Victoria’s top labour hire cop has launched an unprecedented attack on the state’s Big Build mega-contractors, saying they are the head of the rotting fish that is the state’s corruption-plagued construction sector and declaring that legal holes mean they get away with appalling wrongdoing.
Labour Hire Commissioner Steve Dargavel’s extraordinary comments came as two respected former top anti-corruption officials issued a damning joint assessment of Premier Jacinta Allan’s failure to clean up the infrastructure scheme she presided over for years as minister.
Former ombudsman Deborah Glass and ex-senior judge and former chief of the Independent Broad-based Anti-Corruption Commission Robert Redlich said an urgent royal commission was the only remedy that would adequately confront corruption on the government’s signature $109 billion Big Build infrastructure program.
“A royal commission is desperately needed,” said Redlich, who Labor appointed to run IBAC from 2018 to 2022. “It’s the only mechanism for properly investigating what is 10 years of rotten culture.
“This is an unprecedented historic scandal. I know of no scandal that has involved the sort of public wastage that has occurred here, and it’s only a royal commission that can root out all of the causes, all of the reasons why the checks and balances that are in place have failed.”
Glass agreed, saying questions about the Labor government’s management of the Big Build “goes back years”.
‘Ultimately, the fish rots from the head – the principal contractor is the head.. why are they suffering it to continue?’
Labour Hire Commissioner Steve Dargavel
“What we’re seeing is a government that decides to build a huge, expensive hole in the ground, and when it’s digging that huge, expensive hole, it doesn’t care what it costs,” Glass said. “It doesn’t care what else is involved. It just keeps on digging.”
On Saturday, this masthead revealed the government was warned by major contractors about CFMEU excesses on its major projects, particularly the $15 billion Melbourne Metro, well before the scandal broke in public. Leaked documents show the contractors claiming they were told to pay up and keep the projects moving.
Dargavel, who will step down next month after eight years policing Victoria’s labour hire sector, has done more than any law enforcement official or regulator to tackle Big Build labour hire firms engaging in wrongdoing as they turn over hundreds of millions of dollars supplying hundreds of workers to big ticket rail and road projects.
In an exclusive interview with this masthead and 60 Minutes, Dargavel took aim at principal or tier-one contractors, saying that some had engaged in shocking behaviour by relying on labour hire firms they knew to be suspect.
“There has been nothing done about the principal contractors involved in this,” he said.
“There is evidence of principal contractors being involved in unlawful conduct or supporting those who are engaging in unlawful conduct,” he said, while refusing to name specific companies.
“Ultimately, the fish rots from the head – the principal contractor is the head. If the body is rotten, the question has to be: why are they [allowing] it to continue?”
While Redlich and Glass no longer hold official office, Dargavel’s comments as a still-serving regulator are politically damaging because they are at odds with Allan’s repeated insistence her government had acted adequately in the past two years combating alleged corruption on the Big Build scheme, which she oversaw as minister.
He said the mega-firms on the Big Build had been “doing business with businesses and structures that most people in the community would find offensive”.
“They have not been held to account … Because the laws in this country need to be improved.”
Dargavel has had relative success attacking corrupt or unlawful labour hire, including some that placed bikies and gangland figures on Big Build sites with the help of CFMEU figures. One notorious examples is Women in Construction, a firm that Dargavel has ordered to leave the North East Link by Friday but which has already earned millions in taxpayer funds in recent years.
Despite its clear links to criminals, Women in Construction will be paid by the NE Link consortium, led by principal Labor government contractor CPB, for another week, having already earned millions supplying hundreds of workers to the project.
It was previously used by another government principal contractor, Acciona, although the giant infrastructure firm severed ties with Women in Construction in 2024 after repeated integrity concerns.
Dargavel’s intervention comes after this masthead revealed explosive secret correspondence written in 2023 and 2024, in which Labor’s Big Build’s principal contractors claimed the state government directed them for “political reasons” to cave in to the CFMEU’s lawless Big Build behaviour despite knowing it was inflicting massive cost blowouts.
Opposition Leader Jess Wilson said on Saturday a royal commission was required to ensure the scandals on the Big Build were never repeated.
“The revelations today demonstrate that Premier Jacinta Allan knew that corruption was happening on these sites,” she said. “Not only did she know and do nothing about it, she allowed it to happen. She backed it in. She approved it. This premier is not fit to govern.”
In the next part of a major investigation, The Age and 60 Minutes will on Sunday night reveal evidence showing how payments from Big Build subcontractors, including those with Victorian government labour hire licences, are still being made to Victoria’s underworld.
Redlich, who worked on the landmark Costigan royal commission into organised crime and the painters and dockers union in the 1980s, said a royal commission was needed to examine all those accused of contributing to Big Build corruption: from bikies and gangland figures profiteering, and principal contractors employing corrupt labour hire and other subcontractors, to the public servants in charge of this procurement, and the Labor politicians with ultimate responsibility.
Asked who was ultimately responsible for the Big Build’s corruption, Redlich named the “ministers that are responsible for particular government departments [including] the Victorian Infrastructure Development Authority … senior public servants who should be responsible for oversighting the contractual arrangements, the private enterprises who must be party to the corrupt environment which is taking place”.
Before becoming premier in September 2023, Allan was the minister responsible for the Big Build for almost a decade.
The last time Redlich and Glass joined forces was in 2021 to expose the abuse of public resources by Labor minister Adem Somyurek, who was sacked and expelled from the ALP for his misconduct. The pair said the Big Build scandal was vastly bigger but had led to no accountability.
Glass said her last major investigation before stepping down as ombudsman in 2024 was into the genesis of the Suburban Rail Loop
She said that what she discovered “made me profoundly uncomfortable about how public money was being used for political purposes and how the end simply seemed to justify the means”.
“What we’ve seen in the last couple of years, there are an enormous number of questions and no answers,” she said. “They [the state government] care about their political legacy. They care about the tunnels being dug, the project being built, how it happens. There seems to be no desire to expose where those public funds have gone.”
Redlich said the Big Build provided “an environment in which bikie gangs and criminal organisations have been able to flourish”, while Victorian taxpayers “are not getting value for money”.
The former judge said this was because some contractors had to pay an “extortion fee in order to be able to survive in the Big Build”.
Redlich said a royal commission should examine why Labor gave so much power to the CFMEU to wield lawlessly over the Big Build.
“One needs to look at why it was that a decision was made to give CFMEU much greater power,” he said. “It became a monopoly over time, and I suspect it’s a bit like the unruly child who is given something to play with and, eventually, it becomes one that is out of control.”
The government did not respond to questions.
For more watch 60 Minutes on Sunday at 7pm
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Nick McKenzie is an Age investigative journalist who has three times been named the Graham Perkin Australian Journalist of the Year. A winner of 20 Walkley Awards, including the Gold Walkley, he investigates politics, business, foreign affairs and criminal justice.Connect via email.
Lachlan Abbott is a crime reporter at The Age. He was previously a city reporter and covered breaking news.Connect via email.From our partners
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