The Kourakis royal commission has opened with cabinet-in-confidence documents indicating that Jacinta Allan was warned more than three years ago about serious problems surrounding Victoria’s Big Build.
At its first public hearing, held only a month after the commission received its letters patent, the inquiry published documents detailing concerns about organised crime figures appearing at major construction sites and allegedly intimidating contractors.
Commissioner Chris Kourakis used the opening hearing to set out the standards he expects governments, public agencies and unions to meet as the inquiry examines Victoria’s infrastructure programme.
He said governments must select and design infrastructure projects according to the “socioeconomic needs of the Victorian public, and not party political interests”.
The commission is expected to consider whether that principle was followed in the development of projects including the Suburban Rail Loop, the expanded level crossing removal programme and the proposed airport rail link.
It will also examine how projects were managed after they were approved, including the response of ministers and senior officials to risks on construction sites.
Documents detail concerns about Big Build sites
The material released at the hearing records concerns held by the Major Transport Infrastructure Authority, the agency responsible for major road and rail projects, about organised crime figures attending Big Build sites and potentially standing over contractors.
Allan wrote to the then chief commissioner of Victoria Police, Shane Patton, the day after receiving the information in June 2023. The commission will examine whether that response was sufficient and what further action was taken by Allan, MTIA chief Kevin Devlin and other officials.
The concerns arose while the North East Link, West Gate Tunnel, Metro Tunnel and level crossing removal projects were under construction. The CFMEU also held significant influence across the industry, while the Australian Building and Construction Commission was facing its impending closure under the newly elected Albanese government.
Counsel assisting the commission, Chris Young KC, said the circumstances raised questions about whether ministers and officials had acted quickly enough to protect contractors and the integrity of the Big Build.
Kourakis also warned union officials that their powers and privileges under industrial relations law carried a particular responsibility.
“It is an especially egregious breach of trust to abuse those privileges and powers for personal gain, and there can be no tolerance at all for the carpetbaggers who corrupt an industry through extortion and bribery, whatever euphemisms they may employ to hide what they really do,” he said.
Chris Carr SC, another counsel assisting the inquiry, said it had been alleged that CFMEU bosses in Victoria used their power to enrich themselves and organised crime figures who had infiltrated the union, rather than serving members.
Several subcontractors involved in the Big Build are alleged to have paid hundreds of thousands of dollars to Mick Gatto and other organised crime figures to secure union-backed enterprise bargaining agreements.
“These are grave allegations,” Carr said. “Their accuracy will need to be carefully assessed.”
He said that, if proven, the claims would suggest the CFMEU had acted as a facilitator for organised crime and that the Big Build had involved a major transfer of wealth from taxpayers to criminal figures.
