Victorian premier accused of ‘nonsense’ for blaming inflation amid gangland allegations over cost blowouts
An integrity expert says Jacinta Allan blaming “inflationary pressures” rather than corruption for cost blowouts on the state’s $100bn Big Build is “nonsense”, as the Victorian premier resists growing calls for a royal commission.
Allan on Monday declared that “inflationary pressures on projects is not corruption” after Nine newspapers and 60 Minutes reported allegations that money from the state’s Big Build infrastructure projects was being paid to gangland figures and that the state government was warned about cost blowouts due to Construction, Forestry and Maritime Employees Union (CFMEU) demands.
Geoffrey Watson SC, a director of the Centre for Public Integrity who was appointed by the CFMEU administrator to investigate allegations of corruption and criminal offences within the union, said solely blaming inflation was “nonsense”.
“Inflation may have some sort of a role but it’s a relatively minor one, and in any event standard inflation rates would have been built into the earlier estimates as they always are,” he said.
Watson reiterated his calls for a royal commission, saying it was the only way to address the corruption.
“It’s time to stop making excuses and to address the issue,” he said.
Nine’s Building Bad investigation reported that infrastructure companies repeatedly warned the Victorian government between 2022 and 2024 that CFMEU demands had inflated labour costs on the Metro Tunnel.
The leaked consortium’s report, referenced in Nine’s investigation, warned the state government about cost blowouts by 22% above what would be required under existing industry norms in Victoria. It estimated $196.4m of its labour costs were driven wholly by union-backed staffing and outlined how contractors were forced to add on additional non-productive workers.
The consortium stated it caved to the CFMEU’s demands with the Labor government’s backing, Nine reported.
Allan was the minister who oversaw the state’s Big Build program between 2018 and 2023 before becoming premier. Speaking at a press conference on Monday, Allan said she had not read the consortium’s report.
Referring to the reporting about the Metro Tunnel, Allan said union members cost more because their wages came with “better” and “safer” conditions.
“That is a cost, but that is a cost that is about supporting those workers to do this work to deliver projects,” she said.
Allan said “fair wages” for union workers were part of the inflationary pressures on projects like the Metro Tunnel.
“Inflationary pressures on projects is not corruption,” she said.
Asked about Watson’s assessment on 60 Minutes that he had not seen evidence the premier had held herself responsible for allegations of corruption and criminal wrongdoing on government worksites, Allan said “he is wrong” and pointed to the action her government had taken.
The premier said she was confident Victoria police and the Labour Hire Authority had been given sufficient powers to address any wrongdoing, saying over the last two years the authority had cancelled 164 construction industry licenses while police had laid 93 charges.
“After all this time, if there is any evidence of any allegation of criminal behaviour that includes corruption and extortion, I don’t understand why that wouldn’t immediately be reported to Victoria police,” she said.
The Nine investigation also revealed that money from the state’s Big Build infrastructure projects continues to flow to gangland figures after an almost two-year attempt by the government to clean up corruption.
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Asked if corruption was still occurring on the Big Build, Allan said she accepted that allegations had been made and that those who “claim to have evidence” should refer it to Victoria police.
Allan defended her administration, saying: “There is no evidence of government corruption on the Big Build.”
Victoria’s opposition leader, Jess Wilson, on Monday said Nine’s reporting demonstrated that “the corruption continues to happen today”.
“Payments are continuing to underworld figures under premier Jacinta Allan’s watch,” she told reporters.
Allan continued to resist calls for a royal commission, saying it equated to “a call for delayed action” and would not lead to cultural change on work sites.
Victoria’s former ombudsman, Deborah Glass, and the former commissioner of Independent Broad-based Anti-Corruption Commission Robert Redlich said in a joint statement that a royal commission was urgently needed.
Federal deputy opposition leader, Jane Hume, on Monday called for a royal commission – pointing to Queensland’s commission of inquiry into the CFMEU – and a funding pause on the state’s infrastructure projects.
“I do believe that you need to remove the corrupt elements before you can continue to give taxpayer money to these projects,” she told ABC radio.
Allan dismissed Hume’s call for a halt to the projects, saying that “would see tens of thousands of workers put off the job immediately”.
A report by Watson, tendered during the Queensland inquiry in February, estimated Big Build corruption involving the union had cost Victorian taxpayers up to $15bn.
The Allan government rejected the figure as “unfounded” at the time. During an interview with the ABC’s 7.30 program this month, Allan refused to provide a figure of how much CFMEU corruption had cost the state.
The Big Build began in 2015 after the election of the Daniel Andrews-led Labor government. It includes major road and rail infrastructure projects such as the recently opened Metro Tunnel and the contentious Suburban Rail Loop.
Read the full story at The Guardian ↗ · The Guardian ↗ · The Guardian ↗ · The Guardian ↗
The Victorian government faces questions about cost management on its major Big Build infrastructure program. Premier Jacinta Allan attributes project cost increases to inflationary pressures and union wage conditions, characterising these as legitimate industrial costs rather than corruption. An independent integrity expert counters that inflation plays only a minor explanatory role in the documented cost increases. Nine's investigation reports that contractors warned the government of cost escalations driven by union-related staffing demands between 2022 and 2024, with one consortium estimating an additional $196.4 million in labour costs on the Metro Tunnel. The investigation also indicates ongoing payments from Big Build projects to individuals with criminal associations. Allan emphasises her government's enforcement actions—164 construction licences cancelled and 93 police charges laid in two years—and maintains there is no evidence of government corruption. Opposition figures and former public officials argue a royal commission is necessary to address systemic issues; Allan maintains existing oversight mechanisms are sufficient and warns that halting projects would displace tens of thousands of workers.
Read the full story at The Guardian ↗ · The Guardian ↗ · The Guardian ↗ · The Guardian ↗
An integrity expert says Jacinta Allan blaming “inflationary pressures” rather than corruption for cost blowouts on the state’s $100bn Big Build is “nonsense”, as the Victorian premier resists growing calls for a royal commission.
Allan on Monday declared that “inflationary pressures on projects is not corruption” after Nine newspapers and 60 Minutes reported allegations that money from the state’s Big Build infrastructure projects was being paid to gangland figures and that the state government was warned about cost blowouts due to Construction, Forestry and Maritime Employees Union (CFMEU) demands.
Geoffrey Watson SC, a director of the Centre for Public Integrity who was appointed by the CFMEU administrator to investigate allegations of corruption and criminal offences within the union, said solely blaming inflation was “nonsense”.
“Inflation may have some sort of a role but it’s a relatively minor one, and in any event standard inflation rates would have been built into the earlier estimates as they always are,” he said.
Watson reiterated his calls for a royal commission, saying it was the only way to address the corruption.
“It’s time to stop making excuses and to address the issue,” he said.
Nine’s Building Bad investigation reported that infrastructure companies repeatedly warned the Victorian government between 2022 and 2024 that CFMEU demands had inflated labour costs on the Metro Tunnel.
The leaked consortium’s report, referenced in Nine’s investigation, warned the state government about cost blowouts by 22% above what would be required under existing industry norms in Victoria. It estimated $196.4m of its labour costs were driven wholly by union-backed staffing and outlined how contractors were forced to add on additional non-productive workers.
The consortium stated it caved to the CFMEU’s demands with the Labor government’s backing, Nine reported.
Allan was the minister who oversaw the state’s Big Build program between 2018 and 2023 before becoming premier. Speaking at a press conference on Monday, Allan said she had not read the consortium’s report.
Referring to the reporting about the Metro Tunnel, Allan said union members cost more because their wages came with “better” and “safer” conditions.
“That is a cost, but that is a cost that is about supporting those workers to do this work to deliver projects,” she said.
Allan said “fair wages” for union workers were part of the inflationary pressures on projects like the Metro Tunnel.
“Inflationary pressures on projects is not corruption,” she said.
Asked about Watson’s assessment on 60 Minutes that he had not seen evidence the premier had held herself responsible for allegations of corruption and criminal wrongdoing on government worksites, Allan said “he is wrong” and pointed to the action her government had taken.
The premier said she was confident Victoria police and the Labour Hire Authority had been given sufficient powers to address any wrongdoing, saying over the last two years the authority had cancelled 164 construction industry licenses while police had laid 93 charges.
“After all this time, if there is any evidence of any allegation of criminal behaviour that includes corruption and extortion, I don’t understand why that wouldn’t immediately be reported to Victoria police,” she said.
The Nine investigation also revealed that money from the state’s Big Build infrastructure projects continues to flow to gangland figures after an almost two-year attempt by the government to clean up corruption.
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Asked if corruption was still occurring on the Big Build, Allan said she accepted that allegations had been made and that those who “claim to have evidence” should refer it to Victoria police.
Allan defended her administration, saying: “There is no evidence of government corruption on the Big Build.”
Victoria’s opposition leader, Jess Wilson, on Monday said Nine’s reporting demonstrated that “the corruption continues to happen today”.
“Payments are continuing to underworld figures under premier Jacinta Allan’s watch,” she told reporters.
Allan continued to resist calls for a royal commission, saying it equated to “a call for delayed action” and would not lead to cultural change on work sites.
Victoria’s former ombudsman, Deborah Glass, and the former commissioner of Independent Broad-based Anti-Corruption Commission Robert Redlich said in a joint statement that a royal commission was urgently needed.
Federal deputy opposition leader, Jane Hume, on Monday called for a royal commission – pointing to Queensland’s commission of inquiry into the CFMEU – and a funding pause on the state’s infrastructure projects.
“I do believe that you need to remove the corrupt elements before you can continue to give taxpayer money to these projects,” she told ABC radio.
Allan dismissed Hume’s call for a halt to the projects, saying that “would see tens of thousands of workers put off the job immediately”.
A report by Watson, tendered during the Queensland inquiry in February, estimated Big Build corruption involving the union had cost Victorian taxpayers up to $15bn.
The Allan government rejected the figure as “unfounded” at the time. During an interview with the ABC’s 7.30 program this month, Allan refused to provide a figure of how much CFMEU corruption had cost the state.
The Big Build began in 2015 after the election of the Daniel Andrews-led Labor government. It includes major road and rail infrastructure projects such as the recently opened Metro Tunnel and the contentious Suburban Rail Loop.
Read the full story at The Guardian ↗ · The Guardian ↗ · The Guardian ↗ · The Guardian ↗
Premier Jacinta Allan stated that 'inflationary pressures on projects is not corruption' when defending Big Build cost increases. Geoffrey Watson SC, director of the Centre for Public Integrity, characterised Allan's inflation explanation as 'nonsense.' A leaked consortium report warned the Victorian government between 2022 and 2024 that CFMEU demands inflated Metro Tunnel labour costs by 22% above existing industry norms. The consortium estimated $196.4 million of labour costs were driven by union-backed staffing and non-productive workers. Nine's investigation reported that money from Big Build projects continues to flow to gangland figures. Watson estimated Big Build corruption involving the union cost Victorian taxpayers up to $15 billion. Allan said she had not read the consortium's report referenced in Nine's investigation. Allan characterised union wages as reflecting 'better' and 'safer' working conditions rather than corruption. Victoria Police and the Labour Hire Authority cancelled 164 construction licences and laid 93 charges over two years. Opposition leader Jess Wilson stated that 'corruption continues to happen today' under Allan's watch. Former ombudsman Deborah Glass and former IBAC commissioner Robert Redlich issued a joint statement that a royal commission was urgently needed. Allan resisted calls for a royal commission, saying it would delay action and not lead to cultural change on work sites. Allan stated there is 'no evidence of government corruption on the Big Build.'
Read the full story at The Guardian ↗ · The Guardian ↗ · The Guardian ↗ · The Guardian ↗
- Victorian Premier Jacinta Allan attributes Big Build cost overruns to inflation rather than corruption, dismissing calls for a royal commission
- Integrity expert Geoffrey Watson and others say inflation explanation is inadequate; Nine's investigation reports CFMEU demands added approximately $196.4m in labour costs to Metro Tunnel alone
- Leaked consortium reports warned government between 2022-2024 that union-backed staffing inflated costs by 22% above industry norms; government allegedly backed compliance with union demands
- Nine investigation alleges money from Big Build continues flowing to gangland figures despite government action; Watson's report estimates corruption cost Victorian taxpayers up to $15bn
- Opposition and former officials call for royal commission; Allan resists, citing infrastructure project continuity and job protection concerns