Breaking the Sheep's Back

Breaking the Sheep's Back is the untold story of Australia's biggest business disaster. It involves government complicity and is a political scandal that reaches into the offices of Cabinet ministers and prime ministers across six federal governments.

In only twenty years, from 1989 to the present, the Australian wool industry—once the nation-building iconic representation of the country—has been cut to only a third of its size, due in large part to this disaster. When the Australian Wool Corporation's Reserve Price Scheme collapsed in January 1991, there was a 4.8-million-bale stockpile of unwanted wool, and its bankers were left owing $3 billion in government-guaranteed debt.

During the years leading up to the crash, the Wool Corporation and its affiliates recklessly spent a further $5 billion of woolgrower and government funds. With the crash, the international wool trade lost billions of dollars, all due to Australian government-sanctioned statutory intervention. The combined losses of at least $10 billion constitute Australia's largest business disaster by far, and the social costs are ongoing.

By comparison, the AWB scandal involved funds one-thirty-thousandth the size. Yet, despite this politically sanctioned wool disaster, including the close involvement of successive federal governments and its agencies throughout, there has never been a royal commission.

Breaking the Sheep's Back is a private royal commission—over eight years in the writing, and involving a colourful and intriguing cast of characters. It is written by someone who was intimately involved in the industry at many levels; who was appointed by a federal minister to statutory boards after the disaster; who has spoken to most of the key players involved, and to those who were inside the Cabinet offices and Corporation and other board rooms; and who has had access to the key documents (such as board papers, government papers, and private correspondence).