Former construction supervisor calls for reorganization to clean up the sector

A former construction industry watchdog called alleged criminal infiltration of unions a cancer that, if left untreated, would infect healthy parts of the construction industry.

John Lloyd, who led the controversial Australian Building and Construction Commission (ABCC) when it was established in 2005, said a new version of the watchdog was needed to sort out the sector and the embattled CFMEU.

“They are a difficult customer, an organisation that shows little respect for the law and has done so for years, despite various attempts to curb this,” Mr Lloyd said of the union.

Last month, a series of reports from nine newspapers alleged that underworld figures and members of motorcycle gangs had infiltrated major construction projects, leading to the CFMEU’s Victorian branch being placed into administration and the resignation of long-time state boss John Setka.

After five years leading the ABCC, Mr Lloyd said the presence of criminals and organised crime in the trade union movement was nothing new to him.

“This industry is inherently problematic,” he told Stateline.

“What was surprising this time was the extent to which the underworld had penetrated the industry.

“That’s worrying, because the presence of the underworld in an industry is a cancer that grows. And when that’s the case, things generally get much worse.”

The ABCC’s role was to ensure that the construction industry functioned fairly and efficiently, but the organisation developed a reputation as a union buster, angering the left.

The party was eventually dissolved in 2012 by the Gillard government, re-established in 2016 by the Turnbull government and abolished again last year by Labor.

Mr Lloyd said questions needed to be answered about how alleged criminal elements were allowed to flourish within the union, and therefore in the workplace.

“Government officials, who are responsible for spending billions of dollars, should be in close and regular contact with the prime contractor to find out what is going on,” he said.

Construction contractors are motivated by the prospect of hefty fines to meet project deadlines, which Mr Lloyd says makes it difficult for them to resist union influence.

Mr Lloyd’s appointment as Commissioner of the ABCC, and later as Commissioner for Public Services, was seen by many as highly political.

He had long-standing ties to the conservative think tank Institute of Public Affairs (IPA) and left government service under a dark cloud in 2018.

He was found to have breached the Public Sector Code of Conduct over an interaction with the IPA, a finding Mr Lloyd disputed.

Mr Lloyd is now involved in the opposition in Victoria, working for Shadow Finance Minister Brad Rowswell.

Saga dominates return of parliament

The political storm over the CFMEU spilled over into the first week of parliamentary sitting in Victoria after the winter break.

A bill by private opposition parties that would make construction companies responsible for checking the criminal records of workers on government construction sites and ban anyone with ties to organized crime gangs failed to gain the necessary support when it was introduced in parliament on Tuesday.

On Thursday, the opposition walked out of Question Time in protest, accusing Prime Minister Jacinta Allan of dodging questions about the CFMEU scandal.

The state government is expected to tighten anti-biker laws in the future. Ms Allan has previously indicated that she will tighten anti-gathering laws.

“We will shortly be introducing a bill to Parliament that will adjust the thresholds and make it much easier for police to issue anti-association rules for people who engage in or suspect illegal activity,” Attorney General Jaclyn Symes said at a news conference on Monday, after allegations of misconduct and criminality within the CFMEU emerged.

Meanwhile, an independent inquiry into the conduct of the CFMEU and the construction industry in Victoria, led by former Justice Minister Greg Wilson, is underway. An interim report is expected on August 29, just a month after the inquiry was announced.

His final report is expected at the end of November.

Prime Minister Jacinta Allan said on Wednesday his work was part of a “strong action plan to eradicate this rotten culture at its roots”.

“I felt it was important to set a timeline so that we could get an initial response from Mr. Wilson so that we could explore what could be done immediately,” she said.

However, Mr Lloyd has reservations about what can be achieved in such a tight time frame.

“I’m a little concerned about the structure of the review,” he said.

He wondered whether the research would be set up in such a way that people with knowledge of the sector would actually be heard.

“I’m not sure how they’re going to build the confidence of whistleblowers to come forward,” Lloyd said.

“There needs to be very strong protection for people because one of the most worrying aspects of the sector is that witnesses, or people who assist bodies like the ABCC or assessments, are being targeted for reprisals by the union and their fellow travellers.”

Whatever the path to reform – whether it is a royal commission, as the opposition is demanding, or a government review – Mr Lloyd said nothing would succeed without political will.

“You need good recommendations and rules from whoever is in power to ensure that sensible and effective changes are made,” he said.