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Aussie foreign minister tells Krishna Games OC owes millions to his country's companies

INDIA was left deeply embarrassed when foreign minister S. M. Krishna was told by his Australian counterpart in Melbourne on Thursday that the Commonwealth Games organising committee owed millions to Australian firms for work in the games.

The non- payment of CWG dues was brought up during talks between Krishna and Australian foreign minister Kevin Rudd -- clearly the Suresh Kalmadi- led October 2010 games continue to haunt India, with issues concerning Australians proving the most troublesome.

Australian firms, that worked in the opening and closing ceremonies and were behind the pyrotechnics and fireworks display, have claimed a total outstanding of $ 2 million ( over ` 9 crore). Events organiser Ric Birch has commissioned a law firm to draw up a

multi-million dollar lawsuit that would involve at least four of Australia's biggest event firms, including his firm Spectak Productions and fireworks group Howard & Sons. The lawsuit could shape up to a possible $3 million-plus (over `13.5 crore) class action against the Games organisers. The CWG organising committee defended the non-payment of dues, saying this was because of performance-related issues and according to contract. But, the defence came alongside reports that "30-40" organisations around the world that were associated with the CWG had also payment stuck with the organising committee. In fact, Birch told ABC radio in Australia: "We decided that India stood for: India -- I'll never do it again." The Indian reaction at Melbourne and New Delhi indicated that the government wanted the matter to be resolved quickly. "It (CWG dues to Australian firms) has been brought to my notice, and I would go back to India and take it up with the ministry of sports," Krishna told reporters at a joint press conference with Rudd. However the minister, who leaves for home on Friday after a three-day trip Down Under, did not say how soon he expected the matter to be sorted out.

That answer was provided by newlyappointed sports minister Ajay Maken who said the issue would be resolved within 10 days. "I had a meeting with sports secretary (Sindhushree Khullar) and directed her to tell the government officials and nominees in the organising committee to conduct a thorough verification of the works concerned to ensure that no legitimate dues are left unpaid. All this work must be done within the next 10 days." Keenly aware of the potential for damage that the CWG payment issue with the Australian firms held, he said the Games got over more than three months ago and no one could be allowed to "point fingers at us". The Australians appeared to be satisfied that taking up the matter with New Delhi at the highest level was paying off. Rudd told media persons, "We did discuss these matters. We in Australia are comfortable about Indian government's responses about the process we have in hand which is a complicated one on the domestic matters in India itself," he said adding that the Australian government would work with the companies to assure that proper payments were made to them.

The payment tangle has its roots in the claims made by Ric Birch, an impresario who has successfully directed several games ceremonies, like the one at the 2008 Beijing Olympics. His firm Spectak Productions was hired for directing the CWG Delhi opening and closing ceremonies. Birch said he had provided 12 people -- among them choreographers and producers -- over the year. He was the executive producer of the event. Howard & Sons boss Andrew Howard said the combination of the unpaid money and the hold-up of his company's unique pyrotechnics firing equipment in Delhi had left the firm facing a financial crisis. Birch claimed that when he tried to contact the organisers of the Games over the unpaid bills, the calls were first ignored. "Then finally in December, I got a very short note from Lalit Bhanot who is secretary general of the organising committee. He sent a note saying that now they wanted to claim a performance guarantee because Mr Birch's performance was not up to the mark. So I am mortified as you can imagine," Birch said. Birch claimed his firm was owed $350,000 (`1.6 crore) on his games contract while Howard & Sons said $300,000 (`1.4 crore) in unpaid bills is due but it could shoot up to $900,000 (`4.1 crore) once compensation for not having crucial equipment available was taken into account. Birch's outburst over the CWG organising committee's delay in clearing the dues for his company comes three months after the conclusion of the Games.

A `10 crore deal was inked with Birch's company, sources said, out of which 85 per cent has already been released. The organising committee's creative team, headed by Bharat Bala was not impressed with Birch's job and gave a negative feedback to the CWG brass. About a week ago a letter was sent to Spectak Productions regarding their unsatisfactory execution at the ceremonies. This was when Birch decided to come out in open over his unpaid bills. CWG organising committee chief executive Jarnail Singh insisted that of the `10 crore to be paid to Spectak Productions, `8.5 crore had been paid. "We have even notified them that their performance wasn't satisfactory and therefore, we will hold back the remaining amount," Singh said. Sports minister says issue to be resolved within 10 days M O N E Y M ATT E R S Unpaid foreign "As for Mr Birch, he did not perform as per his promise so we deducted his last installment and he has been informed about it," Singh added. On Thursday, CWG's embattled chief Kalmadi also came forward to explain the payment issue. According to him, 65 per cent of the contracted amounted had been paid to Howard & Sons. He pointed out that "full payment" had been made to 39 of the 71 members of the Commonwealth Games Federation.

The four Australian firms are reportedly not the only ones that have large sums of money owed by the CWG organising committee. The Australian Commonwealth Games Association is owed more than $100,000 (about `46 lakh) in travel subsidies. The association's chief executive Perry Crosswhite said his organisation was one of 30 or 40 similar games bodies around the world that were owed money by the organisers of the October 2010 Delhi Games. These reportedly include firms in Britain, France and Germany. Crosswhite said the matter would be taken up with the Commonwealth Games Federation. It has already been raised with the Indian high commissioner in Australia Sujata Singh, who is understood to have assured to look into the matter.

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Publication:Mail Today (New Delhi, India)
Geographic Code:8AUST
Date:Jan 21, 2011
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