Ms Julie Bishop (Curtin, Liberal Party, Deputy Leader of the Opposition) Share this | Hansard source

by leave—On behalf the Leader of the Opposition, I move:

That this bill be now read a second time.

I rise to support the Fair Work (Registered Organisations) Amendment (Towards Transparency) Bill 2013. This bill has been proposed by the coalition in response to genuine community concern about the governance of Australia's trade unions, particularly by those in positions of power within the trade unions: the union bosses. In fact, it is not just a concern; in many cases it is a revulsion within the community with the number of scandalous trade union practices that have been revealed over recent years. For example, there have been reports of spectacular rorting that has been going on over a number of years at the Health Services Union. There are pending court cases after the arrest of the member for Dobell, the former National Secretary of the Health Services Union, and the arrest of Michael Williamson, the former National President of the Health Services Union—and, let us not forget, he is the immediate past President of the Australian Labor Party.

By the way, I note that much of the trade union rorting has been revealed by investigative journalists working for the Fairfax media at the Age and the Sydney Morning Herald, which is somewhat of an irony given that the government's current unprecedented attack on the media and freedom of speech is principally motivated by their hatred of News Ltd.

As has been noted previously, that Fair Work Commission currently has eight major investigations underway into possible improper conduct in unions. At least four large unions are involved: the Communication Workers Union, the Community and Public Sector Union, the Nursing Federation and United Voice. There are 20 years of murky and unresolved fraud allegations related to the Australian Workers Union, a union that has delivered a number of Labor members into parliamentary seats in this House.

Under existing laws, unions have a remarkably soft time when it comes to legislative enforcement of good governance. For example, at the Health Services Union, there have been substantial allegations of fraud amounting to around $20 million and yet the potential penalty for individuals is a maximum of $6,600 and for organisations it is a maximum of $33,000. In addition, I note that these are only civil penalties, not criminal.

I note that the claims regarding the Health Services Union are not mere allegations whisked out of thin air. As the coalition notes in the explanatory memorandum, this bill will ensure that there is a strong deterrent in place to prevent a recurrence of the kinds of wrongdoing and malfeasance found by Fair Work Australia in its report Investigation into the Victoria No.1 Branch of the Health Services Union under section 331 of the Fair Work (Registered Organisations) Act 2009and the further report Investigation into the National Office of the Health Services Union under section 331 of the. Fair Work (Registered Organisations) Act 2009. Similar conduct was also identified in the report titled Final report on HSUeast by Ian Temby QC and Dennis Robertson FCA.

The bill before the House proposes to increase penalties to $340,000 and to provide for criminal as well as civil sanctions, including imprisonment of up to five years. As we have noted previously, this bill seeks to put exactly the same regime in place for unions and those running unions as applies to companies and those running companies. If a union official or a company official does the wrong thing, they should face the same penalty for the same wrongdoing. The members of registered organisations should have the same comfort to know that their money is spent in a proper manner and the conduct of officers is above board as shareholders of corporations.

This bill also makes it an offence to not lodge a full or concise report with the Fair Work Commission. These reports are required to be submitted under the Fair Work (Registered Organisations) Act 2009. However, there are currently inadequate penalties for the lodgement of non-compliant reports.

Finally, the bill also makes it a criminal offence for officers of a registered organisation to not comply with orders of a state or Federal Court that applies to the organisation. More broadly, this bill would implement one of the three major elements of the coalition's policy to ensure that the rule of law operates in our workplaces. The first, to which this bill gives expression, is to ensure that we have reasonable requirements and appropriate penalties on union officials. The second is to establish a registered organisation commission. This will separate the conciliation and arbitration functions of the Fair Work Commission from its law enforcement functions. The third is the coalition's policy commitment to re-establish the Australian Building and Construction Commission with full power, full authority and full funding.

I would also like to note that the coalition has called for a judicial inquiry into the operations of the Australian Workers Union. Many listeners to this debate will know that I am talking about the fraudulent activities that occurred at the Australian Workers Union between 1992 and 1996. Hundreds of thousands of dollars from the bank accounts of the AWU disappeared, and to date no-one has been charged, amid allegations from within the union itself of a massive fraud. Many of the missing pieces rest within the knowledge of the Prime Minister and her former partner, Bruce Wilson—neither of whom, to our knowledge, have given testimony to police about their respective roles. Given that the Prime Minister refuses to answer questions in the parliament, the only way to get to the bottom of these allegations of fraud is for there to be a judicial inquiry.

In 1996 there was a formal request by former AWU official and current Fair Work Commissioner, Ian Cambridge, for a royal commission into this massive fraud. Former Western Australian AWU official Tim Daley also required a formal investigation, joined by former New South Wales Labor treasurer Michael Costa. An investigation is the only way that light could be shed on a dark and ugly chapter in the history of the Australian Workers Union.

It all began with the Prime Minister's legal advice—the instructions of her then partner, Bruce Wilson, on the incorporation of an association in the name of the Australian Workers Union. It was actually a slush fund for the use of individual union bosses, including the Prime Minister's former partner. It was a sham from the outset. Once the association was registered, it was alleged that Wilson fraudulently obtained hundreds of thousands of dollars from building companies who believed they were dealing with the AWU for workplace safety and training, but, as the Prime Minister herself described it, it was a slush fund for union officials. The fraudulent activities continued, with various devious twists and turns, but the existence of this slush fund was not detected until 1996.

The coalition contends that, in relation to the setting up of the association, Wilson, his AWU colleague Ralph Blewitt and the Prime Minister have a case to answer under section 43 of the WA Associations Incorporation Act 1987. It is an offence under section 43 of the act to knowingly make false or misleading statements. Section 170 of the Criminal Code is also relevant. It provides that a person is guilty of a crime if, being required to give information, they knowingly give information that is false in material particular. Section 409 of the Criminal Code sets out the elements of the criminal act of fraud.

'Where's the smoking gun?' was a familiar refrain in the years before an incriminating transcript came to light during the Watergate investigations that led to President Richard Nixon's resignation. In the case of the AWU fraud, the ground is already littered with spent cartridges. There are abundant reasons why the governance of trade unions needs to be cleaned up. It is apparent that the government would rather not have to answer legitimate questions about the Prime Minister's ethics, honesty and professionalism arising from this sordid affair that threatens to engulf her.

One can imagine what would happen to journalists and newspapers that dared to report on this matter if the government were to gets its way and have a hand-picked advocate to regulate the country's media. Mark Baker, writing in the Australian Financial Review, and Hedley Thomas, writing in the Australian, would be gagged by these draconian media regulation laws.

The AWU slush fund affair is a case in point. There are abundant reasons for the need for the governments of trade unions to be cleaned up. When in government, the coalition will make this a priority. However, there is no reason why the clean-up of trade unions and their governance cannot start right away. I urge the crossbenchers to support this important reform. I commend this bill to the House.

See this speech in context