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Line 9: Minerals and Energy Minister [[Rex Connor]] wanted funds for a series of national development projects. He proposed that to finance his plans, the government should borrow US$4 billion (equivalent to US$ {{inflation\|US\|4\|1974}} billion in {{Inflation/year\|US}}). It was a requirement of the [[Australian Constitution]] for non-temporary government borrowings to be through the [[Loan Council]]. Although the development projects were long-term, Whitlam, Cairns, Murphy and Connor authorised Connor to seek the loan on 13 December 1974 without involving the Loan Council. Connor had already been investigating the loan. Through an Adelaide builder, he had been introduced to the Pakistani dealer Tirath Khemlani. According to Khemlani, Connor asked for a 20-year loan with interest at 7.7% and set a commission to Khemlani of 2.5%. Despite assurance that all was in order, Khemlani began to stall on the loan, notably after he was asked to go to [[Zurich]] with officials of the [[Reserve Bank of Australia]] to prove that the funds were in the [[Union Bank of Switzerland]], as he had claimed. The government revised its authority to Connor to $2 billion.<ref name="ReferenceA">Brian Carroll; From Barton to Fraser; Cassell Australia; 1978</ref> Khemlani played a pivotal role. and was employed by Dalamal and Sons, a London-based commodity-trading firm.<ref> {{cite news \| url=http://www.theage.com.au/news/national/the-middleman-who-caused-the-blowup-of-1975/2005/10/28/1130400363882.html Line 47: The affair embarrassed the Whitlam government and exposed it to claims of impropriety. [[Malcolm Fraser]] led the opposition, which used its majority in the [[Australian Senate\|Senate]] to block the government’s budget legislation, thereby attempting to force an early general election by citing the loans affair as an example of ‘extraordinary and reprehensible’ circumstances. Fraser told Parliament that the government was incompetent, and the opposition [[Coalition (Australia)\|Liberal-Country Party Coalition]] delayed passage of the government's money bills in the Senate with the intention of forcing the government to an election.<ref>{{cite web\|url=http://primeministers.naa.gov.au/primeministers/whitlam/in-office.aspx#section12 \|title=In office – Gough Whitlam – Australia's PMs – Australia's Prime Ministers \|publisher=Primeministers.naa.gov.au \|url-status=dead \|archiveurl=https://web.archive.org/web/20130419124214/http://primeministers.naa.gov.au/primeministers/whitlam/in-office.aspx \|archivedate=19 April 2013 }}</ref> Whitlam refused to call an election. The deadlock came to an end when Whitlam was [[1975 Australian constitutional crisis\|dismissed by the Governor General]], [[John Kerr (governor-general)\|Sir John Kerr]], on 11 November 1975 and Fraser was installed as caretaker prime minister pending an election. At the [[1975 Australian federal election\|general election held in December 1975]], Fraser led the Coalition to a landslide victory.<ref name="autogenerated1">{{cite web\|url=http://primeministers.naa.gov.au/primeministers/fraser/before-office.aspx \|title=Before office – Malcolm Fraser – Australia's PMs – Australia's Prime Ministers \|publisher=Primeministers.naa.gov.au \|date=}}</ref> ==In popular culture==

Loans affair: Difference between revisions