The federal government will intervene in the administration of Queensland Nickel to bring forward $70 million in entitlement payments owed to workers and to chase parliamentarian Clive Palmer for the bill.
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The payments will be made under the fair entitlements guarantee (FEG) and the figure is double the largest payout under FEG.
The government will also apply to the courts to appoint a special purpose liquidator, top insolvency practitioner Stephen Parbery from PPB Advisory, to recoup the $70 million on behalf of taxpayers.
A government source said "we won't let this guy drive off into the sunset in a Bentley and leave taxpayers on the hook".
This week administrators at FTI Consulting issued a damning report on the collapse of Queensland Nickel which found the company had been treated as a "piggy bank" to advance Mr Palmer's political and business interests including vintage cars, tropical resorts and the parliamentarian's ill-fated Titanic II project.
Administrators found a staggering $201 million that was transferred from Queensland Nickel to entities associated with Mr Palmer, leaving nothing to pay out workers who lost their jobs when the company went under.
If the court approves Mr Parbery's appointment, he will work together with FTI Consulting's John Park to extract as much money as possible back for creditors.
Employment Minister Michaelia Cash said the administrators' report released this week made it clear there was no rescue option on the table for the company.
"We are doing this because of the unique and alarming circumstances in this case – where a current member of parliament and self-reported wealthy Australian businessman is directly involved," Ms Cash said.
"Taxpayers across Australia can rest assured that the government will use every power at its disposal to ensure the corporate dealings of this joint-venture arrangement are thoroughly investigated and responsible company officers are held to account," Ms Cash said.
"The government wants to send a clear message that in appropriate cases the government is prepared to step in to assist in ensuring that employee entitlements are recovered in full from any companies or individuals that have profited from the endeavours of hard working Australians," she said.
FEG representatives will be in Townsville next week to support workers through the claim process and information sessions will be held at the Mercure Hotel in Townsville.
"I'm confident that FEG will ensure workers receive their unpaid entitlements quickly, which means the workers will no longer have to endure the financial uncertainty of waiting around for the Queensland Nickel joint-venture partners to do what they should have done from the start," Ms Cash said.
"As FEG is now part of the solution for workers, the government will examine the range of actions available under the FEG Recovery Programme to ensure the many suspect issues identified by administrators are fully investigated," Ms Cash said.
Mr Palmer did not return calls.
