Premier blames inflation not CFMEU corruption for Big Build cost blowouts
Prime Minister Jacinta Allan has sought to blame inflation rather than the CFMEU’s corruption and ad-hoc tactics for the cost blowout of one of the signature projects she oversaw as minister responsible for the Big Build.
In a long and contentious meeting with journalists on Monday, Allan refused to heed calls for a royal commission from integrity figures – former IBAC chief Robert Redlich, former ombudsman Deborah Glass and barrister Geoffrey Watson, SC – and insisted Victoria Police had the power and resources it needed to weed out “rotten elements” from the state’s construction industry.
He said he had not read a lengthy report prepared by contractors working on the Metro Tunnel. revealed by this mastheadThis puts a $196.4 million price tag on the surcharge bill to be paid for “excessive” labor costs.
“Inflationary pressures on projects are not corruption,” Allan said. “People know that the cost of building things is increasing, whether it’s building a house or large projects.
“This includes material supply and workers’ wages; these have increased over the last 12 years, and this includes the pandemic period. Now this is not corruption, it is inflation.”
While inflation and disruptions to global supply chains will significantly increase construction costs as Victoria emerges from the pandemic, the report compiled by contractors involved in the Metro Tunnel identifies separate, additional costs caused by union industrial demands for unproductive workers to be recruited on site.
These workers included additional crane monitors, traffic controllers and cleaners who, in the contractor’s opinion and industry standards, were beyond what was required to deliver the project safely.
Allan refused to accept that wage bills for the projects were excessive or that the union’s unfair demands increased the cost to taxpayers.
“What we know and have known since then is that wages for unionized workers, wages for unionized workers come with fairer wages, better conditions, safer workplaces, and that is a cost, but it is a cost associated with supporting those workers to do that work to get projects done,” he said.
“My responsibility as minister was to ensure that these projects were delivered and to ensure that the work was done by the institutions to ensure that these projects were delivered.”
He reiterated his opposition to a royal commission into Big Build corruption, saying it would lead to delayed rather than immediate action, and expressed confidence in Victoria Police, the Labor Hiring Authority and the Independent Broad-Based Anti-Corruption Commission to deal with any allegations of crime or corruption related to major projects.
“I have confidence in Victoria Police and I have confidence in the work of Victoria Police and the additional powers we have given Victoria Police,” the Prime Minister said.
“After all this time, if people have information or evidence, I don’t understand why they don’t refer it to Victoria Police immediately.”
Allan said he watched the show on Sunday night. 60 Minutes The program cataloged how Mick Gatto, a survivor of Melbourne’s early 2000s gang war, placed himself as a middleman between the cartel-like CFMEU and contractors and labor hire companies seeking to secure work on Big Build projects.
However, he did not want to publicly admit that Gatto had profited greatly from this arrangement.
“If there is evidence that their behavior leads to criminal conduct this should be reported to Victoria Police,” he said.
Watson, who led a commission of inquiry into the CFMEU by the union’s own executives, estimates the cost of Big Build corruption at $15 billion.
Allan rejected Watson’s accusation that he had failed to take personal responsibility for Big Build corruption under his watch as a minister and now prime minister – “he is wrong” – and cited the number of charges leveled by police and licenses revoked by the Workers’ Hiring Authority since the scandal first emerged two years ago.
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Chip Le Grand leads our state politics reporting team. He had previously served as the newspaper’s chief correspondent and was a journalist with 30 years of experience.Connect via email.
