Victorian premier blames ‘inflation not corruption’ for Big Build cost blowouts amid fresh allegations | Victorian politics

Jacinta Allan has declared that “inflationary pressures on projects are not corruption”, resisting growing calls for a royal commission into corruption allegations related to Victoria’s $100bn Major Construction.

It came after an investigation by . Nine newspapers and 60 Minutes reported the allegations that money from the state’s Big Build infrastructure projects was being paid to gangland figures and that the state government had been warned of cost increases due to demands by the Construction, Forestry and Maritime Employees Union (CFMEU).

Nine’s Building Bad investigation reported: infrastructure companies have repeatedly warned the Victorian government Between 2022 and 2024, CFMEU’s demands increased labor costs in the Metro Tunnel.

Referenced in the leaked consortium report Nine’s Building Bad investigationhas warned the state government of cost increases of 22% above what is required under current industry norms in Victoria. It is estimated that $196.4 million in labor costs were due entirely to union-supported staff, outlining how contractors were forced to add additional unproductive workers.

According to Nine, the consortium stated that it had bowed to the CFMEU’s demands with the support of the Labor government.

Before becoming premier, Allan was the minister overseeing the state’s Big Build program between 2018 and 2023. Speaking at a press conference on Monday, Allan said he had not read the consortium’s report.

Referring to the news about the Metro Tunnel, Allan said that the wages of union workers are more expensive because they come with “better” and “safer” conditions.

“It’s a cost, but it’s a cost that’s related to supporting these workers to do this work to bring projects to life,” he said.

Allan said “fair wages” for unionized workers were part of inflationary pressures on projects like the Metro Tunnel.

“Inflationary pressures on projects are not corruption,” he said.

The Nine investigation also found that money from the state’s Big Build infrastructure projects continues to flow to mob figures after an almost two-year government attempt to clean up corruption.

Asked if corruption still existed at Big Build, Allan said he accepted allegations had been made and that “anyone claiming to have evidence” should report it to Victoria Police.

Allan defended his administration, saying, “There is no evidence of government corruption in the Grand Establishment.”

Allan stated that he was confident that Victoria police and the Labor Hiring Authority were given sufficient authority to eliminate any abuse, and said that in the last two years, the authority had canceled 164 construction industry licenses and the police had laid 93 charges.

“After all this time, if there is any evidence of alleged criminal conduct involving corruption and extortion, I do not understand why this was not immediately reported to Victoria Police,” he said.

Victoria’s opposition leader Jess Wilson said on Monday Nine’s reporting showed “corruption continues today”.

“Payments to underworld figures continue under the supervision of Prime Minister Jacinta Allan,” he told reporters.

Alla continued to resist calls for a royal commission, saying it amounted to a “call for delayed action” and would not lead to cultural change on the job sites.

Victoria’s former ombudsman, Deborah Glass, and Robert Redlich, the former commissioner of the Independent Broad-Based Anti-Corruption Commission, said in a joint statement that a royal commission was urgently needed.

Deputy federal opposition leader Jane Hume on Monday called for a royal commission and a pause in funding for the state’s infrastructure projects, pointing to Queensland’s CFMEU commission of inquiry.

“I believe you have to eliminate the elements of corruption before you can continue to give taxpayers money for these projects,” he told ABC radio.

Allan rejected Hume’s call for the projects to be halted, saying “we will see immediate layoffs of tens of thousands of workers”.

A report tendered by barrister Geoffrey Watson SC during the Queensland inquiry in February estimated Big Build corruption involving the union had cost Victorian taxpayers up to $15 billion.

The Allan government rejected this figure at the time as “unfounded”. In an interview with the ABC’s 7.30 program this month, Allan refused to put a figure on how much CFMEU corruption had cost the state.

Big Building It began following the election of the Labor government led by Daniel Andrews in 2015. It includes major road and rail infrastructure projects such as the recently opened Metro Tunnel and the contentious Suburban Rail Loop.