Federal Politics


Thomson saga drags on and on

Fair Work Australia's inept handling of the sensitive allegations of corruption against a union has damaged its patron, Julia Gillard.

The saga surrounding the Health Services Union and Labor MP Craig Thomson has also cast the union movement generally in a poor light. But the ACTU has acted decisively with its dramatic decision to cut ties temporarily with the union at the centre of corruption charges.

This action makes the Prime Minister's situation worse. The ACTU looks and sounds resolute but she is left looking indecisive and not in control.

She could have come out and said it is unacceptable that a taxpayer-funded body believes it can keep secret a report that may make serious allegations about an elected representative.

She should have demanded that Fair Work Australia's report on the the union be published immediately because the longer it is kept under wraps, the worse it looks for the organisation - and for the Prime Minister. And what about the right of Thomson to clear his name or know what he is facing?

Late on Thursday, Fair Work Australia's general manager Bernadette O'Neill relented on her determination, based on earlier legal advice, to keep the report secret. Yet it recently released a report into the administration of the Victorian branch of the HSU. That one did not involve Thomson.


The reversal on the latest HSU report came after intense pressure from the Opposition which was suggesting police seek a warrant to examine the report and prepare a brief as a basis for possible criminal charges.

The 1100-page report will now be given to the Senate's education, employment and workplace relations committee but only in four to six weeks after the FWA has gone through it again. The delay is astonishing.

The report details 181 contraventions of workplace laws and HSU rules by three former or current HSU officials and a fourth person, none of whose names have been released. Of the breaches, 76 are believed to be minor and do not warrant a penalty. Another 105 breaches possibly warrant referral to the federal court and the imposition of fines.

The inquiry was into alleged financial mismanagement in the HSU national office during the years Thomson was national secretary and specific allegations that he used his union credit card for private spending, including on prostitutes. Thomson, now the federal Labor member for Dobell on the NSW central coast, strenuously denies all wrongdoing.

After three years of work by FWA, Commonwealth Director of Public Prosecutions Chris Craigie SC took one look and declared that the report was not a brief of evidence. It is effectively useless for the purposes of levelling possible criminal charges. His office does not have investigative powers and is not able to conduct a criminal investigation.

Did FWA recognise criminality and, if so, why didn't it commission someone to prepare a brief of evidence?

The bungle and the blanket of secrecy allows Tony Abbott to bang his drum saying there is an institutional go-slow. He has ample scope for this claim because the investigation took three years, cost millions of dollars and revolves around a Labor MP.

His case is helped by what Gillard's mates in the ACTU think of the stench emanating from the union. The union movement is reacting to the court of public opinion with the dramatic decision to suspend the union's affiliation.

The ACTU executive is trying to put pressure on the union to act. ''The Australian union movement has zero tolerance for corruption or the misuse of members' funds for maladministration of union affairs,'' ACTU boss Ged Kearney says. Clearly Kearney is worried that the lack of action is tarnishing the union brand.

When Abbott stepped up his rhetoric late Thursday, his huffing and puffing appeared to ride roughshod over an important principle.

The presumption of innocence is a cornerstone of our legal system. This protection must be upheld, particularly against baseless allegations.

But what is to happen when a government body undertakes a three-year investigation that details allegations of numerous breaches of union rules? Does it stand by the quality of that report?

When the report was finalised this week, O'Neill pointed out that it was not up to her organisation to establish whether the findings were of a criminal nature. That was for the DPP to establish, she said, trying unsuccessfully to hose down expectations.

In an interesting twist, however, she pointed to serious material in the report. ''I am satisfied that the report raises many significant matters which may be appropriate for the DPP's consideration.''

But wait. The esteemed members of the DPP are lawyers, not police officers. What a mess.

If FWA suspects the report contains material that warrants a criminal investigation, why did it hand it to an organisation that can't do anything about it? It says the reason is that the CDPP is the organisation specified in its governing legislation.

But, if the report is now considered useless and doesn't contain serious allegations, why can't it be made public immediately, like earlier reports? If it is, and Thomson is named, then what does Gillard do?

At the moment she is correctly maintaining her confidence in the MP. No charges have been laid against him. The presumption of innocence is maintained.

But female members of her caucus are very unhappy. Their concerns revolve around the grubbiness of the allegations. They are very worried that Gillard gives the appearance, at least, of not taking them seriously.

They were horrified when links were published about Thomson's credit card and prostitutes. That information came to light in court in a fateful rebound for Thomson when he sued The Sydney Morning Herald for defamation over earlier allegations. The NSW Supreme Court was told in December 2010 that Thomson's mobile phone records, driver's licence details and credit card vouchers with his signature show he used a HSU credit card to pay for the services of a Sydney escort agency. Thomson repeated his strong denials of using the credit card to pay for the services of an escort agency or other adult services.

NSW police examined the Thomson case last year, at the request of George Brandis, the eminently qualified opposition spokesman for the Attorney-General's portfolio, and decided no investigation was warranted. Subsequent revelations by the newspaper of serious allegations against the union administration more broadly, rather than Thomson per se, prompted both the NSW and Victorian police to begin investigations, which are continuing.

As Gillard stands aside, saying the investigation process is run by independent agencies, Abbott is suggesting a deliberate ''obstruction of justice''. Although Parliament is in recess, he is repeating his charge that Thomson's vote is tainted.

The many unresolved questions mean this saga is set to continue, another scandal sucking the oxygen out of whatever else the Prime Minister is trying to sell to voters.

Ross Peake is Political Editor