Australia under pressure to explain lucrative PNG refugee contracts

Canberra came under pressure Monday to explain how an obscure firm with a beach shack as its registered office won contracts worth hundreds of millions of dollars to provide security at Pacific refugee camps.

The Singapore-registered Paladin Holdings was awarded more than Aus$420 million (US$300 million) -- about Aus$17 million a month -- in contracts to provide services at three transition centres for refugees on Papua New Guinea's Manus Island.

The operations are part of Canberra's harsh policy of processing asylum-seekers who try to reach Australia by boat at remote offshore Pacific camps, where hundreds of refugees have been stranded for five years.

But questions have been raised about why Paladin was given the contracts after local media reported the firm had little experience, was thinly capitalised and had ties to a senior PNG politician.

The Australian Financial Review said Paladin's registered office in Australia was a beach shack on Kangaroo Island, a sanctuary for native wildlife off the coast of South Australia.

After the reports surfaced last week, Paladin changed its registered address to an office in the capital Canberra, the newspaper said Monday.

Attorney-General Christian Porter defended the decision to award the security contracts to Paladin, telling national broadcaster ABC the PNG tender "was the subject of a full independent Commonwealth procurement process".

"I'm sure that the claims are going to be very thoroughly investigated," he said of the reports challenging the size and process of the contract awards to Paladin.

"The reality is that doing these types of things offshore in Papua New Guinea and in Nauru is a very costly exercise." But Porter added that reports of links between Paladin and the Manus-based family of a senior PNG politician would "have to be investigated thoroughly".

Home Affairs Minister Peter Dutton, whose portfolio encompasses the offshore detention regime, last week distanced himself from the tender process which was reportedly closed, saying it was managed by lower-level officials.

Home Affairs officials are set to be quizzed about Paladin at parliamentary hearings on Monday and Tuesday, with opposition Labor Senator Murray Watt calling for transparency from the government.

"It's about time they started providing some answers, about why Aus$400 million in taxpayer contracts can go to a company that no one has heard of, with no scrutiny about how the money is being spent," he said.

Asylum-seekers sent to Manus Island for processing were moved to the three centres when their camp was closed in late 2017 after a PNG court ruled it was unconstitutional.

Several security and service providers had previously walked away from running the contentious camps -- which include one on the tiny island-state of Nauru -- in the wake of domestic and international criticism of conditions at the centres, which rights activists and refugees have also complained about.