COPYRIGHT RESERVED Note: Copyright in this transcript is reserved to the Department of Finance, Services and Innovation. The reproduction, except under authority from the Department of Finance, Services and Innovation, of the contents of this transcript for any purpose other than the conduct of these proceedings is prohibited. INQUIRY UNDER THE CHARITABLE FUNDRAISING ACT 1991 Public Hearing Held at Level 3, LPI Building Queens Square 1 Prince Albert Road Sydney, New South Wales On Tuesday, 24 October 2017 at 10.00am (Day 30) BEFORE: The Public Inquirer, The Hon. P A Bergin SC Anthony Cheshire SC Ms Jennifer Single Mr Enzo Camporeale .24/10/2017 (30) 3302 Transcript produced by DTI

1 PUBLIC INQUIRER: Yes, Mr Cheshire. 2 3 MR CHESHIRE: Thank you, Madam Inquirer. There is one 4 additional bundle to tender which is entitled "Australian 5 Taxation Office Documents", which consists of four taxation 6 rulings. I tender that. I think it is Exhibit 33. 7 8 PUBLIC INQUIRER: Thank you, that will become Exhibit 33. 9 10 EXHIBIT #33 BUNDLE TITLED "AUSTRALIAN TAXATION OFFICE 11 DOCUMENTS" 12 13 MR CHESHIRE: I call Mr James Brown. 14 15 <JAMES ALEXANDER BROWN, affirmed: [10.00am] 16 17 MS HARRIS: Madam Inquirer, I understand that leave has 18 been granted to Alex Linden to appear for Mr Brown. 19 20 MADAM INQUIRER: It has. 21 22 MS HARRIS: Alex Linden is running slightly late, so 23 I seek to appear until he arrives. 24 25 MADAM INQUIRER: Yes, of course. 26 27 MS HARRIS: At this stage, I would like to, on behalf of 28 Mr Brown, take objection under section 41N(2) of the 29 Charitable Fundraising Act on the basis that the evidence 30 Mr Brown gives in the Public Inquiry might incriminate him. 31 32 Might I indicate the matters that that objection 33 extends to? 34 35 MADAM INQUIRER: Yes, of course. 36 37 MS HARRIS: The objection extents to all matters including 38 any act or omission on the part of or by Mr Brown during 39 the period from 23 May 2017 to the present time in respect 40 of anything he did, did not do or ought to have done as 41 State President of RSL (NSW), or as a member of any 42 committee of RSL (NSW), as a trustee of WBI and/or a 43 Director of RSL LifeCare Pty Limited. Mr Brown reserves 44 the right to review the transcript of his evidence and 45 identify any further matter in respect of which he takes 46 objection pursuant to section 41. 47 .24/10/2017 (30) 3303 J A BROWN Transcript produced by DTI

1 PUBLIC INQUIRER: Thank you, Ms Harris. Mr Sulan? 2 3 MR SULAN: Yes, Madam Inquirer, I seek leave to appear on 4 behalf of RSL (NSW). 5 6 PUBLIC INQUIRER: Yes, thank you. Mr Herzfeld? 7 8 MR HERZFELD: I appear again for WBI. 9 10 PUBLIC INQUIRER: Yes, thank you. 11 12 <EXAMINATION BY MR CHESHIRE: 13 14 MR CHESHIRE: Q. Sir, would you give the Inquiry your 15 full name, please? 16 A. James Alexander Brown. 17 18 Q. You reside in Paddington; is that correct? 19 A. Yes. 20 21 Q. What's your current occupation? 22 A. I've taken a leave of absence from my normal employer 23 to fulfil the duties of President of RSL (NSW). 24 25 Q. I think you were appointed President of RSL (NSW) on 26 24 May 2017; is that correct? 27 A. I was we elected on 24 May. 28 29 Q. You took over office on that date; is that right? 30 A. Yes. 31 32 Q. You also became a Trustee of RSL WBI; correct? 33 A. Yes. 34 35 Q. Was that on the same date? 36 A. Yes. 37 38 Q. By virtue of your election as president of RSL (NSW), 39 you became a Trustee of the Board of WBI; is that correct? 40 A. Yes. 41 42 Q. Then I think a little while later you took up a 43 position of Director of LifeCare; is that correct? 44 A. Yes. 45 46 Q. I think that carried with it appointments to the Board 47 of related RSL entities; is that correct? .24/10/2017 (30) 3304 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes. 2 3 Q. And also, I think, through one or other of those 4 appointments on various related trusts as well; correct? 5 A. Yes. 6 7 Q. With your background, I think you were a serving army 8 officer between 2003 and was it 2010? 9 A. That's correct. 10 11 Q. What rank did you rise to? 12 A. Captain. 13 14 Q. That was on active service, was it? 15 A. Yes, there were two deployments to Iraq, one to 16 Afghanistan and a number of smaller trips to the 17 Solomon Islands. 18 19 Q. You mentioned that you were on a leave of absence from 20 your regular position. What is your regular employment? 21 A. I work at the United States Study Centre at the 22 University of Sydney. I'm the Director of Foreign Policy, 23 Defence Policy and Strategy Research there and I'm an 24 adjunct Associate Professor at the university as well. 25 26 Q. Was that something that you took up when you returned 27 from service? 28 A. I had a number of other roles between leaving the 29 Defence Force in 2010 and taking up that role 30 in December 2014. 31 32 Q. The US Study Centre, what is that? Is that a private 33 part of the university? 34 A. It is a hybrid think tank research centre and teaching 35 centre based at the university. 36 37 Q. By its name, are you limited to matters relevant to 38 the United States? 39 A. The focus is on the US, but my specific area of focus 40 is on the US-Australia alliance, particularly Defence and 41 foreign policy aspects of that. 42 43 Q. The US Study Centre is not limited to matters of 44 Defence; is that correct? 45 A. That's correct. 46 47 Q. I think in the course of your work at the University .24/10/2017 (30) 3305 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 of Sydney you have published various books and articles; is 2 that correct? 3 A. Yes, and also in a previous role in the Lowy Institute 4 as well. 5 6 Q. Your focus again in those articles and books has been 7 on issues of defence; correct? 8 A. Defence policy and veterans policy as well. 9 10 Q. At some stage, you became interested in joining or 11 becoming part of the Board or the State Council, I should 12 say, of RSL (NSW). What prompted that interest? 13 A. I'd had an involvement at a sub-branch level through 14 the North Bondi RSL sub-branch for a number of years, both 15 as a committee member and also in a number of executive 16 positions. I was aware of the RSL, its potential, its 17 history, and also its issues, and I'd written a book 18 looking at some specific issues to do with the RSL here in 19 New South Wales in 2014 which alerted me to a number of 20 improvements and reforms I thought needed to be made and 21 the opportunity to nominate for the position of 22 State President was attractive in terms of being able to 23 help be a part of the changes I thought were necessary. 24 25 Q. What had you formed the view were the main issues that 26 needed to be addressed? 27 A. The main issue, in essence, was that for its size, its 28 resources and the tremendous goodwill that the RSL here in 29 New South Wales possessed, it was not delivering the 30 commensurate impact you would expect for veterans and their 31 families. 32 33 Q. When you say "impact", what do you mean by that? 34 A. Well, for those veterans who were in need, it was 35 helping some but not nearly as many as you would expect. 36 It was not leading debate on veterans' policy, either here 37 in New South Wales or at the Federal level, and essentially 38 I thought there were a lot of issues that veterans were 39 facing, including but not limited to the issue of veteran 40 suicide that the RSL was simply not doing enough to fix. 41 42 Q. The Inquiry heard evidence yesterday from Mr Condon 43 about there being in excess of now 5,000 charitable 44 organisations focusing on issues of veterans affairs. 45 Is that a matter that you have come across in your dealings 46 with the RSL? 47 A. The RSL originally had a position as the leader of .24/10/2017 (30) 3306 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 veterans organisations, but because it has been unable and 2 at times unwilling to perform that role recently, a number 3 of other veterans organisations have sprouted up to the 4 extent that the sector, as Andrew Condon mapped out, is 5 fragmented and very inefficient. 6 7 Q. When you say that RSL had a leading position, was that 8 a sort of formal appointment or informal appointment, or 9 was it just the fact that it had perhaps the loudest voice? 10 A. I think if you look at the history of the organisation 11 and the privileged place it has been given in Australian 12 society, it had a formal position to lead the ex-services 13 community. It also had the resources to do that and the 14 support of the public to do that. 15 16 Q. From your dealings at least thus far with the 17 RSL (NSW), is there any mechanism in place at the moment 18 for RSL (NSW) to have contact and discussions with the 19 various other organisations in this field? 20 A. Yes. 21 22 Q. How does that work? 23 A. There are a number of consultative forums that the RSL 24 is a part of, both at the State level and also at the 25 Federal level. There are a number of informal 26 consultations and our members are also very active in terms 27 of engaging with other ex-Service organisations. 28 29 Q. Can you give us some examples of the State or Federal 30 bodies through which it exerts its influence? 31 A. There is a Department of Veteran Affairs consultative 32 forum convened at the State level on a regular basis to 33 which the RSL and DefenceCare contribute and play an active 34 part in. There's a process that Andrew Condon and Sir 35 Angus Houston are leading at a Federal level, which 36 DefenceCare has had a role in and other RSL representatives 37 have had a role in, and there are a range of conferences 38 and forums throughout the year to which we would send 39 people and they would participate. 40 41 Q. RSL (NSW) has roughly how many members? 42 A. We have approximately 38,000 members who are either 43 Service, honorary or affiliate members of RSL (NSW). 44 45 Q. Are you able to give an estimate as to how many of 46 them would be Service members? 47 A. I don't have that information with me today. .24/10/2017 (30) 3307 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. Would it be the majority of that 38,000, do you know? 3 A. I would expect so. 4 5 Q. Am I right that most of the members of RSL (NSW) 6 become members of RSL (NSW) and a sub-branch at the same 7 time; is that correct? 8 A. Yes. 9 10 Q. It is possible to be a member of RSL (NSW) without 11 being a member of a sub-branch; correct? 12 A. Yes. You can be the member of the unattached list at 13 Anzac House. 14 15 Q. The vast majority of members of RSL (NSW) are members 16 of a sub-branch; correct? 17 A. Yes. 18 19 Q. The sub-branches are grouped into 23 District 20 Councils; correct? 21 A. Yes. 22 23 Q. Then one has the Executive State Council and 24 State Congress to govern the affairs of RSL (NSW); correct? 25 A. Yes. 26 27 Q. I think you described the organisational structure of 28 RSL (NSW) as being complex; is that right? 29 A. Very much, yes. 30 31 Q. Is it something that maybe in time you would like to 32 look at rationalising in some way? 33 A. We are already looking at ways to make that simpler 34 and more effective. 35 36 Q. You also have, if I say as part of the RSL (NSW) 37 organisation, the Central Council of Women's Auxiliaries? 38 A. Yes. 39 40 Q. And the Women's Auxiliaries day clubs and the youth 41 clubs? 42 A. Yes. 43 44 Q. Is that again an example of the complexity of the 45 organisation? 46 A. Yes. 47 .24/10/2017 (30) 3308 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. Do they have defined roles, for instance, the day 2 clubs and the youth clubs, to be contrasted with other 3 parts of the organisation? 4 A. Yes. 5 6 Q. What do they do? 7 A. The youth clubs are primarily aimed at providing for 8 the wellbeing of youth. Originally, children of veterans. 9 Their activities are focused on sporting clubs and 10 competitions, so they encourage children in New South Wales 11 to take part in swimming carnivals, soccer matches, 12 ballroom dancing, for example, and they convene State-Wide 13 competitions around those events. Day clubs are, 14 effectively, a weekly activity program for potentially 15 isolated senior citizens, some of whom are members of the 16 RSL but not all. 17 18 Q. And the women's auxiliaries? 19 A. The women's auxiliaries, one of their primary purposes 20 is fundraising, but they also have a welfare role. They 21 are connected to sub-branches and they support the work of 22 sub-branches. They are very important in country and 23 regional areas particularly. 24 25 Q. May I take it from your answers that although the 26 focus of the RSL is upon veterans, it is not exclusive? 27 A. That's correct. 28 29 Q. We'll come on to LifeCare in due course, but that's a 30 similar idea, as you see it, to the way that LifeCare 31 similarly operates; correct? 32 A. I'm not sure I understand the question. 33 34 Q. It has a focus on veterans but it is not an exclusive 35 focus? 36 A. That is correct. There are aspects of our work being 37 done at RSL (NSW) that are not directly attached to the 38 core mission of looking after veterans and their families. 39 40 Q. That is, as you see it, part of the role of RSL (NSW), 41 not simply to confine itself to veterans; correct? 42 A. That's correct. Our members want to be an active part 43 of the communities that they're based in. 44 45 Q. You mentioned the rural parts. Am I right that 46 RSL (NSW) and the various related parts of it is not 47 confined to the metropolitan areas around Sydney? .24/10/2017 (30) 3309 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. That's correct. 2 3 Q. To what extent is it active in the more remote parts 4 of New South Wales? 5 A. We have a distribution across the State including in 6 some very remote areas. The concentration of many of our 7 sub-branches is along the coastline, but we have 8 sub-branches operating all the way from the Riverina to the 9 north-west parts of New South Wales, including in some very 10 small towns. 11 12 Q. Am I right that although there are some employees in 13 particular connected with Anzac House and the central 14 operations of the organisation, it is otherwise almost 15 entirely dependant upon the work of volunteers? 16 A. That's correct. Volunteers are the backbone of the 17 organisation. 18 19 Q. I think I'm right that RSL (NSW) also has interests in 20 various properties; is that right? 21 A. Yes. 22 23 Q. Why does it have those interests? 24 A. In many cases, those properties were gifted to the 25 RSL when soldiers return from either the First World War or 26 the Second World War particularly. They wanted a place to 27 meet to continue the camaraderie that they'd enjoyed in the 28 military for peer to peer support, and they built halls or 29 developed halls or were gifted properties to meet in and 30 continue their activities in. 31 32 Q. When you refer to being gifted properties, does it 33 have, for instance, some domestic, ordinary household 34 premises? 35 A. Some of the properties would have kitchens and 36 bathrooms, if that's the question you're asking me? 37 38 Q. I was more looking as does it have properties that, 39 for instance, it rents out on the open market for people to 40 live in? 41 A. Some of our sub-branches have a number of properties 42 which they rent either to veterans, socially disadvantaged 43 veterans, or others. Some have properties that they also 44 use for members to undertake periods of time for 45 recreational activities. 46 47 Q. Then also, I think, as you were giving the example, .24/10/2017 (30) 3310 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 perhaps larger properties such as halls and the like which 2 are then used by the RSL sub-branches; is that correct? 3 A. That's right. 4 5 Q. I think also the sub-branches did, at one time, run 6 the clubs that were operated? 7 A. Yes. 8 9 Q. That now is not the case; correct? 10 A. Yes. 11 12 Q. Was that because of changes in licensing regulation, 13 as you understand it? 14 A. Yes. 15 16 Q. Did a lot of the sub-branches sell those premises to 17 the clubs? 18 A. A number have done so in the last few decades. 19 20 Q. So the clubs are now running the clubs, but the 21 sub-branches then have the proceeds of the sale of the 22 premises; correct? 23 A. In some cases, but not all. My own sub-branch has not 24 sold its property and leases it to the registered club that 25 operates in it. 26 27 Q. From which it derives an income? 28 A. Yes. 29 30 Q. Is that a commercial income rather than a peppercorn? 31 A. It is set at a commercial rate or near to a commercial 32 rate. 33 34 Q. Am I right that some of the sub-branches have very 35 little by way of assets? 36 A. Yes. 37 38 Q. Some of them have a lot by way of assets? 39 A. Correct. 40 41 Q. And, similarly, some will have very little income and 42 some of them will have a large income? 43 A. Yes, that's right. 44 45 Q. Am I right that one of the things that you have looked 46 into is this issue of money being, as it were, stuck in the 47 sub-branches? .24/10/2017 (30) 3311 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes. 2 3 Q. Is that a matter that you have a concern about? 4 A. Yes. I think as an organisation we have a duty to 5 ensure that we connect the resources we hold with the 6 people who need it. 7 8 Q. When you say connect the resources with the people who 9 need it, what are you implying there? Are you suggesting 10 that the money should be in some way applied from the 11 sub-branches to the benefit of veterans? 12 A. Yes. 13 14 Q. Is that an easy thing to bring about? 15 A. We will find out. There is some concern as to having 16 head office centralise or redistribute funds, but we are 17 looking at all options and we're considering all options 18 for how to deal with the League's property, including 19 seeking legal advice on the status. 20 21 Q. Various people have given evidence to this Inquiry 22 about either having some form of amount being paid each 23 year or having some central organisation that manages the 24 properties. Am I right that the effect of your evidence is 25 at the moment everything is on the table to be looked at? 26 A. Yes. 27 28 Q. But in terms of the various options, an option which 29 is really ultimately one you do not want to pursue is 30 simply leaving things as they are? 31 A. That's correct. We accept, as an organisation, the 32 need for major reform. At a meeting of District 33 Councillors last week, they endorsed a set of principles 34 for the period of reform we're about to undertake which 35 acknowledged both the need to reform and the need to make 36 sure that serving and honouring veterans and their families 37 is the driving force of everything we do. 38 39 Q. Some of the organisations within the RSL's overall 40 umbrella organisation, some of them have very significant 41 assets; correct? 42 A. Yes. 43 44 Q. In terms of managing those assets, I think it would 45 not always be ideal, as you would see it, to have those 46 assets being managed by volunteer organisations? 47 A. If I were starting afresh and looking at how best to .24/10/2017 (30) 3312 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 manage assets of the organisation, it would look quite 2 different to the way it does now. 3 4 Q. You would want to ensure that where significant assets 5 are being managed, there was proper professional input to 6 ensure that that was done properly? 7 A. Yes. 8 9 Q. There is also, I think, a role of RSL (NSW) in 10 commemoration; correct? 11 A. Yes. 12 13 Q. Is that a part of the RSL that you consider to be 14 important? 15 A. Yes. 16 17 Q. Do you regard that as being something for which all of 18 the various parts of the organisation have an involvement 19 and a responsibility, or is it limited to the State Branch? 20 A. No, that's a responsibility throughout the 21 organisation and I think it serves two main purposes. It 22 serves the purpose of public education, reminding the 23 public of what veterans and their families have sacrificed 24 in the past, but it also provides a social networking 25 aspect which is important to the welfare of our members and 26 people in their communities. 27 28 Q. You mentioned directing money to areas where it is 29 needed. Am I right that traditionally the RSL has been 30 perhaps viewed by reference to veterans from World War I 31 and then World War II? 32 A. There have been a number of generational shifts. 33 34 Q. Do you see that there is currently a generational 35 shift that is happening? 36 A. Yes. The largest cohort at the moment of our members 37 are Vietnam veterans who I think are very conscious to make 38 sure that we are not an organisation that excludes any new 39 generations from joining. 40 41 Q. When you talk about generational shifts, you mentioned 42 the large cohort from Vietnam. Am I right that there's 43 also then a significant cohort of veterans who are 44 currently fighting? 45 A. That is a growing number of veterans. 46 47 Q. In conflicts such as? .24/10/2017 (30) 3313 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Some of our members are in Afghanistan, they are in 2 Iraq, we had a member at our State Congress in May who was 3 on her recreational leave from Afghanistan and had taken 4 the time during that two-week period to come and be a part 5 of the Congress and to be a part of voting for change at 6 that Congress. 7 8 Q. Am I right that the number of veterans from 9 Afghanistan and Iraq and recent conflicts is a growing 10 number? 11 A. It is. There are many tens of thousands of more 12 recent veterans in those conflicts and others, and also 13 their families as well. 14 15 Q. When you referred earlier to the issue of suicide, and 16 we're aware of homelessness within veterans, is that 17 something which has a particular demographic? 18 A. We are not clear on the demographic yet. There are a 19 number of figures that have been mentioned, but, for 20 example, on the issue of veteran suicide, one of the 21 difficulties we have is that until very recently no-one was 22 tracking the number of veterans killing themselves. One of 23 my former soldiers was doing it informally, maintaining a 24 tally. There has been a project to count that and there is 25 also an initiative under way to have veterans counted in 26 the next Australian census and also to have veterans 27 counted in more records of States and Federal agencies, 28 particularly hospital and police records. 29 30 Q. In terms, then, of issues of suicide and homelessness, 31 is that something that you are seeing in particular with 32 the younger veterans? 33 A. Yes. We have had a large number of veteran suicides 34 this year particularly and most, not all, have been young. 35 36 Q. That would appear to be part of a generational shift 37 towards recognising the more recent conflicts? 38 A. I think we are becoming aware of the cost of the more 39 recent conflicts and the scale of the need. 40 41 Q. Do you see it as something that you are keen to 42 encourage involvement in the RSL, whether it is 43 State Council, or the various other parts of it, for the 44 younger veterans to become involved? 45 A. Yes. I think younger veterans are starting to realise 46 that the RSL can contribute to solving these problems and 47 be very active in defining them and encouraging government .24/10/2017 (30) 3314 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 to take steps to fix them, or if government is unable to do 2 that, doing it ourselves. 3 4 Q. Just to be clear, you're not saying, are you, that the 5 older veterans, whether Vietnam or Korea or wherever, that 6 it is time for them to move along and move over on the 7 State Council and allow the younger veterans to take over? 8 A. This is not a question of young or old, it is a 9 question of delivering impact and the issues aren't 10 mutually exclusive. In fact, many of the emails I've had 11 on the issue of suicides this year amongst the younger 12 veterans cohort have been from older veterans themselves 13 who are very concerned about it. 14 15 Q. I think you referred to, particularly in rural areas, 16 the importance of community. You see that across the whole 17 of the RSL network, the importance for involvement 18 throughout the community and across all ages; is that 19 right? 20 A. Yes. 21 22 Q. In terms of the money that flows into the 23 organisation, money flows in to the various parts of the 24 organisation; correct? 25 A. Yes. 26 27 Q. And also flows between the various parts of the 28 organisation; correct? 29 A. Yes. 30 31 Q. Am I right that there has perhaps been to date a lack 32 of control of how the money flows through the various 33 different parts of the organisation? 34 A. The way that money is moved through the organisation 35 is complex. It took me some time to understand, and in 36 some areas control measures have not been sufficient. 37 38 Q. Again, in the same way as the organisation is complex, 39 that's a matter where you are looking at trying to find a 40 simpler mechanism for the movement of money; correct? 41 A. Yes. 42 43 Q. You mentioned your regular employment at the 44 University of Sydney. Is that something that you receive a 45 salary for? 46 A. Yes. 47 .24/10/2017 (30) 3315 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. On your leave of absence, are you currently receiving 2 a salary from it? 3 A. No. 4 5 Q. When did your leave of absence commence? 6 A. It began on - 1 August was my first day of leave 7 without pay. 8 9 Q. You then have been focusing on your roles at the 10 various RSL entities from that time; correct? 11 A. Exclusively from that time, but substantially before 12 that. 13 14 Q. Given that, as we'll come to, you've identified many 15 issues that need to be attended to, is this a long-term 16 proposition, that you continue on a leave of absence 17 running RSL entities for nothing? 18 A. My term of office is for three years and I intend to 19 fulfil my duties during that term. The question of 20 undertaking full-time duties without any salary does 21 involve some personal sacrifices on behalf of my wife and 22 children and ultimately, I think, the expectation of the 23 presidency being a full-time role and there being no salary 24 is unsustainable and unfair, I think, to people who might 25 follow me. 26 27 Q. In the same way as I asked Mr Condon yesterday for the 28 LifeCare Chairman, he had a similar view in relation to 29 that. Also, to attract the best candidates, there should 30 be, if it is to be a full-time role, some understanding 31 that there need to be some remuneration paid for that? 32 A. I have discussed that with various members of 33 State Council and also discussed that issue with the 34 District Council presidents last week, but in terms of the 35 issues we as an organisation have to deal with, it is not 36 the most important one. 37 38 Q. Just to be clear, you didn't take on the role of 39 State President because you wanted to be paid for it; 40 that's right, isn't it? 41 A. Yes. 42 43 Q. When you took over, you discovered fairly quickly the 44 complexity of the various organisations within the RSL; 45 correct? 46 A. Yes. 47 .24/10/2017 (30) 3316 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. But also problems of record keeping; correct? 2 A. Yes. 3 4 Q. So that has meant that it has been a very difficult 5 and time-consuming job for you to work out what has been 6 going on in the past? 7 A. Yes, it has required considerable effort. 8 9 Q. I think even down to the level of getting email access 10 to you, that took several weeks; is that right? 11 A. It did. We faced a number of logistical challenges in 12 the building. 13 14 Q. Those are the types of issues that you would also wish 15 to address to ensure that anybody else who takes over from 16 you will have an easier task? 17 A. We've addressed the email issue particularly and 18 access to information urgently, and we are quite advanced 19 in terms of fixing those issues. 20 21 Q. Do you see there being a sharp divide or demarcation 22 between RSL (NSW) and WBI? 23 A. They are legally separate entities and the interests 24 of both organisations and those that govern them are 25 separate. 26 27 Q. In terms of how they, at least, have been operating 28 from day to day, am I right that there has been significant 29 overlap? 30 A. Prior to me undertaking that role, that is my 31 understanding. 32 33 Q. As matters currently stand, both operate from 34 Anzac House; is that correct? 35 A. Yes. 36 37 Q. I think there are 26 employees currently; is that 38 right? 39 40 PUBLIC INQUIRER: Of? 41 42 MR CHESHIRE: Q. Perhaps if I ask you, you mention in 43 your statement 26 employees. Is that of WBI or of 44 RSL (NSW), or jointly? 45 A. It's approximately the same number for both. 46 I believe WBI is now - it's 26 or 27 and RSL (NSW) was that 47 number but we made some structural changes at RSL (NSW) .24/10/2017 (30) 3317 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 yesterday, which has reduced that number of staff. 2 3 Q. They're different, the 26 and 27, is that right, so 4 there's about 50 in total? 5 A. That's correct. 6 7 Q. To what extent, until you put in place any reforms, 8 were employees of one also performing a role for the other? 9 A. There was some crossover between the two organisations 10 before I came to the role, particularly in terms of back 11 office system, and I think there was some misunderstanding 12 as to the need to keep the interests of both separate. 13 There will be occasions where it is appropriate for one 14 person to perform roles for both, but that needs to be 15 independently considered by both organisations and 16 carefully approached. 17 18 Q. Although they are different organisations, how would 19 you describe the difference in terms of what they are set 20 up to do, WBI and RSL (NSW)? 21 A. RSL (NSW) is a member-based organisation with objects 22 that are broad. WBI is a trust. Its governors are not 23 elected by members directly, although indirectly that is 24 the case, and WBI's objects are very much focused on 25 ex-Service personnel and charitable services. 26 27 Q. WBI, am I right, actually does provide those services 28 itself to veterans? 29 A. Yes. 30 31 Q. Whereas RSL (NSW), am I right, generally does not 32 provide programs directly to veterans; is that correct? 33 A. Not entirely. So, for example, when it comes to 34 welfare and advocacy support and, by that I mean advocacy 35 in the pension system or legal advocacy, there are a number 36 of RSL (NSW) members and volunteers who provide direct 37 services to veterans. 38 39 Q. In the same way I asked you about the 5,000 or so 40 charities operating in this sphere, is that sort of overlap 41 one of the things you have been looking at trying to 42 rationalise between these two organisations? 43 A. Yes, that's right. 44 45 Q. I think you say that WBI has assisted veterans outside 46 of New South Wales; is that correct? 47 A. I understand so. .24/10/2017 (30) 3318 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. As you understand it, is WBI effectively a an 3 Australia-wide organisation, or is it a New South Wales 4 organisation that sometimes provides assistance beyond the 5 State boundaries? 6 A. I don't have the details on the number of cases that 7 we've performed outside of New South Wales. 8 9 Q. As a general proposition, does it operate 10 Australia-wide or is it really a New South Wales 11 organisation? 12 A. Primarily New South Wales, but it has at times 13 operated in other parts of the country, for example, 14 Western Australia. 15 16 Q. Am I right that a number of the other States and 17 Territories have similar organisations to RSL (NSW)? 18 A. Yes. 19 20 Q. Different State Branches; correct? 21 A. Yes. 22 23 Q. And also are there similar programs to WBI and 24 DefenceCare in the other States and Territories? 25 A. I understand that there is not a range of similar 26 organisations to WBI DefenceCare across the country. 27 WBI DefenceCare is rather special in that regard. 28 29 Q. As you understand it, then, how are the State Branches 30 supporting their veterans in the other States and 31 Territories? 32 A. The other RSL State Branches have different operating 33 models to New South Wales. Some of them are doing it 34 directly. There are also a range of other organisations 35 that support veterans in other States. 36 37 Q. Is that also one of the things that you will be 38 looking at, the crossover between the operations of the 39 various States and Territories? 40 A. It's something I'm giving very active consideration 41 to, both formally through my role as a Director of 42 RSL National but also informally in conversations with a 43 range of people in the ex-Services community. 44 45 Q. On RSL National, am I right that the State Presidents 46 sit on the Board of RSL National? 47 A. Yes. .24/10/2017 (30) 3319 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. How often does that meet? 3 A. The meeting schedule is a little irregular at the 4 moment, but I have had two Board meetings since I became 5 President of RSL (NSW). 6 7 Q. Do you understand that, largely, it is about every 8 month or so; is that how you anticipate going forward? 9 A. It is a little difficult to answer that with regard to 10 RSL National at the moment. It is not clear when our next 11 Board meeting will be. 12 13 Q. That at least provides you a forum for interacting 14 with other State Presidents? 15 A. It does, yes. 16 17 Q. Is your contact with them such that you can also 18 contact them outside of RSL National Board meetings? 19 A. That's right. I've had a number of productive 20 discussions with various RSL presidents in other States, 21 including as recently as yesterday morning, on how we can 22 integrate our operations in a more effective and efficient 23 way and deliver greater national impact. 24 25 Q. I think you say that in relation to DefenceCare, there 26 has been increasing demand for its services in recent 27 years? 28 A. Yes, that's right. 29 30 Q. Are you able to explain why that appears to have been 31 the case? 32 A. I think there would be three reasons. One is as a 33 country we're becoming more aware of the needs of the more 34 modern veterans and their families, including through 35 issues of mental health, but also more broadly in 36 developing resilience of Defence personnel and their 37 families. Secondly, I think DefenceCare's capabilities 38 have increased in recent years so it has been more able to 39 take on a greater case load. Thirdly, I think its 40 reputation has developed to the extent that more veterans 41 and serving personnel know about it and are able to pick up 42 the phone and call. 43 44 Q. You would regard that increase in demand as being a 45 good thing? 46 A. Ultimately, no. It would be preferable for us not to 47 have any cases to work at all, but to the extent that more .24/10/2017 (30) 3320 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 people are seeking help and DefenceCare is able to provide 2 it, then that is a good thing. 3 4 Q. That means that, from your point of view, DefenceCare 5 needs to make sure that it is able to expand if necessary 6 to meet the increasing demand? 7 A. That's right. DefenceCare has an excellent reputation 8 and we would like to scale that to the extent we're able 9 to. 10 11 Q. Can I ask you then about fundraising. When you 12 commenced as State President, one of the issues that you 13 looked at was how the various RSL entities were 14 fundraising; correct? 15 A. I was aware that RSL (NSW) was fundraising and the 16 other entities, and that did become an issue. 17 18 Q. You, I think, have looked into that issue; is that 19 right? 20 A. Yes. 21 22 Q. You are aware that each of the various bits of the 23 organisation has been fundraising in many different ways 24 over the years; correct? 25 A. Yes. 26 27 Q. So that has gone from formal appeals such as the 28 Poppy Day Appeal and the Anzac Day Appeal; correct? 29 A. Yes. 30 31 Q. Am I right that that has been conducted by WBI; 32 correct? 33 A. Yes. 34 35 Q. And before that URSF? 36 A. Yes. 37 38 Q. But, at the same time, the other bits of the 39 organisation, such as the sub-branches, have also had 40 involvement in carrying out those appeals? 41 A. Yes, and we can date that apparently back to 1923. 42 43 Q. As for the money that is raised by that, I think 44 I asked you earlier, it is right, isn't it, that rather 45 than the money simply going to WBI, some of it has been 46 retained in the sub-branches? 47 A. Yes, that's correct. .24/10/2017 (30) 3321 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. Which I think has made it very difficult for WBI and 3 RSL (NSW) to see how much money has been raised; correct? 4 A. Yes. 5 6 Q. What has been deducted for expenses? 7 A. That is also difficult to see. 8 9 Q. Also it is difficult to ensure that the money has gone 10 to the purpose for which it was raised? 11 A. We cannot have 100 per cent confidence of that. 12 13 Q. You recognise that that's one of the issues that 14 RSL (NSW) and WBI have needed to address? 15 A. Yes. 16 17 Q. In addition to the formal appeal, there have always 18 been ad hoc appeals from time to time, correct? 19 A. I can't say that that's always been the case, but we 20 have become aware of a number of ad hoc appeals that have 21 been conducted by the organisation. 22 23 Q. When you say by the organisation, by the various parts 24 of the organisation; correct? 25 A. Yes, New South Wales and WBI. 26 27 Q. And also then the sub-branches, the women's 28 auxiliaries; correct? 29 A. Yes. 30 31 Q. All of those, effectively, as you see it, answerable 32 to RSL (NSW) and WBI? 33 A. Yes, sub-branches and auxiliaries and other 34 subsidiaries are answerable to RSL (NSW). 35 36 Q. In circumstances where WBI has been conducting 37 appeals, answerable also to WBI? 38 A. Yes, they are the authorised fundraiser. 39 40 Q. It is right, isn't it, in addition to that there have 41 been other ways of seeking money from the public, such as 42 through websites? 43 A. Yes. 44 45 Q. "Donate now" buttons? 46 A. Yes. 47 .24/10/2017 (30) 3322 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. Selling of RSL products? 2 A. Yes. 3 4 Q. I think the Everyday Hero website for WBI; is that 5 correct? 6 A. Yes. 7 8 Q. That operates, I think, to allow third party 9 individuals to run activities, such as fun runs, for the 10 benefit of WBI; is that correct? 11 A. That's my understanding. 12 13 Q. Again, then, becoming effectively part of WBI's 14 fundraising activities? 15 A. That would be correct, yes. 16 17 Q. When you started looking into this issue of 18 fundraising, you identified a number of concerns; correct? 19 A. Yes. 20 21 Q. A significant number of concerns; correct? 22 A. Major concerns, yes. 23 24 Q. Relating to issues such as what was happening to the 25 money; correct? 26 A. Yes. 27 28 Q. And whether proper records were being kept; correct? 29 A. Yes. 30 31 Q. Just to be clear, am I right that the position was 32 your investigations didn't say to you the money is being 33 misappropriated; correct? 34 A. No, it was the absence of being able to guarantee that 35 the money had been appropriately handled and spent. 36 37 Q. You recognised that being able to tell the donating 38 public their money is being put to proper use and that you 39 can demonstrate that, was a very important part of 40 fundraising? 41 A. It's morally correct and legally required. 42 43 Q. You were aware then, were you, of the various 44 requirements of the Charitable Fundraising Act and the 45 associated regulations and conditions? 46 A. Yes. 47 .24/10/2017 (30) 3323 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. I think you took legal advice in relation to that 2 issue in view of the deficiencies that you had found; 3 correct? 4 A. Yes. 5 6 Q. And you also engaged Ernst & Young to carry out a 7 forensic analysis of the accounts of WBI and RSL (NSW); 8 correct? 9 A. Yes. 10 11 Q. And when you did, that revealed very significant 12 deficiencies within the accounts of RSL (NSW) and WBI? 13 A. Yes. 14 15 Q. So the sorts of things I've been asking you about, the 16 ability to track money through from donation to expense, 17 you recognise as being, as you say, morally important and 18 legally required; correct? 19 A. Yes. 20 21 Q. Ernst & Young effectively told you that that was 22 simply not possible with the way that RSL (NSW) and WBI was 23 operating its accounts and ledgers? 24 A. Yes. 25 26 Q. When you understood that this was the case, what did 27 you decide to do? 28 A. I was alerted to these problems. I had discussions 29 with staff of WBI in New South Wales about it. I took it 30 as an issue to the RSL (NSW) State Council and recommended 31 to them that we immediately cease fundraising until we 32 could guarantee compliance, and the State Council passed a 33 resolution to that effect and subsequently WBI's trustees 34 made the same decision. 35 36 Q. That meant that in the light of what Ernst & Young had 37 uncovered in relation to WBI and RSL (NSW), that there were 38 problems with its own fundraising; correct? 39 A. RSL and WBI's own fundraising? 40 41 Q. Yes. 42 A. Yes. 43 44 Q. But in view of what I've been asking you then about 45 the sub-branches and the women's auxiliaries and their 46 involvement in the fundraising of RSL (NSW) and WBI, it was 47 important that the directives that were given in relation .24/10/2017 (30) 3324 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 to fundraising extended just beyond RSL (NSW) and WBI; 2 correct? 3 A. Beyond the State Branch and Anzac House, if that's 4 what you mean? 5 6 Q. Yes. 7 A. Yes, it was important to communicate that across the 8 entire organisation - both organisations. 9 10 Q. And to require that the various sub-branches, for 11 instance, ceased fundraising? 12 A. Yes. 13 14 Q. Because unless and until State Branch and WBI could 15 have confidence that it was being done properly at a 16 sub-branch level, then the sub-branches shouldn't be 17 fundraising; correct? 18 A. That was the decision we made. 19 20 Q. That was, to your view, a correct decision? 21 A. Yes. 22 23 Q. I think your view is that unless and until you can 24 satisfy yourself that there are proper and effectively 25 controls at all levels of the organisation, that RSL (NSW), 26 the State Branch and WBI will not themselves commence 27 fundraising; correct? 28 A. That's correct. 29 30 Q. And also will not permit the sub-branches, the women's 31 auxiliaries and the other parts of the organisation to 32 commence fundraising? 33 A. That's right. State Council will not make that 34 decision, I don't believe, until we are satisfied that we 35 are compliant. 36 37 Q. Am I right that your focus, then, has been on 38 addressing those deficiencies; correct? 39 A. The initial focus has been on scoping the deficiencies 40 and then moving to address them. 41 42 Q. And also, at the same time, looking at the other 43 deficiencies that you have uncovered, such as in the 44 general record keeping within RSL (NSW)? 45 A. We have had a large number of work streams across both 46 organisations beyond the issue of fundraising compliance. 47 .24/10/2017 (30) 3325 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. When you say both organisations, although you're not 2 the Chairman of LifeCare, Mr Condon has given evidence 3 about that, but effectively across all three organisations; 4 correct? 5 A. Yes, there has been an enormous amount of work across 6 all three. 7 8 Q. Also that then has had to extend into the 9 sub-branches; correct? 10 A. Yes. 11 12 Q. Would I be right in saying, in general terms, you have 13 done a lot of work thus far? 14 A. Yes, I believe so. 15 16 Q. And you've identified, and perhaps in the more work 17 have you done, you have continued to uncover more problems? 18 A. Yes. 19 20 Q. But you're in the process of addressing those 21 problems; correct? 22 A. Yes. 23 24 Q. But there's still some way to go? 25 A. There is a long task list of issues, many of which are 26 important, all of which we are addressing. 27 28 Q. From the point of view of State Branch and WBI, 29 Ms Collins was the General Manager of at least DefenceCare 30 when you started; correct? 31 A. Yes. 32 33 Q. She is now formally the General Manager of WBI 34 and State Branch; correct? 35 A. Yes. 36 37 Q. So she has been very involved in many of these 38 reforms; correct? 39 A. Pivotal to those reforms. 40 41 Q. Some of the reforms that have been put in place have 42 been to the internal systems within State Branch and WBI; 43 correct? 44 A. Yes. 45 46 Q. You are aware that Ms Collins gave evidence on these 47 issues? .24/10/2017 (30) 3326 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes. 2 3 Q. Am I right that part of that has been moving the 4 finance system over to what's called Navision? 5 A. Yes. There was an initial effort to separate the WBI 6 finance system from the RSL (NSW) finance system. The 7 chosen system for that was Navision and work is under way 8 to similarly transfer the RSL (NSW) finance system to that 9 product as well. 10 11 Q. I think I'm right that thus far RSL (NSW) has not yet 12 transitioned? 13 A. That's correct. 14 15 Q. Am I right that the WBI records from prior to I think 16 2016, have not yet been moved over to the Navision system; 17 is that right? 18 A. I'm not aware of that detail sitting here today. 19 20 Q. The transfer over to Navision is an important part of 21 putting in place better systems; correct? 22 A. It will make it easier for us to report and track our 23 finances in both organisations. 24 25 Q. When you say to report and track, that includes the 26 donations received from members of the public? 27 A. Yes. 28 29 Q. Am I right that at least in respect of RSL (NSW), that 30 is likely to be completed early next year? 31 A. It will take some months, so I would expect the 32 beginning of next year is when we would complete that 33 transition. 34 35 Q. You have Ernst & Young engaged now, or in the course 36 of being retained as new auditors; correct? 37 A. We have appointed them as our new auditors for both 38 RSL (NSW) and WBI. 39 40 Q. Are you aware that they have sent a conflict letter to 41 Grant Thornton? 42 A. Yes. 43 44 Q. But it has now gone beyond that, has it, and there is 45 now a formal appointment of the new auditors? 46 A. That has certainly happened, yes. 47 .24/10/2017 (30) 3327 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. In addition to the auditing work, they have also been 2 retained to carry out testing on your new systems; correct? 3 A. We are looking at a number of work streams that they 4 might progress. Last week we signed a proposal for them to 5 address issues with the EY system and the New South Wales 6 system. 7 8 Q. When you put the new systems in place, one of the 9 things that you would want to do is to test and make sure 10 that they're doing what needs to be done; correct? 11 A. Yes, the systems need to have a structure design that 12 matches our needs, both operational and compliance, and 13 then they need to be tested to ensure they can deliver the 14 reporting that we require. 15 16 Q. It may be, for instance, in the case of fundraising, 17 you may need further additional information above and 18 beyond what is produced by the electronic system? 19 A. Correct. 20 21 Q. You will need testing to take place once the system 22 has been finalised to ensure that it is giving you reports 23 and information that is then compliant with the charitable 24 fundraising legislation; correct? 25 A. Yes. 26 27 Q. Ultimately, whatever Ernst & Young may be doing at the 28 moment, you will need them to come back and look at the 29 State Branch system once the Navision has been put in place 30 to ensure that State Branch can be compliant? 31 A. I don't know the exact sequence of the steps in that 32 process, but I agree with the overall aim of what you're 33 saying, which is that we will need to have our systems 34 independently tested to ensure they're compliant. 35 36 Q. Whatever reforms are ultimately put in place, the last 37 piece of the jigsaw will be somebody testing and, as it 38 were, signing off and saying, "Yes, everything is now in 39 place and compliant"? 40 A. At the State Branch level, yes. 41 42 Q. Also at the WBI level as well? 43 A. Yes. 44 45 Q. For that, if I can call it, sign off, you have 46 Ernst & Young engaged to look at the financial side; 47 correct? .24/10/2017 (30) 3328 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes. 2 3 Q. You also have external legal advisers for both 4 organisations? 5 A. Yes. 6 7 Q. And that's not merely for the purpose of representing 8 the organisations in this Inquiry, is it? 9 A. No, we have a considerable number of legal advisers 10 engaged at the moment. 11 12 Q. Is the anticipation that as and when the various 13 changes are put in place, you will be ensuring with your 14 lawyers that from a legal perspective there is compliance 15 as well? 16 A. Yes. 17 18 Q. So that then contemplates ongoing external legal 19 involvement? 20 A. I expect so. 21 22 Q. One of the issues, which I'll come back to, which is 23 up in the air is the structure of the three entities, State 24 Branch, WBI and LifeCare, going forward; correct? 25 A. Yes. 26 27 Q. And also as to whether one or all will seek to resume 28 fundraising; correct? 29 A. Yes. 30 31 Q. In that context, the reforms that you have been giving 32 evidence about, are those reforms only for the purpose of 33 resuming fundraising or even if, let's say, WBI is not to 34 resume fundraising, will it be still be carrying on with 35 the reforms that you've given evidence about? 36 A. We have extensive reforms to do in each organisation 37 outside of the realm of fundraising. The eventual 38 structure we adopt for what might be called the RSL Group 39 or the RSL family will determine the nature of those 40 reforms with regards to fundraising in each entity. 41 42 Q. For instance, in terms of the separation of the 43 financial affairs of WBI and RSL (NSW), that was not just 44 to become compliant with fundraising legislation? 45 A. No. 46 47 Q. You agree with me? .24/10/2017 (30) 3329 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. I agree with you, sorry. 2 3 Q. And, likewise, the transferring to Navision has 4 broader purposes than simply compliance with charitable 5 fundraising regulations? 6 A. Yes, there are a number of operational advantages to 7 that. 8 9 Q. The reforms that you put in place have extended far 10 beyond simply a new financial management system; correct? 11 A. Yes. 12 13 Q. I think, for instance, you have an internal IT support 14 employee; is that right? 15 A. Yes. We had a number of IT issues, ranging from 16 myself and the rest of State Councillors not being able to 17 access email after hours or on the weekends. We employed a 18 new IT person in-house employed by WBI, but their services 19 are shared across the two organisations. That has been 20 ratified by both RSL (NSW) and WBI separately. 21 22 Q. In terms, then, of the internal structures, you have 23 separated out the financial management systems, the 24 electronic systems, between State Branch and WBI, but am 25 I right that in terms of putting in place reviews of 26 budgets, for instance, or employing an IT specialist, those 27 are the sort of matters that, where you can, you've looked 28 to benefit both organisations? 29 A. Yes. 30 31 Q. Part of that, I think, is looking at the space that 32 you occupy with a view to seeing whether it best suits the 33 needs of both organisations; is that right? 34 A. Yes. We have done extensive work on that, looking at 35 what our true needs are for both organisations and looking 36 at where our future home might be. 37 38 Q. So it has extended both to perhaps the broader macro 39 issues such as where do you actually have everybody 40 operating, but then also internal issues such as who is 41 going to be signatories on the various accounts? 42 A. Yes. 43 44 Q. And what controls are going to be in place for 45 operation of accounts and expenses; correct? 46 A. Yes, we've had some work to do there. 47 .24/10/2017 (30) 3330 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. For one of the issues I think you have engaged a Chief 2 Governance Officer; is that correct? 3 A. Yes, we hired an experienced company secretary, who 4 also happens to be the President of the Governance 5 Institute of Australia who starts work today as the 6 Chief Governance Officer of RSL (NSW), with broad 7 responsibilities for company secretary function and 8 governance improvement. I expect those services will be 9 shared with WBI to the extent that it is authorised by 10 WBI's Trustees. 11 12 Q. What do you understand that the Chief Governance 13 Officer will be responsible for? 14 A. Company secretary functions particularly, so dealing 15 with meetings of State Council, for example, the 16 preparation for those meetings, the actions of those 17 meetings, the compliance of those meetings, working to 18 ensure that we comply with our various responsibilities as 19 a corporation in terms of reporting, and also being a point 20 of contact for advice on these matters and to progress 21 projects which will improve our overall governance. 22 23 Q. What about in relation to fundraising? 24 A. I would expect they would have a contribution to 25 ensuring that we are compliant with fundraising as well. 26 27 Q. To whom does the Chief Governance Officer report? 28 A. They report to the General Manager, Robyn Collins. 29 30 Q. I think you also have an Acting General Counsel now; 31 is that right? 32 A. We do. We have two people working in internal legal 33 roles at the moment for RSL (NSW). 34 35 Q. In the same way as the Chief Governance Officer is 36 available to WBI, is it anticipated that the Acting General 37 Counsel will also be available to WBI? 38 A. I would expect there will be day-to-day matters on 39 which it would be efficient for WBI to be able to access 40 those services. There may also be issues on which WBI 41 would need to maintain separate legal representation. 42 43 Q. And the Acting General Counsel, is that an employee 44 role? 45 A. The Acting General Counsel is a contract role for both 46 of those personnel on different contracts at the moment, 47 but we expect that, subject to a proposal being approved by .24/10/2017 (30) 3331 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 State Council, that would become an internal role, an 2 employee role. 3 4 Q. Then a full-time role within State Council? 5 A. I expect we will need at least one, if not more, 6 full-time employees working on legal issues. 7 8 Q. One of the issues that I think you addressed is the 9 position in the past that has been used of using an 10 honorary legal adviser. Is that something that you are 11 also keen on maintaining? 12 A. No, and at our first full State Council meeting, we 13 abolished the positions of honorary legal and honorary 14 medical adviser. 15 16 Q. Why was that? 17 A. Because I think, for accountability purposes, it's 18 better to be clear about the expectations of performance of 19 your legal advisers and, speaking more generally, the legal 20 needs of an organisation as large and as complex as 21 RSL (NSW) require a paid professional to be working on 22 them. 23 24 Q. Am I right that both the Chief Governance Officer and 25 the General Counsel will be retained by State Council? 26 A. They will be directly employed by the General Manager, 27 but obviously State Council has responsibilities there. 28 29 Q. You have the General Manager in both organisations, 30 State Council and WBI. Is it anticipated that the Chief 31 Governance Officer and the General Counsel will be on the 32 New South Wales side, State Council side? 33 A. Yes. 34 35 Q. Or that they will straddle the two? 36 A. No, they will be on the New South Wales side. 37 38 Q. You are aware that in the past the honorary legal 39 adviser at times has been giving advice to all three 40 organisations, State Council, WBI and LifeCare? Are you 41 aware of that? 42 A. Yes. 43 44 Q. That, at least, raises the possibility, doesn't it, of 45 conflicts of interest arising between the organisations? 46 A. Yes. 47 .24/10/2017 (30) 3332 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. I think you indicated earlier that there would be 2 occasions when WBI might be able to use their services, but 3 if there was any doubt about a conflict, I think you would 4 say they would have to go elsewhere; is that right? 5 A. Yes, that's right. 6 7 Q. What about the use of external lawyers, is it 8 anticipated that that will continue on an ongoing basis? 9 A. I think if you look at the issues we have to address, 10 I unfortunately cannot see a future when we will be devoid 11 of external legal advice. 12 13 Q. For the purposes of this Inquiry, it is right, isn't 14 it, that RSL State Branch and WBI have retained separate 15 external legal advisers? 16 A. Yes. 17 18 Q. You have recognised, have you, at least, the 19 importance there of considering conflicts of interest 20 positions between the various organisations? 21 A. Yes. 22 23 Q. I asked you earlier about the importance of attracting 24 good people to the organisation to sit on the Board or as 25 Trustees. You, I think, have also introduced various 26 measures to improve the knowledge base and skills of the 27 State Councillors; correct? 28 A. Yes. 29 30 Q. One of those issues you have introduced or 31 State Council has introduced, is that the State Councillors 32 should complete the Australian Institute of Company 33 Directors course; correct? 34 A. Yes, that was a resolution of State Council. 35 36 Q. With which you agreed? 37 A. Absolutely. 38 39 Q. That would include matters such as addressing 40 conflicts of interest; correct? 41 A. Yes. 42 43 Q. But also you would envisage, would you, that there 44 would be further in-house training for all 45 State Councillors from time to time? 46 A. I would expect a thorough program of training, whether 47 it is in-house or external, to maintain competency. .24/10/2017 (30) 3333 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. That then presumably would be a matter on which your 3 internal General Counsel would be able to assist? 4 A. Yes. 5 6 Q. On issues such as compliance with charitable 7 fundraising? 8 A. Yes. 9 10 Q. Since this Inquiry commenced, it is right, isn't it, 11 that a number of State Councillors have resigned? 12 A. Yes. 13 14 Q. The current position is, as I understand it, that 15 letters have been sent to three of the State Councillors 16 asking them to resign; correct? 17 A. Yes, it gives me no pleasure to do that, but we have 18 done that as a Council. 19 20 Q. That was something with which you agreed; correct? 21 A. Yes. 22 23 Q. And those State Councillors being Mr Toussaint, 24 Mr Harrigan and Mr Hutchings; correct? 25 A. Yes. 26 27 Q. Why, in your view, should they be called upon to 28 resign? 29 A. My view, and the view of State Councillors endorsed in 30 that resolution, is that their ongoing position as 31 State Councillors is not in the best interests of 32 RSL (NSW). 33 34 Q. Because? 35 A. A range of reasons. Primarily, with regard to their 36 role in matters that occurred before 24 May 2017, and which 37 have been the subject of investigation by this Inquiry, but 38 also as to their general suitability to be fit and proper 39 people to sit on the Board of an organisation such as 40 RSL (NSW). 41 42 Q. Is that in particular in relation to the response to 43 the issue of Mr Rowe's expenses? 44 A. Yes. 45 46 Q. Mr James was on the State Council at the time when the 47 issue of Mr Rowe's expenses was considered; correct? .24/10/2017 (30) 3334 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes. 2 3 Q. Am I right that although a letter was prepared, the 4 motion for it to be sent out to Mr James calling on him to 5 resign was defeated; correct? 6 A. Correct. 7 8 Q. You voted against that resolution? 9 A. I did. 10 11 Q. Given that Mr James was also around at the same time 12 these issues arose with the other three, why was his 13 position different? 14 A. We have considered his - or I have considered his 15 position with regard to the actions he took at the time of 16 what has become known as the Don Rowe coverup. 17 I considered his position with regard to actions that he 18 took subsequently to that episode, including after he 19 resigned as a a State Councillor during State Congress 20 earlier this year, and before State Congress earlier this 21 year, with regard to his initiatives to both call for an 22 extraordinary Congress to make State Council for answerable 23 for its actions, and also in terms of recommending a 24 resolution to Congress which had the intent of making 25 State Councillors more answerable for their actions. Also, 26 I have had regard to Mr James's actions since he became a 27 State Councillor again on 24 May and, finally, his 28 understanding and acceptance of the responsibilities of the 29 role he is in. 30 31 Q. When you say there was a resolution trying to make 32 State Council more answerable, what was the mechanism for 33 making them more answerable? 34 A. There is a provision of the Constitution that provides 35 that State Council may appoint, suspend or dismiss any 36 officer. The resolution that Mr James proposed through his 37 sub-branch was to include State Councillor in the 38 definition of "officer", with the intent of creating a 39 mechanism by which State Councillors could be removed from 40 the Council by a majority vote of Councillors. 41 42 Q. Have you yet had a response to the letters to 43 Mr Toussaint, Mr Harrigan and Mr Hutchings? 44 A. No. 45 46 Q. I think, prior to that, you had also asked them in a 47 conversation to resign; is that correct? .24/10/2017 (30) 3335 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes. 2 3 Q. Had you asked Mr James to resign? 4 A. I had not directly used the language around a 5 resignation, but we had talked around the issue of making a 6 clean break from the past and former Councillors being 7 re-elected to the Council. 8 9 Q. Have you at any time asked Mr James to resign? 10 A. Not in those words, no. 11 12 Q. Have you conveyed anything to him on previous 13 occasions that would give that impression? 14 A. We had discussed whether it would be appropriate for 15 him to take a period of leave, but I have not directly 16 asked him to resign in that way. 17 18 Q. When you say "we have discussed", did you have that 19 discussion with him? 20 A. Yes. 21 22 Q. He indicated, did he, that he wanted to carry on, or 23 did he offer to resign? 24 A. No, he indicated that he wanted to carry on and keep 25 working within the League. 26 27 Q. As matters currently stand, the next election then for 28 State Councillors is when? 29 A. We will need to conduct an election in May 2018 to 30 fill the two vacant positions by the recent resignations. 31 32 Q. Do all of the State Councillors come up for 33 re-election at that time? 34 A. Not at that point. In the normal course of events, 35 the majority of State Councillors, myself and the Treasurer 36 would not be up for election until 2020. 37 38 Q. Just to be clear, with the two vacancies being filled 39 next year, that means the election of two new people; 40 correct? 41 A. Not necessarily. We are considering, amongst other 42 reforms, the need to reduce the overall size of 43 State Council. That is a reform that has been suggested 44 through various reviews in the past and one with which 45 I personally agree. A Board of 14 is practically difficult 46 to manage, so if we were to propose a reduction in the size 47 of the Board, and that was to be endorsed by members, there .24/10/2017 (30) 3336 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 might not necessarily be elections for those specific 2 positions, but we are considering all options. 3 4 Q. As matters currently stand, as you understand it, 5 there would be an election for the appointment of two 6 State Councillors next year; is that? 7 A. If there are no changes we would expect an election 8 for those two in May 2018. 9 10 Q. The election would be merely to appoint two further 11 people; is that right? 12 A. Yes. 13 14 Q. So there would not then be the ability to remove in an 15 election any of the existing State Councillors; is that 16 right? 17 A. It could be. State Congress has the power to remove 18 existing Councillors, so either a sub-branch or 19 State Council itself could recommend a motion to the 20 Congress to remove a number or all of existing 21 State Councillors. 22 23 Q. When is the next State Congress due? 24 A. It will be in the last week of May in Albury, in 2018. 25 26 Q. The election would be held at that State Congress, if 27 it was still required? 28 A. Yes. 29 30 Q. I think you have also put in place matters relating to 31 things such as dealing with minutes; is that correct? 32 A. Yes. The minutes previously were sparse and 33 resolution-based only. From our first meeting, we have 34 included additional detail which fleshes out the issues 35 being discussed. At our most recent meeting conducted last 36 Thursday we had a professional minute-taker from the 37 Governance Institute of Australia, and from meetings going 38 forward in RSL (NSW) we will have a proper company 39 secretary taking minutes. We have also made all of those 40 minutes going back to 2010 for State Council available on 41 the public section of our website. 42 43 Q. Dealing with resolutions, if there is a resolution and 44 a number of people vote against a resolution that is 45 passed, will that be recorded now in the minutes? 46 A. I've taken advice on this. As the regulations 47 currently stand, we are governed by the procedures in .24/10/2017 (30) 3337 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Renton's guide to meetings. That provides a mechanism by 2 which pay a poll can be demanded and names be recorded, but 3 we have approached that issue sensibly and practically, and 4 in the case of the motions passed last week regarding the 5 letters to former Councillors, we thought it was 6 appropriate that those who opposed had their name recorded. 7 8 Q. Am I right that even if you don't record their names, 9 at the very least you would record whether it was by 10 majority for unanimously? 11 A. Yes. 12 13 Q. When you say that the minutes will be published on the 14 public area of the website, what about the process of 15 in-committee minutes being taken and kept from the website? 16 A. There are a number of irregularities around what was 17 termed the in-committee process of previous State Council 18 meetings. We do not adopt that process anymore. If we 19 were to need to resolve into a committee as a whole, we 20 would certainly ensure that resolutions in that committee 21 were appropriately reported back to the State Council 22 meeting and recorded in the minutes. 23 24 Q. What about issues that might be commercially 25 sensitive? 26 A. We have given consideration to balancing the needs to 27 publish confirmed minutes quickly for reasons of 28 transparency, as well as balancing the fact that we do have 29 commercial operations and sometimes personally sensitive 30 details which might need to be redacted temporarily or 31 permanently. 32 33 Q. Am I right that your starting point is that everything 34 should be open and open to the whole public, but there may 35 be occasions when that's not commercially possible? 36 A. That's right. We are a charity and we're accountable 37 to the public, so everything we should do in the first 38 instance should be open to the public to scrutinise. 39 40 Q. I think one of the other matters that you have 41 introduced is establishing a perpetual resolution log for 42 State Council; is that right? 43 A. We have done some work on that. I did task a member 44 to put that together. I think we will need to go back a 45 little bit further and be a bit more thorough in our 46 efforts to clarify exactly which policies are still in 47 place. .24/10/2017 (30) 3338 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. At least on an ongoing basis, everything will be, as 3 you understand it, maintained and retained in one ongoing 4 document? 5 A. Yes. 6 7 Q. One of the deficiencies that you had recognised, 8 I think, was a failure to recognise conflicts of interest; 9 correct? 10 A. Yes, that was a deep problem in the organisation. 11 12 Q. When you say "the organisation", that in fact applies 13 to all three, State Council, WBI and LifeCare; correct? 14 A. Yes. 15 16 Q. I will ask you just about State Council and WBI. 17 Am I right that a conflict of interest policy and register 18 has been considered for each of the organisations? 19 A. Yes. 20 21 Q. What is the current position in that regard? 22 A. We have adopted a conflict of interest policy for 23 RSL (NSW). That was adopted on 31 August 2017. 24 Councillors have been educated on that. We have also begun 25 the process of establishing a standing conflicts of 26 interest register, introducing at the start our meetings a 27 declaration of updates as well as particular conflicts for 28 that meeting. In WBI we are in the process of adopting a 29 formal conflict of interest policy and expect to do that in 30 our next meeting. 31 32 Q. I didn't ask you and I meant to - there is something 33 you refer to called a Business Operations Specialist? 34 A. Yes. 35 36 Q. Is that a new role? 37 A. That is a role that existed in RSL (NSW) prior to me 38 being elected as President, but one that we have made much 39 greater use of in the past months. 40 41 Q. What does a Business Operations Specialist do? 42 A. The individual in that role is skilled at looking at, 43 essentially, how business is conducted, the systems and 44 processes that underpin business operations and is 45 particularly focussed and skilled in helping to reform 46 organisations in those areas and is doing so across both 47 RSL (NSW) and WBI. .24/10/2017 (30) 3339 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. Who is in that role currently? 3 A. Raj Nair. 4 5 Q. R-A-J N-A-I-R? 6 A. Correct. 7 8 Q. Mr Nair reports to who? 9 A. He reports to Robyn Collins. 10 11 Q. Then in terms of the ultimate responsible for these 12 reforms, you have State Council on one side and the 13 Trustees on another? 14 A. Yes. 15 16 Q. With Ms Collins reporting directly to them; is that 17 right? 18 A. Yes. 19 20 Q. And then below her you have the Business Operations 21 Specialist reporting to her? 22 A. His title at the moment is Chief Operating Officer, 23 although he has used the term Business Operations 24 Specialist in the past. 25 26 Q. The General Counsel, when engaged, will report to 27 Ms Collins as well; is that correct? 28 A. I would expect so. 29 30 Q. You referred earlier to problems identified by the 31 Inquiry in relation to expenses. Am I right that you have 32 introduced new controls over the expenses within 33 State Council and WBI? 34 A. Yes. The issue of expenses was front and centre when 35 I first went to work at Anzac House. Early on I asked - 36 I became aware that the paper-based systems we were using 37 were problematic, and asked Robyn Collins to investigate 38 bringing in a digital expense management system for both 39 operations called Concur, and we are now taking steps to do 40 that. With regard to expenses for individual 41 State Councillors, we're in the peculiar situation where we 42 did not have a Treasurer for 14 weeks because of the length 43 of the RSL election processes, so I directed staff that 44 I would personally approve all expenses of 45 State Councillors. I did that. 46 47 I also had a number of legacy expense claims from .24/10/2017 (30) 3340 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 former members of the Caretaker Management Committee and 2 former Council. Several of those I rejected because there 3 was no receipts. Where there were no receipts, I asked for 4 a statutory declaration to be provided by the individuals. 5 I personally spoke with the finance staff to instruct them 6 to scrutinise and be confident in rejecting inappropriate 7 claims or incomplete claims. We are now in a position 8 where our State Treasurer has done work designing a new 9 process for State Council expenses to be processed and 10 authorised, including my own expenses. Finally, we have 11 quite closely examined what the organisation, RSL (NSW) 12 that is, is spending money on and I think we are succeeding 13 in developing a more cost conscious culture. 14 15 Q. With the State Council reimbursement of expenses, by 16 way of claim forms after the individual has spent the 17 money, am I right that those were the documents you 18 referred to about being rejected if they did not have 19 supporting documentation? 20 A. Yes. 21 22 Q. Those documents, are they now approved by the 23 State Treasurer; is that right? 24 A. Yes. 25 26 Q. Do they then go before the Finance Committee? 27 A. Yes. 28 29 Q. When they go before the Finance Committee, do they go 30 as a line item or a total, or the does the reimbursement 31 form itself go before the Finance Committee? 32 A. I don't have an answer to that question. I can't 33 answer that immediately, but I would expect that that 34 committee would have the power to review the individual 35 documents. 36 37 Q. Then the credit cards, do you have a State Council 38 credit card? 39 A. I do, but I've not activated it yet. 40 41 Q. Your expenses are, at the moment, currently done by 42 way of reimbursement; is that right? 43 A. Yes. Flights, of which I've had two to Canberra, two 44 sets of flights to Canberra, are booked directly by the 45 organisation. Cabs are billed directly to the organisation 46 and there are some minor expenses which have been 47 reimbursed to me. .24/10/2017 (30) 3341 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. With your expenses, who is keeping an eye on those? 3 A. The State Treasurer is the approver for my expenses. 4 5 Q. To your understanding, are they reviewed by the 6 Finance Committee as well? 7 A. Yes. 8 9 Q. Again, are they reviewed as one single line item total 10 or in detail by the Finance Committee? 11 A. I would expect that they would review them in detail. 12 13 Q. I think you're not on the Finance Committee; is that 14 right? 15 A. No, although I did attend one meeting before the 16 current Terms of Reference were confirmed. 17 18 Q. What about the State Treasurer's expenses? 19 A. They're reviewed by me. 20 21 Q. And then by the Finance Committee? 22 A. Then by the Finance Committee and State Council if 23 necessary. 24 25 Q. Do you have a contract, or similar, in force for your 26 position as State President? 27 A. No. 28 29 Q. Do you have a policy that governs your expenses? 30 A. We have an expense delegation limit for 31 State Councillors which includes me, and we have a matrix 32 which indicates items that are appropriate for expenditure 33 on. We are also reviewing extant policies, for example 34 former State Council charters and presidential guidelines, 35 and we will consolidate those into a clearer document in 36 the near future. 37 38 Q. And presumably then require each of the 39 State Councillors to sign up to them to indicate that 40 they're aware of them and agree to them; correct? 41 A. Yes. 42 43 Q. Do any of the other State Councillors have a credit 44 card? 45 A. Not currently. One of my first actions was to cancel 46 all outstanding credit cards for State Councillors and to 47 review the use of credit cards across RSL (NSW). .24/10/2017 (30) 3342 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. At the time you took over, how many of the 3 State Councillors had State Council credit cards? 4 A. Of the State Councillors currently on State - of the 5 State Councillors that were current in May 2017, only 6 Darren McManus-Smith had a credit card, to the best of my 7 recollection. 8 9 Q. And you have cancelled that; is that right? 10 A. I cancelled that in my first week on the job. 11 12 Q. That was to ensure a greater oversight in relation to 13 expenses; is that right? 14 A. I wanted to have greater control of who was spending 15 the organisation's money. I also reviewed the number of 16 staff credit cards and determined whether each was 17 required, the credit limits, and personally reviewed the 18 credit card statements for all of those credit cards going 19 back some months. 20 21 Q. Currently who has a State Council credit card? 22 A. The only person on State Council who has a credit card 23 at the moment is me and that has not yet been activated. 24 25 Q. What about within the staff? 26 A. There are a number of personnel that have credit 27 cards. My PA has a credit card, the State Secretary has a 28 credit card, the General Manager has a credit card, the 29 General Manager of the Hyde Park Inn has a credit card. 30 There is also a gentleman by the name of Tom Barnesly who 31 is the volunteer coordinator for RSL Day Clubs across the 32 state. He has a credit card as well due to the nature of 33 that role which requires regular travel. 34 35 Q. The current State Secretary is? 36 A. Jeff O'Brien. 37 38 Q. Those credit card statements, how are they dealt with? 39 A. They are now reviewed by the General Manager and, as 40 necessary, reviewed and referred to the Finance Committee. 41 42 Q. What about Ms Collins' credit card? 43 A. That would be reviewed by the Treasurer and then the 44 Finance Committee. 45 46 MR CHESHIRE: Is that a convenient time? 47 .24/10/2017 (30) 3343 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 PUBLIC INQUIRER: It is, thank you, Mr Cheshire. We're 2 going to take a short break now, if you would like to step 3 down, and return at 10 to 12. I will adjourn until then. 4 Thank you. 5 6 SHORT ADJOURNMENT 7 8 PUBLIC INQUIRER: Yes, thank you. Yes, Mr Brown, could 9 you come back into the witness box, thank you. 10 11 MR CHESHIRE: Before I resume with Mr Brown, I should have 12 tendered two statements. Could I tender his statement of 13 11 September which I think is Exhibit 34. 14 15 PUBLIC INQUIRER: Yes. 16 17 MR CHESHIRE: And the statement of 23 October 2017 as 18 Exhibit 35. 19 20 PUBLIC INQUIRER: They'll be tendered subject to the 21 objection, Mr Linden, that your colleague has taken. 22 23 MR LINDEN: Thank you. 24 25 EXHIBIT #34 STATEMENT OF MR JAMES BROWN DATED 26 11 SEPTEMBER 2017 27 28 EXHIBIT #35 STATEMENT OF MR JAMES BROWN DATED 29 23 OCTOBER 2017 30 31 PUBLIC INQUIRER: Yes. 32 33 MR CHESHIRE: Q. You gave some evidence, Mr Brown, about 34 matters such as flights being paid for by way of, I think, 35 an account or an EFT; correct? 36 A. Yes. 37 38 Q. For those matters, where they are your expenses, are 39 you expected to produce receipts for them? 40 A. Not for ones that are produced by the EA, or booked by 41 her, she provides those receipts, but for Cabcharges, for 42 example, I'm expected to provide the receipt. 43 44 Q. If I put it this way: there is now an expectation and 45 a system that there must be a receipt somewhere for each 46 expense or a statutory declaration verifying the expense? 47 A. Yes, as well as a justification for why the expense is .24/10/2017 (30) 3344 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 to the benefit of RSL (NSW). 2 3 Q. Are you provided with any accommodation within the 4 Hyde Park Inn? 5 A. No. 6 7 Q. Are you provided with a car allowance? 8 A. No. 9 10 Q. Are you provided with any cash sums? 11 A. No. 12 13 Q. If you activate your credit card, what, as you 14 understand it, is the position in relation to cash 15 withdrawals? 16 A. I wouldn't see a need to have cash withdrawals. 17 18 Q. If there were any particular need, you would expect to 19 be required to produce receipts together with a 20 justification; correct? 21 A. Yes. I should also point out that because of a 22 resolution passed by the State Congress in May, the 23 expenses of myself and other Councillors are now to be 24 published to the public website. That called for quarterly 25 publications. We have decided to go with monthly 26 publication of our expenses so they're open to scrutiny by 27 members and the public alike. 28 29 Q. If members have concerns about the level of your 30 expenses, how would they go about raising those concerns? 31 A. They could raise them directly with the organisation. 32 They could raise them directly with me or other 33 Councillors. They could raise them with the staff. They 34 could raise them with the external whistle-blowing hotline 35 that we have in operation or they could raise them with the 36 authorities. 37 38 Q. Or, presumably, through a motion at State Congress if 39 they were a member of a sub-branch; is that right? 40 A. Yes. 41 42 Q. You mentioned the whistleblower hotline. I think 43 that's also something that you have set up in response to 44 their problems that have you identified; is that correct? 45 A. Yes, we wanted to give everybody the opportunity to 46 report any issues of concern without fear of intimidation 47 or bullying. .24/10/2017 (30) 3345 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. I had asked you earlier about the issue of the 3 sub-branches being involved in fundraising. I think you're 4 aware that some of the sub-branches conduct fundraising on 5 behalf of WBI; correct? 6 A. Yes. 7 8 Q. Some of them also have their own fundraising 9 authorities; correct? 10 A. Yes. 11 12 Q. That, to your mind, raises a problem; correct? 13 A. Yes. 14 15 Q. What problem does that give rise to? 16 A. I think it creates complexity. There are compliance 17 issues. It is not clear that some of the people operating 18 those authorities understand the obligations to the extent 19 they should. It creates the potential for there to be 20 confusion because if you have, say, 40-plus authorities 21 across the organisation, the conditions of them could be 22 different, so it makes education and compliance difficult. 23 24 Q. The State Branch is in a position to supervise and 25 control the sub-branches; correct? 26 A. Yes. The Constitution gives State Council extensive 27 power to control the activities of sub-branches. 28 29 Q. As you would see it, it has at least some 30 responsibility for the actions of sub-branches; correct? 31 A. Yes. 32 33 Q. In an extreme case, it is entitled to remove a charter 34 from a sub-branch? 35 A. Yes, that's right. 36 37 Q. Which then means that the sub-branch, effectively, 38 ceases to exist; correct? 39 A. Yes. 40 41 Q. As part of investigating fundraising issues at a 42 sub-branch level, am I right that a survey was issued by 43 State Branch? 44 A. Yes. 45 46 Q. That was to seek to gain an understanding of exactly 47 what was going on within the sub-branches; correct? .24/10/2017 (30) 3346 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes, with regards to fundraising. 2 3 Q. And that, I think, was sent out on 5 September; 4 correct? 5 A. That sounds right to me. 6 7 Q. You have received, I think, about 80 per cent of those 8 back; is that right? 9 A. That was the approximate, the last time I checked. 10 11 Q. I am right, aren't I, that each year the Constitution 12 of State Branch requires the sub-branches to provide 13 certain information to State Branch? 14 A. Yes, as well as the regulations. 15 16 Q. That includes what are known as forms SBA1, 2, 3 and 17 4; correct? 18 A. Yes. 19 20 Q. Am I right that whilst they required certain 21 information, that didn't deal whether in fact the 22 information that was being provided was correct? 23 A. Sorry, could you ask that one again? 24 25 Q. When State Branch received the SBA1, 2, 3 and 4, of 26 itself, that didn't give you any mechanisms for testing 27 whether in fact the information you're being provided with 28 is correct? 29 A. Not on the form, but there was a compliance check of 30 sorts for some of that information that was in place. 31 32 Q. Why then the need for the surveys in addition to those 33 forms? 34 A. Because the survey goes further than those forms. 35 Those forms were also current as of March last year, we 36 were conducting this in September, and it also consolidated 37 the information in one location, which means we can analyse 38 it. 39 40 Q. The process of that analysis has commenced; correct? 41 A. Yes. 42 43 Q. But it is still ongoing? 44 A. Yes. 45 46 Q. Some of the sub-branches have not yet responded; 47 correct? .24/10/2017 (30) 3347 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes. 2 3 Q. Some of the sub-branches have given responses which 4 are not complete? 5 A. Yes, that's right. 6 7 Q. Would it be right to say that even on the basis on the 8 analysis you have carried out, it is clear that there are 9 problems within the sub-branches? 10 A. Yes. 11 12 Q. And that there is extensive non-compliance? 13 A. I have seen compliance. I don't yet have a view on 14 how extensive it is. 15 16 Q. When you say you have "seen compliance" -- 17 A. Sorry, I've seen issues that raise concerns with 18 regard to compliance, but I haven't yet formed a view on 19 how extensive that is. 20 21 Q. On the face of it, it would be right to say that it 22 appears there has been non-compliance in relation to 23 charitable fundraising within the sub-branches? 24 A. Yes. 25 26 Q. At least at this stage, it would appear that that 27 non-compliance is extensive; correct? 28 A. It would appear that it is happening across a large 29 number of sub-branches, so extensive in that regard, yes. 30 31 Q. You are a member of the North Bondi sub-branch; 32 correct? 33 A. Yes. 34 35 Q. What is its position, as you understand it? 36 A. With regard to? 37 38 Q. Compliance. 39 A. I have not considered in detail what North Bondi's 40 position is. 41 42 Q. Do you hold any role within that sub-branch? 43 A. I'm a member of the sub-branch but I have no executive 44 role. 45 46 Q. As of yet, you haven't looked at the form, the 47 response that's coming from North Bondi; is that correct? .24/10/2017 (30) 3348 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. No. 2 3 PUBLIC INQUIRER: Q. That is correct? 4 A. Sorry, yes, that is correct. 5 6 MR CHESHIRE: Q. Who is it that is responsible for 7 reviewing the responses? 8 A. That effort is being led by Robyn Collins with the 9 involvement of a number of staff, particularly in the 10 business services area of RSL (NSW). 11 12 Q. Are there at least plans to engage a fundraising 13 manager; is that right? 14 A. That is an option we're considering. We are aware 15 that there is a skills gap in need, but what that position 16 looks like has not yet been settled. 17 18 PUBLIC INQUIRER: Q. It looks like the surveys that have 19 been provided to the Inquiry show that a very large number 20 of sub-branches are putting the public money into a general 21 account similar to what has happened in RSL (NSW), so that 22 they have disclosed to you that not only is the public 23 money going into the account, which is correct, but it is 24 going in with things from which all activities, such as 25 out-of-pocket, post and the general running of the welfare 26 and pension, and stationery and phone costs are being paid 27 out. If that is the case, then it will need to have a very 28 serious review, won't it? 29 A. Yes, Madam Inquirer, yes. 30 31 Q. I suppose the work that you've spoken about at RSL 32 State Branch level, although it won't be needed to be 33 replicated to the same extent, but if there is a model and 34 that could then be fed into the sub-branches, it would be 35 of assistance, I presume? 36 A. Yes. 37 38 PUBLIC INQUIRER: Yes, Mr Cheshire, sorry to interrupt. 39 40 MR CHESHIRE: Not at all. 41 42 Q. One of the issues that you were looking into was the 43 issue of consolidating the sub-branches fundraising 44 activities under the umbrella of, and so using the 45 authority of, WBI or State Branch; correct? 46 A. That to me makes a lot of sense. 47 .24/10/2017 (30) 3349 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. Particularly then in the contact of a renewal process 2 where information is being provided, State Branch or WBI 3 would then have the ability to control that renewal 4 process; correct? 5 A. Yes. 6 7 Q. And ensure at that stage that there was compliance; 8 correct? 9 A. Yes. The issue of compliance with State Council 10 direction, including processes such as the fundraising 11 survey and others, is also an eligibility criteria for 12 voting at State Congress. 13 14 Q. That's in relation to the SBA forms; correct? 15 A. Yes. 16 17 Q. Not in relation to the surveys? 18 A. To the extent that the surveys is a direction of 19 State Council, failure to complete that could be considered 20 to be an obstacle to being eligible to vote at 21 State Congress. 22 23 Q. You would hope that when that is pointed out, the 24 remaining sub-branches would respond to the survey and 25 provide the information? 26 A. Yes, we have been actively following up with the 27 District Council Presidents and I've made a number of calls 28 to individual sub-branches to encourage them to complete 29 the survey. 30 31 Q. You are aware that back in, I think, 2011, there was a 32 review of the sub-branches and their activities by the ATO? 33 A. Yes. 34 35 Q. I think that involved members of State Council or 36 employees of State Council Management going out into the 37 sub-branches and talking to them about issues that had been 38 raised; correct? 39 A. Yes. 40 41 Q. So you would recognise that there may well need to be 42 a very significant input from State Council going out into 43 sub-branch land, as it has been called, to assist the 44 sub-branches on issues of fundraising? 45 A. Yes, and I'd point out that for some of the 46 sub-branches it is not an issue of being unwilling to 47 comply, it is a question of needing additional resources to .24/10/2017 (30) 3350 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 comply. So, whilst there is a role for State Council and 2 State Branch to, in effect, police sub-branches, there is 3 also a role for us to assist sub-branches. 4 5 Q. I think one of the broader matters that feeds into 6 that is what you gave evidence earlier about, the potential 7 of consolidation of various entities within the RSL? 8 A. Yes, as well as we are considering proposals such as 9 potentially providing for full-time staff at a district or 10 regional level who are able to more directly interact with 11 and assist sub-branches. 12 13 Q. You have also given some consideration as to whether 14 moneys have been applied for the general charitable 15 purposes of WBI and State Branch; correct? 16 A. Yes. 17 18 Q. But you're aware, aren't you, that in the context of 19 the Charitable Fundraising Act, it isn't simply application 20 in accordance with the general charitable purposes, but in 21 accordance with any representations that are made for the 22 purposes of the appeal; correct? 23 A. Yes. 24 25 Q. If one is looking at appeals that are being run by 26 sub-branches, the potential level of Inquiry into the 27 representations that were made becomes perhaps almost 28 prohibitive? 29 A. Sorry, could you repeat that question? 30 31 Q. In the context of the sub-branches conducting 32 fundraising, if State Branch had to look into not only what 33 has happened to the money, but also what representations 34 were made in the context of any appeal by sub-branches, a 35 State Branch Inquiry becomes almost prohibitive, doesn't 36 it? 37 A. It becomes more complex. I wouldn't necessarily agree 38 that it becomes more prohibitive, particularly if you think 39 about the major appeals in question which are related to 40 Remembrance Day and Anzac Day, I think would you find a 41 degree of consistency amongst the representations made by 42 sub-branches. It does become difficult when you consider 43 that we are not the only RSL fundraising in New South 44 Wales. For example, the RSL Queensland Art Union often 45 appears in local areas and makes representations and that 46 can cross-cut and be of some concern to my sub-branches as 47 well. .24/10/2017 (30) 3351 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 PUBLIC INQUIRER: Q. I can understand that, because when 3 you look at it, it is difficult to know whether it is 4 RSL (NSW) or RSL Queensland, because unless you go to the 5 website and then go back to where it comes from, on one 6 view of it, the shoppers at the local shopping centre might 7 well think it is your organisation? 8 A. That's correct, Madam Inquirer, and in my office is a 9 file of representations made by members to former leaders 10 of the organisation detailing instances of encounters with 11 the RSL Art Union, including reports that they have 12 represented that the money they raise is going to local 13 RSL (NSW) activities, which is clearly not the case. 14 15 Q. That's a worry. 16 A. Yes. 17 18 PUBLIC INQUIRER: Yes, Mr Cheshire. 19 20 MR CHESHIRE: Thank you. 21 22 Q. From when State Branch and WBI ceased fundraising, is 23 it your understanding that RSL Queensland, the Art Union 24 and similar interstate bodies, have become more active in 25 New South Wales? 26 A. Yes. 27 28 Q. Is that a matter that you have encouraged? 29 A. No. It has been a matter of concern to my members. 30 I have raised that on two occasions with the RSL Queensland 31 President, but we have not yet had a substantive 32 conversation about it. I've also had discussions about 33 that at the national level with other RSL State Presidents. 34 35 Q. Is it your vow that, as a general proposition, each of 36 the State Branches should be raising money limited to their 37 own States? 38 A. That is preferable, or if there is to be a national 39 approach to fundraising for the RSL or, indeed, amongst the 40 veteran community, for example, with Legacy, it should be 41 coordinated and not duplicated. 42 43 Q. And potentially not competing with each other; 44 correct? 45 A. I think that is correct. 46 47 PUBLIC INQUIRER: Q. Has there been any discussion at a .24/10/2017 (30) 3352 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 national level about the entities of the RSL that actually 2 hold fundraising authorities in New South Wales and their 3 compliance with the Charitable Fundraising Act? 4 A. Not at the RSL National to the extent that I'm aware, 5 but I have had discussions with RSL Victoria because of the 6 role they play in major appeals. We have dealt with a 7 number of the issues, including non-compliance there. 8 9 Q. Just on an assessment of taking the temperature of 10 each of the organisations in relation to how they have or 11 have not complied, it does seem, at least prima facie, that 12 not a great deal of regard has been paid to the 13 Charitable Fundraising Act, possibly because of the 14 introduction of the ACNC? 15 A. That is a possibility, but I haven't had conversations 16 on that. But I will say that what I'm finding so far is 17 that although the States are in different stages of 18 progress with some of these issues, the issues seemed to be 19 common. 20 21 PUBLIC INQUIRER: I understand. Thank you. Yes, 22 Mr Cheshire. 23 24 MR CHESHIRE: Q. I asked you about the appeals within 25 the sub-branches and you have given an answer about the 26 more formal appeals, but you're aware, aren't you, that 27 within the sub-branches there are many much more informal 28 or ad hoc appeals, such as raffles, lemonade stalls and the 29 like; correct? 30 A. Absolutely. 31 32 Q. As State Council, it would be difficult to assess and 33 to discover precisely what representations were made in 34 respect of each and every appeal; correct? 35 A. Difficult and time-consuming. 36 37 Q. That is perhaps why there would be sense in 38 centralising the appeals so that the representations would 39 be made by perhaps WBI or RSL which could then be adopted 40 or repeated by sub-branches? 41 A. Yes, and that has been the practice adopted by other 42 large ex-Service organisations. 43 44 Q. Such as? 45 A. Legacy. 46 47 Q. How does that operate as different? .24/10/2017 (30) 3353 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. They have a more centrally coordinated fundraising 2 effort with a number of staff and a fundraising manager. 3 They have taken steps to seek specific amendments to their 4 individual conditions and authorities that are appropriate 5 to that organisation. 6 7 A good example of that is I understand the Charitable 8 Fundraising Act requires us to provide individual and 9 sequentially numbered identifications for people who are 10 engaged in fundraising. Legacy and other organisations 11 have sought amendments to their conditions so that their 12 membership badge, which is sequentially numbered, can serve 13 as that identification. RSL (NSW) has not, and that would 14 save us considerable time and make things more accountable. 15 16 PUBLIC INQUIRER: Q. So you seek an exemption from that 17 condition? 18 A. Yes. 19 20 MR CHESHIRE: Q. Have you discovered this from talking 21 to Mr Condon or through your relationship with Legacy? 22 A. Both. The successor to - Mr Condon was formerly the 23 CEO of Sydney Legacy clubs. His successor, John Hutcheson, 24 is the secretary of the North Bondi sub-branch and an RSL 25 member. It is quite common for people engaged in the 26 community to be a member of more than one organisation. 27 I've taken the time to meet with him and understand how his 28 back office operates, and I have spoken with his 29 fundraising manager about this and the future of 30 fundraising for veterans generally. 31 32 Q. Part of the exercise that you've engaged in is talking 33 to people who work in the field to discover how they do it; 34 correct? 35 A. Yes. 36 37 Q. Has the reaction to that from other organisations 38 generally been helpful or have they been resistant? 39 A. No, it has been helpful. 40 41 Q. Do you regard this as being a competition in this 42 field for the public's money? 43 A. In an optimal circumstance, no. There are some really 44 excellent veterans charities that I've had experience with, 45 including Soldier On, and, you know, I think there's scope 46 for us to operate together in a much more coordinated and 47 effective way, particularly here in New South Wales where .24/10/2017 (30) 3354 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 the heads of these charities are people known to me and we 2 have a good functioning relationship, so I think we could 3 actually here start a much more productive relationship 4 amongst the community. 5 6 Q. Poppy Day or Remembrance Day is not far away. As I 7 understand it, RSL (NSW) and WBI will not be fundraising 8 for it this year; correct? 9 A. That's correct, and I issued a signal to that effect 10 on behalf of the State Council I think last week or the 11 week before. 12 13 Q. That extends to sub-branches, women's auxiliaries and 14 the like; correct? 15 A. Yes. 16 17 Q. Is it your understanding that there will be any 18 fundraising for Remembrance Day? 19 A. Not conducted by RSL (NSW) or WBI. 20 21 Q. Is that something you expect Legacy will be doing? 22 A. I'm not aware exactly what Legacy has planned for 23 Remembrance Day. 24 25 Q. Is that something that's usually, say, in central 26 Sydney, carried out by taking donations for poppies that 27 State Branch usually conduct, or WBI? 28 A. Yes, that would normally be conducted by RSL or WBI at 29 major services in Sydney. 30 31 Q. Do you know whether there are plans of another State 32 Branch or another organisations to conduct those sorts of 33 exercises that State Branch or WBI would have conducted on 34 Remembrance Day? 35 A. I'm not aware of any. 36 37 Q. You are aware that with the proceeds of fundraising 38 between the various RSL entities, it has moved between 39 those various entities without significant oversight; 40 correct? 41 A. It has had a degree of oversight, but not what I would 42 personally regard as sufficient. 43 44 Q. You are aware that that that gives rise to a problem 45 where WBI has been involved because of it having different 46 objects to State Council; correct? 47 A. In terms of? .24/10/2017 (30) 3355 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. You are aware that State Council's objects allow it 3 and require it to provide for current as well as ex-Service 4 personnel; correct? 5 A. Yes. 6 7 Q. Whereas WBI is limited by its objects to ex-Service 8 personnel; correct? 9 A. Yes, that's correct. 10 11 Q. So that means that moneys passing, let's say, from WBI 12 to State Branch may ultimately be applied other than in 13 accordance with WBI's objects; correct? 14 A. There has been the potential for that kind of 15 pollution. 16 17 Q. You are aware now, are you not, that WBI, in fact, has 18 not been complying with its objects in that regard for many 19 years; correct? 20 A. I am aware that it has been operating outside of its 21 objects. 22 23 Q. That is a matter that needs to be addressed; correct? 24 A. Yes, urgently. 25 26 Q. Do you see, from a practical and needs point of view, 27 any reason why WBI should operate in a way that it is 28 limited to ex-Service personnel? 29 A. I'm not clear on whether you're asking me from a legal 30 basis or from a practical basis? 31 32 Q. From a practical commonsense, is there anything to be 33 gained from WBI operating only for the benefit of 34 ex-Service personnel? 35 A. No. 36 37 Q. Am I right that one of the issues that you are 38 currently looking into, and that State Branch and WBI is 39 looking into, is finding a way to extend the operations of 40 DefenceCare and WBI to all veterans? 41 A. We are looking at whether we might be able to do that. 42 We're certainly looking at ensuring that the trusts and the 43 trustees comply with the objects of the trust. 44 45 Q. Because you would recognise that it is not a viable 46 option simply to continue to operate in breach of its 47 objects; correct? .24/10/2017 (30) 3356 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. I acknowledge the seriousness of that situation and 2 that it is unacceptable for Trustees to be operating in 3 that way into the future. 4 5 Q. And at least something has to be done? 6 A. Yes. 7 8 Q. Am I right that you're aware that there was a proposal 9 developed, I think towards the end of last year, for 10 setting up a corporate entity to, in effect, replace 11 DefenceCare; correct? 12 A. Yes. 13 14 Q. With a view to addressing that issue and the corporate 15 entity having broader charitable objects; correct? 16 A. Yes. 17 18 Q. As I understand it, that was blocked by State Council; 19 is that correct? 20 A. That proposal was briefed to members of the 21 State Congress and there was a resolution passed at 22 State Congress which had the intent, I believe, of blocking 23 that move. 24 25 Q. To your understanding, what was the reason for 26 blocking it? 27 A. My personal view is that members were concerned that, 28 to use informal language, DefenceCare was running away from 29 the RSL and that RSL would lose control of DefenceCare, to 30 the extent that it had any. 31 32 Q. As you understood it, the objection was not so much 33 the changing of objects, but, rather, setting up a separate 34 corporate entity; is that right? 35 A. That is my personal view of what motivated that 36 resolution. 37 38 Q. Are you aware of any resistance to extending the 39 objects of DefenceCare to cover current as well as 40 ex-Service personnel? 41 A. I'm not and I'm confident - one of the issues we have 42 here is that it is not broadly understood what WBI is and 43 its relationship to the RSL, so I'm confident that we can 44 explain that and, through what has happened in this Inquiry 45 and our own efforts, we can identify the issues and help 46 ensure that there would be limited resistance to resolving 47 the problem with the trust objects. .24/10/2017 (30) 3357 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. Which part do you fear is not understood in relation 3 to WBI? 4 A. I think the general awareness of the corporate 5 structures in the RSL family is low. I think that's the 6 main issue. 7 8 Q. Do you regard the close relationship between State 9 Branch and WBI as being an important one? 10 A. Yes. 11 12 Q. In the context of, effectively, amendments to WBI 13 being discussed by State Congress, you would recognise the 14 potential for disagreements of opinion between WBI and 15 State Branch; correct? 16 A. Yes. 17 18 Q. That puts you in a potentially difficult position? 19 A. It does. 20 21 Q. One way of resolving that is, effectively, to separate 22 the governance of State Branch from WBI; correct? 23 A. Yes. 24 25 Q. Is that a separation that at least would have some 26 benefit, from your point of view? 27 A. Yes, and we've already taken steps to do that by 28 amending the rules of the Trust so that the Treasurer of 29 RSL (NSW) and the State Secretary are no longer appointed 30 directly as Trustees, so that we can draw Trustees from a 31 wider pool, and also giving the Trustees the ability to 32 resign, which they did not previously it have. 33 34 At this point in time, there are benefits to having 35 someone with visibility of both organisations for the 36 purposes of coordination and efficiency, but in an ideal 37 world it would be useful to have complete separation of 38 governance. 39 40 Q. If one has complete separation of governance, does 41 that then lead to a position where WBI does become 42 completely separate to State Council? 43 A. It could do, yes. 44 45 Q. Is that, then, the sort of arrangement that the 46 members of State Council might find unpalatable, bearing in 47 mind what happened with blocking the previous proposal? .24/10/2017 (30) 3358 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. I have not tested this with members of State Council 2 of RSL (NSW)? 3 A. I think - I know that one of the concerns registered 4 by a re-elected councillor to me, as recently as last 5 Thursday, was that they had not had sufficient knowledge of 6 WBI activities. So I think the concern was more to a lack 7 of transparency rather than a lack of control. I think, 8 given the decisions the State Council has been making 9 easily, they would be sensible, practical and reasonable 10 about any step to separate the governance of the two 11 organisations. 12 13 Q. You would see a considerable benefit in separating at 14 least governance of the two organisations; correct? 15 A. Yes. 16 17 Q. If we put LifeCare into the mix, separating the 18 governance of the three organisations? 19 A. I would like that to occur. It would make my role 20 considerably easier. 21 22 Q. I think it is right that a third Trustee for WBI was 23 appointed recently; correct? 24 A. Yes, and that makes it easy to remove myself from any 25 decisions on the WBI Board on which I might possibly or 26 actually be conflicted. 27 28 Q. And the third trustee was a State Councillor, or not? 29 A. No, the third Trustee is a currently serving member of 30 the Defence Force who is also a member of the wider RSL, 31 but he's not on State Council and does not hold any role 32 within the RSL (NSW) State Council. 33 34 Q. The second WBI Trustee is a State Councillor, or not? 35 A. No. The other - the remaining Trustee, Mr Evans, is 36 not a member of RSL (NSW) State Council. I'm the only 37 current Trustee of WBI who also has a role on the RSL (NSW) 38 State Council. 39 40 PUBLIC INQUIRER: Q. Is that the same with Mr Evans, who 41 is involved in Homes for Heroes? 42 A. Yes. 43 44 PUBLIC INQUIRER: Yes, thank you. 45 46 MR CHESHIRE: Q. That separation of governance could 47 lead to or could open up the possibility of the .24/10/2017 (30) 3359 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 organisations, WBI and State Council, effectively, going 2 their own separate ways and being entirely separate. Is 3 that something you would encourage? 4 A. No. It is a possibility, but if you read the trust 5 document as well as the Administrative Rules and consider 6 the history of WBI, there is, in my view, a very clear 7 intent for it to remain related to and linked to the RSL. 8 9 Q. Whatever structure going forward, would I be right 10 that you would regard that State Council should have very 11 close links with whichever organisation is going to run the 12 various veterans programs? 13 A. That would be my personal preference. 14 15 Q. That would apply not only to the DefenceCare programs, 16 but the Homes for Heroes program? 17 A. Yes. 18 19 Q. There have been a variety of discussions, I think, 20 about what is to be the structure of these three 21 organisations going forward; correct? 22 A. Yes. 23 24 Q. As of yet, there are no decisions? 25 A. Agreement in principle has been given to the high 26 level proposal by the RSL LifeCare Board. The RSL 27 State Council has noted the proposal and agreed in 28 principle, subject to seeing further details before final 29 agreement, and although no formal resolution has been 30 passed by the WBI Trust, I understand, at least, that 31 Mr Evans is supportive from the conversations he and I have 32 had. 33 34 Q. That proposal is for the operations of DefenceCare to 35 be effectively moved across to LifeCare; is that right? 36 A. Yes. 37 38 Q. LifeCare operates not only for the benefit of 39 veterans, but also for the aged care generally; correct? 40 A. Yes. 41 42 Q. Whereas the DefenceCare programs are limited to 43 veterans; correct? 44 A. Yes. 45 46 Q. Does that not create a potential problem in moving 47 veterans programs across to LifeCare so that it is running .24/10/2017 (30) 3360 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 veterans programs but also running an aged care business? 2 A. The provision of aged care is also referred to in the 3 WBI Trust objects, although in a very specific context. 4 There are things that RSL LifeCare is doing that would not 5 be contained in the current objects of the WBI Trust. My 6 expectation is that we will find a way to resolve a 7 structure that accommodates each of those needs. 8 9 Q. Do you see that, then, the Board of LifeCare would 10 control both the aged care retirement village side and also 11 the DefenceCare veterans programs side? 12 A. Yes, and we've given thought to how you would 13 structure the different needs and objectives of each of 14 those areas within an overall entity. 15 16 Q. In that context, WBI then would be, essentially, put 17 into run-off and allowed to run down; correct? 18 A. Yes, if the Trustees agreed to that. 19 20 Q. One would then be left with two organisations rather 21 than three; correct? 22 A. Yes. 23 24 Q. You would see a significant benefit in that occurring? 25 A. I would. I think there would be a number of benefits. 26 It would, if you like, sequester the professional delivery 27 of some quite complex services from the cadence of the 28 election cycle in a member-led organisation. It would 29 simplify the various conflict of interest issues in the 30 current governance structures by separating and simplifying 31 them. And there would be, I think, tremendous efficiencies 32 in terms of corporate structures, back office functions. 33 It would allow us potentially to give DefenceCare a 34 physical footprint across the State by using RSL LifeCare's 35 villages. There has been a lot of discussion about 36 establishing more veteran centres across the state, for 37 example. If LifeCare's Board were to choose to do so, it 38 is has the physical footprint to do that and some of the 39 services that might be required, whether it is buses or 40 physical therapists or mental health experts. It might 41 allow us to create, effectively, a professional charitable 42 services delivery company which can look after veterans and 43 their families from cradle to grave. 44 45 Q. You would see the Homes for Heroes being a good fit 46 with the DefenceCare programs? 47 A. Yes. .24/10/2017 (30) 3361 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 2 Q. In the same way when I think you talk about the 3 footprint across New South Wales, in the same way the 4 Homes for Heroes program is in a position where it can 5 expand, if it needs to, into other areas of New South Wales 6 using the LifeCare facilities? 7 A. Yes, there's a synergy between the two. Many of the 8 people who need the help of DefenceCare often need 9 temporary or long-term accommodation. That is very similar 10 to what the Homes for Heroes program is providing. I think 11 we could establish a continuum of need and relief from 12 temporary one-off through to more permanent. 13 14 Q. Mr Condon gave evidence yesterday about various 15 governance issues that have been proposed in relation to 16 LifeCare. Are you aware of that evidence? 17 A. Yes. 18 19 Q. Are those proposals, such as changing the members and 20 the way the Board operates, proposals that you support? 21 A. Yes, and indeed initiated and discussed extensively 22 with Mr Condon and other members of the LifeCare Board. 23 24 Q. LifeCare then operates its villages and operates, 25 effectively, the veterans services, DefenceCare, Homes for 26 Heroes. What then happens to State Council? 27 A. State Council remains. Within RSL (NSW) you would 28 still have responsibility for managing the operations of 29 sub-branches and subsidiaries, including property and 30 assets. You would have responsibility for commemoration 31 and the various public education programs attached to that, 32 as well as obligations we have under various Acts, for 33 example, the Anzac Memorial Act and the provisions relating 34 to the custodian of the cenotaph. 35 36 If I could describe the relationship between RSL (NSW) 37 and the new RSL LifeCare entity, the members of our 38 sub-branches are, effectively, the eyes and ears, and when 39 it comes to welfare services they in their communities 40 engaging with veterans and families on a regular basis. 41 They can detect problems that need to be resolved and then 42 refer those people on to DefenceCare/LifeCare who can do 43 the more intensive and long-term and professional work, 44 whether that's relating to community support and financial 45 relief or support for legal advocacy and pensions. 46 47 Q. You referred earlier in your evidence to that idea of .24/10/2017 (30) 3362 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 community, particularly outside of the metropolitan areas. 2 Is that something that you would see State Council as 3 taking that aspect forward and being a focus for the local 4 communities? 5 A. Yes. 6 7 Q. Focused around the sub-branches? 8 A. Yes. 9 10 Q. And the volunteers working in those sub-branches? 11 A. Yes, that's right. 12 13 Q. And also then the function of commemoration through 14 that network of State Councils, sub-branches and the 15 community? 16 A. Yes. 17 18 Q. What then about fundraising? 19 A. I would expect that, certainly on the RSL (NSW), my 20 members would want to retain the ability to fundraise, 21 particularly through major appeals. For some of the 22 sub-branches, the only money they have is the money that 23 they raised through those appeals, and their only ability 24 to provide services is reliant on fundraising. Clearly 25 there are some sub-branches who are in more fortuitous 26 financial circumstances. But, for my members, fundraising 27 really is about public engagement as well. One of the most 28 common complaints I have had from members in the past 29 months is the fact that the fundraising suspension has cut 30 them off from their communities. They want to be out there 31 on Remembrance Day and Anzac Day reminding people of the 32 importance of veterans in Australia's history and live and 33 reminding people of the sacrifices of RSL members and other 34 veterans as well. 35 36 Q. You referred to the sub-branches needing fundraising 37 for themselves. You would be aware, of course, that moneys 38 raised by fundraising had to be applied in accordance with 39 the representation of the appeal? 40 A. Yes. 41 42 Q. You would also see a structure, as I think you said 43 earlier, of the sub-branches fundraising effectively using 44 State Branches's authority; correct? 45 A. Yes. I think in an ideal situation for compliance 46 control and efficiency, funds would be remitted back to a 47 central authority holder, a central bank account, and there .24/10/2017 (30) 3363 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 would be consistency of representation from top to bottom. 2 3 Q. You would also have to be very careful about the 4 representations that were made to ensure that if some 5 moneys were going to help sub-branches, that that was made 6 absolutely clear in the representations; correct? 7 A. Yes, that's right. Part of that is having a clearer 8 and more detailed description of what is appropriate 9 charitable spending or welfare spending and what is not, 10 and we've taken steps to initiate a policy on that. 11 12 Q. You are aware, for instance, of criticisms that have 13 been made about sub-branches providing beer vouchers; 14 correct? 15 A. Yes. 16 17 Q. That's the sort of thing, is it, that you're looking 18 at? 19 A. Yes. The survey makes clear - this is one part of the 20 survey that I have considered, the survey results - there 21 is not a consistent understanding across the organisation 22 of what is appropriate welfare spending. 23 24 For example, the other day I had a request to approve 25 the use of RSL funds on a travel outing for members, and I 26 was not convinced that was sufficiently in the welfare 27 category, so we will not be approving that, but the 28 important thing is that they asked because they were not 29 sure. 30 31 Q. Just to be clear, for instance, the idea of a 32 sub-branch raising money to give beer vouchers for its 33 members would be something that you would not consider 34 would be appropriate; correct? 35 A. That's not what we are in the business of doing. 36 We're a charity to help veterans and their families and 37 that drives everything we do. We are not a social club. 38 39 Q. That then means, I think, that State Branches need 40 probably to be much more prescriptive to sub-branches about 41 what can and cannot be done with the public's money; 42 correct? 43 A. Yes, and I think from the majority of my interactions 44 with sub-branch members, they would welcome clear, concise 45 and consistent direction from State Council on that very 46 issue. 47 .24/10/2017 (30) 3364 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. That's one of the many issues also that needs to be 2 addressed; correct? 3 A. Yes. 4 5 Q. I think, in the context of LifeCare, your position was 6 that LifeCare should cooperate with this Inquiry; is that 7 correct? 8 A. Yes. 9 10 Q. You formed the view that, at least for a time, that 11 appeared not to be the case; correct? 12 A. Yes, I had concerns about that. 13 14 Q. And that was, I think, the lawyers who were instructed 15 changed from PricewaterhouseCoopers to Clayton Utz; is that 16 correct? 17 A. Yes. 18 19 Q. Was that, at least in part, as a result of the 20 concerns that you had? 21 A. Yes. I made those concerns made to a number of the 22 Directors and staff prior to that change happening. 23 24 Q. You were aware, were you, that PricewaterhouseCoopers 25 had acted as lawyers or provided advice to all three 26 organisations for many years in the past; correct? 27 A. Yes, and the fact that Mr Cannings had worked at 28 PricewaterhouseCoopers, including with some of the people 29 who were at that stage advising RSL LifeCare. 30 31 Q. In that context, you thought it inappropriate for 32 PricewaterhouseCoopers to be continuing to represent any of 33 the three entities; correct? 34 A. I formed a view that they had an interest in the 35 issues at hand on which they were advising and thought that 36 was a needlessly complex situation. 37 38 Q. And potentially a conflict of interest? 39 A. Yes. 40 41 Q. Which was a matter, I think at least in relation to 42 these organisations, that you had realised was a real 43 problem? 44 A. Yes. 45 46 Q. I have asked you about the cooperation in the context 47 of LifeCare. Did you also give instructions in relation to .24/10/2017 (30) 3365 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 cooperation by State Council and WBI with the Inquiry? 2 A. Yes, I did. 3 4 Q. That extended, I think, to admission documents being 5 provided by each of the three organisations; correct? 6 A. In my personal capacity I gave instructions to - in my 7 role, I gave instructions to New South Wales and WBI, and I 8 was part of the decision of the Board of LifeCare. 9 10 Q. In relation to the admissions for State Council, was 11 that with the approval of the State Council? 12 A. It was approved by the Inquiries Sub-Committee and 13 State Council which was formed to manage the potential for 14 there to be conflicts of interest with re-elected 15 Councillors who themselves were the focus of this Inquiry. 16 17 Q. So the admission that was made on behalf of 18 State Council was with the approval of that committee; is 19 that correct? 20 A. Of the Inquiries Committee. 21 22 Q. On behalf of WBI was on behalf of the organisation 23 with the approval of the then Trustees; correct? 24 A. That's right, myself and Mr Evans. 25 26 Q. Who at the time were the only Trustees? 27 A. Yes. 28 29 Q. As matters currently stand, in addition to this 30 Inquiry, you, I think, have an ongoing involvement with the 31 ACNC on behalf of each of the three organisations; is that 32 right? 33 A. Yes. 34 35 Q. That position is up in the air at the moment; correct? 36 37 PUBLIC INQUIRER: "That position" - do you mean the 38 Inquiry? 39 40 MR CHESHIRE: Q. The ACNC have not finalised any of 41 their inquiries, to your understanding; is that correct? 42 A. That is correct. 43 44 Q. You, however, have maintained a dialogue with the 45 ACNC? 46 A. Yes, we have been responsive to their requests. We 47 are adopting a policy certainly from a New South Wales and .24/10/2017 (30) 3366 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 WBI, and I understand a LifeCare perspective, of being 2 cooperative with that. I have had a number of discussions 3 with personnel from the ACNC, including inviting the then 4 Deputy Commissioner, David Locke, to address members of 5 State Council during our first full meeting. 6 7 Q. Am I right that one of the issues that you have been 8 discussing with the ACNC is the possibility of providing 9 some form of enforceable undertaking? 10 A. Yes, we have had an discussion on that. 11 12 Q. Is that in relation to each of the three 13 organisations? 14 A. That's primarily in relation to RSL (NSW). It might 15 become necessary for WBI, but at this stage I have not had 16 that conversation with the ACNC in my role as an 17 RSL LifeCare Director. 18 19 Q. Are those discussions in the context of the 20 possibility of resuming fundraising? 21 A. Yes. Yes. 22 23 Q. So if WBI is not to continue, it won't need to 24 recommence fundraising; correct? 25 A. That's right. 26 27 Q. Is that why you have not had those discussions with 28 WBI? 29 A. It has primarily been an issue for RSL (NSW) to 30 address, given where RSL (NSW) is at in terms of its move 31 towards full compliance for fundraising compared to the 32 other organisations. 33 34 Q. I think you're saying State Branch in terms of getting 35 to a position where it can be compliant and demonstrate 36 compliance, is a long way ahead of WBI? 37 A. It is a long way behind WBI. WBI is in a more 38 advanced state of readiness for compliance and 39 demonstration of compliance. 40 41 Q. So what is the aim of giving enforceable undertakings 42 for State Council and not for WBI? 43 A. We would want to essentially have a mechanism by which 44 we could have our reform efforts validated. That, to my 45 mind, is one option which would give us that mechanism to 46 have a regulator formally validate our internal reforms. 47 .24/10/2017 (30) 3367 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. If WBI is to recommence fundraising or to continue, 2 then you would anticipate a similar exercise in relation to 3 WBI? 4 A. I'm conscious of the timing of this Inquiry's report, 5 and it may be that WBI is in a position to demonstrate that 6 prior to the completion of this Inquiry process. Equally, 7 it may not be possible, but the question of timing is 8 exercising my mind in this regard. 9 10 Q. In relation to the issue of implausible undertakings, 11 as I understand it, you would not be resistant to providing 12 those on behalf of WBI; is that right? 13 A. No. I think we would very happy, if required and 14 appropriate, and pragmatic, to enter into an enforceable 15 undertaking. That's certainly my view. Whilst I can't 16 speak for the other Trustees, from my knowledge of them I 17 think they would be positively inclined to that as well. 18 19 Q. That's your dealings with the ACNC. You are aware 20 that charitable fundraising is regulated by Fair Trading; 21 correct? 22 A. Yes. 23 24 Q. And, therefore, in relation to your fundraising, or 25 the organisation's fundraising authorities, they're matters 26 that are dealt with by Fair Trading and the relevant 27 Minister; correct? 28 A. Yes. 29 30 Q. I think you have had some communications from the 31 Office of Fair Trading about that issue, is that right, 32 about fundraising? 33 A. Yes. 34 35 Q. The types of discussions that you've had with Mr Locke 36 and the suggestion of enforceable undertakings, are they 37 also matters you're prepared to discuss and offer to 38 Fair Trading? 39 A. Yes, if they would like that and there is a mechanism 40 to do that, we would be very open to that. 41 42 Q. Am I right that your discussions with the ACNC appear 43 to be further advanced with Fair Trading and the relevant 44 State Minister? 45 A. Yes, I wouldn't have thought it appropriate to 46 approach the State Minister whilst the Inquiry is ongoing. 47 .24/10/2017 (30) 3368 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 PUBLIC INQUIRER: Q. It is very difficult, isn't it, 2 whilst the Inquiry is running, but the pragmatism of it 3 means that no Poppy Appeal means the loss of a large amount 4 of money, doesn't it? 5 A. Yes. 6 7 MR CHESHIRE: Q. Am I right that it is something that 8 you're very prepared to do and would wish to do, to 9 approach Fair Trading and the State Minister; is that 10 right? 11 A. Yes. 12 13 Q. I think, following Ms Collins's evidence, the 14 State Council and WBI have provided copies of their 15 admissions that have been made to Fair Trading; is that 16 right? 17 A. WBI has, I think State Council has not yet done that. 18 19 Q. Is there any reason for that? 20 A. In the case of - the circumstances are different 21 between the two. WBI is in the midst of an active 22 communication with the Department of Fair Trading to renew 23 its fundraising licence, and obviously the admissions that 24 WBI Trustees have made are material to consideration of 25 that renewal, whereas the State Branch is not in the middle 26 of that process. 27 28 I suppose, personally, my working assumption has been 29 that the Department of Fair Trading has been monitoring 30 this Inquiry closely, but we wouldn't be averse to the idea 31 of communicating the various communications we've made 32 regarding non-compliance directly to Fair Trading. 33 34 Q. Just to be clear, for the purpose whether it is any 35 renewal or ongoing authority, you would recognise that 36 there would need to be full disclosure from each of those 37 organisations; correct? 38 A. Yes. 39 40 Q. In terms of satisfying the ACNC and Fair Trading of 41 proper compliance, you would anticipate that there would 42 be, after your various steps have been put in place, 43 independent review to confirm compliance; correct? 44 A. I think that would be important. 45 46 Q. At the moment you have Ernst & Young in a position to 47 be able to do that from a financial point of view; correct? .24/10/2017 (30) 3369 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes. 2 3 Q. You would anticipate that there would also be external 4 legal confirmation from that perspective? 5 A. Yes, and we've taken preliminary steps to establish 6 that process. 7 8 Q. One of the issues that you address in your statement 9 is the relationship with RSL National. You refer to 10 attempts being made to integrate RSL (NSW) into RSL 11 National governance structures. Would you explain what you 12 mean by that? 13 A. I have reviewed the RSL (NSW) Constitution and by-laws 14 and the RSL National Constitution and by-laws, including 15 previous versions of the RSL National Constitution and 16 by-laws, and also looked at the proceedings of RSL (NSW) 17 state Congresses over the past decade. There has been an 18 attempt to essentially integrate the National and State 19 levels of the RSL at various points, including through 20 Constitutional change. 21 22 That, in my view, has been done in a unsatisfying way 23 to the extent that the RSL National Constitution asserts 24 powers over RSL (NSW) which it does not rightfully have. 25 There is essentially a pollution of both Constitutions in 26 that regard. Some of it is relatively minor, around things 27 like life memberships and charters. Charters are a good 28 example, actually. One of the things I determined in my 29 first month working at Anzac House was that RSL (NSW) had 30 been issuing charters to sub-branches as if they were from 31 RSL National, whereas clearly the RSL (NSW) legislation and 32 our Constitution identifies that charters are issued to 33 sub-branches by RSL (NSW). So we have had to detect which 34 were the problematic charters and replace them. 35 36 At the AGM of RSL National on 22 September I made 37 clear that I believed the RSL National Constitution as 38 adopted on 7 June last year was problematic in that it 39 attempted to exercise control over RSL (NSW) property and 40 sub-branch members in a way that it was not authorised to 41 do, and whoever had agreed to that Constitutional change on 42 behalf of RSL (NSW) had not done it by seeking the 43 appropriate resolution of State Congress. So there is a 44 bit of disentangling to be done and I've reserved RSL 45 (NSW)'s rights in regard to that with RSL National. 46 47 Q. I think in a similar vein you have had concerns about .24/10/2017 (30) 3370 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 RSL National putting in place a system which you describe 2 as pooling; correct? 3 A. Yes. 4 5 Q. What do you mean by "pooling"? 6 A. In my initial review of RSL (NSW)'s budget I noticed a 7 line item for RSL National office expenses. I also noticed 8 in my investigation of our financial records, a number of 9 other payments that had been made to RSL National over the 10 preceding 12 months. My investigations with staff 11 indicated that this was a practice in place, called pooling 12 of expenses, whereby RSL National would determine that it 13 wanted to spend some money and it would then, based on a 14 formula on the size of the membership of each State 15 organisation, allocate a proportion of that expense to the 16 States then to be paid, and that States had been paying 17 that. That had occurred for a number of items. 18 19 I queried this at the first RSL National meeting 20 I went to and asked to see a specific policy or resolution 21 of the Board authorising this. None was provided to me. 22 I followed up an email to the CEO of RSL National and the 23 Treasurer asking for any authorisation for this pooling 24 practice, and despite repeated requests, I received none. 25 I was told this is just the way it has been done. 26 27 Through my own research, I determined that a previous 28 version of the RSL National Constitution had a by-law that 29 authorised the pooling of expenses for a specific purpose, 30 that being the conduct of a National Congress every year 31 and the attendance of Directors at that Congress. I ceased 32 that practice. It has led to an unusual situation in which 33 RSL National engaged a firm link to its former honorary 34 legal adviser to provide an advice on RSL National's rights 35 with regard to RSL (NSW). My organisation has paid for 36 that advice but has not yet seen it, so I've indicated we 37 will not be participating in pooling expenses any more. 38 39 Q. I think there was pooling, as you described it, in 40 relation to Mr Doolan's retiring gift; correct? 41 A. Yes. 42 43 Q. RSL (NSW) was charged a portion of the car that was 44 gifted to Mr Doolan; is that right? 45 A. Yes. 46 47 Q. And paid it? .24/10/2017 (30) 3371 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes, that happened in September 2016. 2 3 Q. As you understand it, RSL National was not demanding 4 payment of all of its expenses; is that right? 5 A. No. 6 7 Q. That is right? 8 A. Sorry, yes, yes, it is correct that they were not 9 demanding payment for their expenses. 10 11 Q. How is RSL National funded? 12 A. RSL National receives capitation fees from the various 13 State members. So, for example, $4.70 from each RSL (NSW) 14 membership is paid through to National. That happens on a 15 monthly basis. Then there is a small percentage, I think 16 30 or 50 cents, which is paid to a Jubilee commemoration 17 fund which is controlled by RSL National. They also 18 receive some money from investments and from grants and 19 from some commercial endorsement arrangements. 20 21 Q. To your understanding, do they fundraise? 22 A. I believe they do. 23 24 Q. But, to your understanding, they're not carrying out, 25 for instance, the Anzac Day Appeal or the Poppy Day Appeal 26 in New South Wales, as you understand it? 27 A. They have an interest, but they do not hold an 28 authority in New South Wales. Essentially, there have been 29 efforts to - it is not my language - consolidate the RSL 30 brand at a national level and to effectively purport to 31 licence the use of the word "RSL" and the badge, including 32 for appeals. There has been a national marketing forum 33 which has been a coordination body to discuss the conduct 34 of, say, the Anzac Day Appeal, but it is quite a complex 35 circumstance. RSL Victoria also has a role in that too. 36 37 Q. Am I right that State Branch was previously running an 38 online shop? 39 A. Yes. 40 41 Q. That, I think, was one of the matters that was stopped 42 by the direction to cease fundraising; is that correct? 43 A. Yes. 44 45 Q. Is that now being operated by RSL National? 46 A. We have not transitioned that shop to RSL National, 47 but we have advised the staff members who run that shop .24/10/2017 (30) 3372 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 that we are in the process of closing that shop down. 2 3 Q. When you say staff members that run that shop, you 4 mean the State Branch shop? 5 A. The State Branch shop. 6 7 Q. Does that have a physical presence? 8 A. Yes. 9 10 Q. Where is that? 11 A. In Anzac House. 12 13 Q. If these issues are put right, would State Branch not 14 resume operating the shop? 15 A. There are really very few items that our sub-branch 16 members and RSL members require. We do not necessarily 17 need to run that shop to provide those items to them. 18 19 Q. Just going back to something you said about RSL 20 National, you described attempts to integrate RSL (NSW) in 21 its governance structures. Was that, as you saw it, an 22 attempt to exercise control over State Branch? 23 A. I'm not sure what motivated those specific 24 Constitutional changes, but RSL National I think has 25 indicated over the last years that it would like to 26 exercise greater control of the State Branches. 27 28 Q. In the context of evidence you gave earlier about 29 potential rationalisation in this field, has there been any 30 suggestion of, effectively, RSL National seeking to abolish 31 that middle tier of all the State branches? 32 A. Not to my knowledge. 33 34 Q. So it is just a matter of governance and control 35 rather than actual existence; correct? 36 A. I'm not sure what you mean by that question. 37 38 Q. RSL National, what you have perceived, has sought to 39 exercise greater control in terms of governance, but it is 40 not seeking, as it were, to take over the role of what 41 State Council is doing? 42 A. I don't believe that is the intention, and the 43 practical reality is that RSL National is not in a position 44 to be able to contribute to the governance of RSL (NSW), in 45 my view, and my personal preference would be for RSL 46 National to be a smaller peak body type organisation. 47 .24/10/2017 (30) 3373 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 Q. In terms of the sorts of discussions that you gave 2 evidence about earlier as to coordinating fundraising 3 throughout Australia, RSL National provides a forum within 4 which those discussions can take place between the various 5 States and Territories? 6 A. It has provided that in the past. 7 8 Q. And it should provide it in the future? 9 A. Not necessarily. I think that coordination can take 10 place horizontally between the States without it 11 necessarily needing to take place through the national 12 body. My personal preference is that the national body 13 should be a smaller organisation. 14 15 Q. In terms of those contacts, whether through the forum 16 of RSL National or otherwise, they are contacts between the 17 States and Territory Councils that should continue; 18 correct? 19 A. Yes. 20 21 Q. In particular, from the viewpoint of discussing 22 fundraising across Australia? 23 A. Yes, and the other possibility is that some of the 24 discussions around a wider national ex-Service organisation 25 body could round up those conversations too, with the 26 involvement of other charities at a national level. 27 28 Q. Involving perhaps organisations such as Legacy in 29 those discussions? 30 A. Yes. 31 32 Q. Am I right that, from your evidence, the position of 33 RSL (NSW) and WBI is that you have already identified 34 serious deficiencies; correct? 35 A. In terms of? 36 37 Q. Fundraising. 38 A. Yes. 39 40 Q. I think you describe the organisations as being in a 41 position of a state of crisis; correct? 42 A. They were certainly in a state of crisis when I and 43 the other State Councillors were elected. The crisis has 44 reduced. 45 46 Q. That has reduced through the steps that have already 47 been introduced? .24/10/2017 (30) 3374 J A BROWN (Mr Cheshire) Transcript produced by DTI

1 A. Yes. 2 3 Q. But there's still a long way to go; correct? 4 A. Yes. 5 6 MR CHESHIRE: Thank you, Madam Inquirer. Thank you 7 Mr Brown. 8 9 MADAM INQUIRER: Does any counsel wish to ask questions of 10 Mr Brown? 11 12 MR SULAN: Madam Inquirer, with leave, I just have a few 13 questions on one aspect of the WBI restructuring proposal, 14 which should be no more than five or so questions. 15 16 MADAM INQUIRER: Anyone else? 17 18 MS HOGAN-DORAN: Unless something arising from Mr Sulan's 19 questions, no. 20 21 MADAM INQUIRER: Anyone else? 22 23 MR HERZFELD: No. 24 25 PUBLIC INQUIRER: Yes, Mr Sulan, I grant you leave. 26 27 <EXAMINATION BY MR SULAN: 28 29 MR SULAN: Q. Mr Brown, you gave some evidence that 30 there is a possibility that one part of the restructure may 31 result in two organisations, being LifeCare and RSL (NSW); 32 that's your evidence, is it not? 33 A. Yes. 34 35 Q. And that one consequence may be that WBI would then be 36 put down into a run-down phase; is that correct? 37 A. Yes. 38 39 Q. If that were to be the case, how long do you 40 anticipate it would take, in effect, to wind up WBI? 41 A. I believe original estimates had that happening over a 42 matter of greater than a year, but there are possibilities 43 to do that sooner, within a matter of months, not years. 44 45 Q. If that were to happen, obviously WBI would not be a 46 fundraising organisation? 47 A. That's correct. .24/10/2017 (30) 3375 J A BROWN (Mr Sulan) Transcript produced by DTI

1 2 Q. In terms of having an outcome where WBI ceases its 3 role, I understand you would be taking external legal 4 advice on those matters? 5 A. Yes, there would need to be legal advice on a range of 6 matters to do with ending the future of that trust. 7 8 Q. And that would be from external legal advisers engaged 9 by WBI Trustees; is that right? 10 A. Yes, that's right. 11 12 Q. If that were to happen, that is WBI was to be, in 13 effect, in run-down and cease fundraising, the legal 14 counsel that would be employed by RSL (NSW) would not have 15 any role with WBI; is that correct? 16 A. That would be appropriate given the different 17 interests. 18 19 Q. So the legal counsel employed by RSL (NSW) would be 20 solely counsel for RSL (NSW)? 21 A. Yes. 22 23 Q. And that would be the same for the Chief Compliance 24 Officer, that is, that person employed by RSL would have no 25 role with WBI? 26 A. I think you mean the Chief Governance Officer? 27 28 Q. Yes, 29 A. Yes, they would have sole responsibilities for 30 RSL (NSW) at that point. 31 32 Q. And they would have no role with WBI if it were to go 33 into run-down? 34 A. That's correct. 35 36 MR SULAN: Thank you, Madam Inquirer. 37 38 PUBLIC INQUIRER: Q. Is there anything further you would 39 like to say to the Inquiry, Mr Brown? 40 A. Madam Inquirer, you have listened to a lot of people 41 in this position over the last weeks. You have not heard a 42 lot from my members and I'm conscious that the intense and 43 rightful focus of this Inquiry has been on issues of 44 fundraising and significant deficiencies when it comes to 45 compliance with the fundraising legislation and 46 regulations. My members have been in constant contact with 47 me during this period, and other State Councillors. They .24/10/2017 (30) 3376 J A BROWN (Mr Sulan) Transcript produced by DTI

1 have been working through this period, they have been 2 volunteering, they have doing what they do in their 3 communities and what they do for veterans and families. 4 5 They have had three occasions on which to really give 6 formal voice to what they want to happen with the future of 7 this organisation. They voted for a candidate promising 8 extensive change before this Inquiry was even announced, 9 and they voted for that candidate with a majority. They 10 were presented with the opportunity to vote for a range of 11 Treasurer candidates and they again voted for the candidate 12 promising change and the candidate who objectively had the 13 best qualifications for the role. And they have responded 14 promptly to the survey we have sent out to them within 15 their capabilities. 16 17 I know that one of the big questions you have in your 18 mind is the future of this organisation and its commitment 19 to change and the question of whether we would ever fall 20 back to the ways of the past. At least speaking for 21 RSL (NSW), I would say, please, hear what the members are 22 saying about their commitment to change, and certainly when 23 it comes to WBI and LifeCare, please see the steps that 24 those organisations have taken to acknowledge and accept 25 the issues, to address them, and to make sure that this 26 never happens again. 27 28 Q. I take it from what you've just said to me that the 29 membership is heartily sorrowful for what has happened? 30 A. They are, Madam Inquirer. They are disgusted by what 31 has happened. They are sad about what has happened. They 32 are embarrassed by what has happened and they feel like 33 they've let the public down and they don't want to go back 34 to that place. 35 36 Q. You say that I haven't heard from the membership, but 37 it is true I've heard a great deal of evidence about the 38 wonderful work that the membership does. It may not have 39 featured greatly but certainly the work of the membership 40 has been subjected to a lot of evidence before the Inquiry 41 and it is in a lot of exhibits before the Inquiry, which of 42 course is the subject of the consideration when answering 43 the questions posed by the Minister, as to whether he does 44 have grounds to revoke the charitable fundraising 45 authority, or to grant one. 46 47 In the circumstances, as I apprehend what you're .24/10/2017 (30) 3377 J A BROWN (Mr Sulan) Transcript produced by DTI

1 telling me, it is that in the past it may be that the 2 grounds were there, but you're telling me that the grounds 3 are in fact disappearing; is that right? 4 A. Yes, Madam Inquirer. To go back to the words used by 5 Mr Cheshire in his opening address, we are - and I think 6 can speak confidently on behalf of all three 7 organisations - conscious that the ability to approach the 8 public and raise funds from them is a privilege and not a 9 right. 10 11 Q. Yes, thank you. Mr Brown, thank you. You may step 12 down. 13 A. Thank you, Madam Inquirer. 14 15 <THE WITNESS WITHDREW 16 17 PUBLIC INQUIRER: Yes, Mr Cheshire? 18 19 MR CHESHIRE: Thank you, Madam Inquirer. That completes 20 the oral hearings. There is a timetable for written 21 submissions which is on the website. Madam Inquirer, the 22 matter will be, as I understand, listed for Thursday, 23 9 November for oral submissions. 24 25 PUBLIC INQUIRER: Yes, thank you. I will adjourn until 26 then. 27 28 AT 1.11PM THE INQUIRY WAS ADJOURNED TO 29 THURSDAY, 9 NOVEMBER 2017 AT 10.00AM 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 .24/10/2017 (30) 3378 J A BROWN (Mr Sulan) Transcript produced by DTI