Government wearing two hats

The Government is both a majority shareholder of Telstra and a regulator of Telstra. So when Telstra informs the Government of market sensitive news, did Telstra also have an obligation to inform the rest of the shareholders?

Issues:

1. It could be argued that Telstra is negotiating with the Government playing it's role as the regulator. However, clearly talking about having to borrow money to pay dividends doesn't sound like regulatory issues to me.

2. The other option is to argue that the information is already readily available, and that financial analysts could already deduce that information from public records.

3. Now if there were additional information that was made available to the Government and the Government is acting on the information to sell its shares to the disadvantage of other people in the market, does this constitute as insider-trading?

4. The government argues that it is illegal for them to reveal the substance of discussion to the general public, under advice from the Department of Finance.

"The reality is that according to the advice I have from the Department of Finance, and from my own department, it would have been against the law for the Government to have done so," he told Parliament.

How come he didn't ask the Department of Attorney General. I thought that when two laws contradict, the newer law has legal effect. Apparently, the information was "... provided to the Government in accordance with the Telstra Corporation Act".
(I'll look these up later)

Oooh, so many questions. Let's so not-have-another-enquiry-this-time-because-no-heads-are-going-to-roll-and-maybe-someone-will-get-a-plum-ambassador-appointment-again.