As Victoria approaches a state election later this year, the incumbent Labor government is campaigning for a fourth term, facing significant scrutiny over its handling of thuggery and corruption in the construction industry, particularly involving the Construction, Forestry and Maritime Employees Union (CFMEU). The federal government, responding to extensive reporting by The Age, appointed an administrator, Mark Irving, in 2024, to address the union’s issues.
A crucial report by Geoffrey Watson SC, an expert in anti-corruption law, revealed the union’s descent into criminality, particularly during the execution of Victoria’s Big Build infrastructure program. Watson estimated that the CFMEU overcharged Victorian taxpayers by A$15 billion, asserting that a substantial portion of these funds ended up benefitting criminals and organized crime syndicates.
In response to Watson’s findings, the Allan government reacted with indignation, which has sparked discussions on the necessity for a royal commission into these allegations. Watson highlighted the severity of corruption in Victoria compared to other Australian states, advocating for a dedicated inquiry equipped with the powers to compel evidence, rather than relying on the already burdened Independent Broad-based Anti-corruption Commission (IBAC), which is tasked with a wide scope of public sector corruption investigations.
Watson explained that a standalone inquiry with royal commission-like powers is essential to thoroughly investigate the corruption and to propose measures to prevent future occurrences. He expressed skepticism about re-establishing the Australian Building and Construction Commission (ABCC), suggesting that it had failed to manage the CFMEU’s misconduct effectively in the past.
Discussing his $15 billion estimate, Watson indicated that he based it on conservative figures derived from interviews with longstanding civil contractors who described significant cost increases after the CFMEU took over from the Australian Workers Union (AWU). These contractors reported cost escalations of 10% to 30%, which Watson applied to an estimated $100 billion in expenditures on Big Build projects.
Despite the controversy surrounding his findings, Watson reported that no Victorian politician had approached him for clarification prior to the government’s criticisms. He expressed disappointment over the personal attacks directed at him, insisting that his calculations were grounded in solid research and deserved serious consideration rather than dismissal without justification.
The situation underscores a pervasive climate of corruption within the CFMEU and a critical need for accountability in Victoria’s construction sector. Watson’s call for a royal commission aims to shed light on these issues, ensuring that the misallocation of taxpayer funds is addressed, and that similar incidents do not recur in the future.
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