August 16th 2014

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Articles from this issue:

CANBERRA OBSERVED High noon for 'End of Entitlements' Joe Hockey

FOREIGN AFFAIRS Australia should help Iraq's besieged Christians

INTERNATIONAL AFFAIRS Locking up the dogs of war: huge decline in war-related deaths

WORLD WAR I The Great War at 100: Revisiting The Guns of August

EDUCATION 'Safe Schools' scandal: Open letter to the education minister

NATIONAL AFFAIRS Govt minister attacked for comments on cohabitation

EDITORIAL Baby Gammy case highlights weakness in surrogacy laws

NATIONAL AFFAIRS Web of criminality unveiled by royal commission

NATIONAL AFFAIRS The odd couple behind the same-sex marriage push

VICTORIA Labor leader in hot water over 'dirty' campaign

ENERGY Russian oil card a threat to European integration

CINEMA Understanding grace, mercy and suffering

BOOK REVIEW Pretext for Hitler's dictatorship: the Reichstag fire

BOOK REVIEW The feel-good policies that devastate

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Web of criminality unveiled by royal commission

by Peter Westmore

News Weekly, August 16, 2014

The Royal Commission into Trade Union Governance and Corruption, established by the Commonwealth government in March this year, has unveiled a web of corrupt practices.

Its findings are expected to lead to major legislative changes to improve unions’ accountability to their members and end standover tactics and intimidation perpetrated by some union officials in co-operation with criminal organisations, including outlaw motorcycle gangs.

A CFMEU official on a Grocon site 

The royal commission was established following years of hushed-up allegations of fraud in the Health Services Union involving senior officials, including Craig Thompson, later a federal Labor MP, and Michael Williamson, as well as intimidation in the building industry, and improper conduct by officials of several other unions.

The commissioner is Dyson Heydon AC QC, a former justice of the High Court of Australia, after having been a judge of the New South Wales Court of Appeal since 2000.

The royal commission was directed to look into five particular unions, some of whose officials have been the subject of repeated allegations of corrupt or improper conduct: the Australian Workers Union (AWU); the Construction, Forestry, Mining and Energy Union (CFMEU); the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia, better known as the Communications, Electrical and Plumbing Union (CEPU); the Health Services Union (HSU); and the Transport Workers Union (TWU).

It is set to deliver its final report by December 2014.

The vast majority of Australia’s unions, state and federal, are not the subject of this inquiry, but they could be affected to the extent that the royal commission recommends changes to the laws affecting organisations.

The justification for the royal commission is that police have been unable to put to rest a number of allegations, which go back years — except in the case of the HSU, two of whose former officials have been tried and convicted of misusing union funds, years after the allegations surfaced.

The matters before the royal commission fall into two categories: those involving misuse of union members’ funds internally, and the abuse of union power, as has been repeatedly alleged in the building industry.

In its public hearings, the royal commission heard sensational allegations of threats and intimidation by the CMFEU directed at some of the largest construction firms in Australia, and their suppliers.

The commission was told that the union effectively controls the industry in some states, forces construction companies to employ union hacks, and uses standover men and threats against employers.

One of Australia’s largest building companies, Grocon, which has a long history of standing up to the CFMEU, made damaging allegations against the union, which has repeatedly ignored court orders to lift illegal bans on construction.

Building suppliers such as Boral were then ordered by the union not to supply concrete to Grocon projects. When Boral refused, it was then subject to black bans by the union.

Boral’s chief executive, Mike Kane, told the royal commission that Boral had been frozen out of almost all high-rise work in Melbourne’s CBD after the union imposed a black ban on its products. Mr Kane alleged that after he refused to stop supplying concrete to Grocon, Boral was prevented from supplying about 70 other building sites, leading to a massive slump in market share and losses of more than $8 million.

“This is a criminal conspiracy to interfere in the marketplace and to stop our ability to supply our customers,” Mr Kane said.

“It’s blackmail by any other definition that I’ve ever heard of and it’s been effective.”

Despite winning a Supreme Court injunction against the alleged ban last year, Mr Kane said Boral trucks were still being turned away from work sites and customers had stopped approaching Boral for quotes.

“We have complained to every federal and state government agency that would listen to us, [but] as we sit here today in the Melbourne CBD it is in full force and effect.”

Mr Kane said there seemed to be no legal recourse against the CFMEU’s “cartel behaviour”.

Police have been unable or unwilling to prosecute the breaches of the law.

The ACTU’s response to the royal commission has been predictably aggressive. While claiming that the ACTU does not condone corruption, the ACTU secretary, Dave Oliver, said: “The royal commission has been designed to tie unions up in a long and expensive inquiry that will ultimately make it harder for them to represent their members.

“The Abbott government is delivering for the radical ideologues that hate unions, hate the important role they play, oppose regulations that protect workers, believe there should be no minimum wage, no rights to unfair dismissal, that don’t support the right to collectively bargain, and want to drive down the wages and conditions of Australian workers.”

He said that allegations of impropriety should be investigated by police — yet police investigations have failed to stop what is clearly criminal conduct.

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