-managed super funds, and family trusts relating to businesses including agricultural concerns.
On 8 October, Hughes declared a shareholding in SLN Services Pty Ltd, the trustee of the SLN Services Trust, which she disclosed is “a discretionary trust in which the senator is a potential beneficiary and provides consultancy services, including in relation to charitable organisations”. The declaration includes no further details of entities that pay the trust for services.
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Hughes told Guardian Australia that through the trust she and “others, whoever I want to engage” perform advisory work for the board of PBFH Pty Ltd – Pacific Biofuels Holdings – which she said had “set up a charitable arm, a social services arm” to “reinvest in local communities”. The trust is paid an undisclosed, fixed annual fee.
“[PBFH is] an Australian company setting up in PNG, and they’ve asked me to assist them because I used to run charities in Australia but also know PNG,” Hughes said.
“I haven’t been a beneficiary of anything – yet. But we set [SLN Services Trust] up because at some stage I may be a beneficiary of it.”
“The reason I had to set something up is I’m not an employee of theirs [PBFH]”. We’re not trying to hide anything, there wouldn’t be a problem putting PBFH on the register of interests … We have done this all the right way.”
Hughes said PBFH is the only entity to have paid SLN Services Trust, which has no other potential beneficiaries “at the moment”. Hughes is the sole director and secretary of the trustee company and has a beneficial interest in 100% of its shares.
Zach Frederick, PBFH’s social change director, told Guardian Australia it is a “new, for-profit company that will be using a portion of its profits to effect beneficial social programs in PNG and throughout the South Pacific”.
“These programs include investing in education and local health initiatives.”
An engagement letter sent to Hughes in September by the PBFH chief executive, Mary Symons, states that SLN Services will advise on “social change programs, aimed at improving the lives of the people in the Central Province”.
Symons wrote PBFH had selected SLN Services due to “extensive experience in charitable work and your deep understanding of the mechanics of how to best obtain positive outcomes”.
Before entering parliament, Hughes was the chair of the Country Autism Network for seven years and a non-executive director of Streetwork, a charity for at-risk youth.
PBFH advised it had “no agreements with the Australian commonwealth”, ensuring that Hughes’ work would not disqualify her from sitting in parliament.
In June, the Senate clerk, Richard Pye, provided advice to Hughes on the declaration of senators’ interests.
Pye noted that senators are required to declare “any other substantial sources of income” using the rule of thumb that income of more than $5,000 a year should be disclosed.
“I expect that Senator Hughes would need to make a declaration here,” he said, commenting on an earlier letter of offer before Hughes decided to provide services through a trust.
Hughes has not declared any “other” sources of income. A spokesperson for Hughes said the corporate advisory work “has been disclosed as a registrable interest”.
The Nationals senator Susan McDonald discloses on her register of interests that she is a discretionary beneficiary of “OHG Trust”, which is described as a “consultancy”.
A spokesperson for McDonald said it was “set up to provide consultancy prior to the senator’s election” but “has been inactive since then with no services being provided by anyone or to anyone”.
McDonald has not received a distribution from the trust since becoming a senator, they said.