Victorian Big Build royal commission opens on an embarrassing note for Labor Government
Construction giant John Holland concluded in 2019 that the CFMEU had ‘unprecedented access to ministers’ in the Andrews Labor government. Here is the latest.
The first public hearing of Victoria’s royal commission into corruption in the CFMEU started with an embarrassing revelation about the State’s Labor Government’s close relationship with the notorious union.
An internal memo from construction giant John Holland Group warned in 2019 the construction union’s access to Daniel Andrews’ Labor government could allow the union to influence building projects.
“The union movement played a critical role in the election of the government, both organisationally and financially,” the memo said. “The premier is factionally aligned with the Socialist Left and the CFMEU is the key industrial organisation in that faction.
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By continuing you agree to our Terms and Privacy Policy.“We also understand the CFMEU have unprecedented access to ministers and other key Victorian government stakeholders. We reasonably expect that the CFMEU in particular will have a substantial amount of knowledge around proposed government tenders and input in respect to the tender process.”
With a State election three weeks away, the description of the notorious union’s political influence is unwelcome news for Labor Premier Ben Carroll, who was appointed to distance the Government from predecessors Daniel Andrews and Jacinta Allan.
Mr Carroll has sought credit for appointing the Big Build royal commission, which is investigating corruption on infrastructure projects under governments he was a minister in.
The Gap
Monday’s hearing concentrated on one project, a $110 million rail underpass in the outer Melbourne suburb of Sunbury known as the Gap Road project.
Built by John Holland and CPB Contractors, construction was disrupted by union officials on June 6 and 7 during a crucial 26-day period in 2022 when trains had been stopped to give the builders access to the rail line.
The inquiry’s lead barrister, Chris Young KC, said union officials did not have the legal right to shut down Victorian work sites. That was limited to health and safety representatives present on the site or public servants from WorkSafe Victoria.
Nonetheless, four union officials arrived at 7.15am and complained about safety breaches, Mr Young said. Even though the complaints were minor and fixed within hours, including out-of-date paperwork for two concrete trucks, union officials remained at the site until 1.42am, according to company logs.
Employees of a piling company hired to place supports for the bridge in the ground were told they would be assaulted if they tried to work that evening, Mr Young said.
“You guys better not turn up tonight, otherwise we will smash you during the day,” he said they were told.
The union officials, who returned the next day at 6.45am, stopped work by sitting on movable barriers, which needed to be shifted for construction to proceed, according to evidence read to the inquiry.
The police were called and turned up, but didn’t resolve the stand off.
“I think they’re afraid to sort of take any action,” the site’s health and safety manager, Neil Thompson, said in a phone call played to the inquiry.
The call was of a recording between Mr Thompson and WorkSafe, an agency responsible for ensuring work sites are safe. “They’re sitting on water barriers when we’re trying to lift things,” Mr Thompson said on the call. “They’re effectively stopping work.”
When Mr Thompson asked when he could expect help from WorkSafe, the woman on the call said she was a message taker and would pass on the information.
On the afternoon of June 7 a meeting was held with the CFMEU. No record of what was discussed was recorded, but work on the underpass restarted afterwards after 36 hours disruption. A WorkSafe inspector arrived the next day.
After the meeting the project’s forecast cost went up at the site by about $6 million, according to Mr Young, and extra people were hired from a firm called BK Labour Hire, which had its licence cancelled in January.
Questions for business
While corruption within the CFMEU has been widely covered in the media for years, relatively little information about potential complicity by construction companies has become public.
As well as the construction union, the royal commission is investigating lead contractors, subcontractors, labour hire firms and industry bodies, Mr Young said in his opening statement
All have been asked in writing to disclose any corruption or serious misconduct they may have been involved in. Of 99 organisations approached, 45 have responded and three declined, he said.
“Some of those responses have been frank and helpful,” Mr Young said. “Several disclosed conduct that appears to be misconduct, corruption or crime.
“They include allegations of the involvement of organised crime on projects and of fraud, including invoices for shifts that weren’t worked. Other responses were not helpful. Some appear on their face to be untrue.
“In at least one case, a company’s response cannot be reconciled with what one of its directors later said under compulsion.”
The inquiry, which has until August 20, 2027, to report and is being conducted by South Australian lawyer Christopher Kourakis, has already held 24 hearings. All were in private.
The Victorian Coalition, which first proposed a royal commission, has said that it may enlarge the inquiry’s scope if it wins power on November 28.
Betting markets indicate the Opposition will win the election easily.
