ICAC: Eddie Obeid lobbied Nathan Rees over Australian Water Holdings without revealing interest

Former Labor premier Nathan Rees has told a corruption inquiry that his crooked former colleague Eddie Obeid lobbied him about a company "on the steps of parliament" without revealing his family was involved in the company.

Mr Rees, whose evidence at the Independent Commission Against Corruption took less than five minutes on Tuesday, said he had a "corridor-type discussion" with Mr Obeid about infrastructure company Australian Water Holdings.

"I think it happened on the steps of Parliament," Mr Rees said.

Mr Rees, who was water minister at the time, said Mr Obeid wanted him to meet the chief executive of the company, Nick Di Girolamo.

He said Mr Obeid did not reveal his family had an interest in the company, nor that his youngest son, Eddie junior, was an employee.

The commission is investigating allegations the Obeid family had a secret 30 per cent stake in Australian Water and that Mr Obeid corruptly lobbied colleagues to benefit the company.

Mr Obeid is expected to give evidence on Wednesday morning.

Outside the inquiry, Mr Rees said he could not remember calling Australian Water "a bunch of crooks", a phrase former Sydney Water boss Kerry Schott recalled he used when she gave evidence at the inquiry.

But Mr Rees said her memory might be better than his.

Later on Tuesday in the hearing, Laurie Brown, a former adviser to Mr Obeid's political allies Joe Tripodi and Tony Kelly, agreed Mr Tripodi changed a cabinet minute in 2010 which had the effect of benefiting Australian Water.

Mr Tripodi was a backbencher at the time but Mr Brown agreed he and Mr Tripodi had "frequent meetings" about the company.

"He was pretty passionate about it," Mr Brown said.

"He was writing his own cabinet minute?" counsel assisting the inquiry, Geoffrey Watson, SC, asked.

"That's what he told me," Mr Brown replied.

Asked why the changes to the cabinet minute were made "in-house", Mr Brown said the Department of Premier and Cabinet were "steadfastly" opposed to it.

The original minute had recommended the government should not enter into talks with Australian Water for a public-private partnership.

The inquiry has heard the Obeids could have made up to $60 million from the PPP.

Mr Brown said Mr Tripodi made changes to the minute and gave it to him "on a disc".

He gave a copy to Mr Kelly, who eventually attempted to submit it to cabinet for approval after further changes were made.

Mr Brown said one of Mr Tripodi's sources for the changes was Australian Water. He agreed no attempt was made to verify the accuracy of the assertions in the minute.

"That's bad government, isn't it?" Mr Watson said.

"Yes, I'm agreeing with you," Mr Brown said.

Mr Brown, who has been friends with Mr Obeid for 20 years, denied he was doing the Labor powerbroker a favour or that he was aware of his family's interest in the company.

Former premier Kristina Keneally gave evidence last month that "this was the cabinet minute that wouldn't die - until I drove a stake through its heart".

The commission continues.

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