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History

Total Recoil

Neal Towart looks at how Royal Commissions designed to kick unions have typically come back to haunt their architects.

	History Repeats

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"Never have a Royal Commission unless you know the result." Nick Greiner in the 1990s and Malcolm Fraser in the 1980s neglected this sound piece of advice from former L-CP Treasurer, Artie Fadden. Tony Abbott, so busy looking to what he hopes is his own glamorous future, seems to be another conservative politician set on the same path.

The Building and Construction Royal Commission scenario is with us again. Short memories need a little prodding, and the antics of Greiner, Fahey and Gyles in the NSW industry in the early 1990s gave unwelcome headlines for some construction industry employers.

Tom McDonald sets out the course of the Gyles Commission in Intimate Union.

"When the Royal Commission into Productivity in the Building Industry in NSW was set up even the Herald queried the Greiner government's motives. Its editorial of 8th October 1990 observed that "with no obvious trigger, the Royal Commission into the building industry has generated speculation about the government's motives for calling it", and "Not surprisingly then there is speculation that the inquiry is Mr Greiner's version of the 1954 Petrov Royal Commission"."

The background leading up to the establishment of the commission enlightens us to the motivations of the Liberals. Troubleshooters, a body-hire company dedicated to breaking union strength in the construction industry, signed a deal with the BLF. The director of Troubleshooters, Mr Groves, called Norm Gallagher 'an honourable man' (this after Gallagher had broken the NSW BLF and had been shown to be corrupt, in association with developers in Victoria). John Fahey, then Minister for Industrial Relations, joined Groves in suggesting that the BLF be re-registered. John Howard declared his support for Troubleshooters and Peter Costello was retained as counsel for the company.

A few days after the agreement was announced, a meeting was held in Fahey's office with representatives of the National Farmers Federation, a representative from Troubleshooters, and a builder named Donovan who owed thousands of dollars in unpaid wages.

Before long the Sunday Telegraph ran two feature stories about corruption and violence in the construction industry. Later the Sydney Morning Herald reported allegations by Donovan that he had been assaulted by a person who supposedly said "Here's a present from the BWIU - I'll be back."

FEDFA and the BWIU then called for the appointment of a national Ombudsperson for the industry, but Greiner set up Gyles and the Royal Commission, without the support of any major employer in the industry.

The unions decided to participate in the proceedings, and from day one they called upon Gyles to investigate corruption and illegal behaviour in relation to tax avoidance, 'cash-in-hand' payments, underpayment of wages and breaches of OHS standards. The union also raised the potential for corruption in dealings between builders, developers, local councils, politicians, public servants and the tendering process generally. The Commissioner, however, spent the time engaging an army of investigators to comb through union records. He took little note of the issues raised by the unions. Collusive tendering was a big issue that was of no interest to the Commissioner, until the union had approached Channel 9 with the issue, and they ran a story.

Despite his best efforts, as the inquiry unfolded, the claims about union corruption were exposed as hot air, and collusive tendering was shown to be part and parcel of the industry via the Master Builders. The MBA also misused funds allocated to group apprenticeship schemes. Claims of violence by the union were turned on their head as it was shown that several major employers were employing criminals to stand over workers. The report from the commission said that services provided by gangsters included infiltrating the workforce as sham unionists and intimidating workers and union delegates.

After bashing unions extensively in the recommendations in volume 7 of his report, Roger Gyles, QC director and shareholder in a property development group, and Royal Commissioner into his own industry, in the final two miscellaneous recommendations made some mild points about the Master Builders Association. He says "it is undesirable that the Government should have any dealings with [the MBA]; and that "advice be sought from the State Crown Solicitor as to whether there are grounds for applying to have the MBA deregistered as an industrial organisation."

Earlier Gyles had strongly asserted that "the appropriate NSW authority move for deregistration of the BWIU, in both the Federal and NSW jurisdictions".

Gyles wanted the Fahey government to establish a building industry taskforce to go hard against unions, to look at "bans, boycotts and the like".

The Commission never seriously looked at the root causes of industrial disputes in the industry. Ken Lovell, former Director of Industrial Relations for the Australian Federation of Construction Contractors said,

"My view is the biggest problem in the industry is that we expect people to get out of bed at 5.30 am, do a shit job for 11 hours in an unsafe environment for 6 days a week, and whinge when they won't do it on Sundays, and then act surprised when they try to spend as much time in the shed playing cards as they can."

So the Commission's final report had to concede that there was "no evidence of widespread or serious corruption". The recommendation of deregistration for the BWIU was solely based on the fact of the union being ready to stand up and argue for the rights of their members, against employer intimidation.

Greiner banned some government departments from dealing with the BWIU after Gyles' unsubstantiated claims were made public. Justice Maidment, of the NSW Industrial Relations Commission, promptly declared the ban a breach of Greiner's own Industrial Relations Act.

After the report was handed down, Fahey, who became Premier after Greiner's resignation over - you guessed it - corruption issues, set up a Task Force, which investigated every allegation from people who had some sort of grudge against the union. Some charges were laid, but all were thrown out. Jeff Shaw disbanded the Task Force when the ALP won the 1995 elections, after wasting $30million. The benefit of it was the clawing back to the public of millions lost by the collusive tendering of construction companies.

Trawling the Harbour

Paul Kelly said "The Costigan missile, which was not launched by accident and was indeed fired by Fraser's own hand from his own flagship and intended to deplete the ALP fleet, traveled a complete circle and torpedoed its instigator."

Fraser first heard about activities around the union in 1980 and decided he wanted a full-scale inquiry as here was a union infiltrated by criminals, thus a way of bashing unions and the ALP. Frank Costigan was an experienced QC who wanted the job, after many in the judiciary had shied away, and he got plenty of resources from Fraser's Attorney General, Durack to investigate the way tax scheme promoters were using the Painters and Dockers. Costigan asked for, and got, access to confidential tax records after an interim report in 1981. Fraser and John Howard were seen as keen to get at the tax evasion industry. They didn't count on the zeal of Costigan and Counsel assisting, Douglas Meagher. Their investigations rocked the foundations of the Liberal Party.

Costigan argued in the report that the major fraud on federal revenue through the "bottom of the harbour" tax evasion schemes had been allowed to flourish because of the incompetence of the government's own advisers. Costigan argued that tax laws that existed since the early 1970s were enough to stop the schemes but they had not been tried. Substantial amounts of potential government revenue had been forgone because of inertia and incompetence.

Fraser's response to the report was a legislative one that sent fear and loathing through the Liberals and its wealthy supporters, who were of course the major abusers of tax laws. John Howard, as Treasurer, had delayed for over 12 months tax laws changes that could have stopped such activities as "one promoter [who] stripped over 1,500 companies in Victoria which had income tax liabilities in the year prior to the strip totaling $14m".

The Costigan report stopped Fraser calling an election in September 1982, and the delay would appear to have been fatal to his government. Lead on Tony Abbott.

Refernces

Audrey and Tom McDonald. Intimate Union: Sharing a revolutionary life. Annandale: Pluto Press, 1998)

Roger Vincent Gyles. Royal Commission into Productivity in the Building Industry in New South Wales. vol. 7, Final Report, Sydney 1992.

Paul Kelly. The Hawke Ascendancy: a definitive account of its origins and climax 1975-1983. Sydney: Angus and Robertson, 1984

Steve Painter. Liberals' BWIU ban illegal. Green Left Weekly, no. 60 1992.

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  Issue 103 contents

»	Survey Shows Majority Support for Unions
»	Howard's Union Stooge in Hot Water
»	Unions Cash in on Big Brother
»	Big Boys Bully Over Della Compo Changes
»	Where's WorkCover? Safety Prosecutions Drop Off
»	Telstra's Ultimatum: Stay Away From Kim
»	Workers Win Stake in New Bank
»	Hours Test Case Gets Green Light
»	St John of God Workers Pray for Justice
»	Five-Star Action From Security Guards
»	Howard Plans to Stop the Vote
»	Rio Outrage Heads for Court
»	Nurses To Fight For Pay
»	One Hundred Reasons to Save Aussie Post
»	Rail Track Sell-Off Part of Privatisation Push
»	Coles Myer Abandons Regional Jobs
»	Qld Wage Rise Still Not Enough
»	Activists Notebook

»	The Soapbox
»	The Locker Room
»	Trades Hall
»	Tool Shed

»	Problems with Hunter Decision
»	A Lost Cause
»	High Farce

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