Victoria’s construction royal commission must investigate crime, intimidation and labour abuse on building sites – but also the political, financial and procurement systems that allow corruption to flourish.
The corruption allegations engulfing Victoria’s construction industry have rightly shocked Australians. Organised crime, intimidation, labour hire rackets, inflated costs and abuse of workers all deserve the full force of the law. But if the royal commission stops there, it will fail.
Construction corruption does not begin with the worker on the scaffold or even the union official at the site gate. Nor does it end with the subcontractor or labour hire company. It runs through an entire political economy of land, property, finance, procurement and politics. A serious inquiry must work in two directions simultaneously.
It must get to the bottom. That means exposing wage theft, sham contracting, coercion, labour hire abuse, organised crime, false invoicing, phoenix companies and intimidation on building sites. These are real crimes committed against workers, subcontractors and taxpayers. They deserve investigation and prosecution.
But it must also get to the top. Who decides which projects are built? Who owns the land before rezoning? Who writes the business cases? Who benefits from planning decisions? Who wins the major contracts?
Who approves the variations worth hundreds of millions of dollars? Who moves between ministerial offices, government agencies, developers, contractors and lobby firms? Who funds political parties? Who has access that ordinary Australians do not? These questions are far less frequently asked, yet they often involve far greater sums of money.
Construction is not simply another industry. It is where public money, private finance and political power intersect. Every new motorway, railway, hospital, defence facility, apartment tower or stadium creates opportunities not only for employment and economic development but also for influence, rent-seeking and, in some cases, corruption.
Australia has spent decades outsourcing the capacity of governments to plan, design and build. Public works departments have shrunk while armies of consultants, developers, financiers and contractors have grown. Governments increasingly buy expertise from those who ultimately profit from the projects they recommend. That creates an obvious conflict. The public sector is expected to act as an intelligent client while progressively losing the expertise needed to challenge those selling advice.
The result is a system where risk flows downwards while profits flow upwards. Small subcontractors carry the cash-flow risk. Workers carry the employment risk. Taxpayers carry the political risk. Those at the top often capture the land values, development rights, procurement opportunities and long-term income streams.
Every previous inquiry has examined part of this system. Industrial tribunals investigate unions. ASIC investigates insolvencies. Police investigate organised crime. Anti-corruption commissions investigate public officials. Competition regulators investigate cartels. Tax authorities investigate phoenix companies.
Yet no institution routinely follows the complete chain from Cabinet decision to planning approval, land transaction, political donation, head contractor, subcontractor, labour hire company and ultimate beneficiary. That is precisely where sophisticated corruption hides.
If Victoria’s royal commission merely replaces one group of gatekeepers with another, little will change. The commission should publish every major subcontracting chain. It should identify beneficial ownership behind every company receiving public contracts. It should examine political donations, lobbying, ministerial diaries and planning decisions alongside industrial conduct. It should investigate whether project business cases systematically underestimated costs or exaggerated benefits. It should ask not only who broke the law, but who designed a system in which corruption could flourish.
Australia does not need another inquiry that looks only at the bottom of the pyramid. It needs one willing to climb to the top.
The true measure of this royal commission will not be how many workers, delegates or subcontractors it prosecutes. It will be whether it follows power, money and influence wherever they lead even if that trail reaches boardrooms, cabinet rooms and Parliament itself.
Only then will Australians know whether corruption was merely happening on construction sites or whether it had become embedded in the way we build our cities and govern our democracy.
Stewart Sweeney
Stewart Sweeney is a writer and public policy advocate with a longstanding interest in the evolution and future of capitalism. He migrated from Scotland to Adelaide in 1975 to work with Premier Don Dunstan on industrial democracy. A former academic and trade unionist, he continues to contribute to public debate on economic justice, democratic reform, and sustainable development. His work reflects a deep commitment to the common good and the role of public purpose in shaping Australia’s future.