Source : the age
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Counsel assisting Chris Young produces another document from inside John Holland highlighting the CFMEU’s influence on the Andrews government which at this point – in August 2021 – was grappling with the height of the COVID-19 pandemic and associated lockdowns.
“It’s a level of influence not seen in previous years and is unlikely to diminish in the next and subsequent elections,” it reads.
“This means our engagement with the CFMEU should be seen as part of a broader strategy to better position our business with the state government.”
More documents have been tendered from John Holland. In a memorandum from April 2021, John Holland staff outlined the shifting industrial landscape with the AWU sidelined in favour of the CFMEU and the difficulties for contractors.
“A CFMEU regional agreement means all projects are forever forced to change the way they work. It impacts everything from current and future tenders to our day-to-day operations,” it reads.
An agreement would mean management would lose rights such as decisions on employment and subcontractor selection. The health and safety representatives would be “universally empowered and extremely difficult to remove from one project to the next”, it reads.
According to the documents, the union advised John Holland and its joint venture projects were “considered targets, regardless of division”.
Quoting from the document, Young says: “In addition, there remains a negligible amount of civil subcontractors and a handful of labour hire companies with AWU agreements. As the CFM deal increases pressure on all contractors, subcontractors and labour hire companies, these AWU subcontractors will cease to exist. Indeed, there is a general view. The AWU will cease to exist in Victorian civil construction in the short to medium term, even their coverage in tunnelling is under extreme threat due to rapid organising.”
The company warns its short-term strategy should be to prepare “all sites for some form of a CFMEU campaign”.
The memo also noted the significant relationship between the CFMEU and the state Labor government.
“It is worth noting the significance of the CFMEU’s relationship with the Andrews government in Victoria and the impact this is having and will have in the future with respect to client relationships with the Victorian government.”
The document reads that the union movement played a “critical role” in the election of the government, organisationally and financially.
“The premier is factionally aligned with the socialist left, and the CFMEU is the key industrial organisation involved in that faction. We also understand that the CFMEU have unprecedented access to ministers and other key Victorian government stakeholders,” it reads.
The memo said it was reasonably expected the union would have a “substantial amount of knowledge around proposed government tenders”.
Young has now moved to a tranche of internal papers from construction giant John Holland, which was involved in the project, describing its industrial relations strategy.
The documents were written for John Holland’s senior managers and a board committee, he tells the commissioner Chris Kourakis.
In one memorandum written to the chief operation officer at the company in 2019, it discussed the CFMEU and its attitude.
This union is proud of the fact that none of their site visits are code-compliant, and they refuse to conduct themselves in a compliant manner,” the documents read.
They have disrupted and complicated recent projects this year. The majority of their organisers have had their permits revoked, and this has not previously prevented them from attending sites. Their position in respect of the building code is consistent with the national position, and they have signed off on a number of code-compliant EDAs, obviously with increased conditions.
Chris Young has returned, and he has tendered a variety of documents, including memorandums, as he describes the splitting of costs of the project was divided under its so-called “alliance” structure.
Young explained that the contract split costs between the state government and alliance members, and detailed what happened if the project ran over or under its $110 million budget.
“The target cost was not a price; it was the agreed estimate of what the works should cost, and it was the yardstick for rewarding or penalising the other members for the [works],” he said.
He said every dollar spent on the Gap Road project was first paid by the state, and any extra cost reached the other members through mechanisms sharing “pain” or “gain”.
“On a job that came in under target, an extra cost reduced the non-owner participant’s share of the savings by 35 cents in the dollar, and an increase in the target cost worked the other way,” he said.
Analysis: One after another, the lawyers stood and announced their presence to royal commissioner Christopher Kourakis. It’s a formal process in which the most important person in the room “takes appearances” from everyone else – those paid to argue their clients’ cases to him.
One by one, the silks and juniors bobbed up.
They started at the table facing the commissioner with the second-most important man in the room, the senior counsel assisting, Chris Young, KC, who introduced his team of six.
Then came two more lawyers for the state government entity, the Victorian Infrastructure Delivery Authority.
The very next lawyer on their feet announced herself as “Ms Foley, appearing for the Honorable Daniel Andrews, AC”.
Earlier in this hearing, Counsel Assisting Chris Young said the commission would hold public hearings in “blocks”, and each would focus on a particular project, issue or theme.
The first “block” was for the Gap Road level crossing, he said.
The silk said it was too early to describe them in detail, but the commission would examine particular claims of wrongdoing.
“The purpose is not only to expose that wrongdoing … it’s also to understand what caused it and what allowed it to happen so the commissioner can recommend changes to prevent it in the future.”
Young pointed to organised crime in the construction industry as one such issue. He said legitimate businesses made payments to people associated with criminals.
Premier Ben Carroll says he’s “pretty sure” that taxpayers will be paying the lawyers representing former Premiers Daniel Andrews and Jacinta Allan at the royal commission.
“I’m pretty sure that [the lawyers are] supported by the state, as per other previous royal commissions,” Carroll told reporters earlier on Monday.
Pressed on whether he was personally comfortable with the government paying the lawyers for the former premiers, Carroll said he was “comfortable with making sure we have a strong, independent, robust royal commission”.
Asked if he thought it was fair that Victorians had to fund the lawyers, Carroll responded: “We need complete accountability and transparency, and follow all the rules as established by previous royal commissioners.”
“The royal commission, with the Department of Premier and Cabinet, have made independent decisions in terms of legal advice,” he said.
While the commission takes a break, here’s a bit of a summary of the project at the heart of this hearing block.
Young told the commission that the state Labor government announced the removal of the crossing in Sunbury, on Melbourne’s north-western edge, in October 2018, as part of its level crossing removal project.
It would include a multi-span bridge and ensure cars went underneath the railway.
But instead of using the existing level crossing removal team, the Major Transport Infrastructure Authority (MTIA) decided to deliver it through a partnership known as the Rail Network Alliance which included the Metro Rail Tunnel, Rail Alliance and Rail Systems Alliance.
Young highlighted a briefing for then-transport and infrastructure minister Jacinta Allan, which he said flagged a number of the issues that would be relevant to the Gap Road case.
The note, tendered through the commission, is attached below.
