Unions say top economist debunks Watson report. He’s never read it
A leading economist whose work has been used to attack the $15 billion cost estimate for the CFMEU’s egregious conduct at the Grand Building says he was never asked to investigate the cost of the union’s misconduct, as the campaign backing his investigation claims.
Independent economist Saul Eslake said: Age Premier Jacinta Allan had no idea that her study, which she also cited to downplay the CFMEU’s impact on the budget, would be used by the Victorian plumbers union to discuss the cost of union corruption.
His study is one of two presented on the website Check the Maths that criticize the $15 billion figure. Records show the site is owned by the Communications, Electrical and Plumbing Association.
The campaign emerged late last month and used advertising. messenger of the sunsocial media and podcasts are challenging barrister Geoffrey Watson, SC’s estimate that the CFMEU’s cost of abuse at Victoria’s Big Build equals about 15 per cent of the $100 billion programme.
Watson’s estimate was included in a report presented to the Queensland commission of inquiry, and the $15 billion figure became a political headache for Allan, who dismissed it as untested and unsubstantiated.
Although this imprint reveals that the government’s infrastructure tsar sits on a senior panel that estimates the CFMEU’s lawlessness and criminality has led to blowouts of up to 30 per cent on taxpayer-funded projects, Allan still attacks that figure. This assessment was supported by the director general of the Fair Work Commission Murray Furlong.
Furlong received at a meeting in October and Age It shows that, under freedom of information laws, a senior Victorian public servant was quoted as estimating a “30% CFMEU premium”. [Big Build] Over the weekend, public officials disputed Furlong’s account.
Construction unions attempted to discredit Watson’s $15 billion figure, with groups such as the Electrical Trades Union and Trades Hall sharing the plumbers’ Check the Maths website. “We asked a public policy professor and an economist to check the Math of the fake ‘$15 billion megastructure,'” this site writes.
However, the economist Eslake mentioned in this sentence said that his study was not done this way.
He said he had initially examined cost inflation as an expert witness for the state government in a trade dispute in Victoria, which showed, to his surprise, that the state’s latest engineering cost inflation was below the national average.
Eslake, a respected economist who has been a harsh critic of the state government’s economic management, said he was later contacted by Andrew Landeryou and asked if he had done such a study.
The Economist confirmed to Landeryou, long a colorful figure in Labor circles, that he had but needed to update the figures. Landeryou declined to comment when contacted by this imprint.
Eslake also declined to provide details of his fee but said the bill was paid by the Plumbing Industry Climate Action Center [PICAC]is a registered training charity run by the plumbers’ union and employers’ representatives.
Eslake said he never read Watson’s report, although he was aware of this.
“Honestly I had no idea [his research] “It’s used that way,” he said. “I don’t think what I wrote proves or disproves anything about corruption. It doesn’t tell you anything about who benefits from the increase in prices; It doesn’t say anything about its distribution.
“I was not asked to make any decisions about the Grand Building, and I did not make any decisions, but I was clearly aware that the Grand Building was an important component of Victorian engineering construction expenditure.”
On Monday, Allan again cited Eslake’s work, arguing that booms and price increases on Big Build projects were due to inflation, not union abuse.
“Economists such as Saul Eslake have pointed out that inflation rates in Victoria, for example, are lower than those experienced in other states,” he told a press conference, where he apologized for his behavior on construction sites exposed by this imprint’s Building Bad investigation.
Not all construction companies agree. Leaked documents show that builders on the Metro Tunnel project in 2024 are trying to claim at least $200 million in extra costs due to out-of-control industrial relations, which they separate from inflation in the sector and the economy in general.
The use of PICAC to pay for a report assessing Big Build corruption costs has sparked backlash, given that its primary purpose is as a training organization offering courses as a “centre of excellence” for the plumbing industry.
Plumbers union secretary Earl Setches, who sits on the PICAC board, was on long-term service leave and was unavailable for comment. The deputy secretaries and PICAC have been contacted for comment.
The Australian Charities and Not-for-Profits Commission’s advice to charity board members is to spend their funds on relevant services.
“No matter how charity funds are raised, the board should ensure that the money is spent on the charitable purpose of the charity, after deducting reasonable expenses,” the commission’s recommendation reads.
A spokesman for the commission did not comment on PICAC other than to say that its registration is up to date and that there are generally circumstances in which it is appropriate for charities to advocate.
“ public interest The purpose of advocacy is its contribution to public debates that inform the public and policymakers,” the spokesperson said.
“However, the manner in which a charity undertakes advocacy and its aims must be consistent with the rule of law and the established system of government. It is important that charities do not cross the line into a disqualifying political aim and maintain independence from party politics.”
Separately, shadow attorney general James Newbury on Monday cited allegations that state government officials told the state’s corruption watchdog about the level crossing project to get builders to strike a deal with the CFMEU.
Last week, Age It emerged that state government officials told the Big Build rail consortium that Allan, then transport infrastructure minister, had asked the builders to negotiate a deal with the CFMEU that would ultimately allow the disgraced union to force its preferred labor hire company onto the level crossing removal site.
Allan denied the allegations and dismissed them as unfounded.
As a result of these negativities, police claimed that BK Labor, the company that provided access to the Gap Road project in Sunbury, was corrupt.
“We are not talking about a full-blown issue. This is at the heart of the corruption scandal facing our state,” Newbury’s letter to the Independent Broad-Based Anti-Corruption Commission said. “This is a very serious guidance and I hope IBAC will take it into consideration.”
Newbury accused the prime minister of making a “fake apology” ahead of November’s state election and pointed to an opinion column: Age He said he was “deeply saddened” by the violence, intimidation and organized criminal behavior on taxpayer-funded projects.
“The only way the Prime Minister’s apology can be believed is if he calls the royal commission and doesn’t call it,” he said.
On Monday, Allan again rejected calls for a royal commission.
“Anyone who wants a royal commission is actually asking for a postponement of action,” he said.
The Prime Minister said Victoria Police, the Labor Hiring Authority and state and federal regulators were focusing on efforts to weed out bad actors and shut down their access to the industry.
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