VIDEO: Royal Commission into Big Build begins - ABC News & Headlines – Australian Broadcasting Corporation

KEVIN BELL KC, FORMER SUPREME COURT JUDGE:  It's an inquiry into the biggest construction activity in Victoria and most importantly, it's an inquiry that includes government activity.

MIKE LORIGAN, REPORTER: On its first public day, the man leading the Victorian Big Build royal commission has sent a warning to the state's construction sector.

CHRISTOPHER KOURAKIS SC, ROYAL COMMISSIONER:  Anyone who has an ambition to remain in the industry will be better served by early voluntary disclosures to the commission than by waiting to be found out.

MIKE LORIGAN:  Led by former Chief Justice of South Australia Christopher Kourakis, it's investigating allegations of corruption, misconduct and criminality on the state's gigantic public infrastructure program worth more than $150 billion.

CHRISTOPHER KOURAKIS: It is the task of this Commission to bring those who were and are responsible to deliver the Big Build projects to account publicly for how they discharged those responsibilities.

MIKE LORIGAN:  The terms of reference are wide, the list of potential witnesses, deep.

CHRIS YOUNG SC, COUNSEL ASSISTING:  The allegations about what was done and what was not done reach from the sheds at worksites to union offices, to boardrooms, to government departments and to ministerial offices.

KEVIN BELL KC, FORMER SUPREME COURT JUDGE:  Nobody is excluded. Builders they're in, subcontractors they're in, union officials they're in, workers they're in, government officials they're in, politicians they're in. 

MIKE LORIGAN:  Kevin Bell is a former Supreme Court Justice and former royal commissioner.

How unusual is it for a royal commission to scrutinise an entire chain of responsibility within government like this?

KEVIN BELL:  It is very unusual. It's not been done in the many inquiries into the building industry in Australia, of which I'm aware.

MIKE LORIGAN:  The Commission is now moving to establish who knew what within the government and crucially when.

Three documents already tendered to the inquiry, reveal concerns raised as early as June 2023. 

A briefing prepared for then infrastructure minister Jacinta Allan, described the industrial relations environment on major projects as "highly challenging" and referred to reports of "outlaw motorcycle club members" and "convicted criminals" being present on worksites.   

A second briefing, signed by Allan the following day, went further, reporting allegations of "criminal elements potentially becoming involved in MTIA projects".

And a letter written by Ms Allan to then Police Commissioner Shane Patton, informing him she's been made, "...anecdotally aware of a small number of possible criminal incidents on government infrastructure projects."

The royal commission was called by the new Premier Ben Carroll after Jacinta Allen resigned in July.

Jacinta Allan now faces the prospect of giving evidence. 

KEVIN BELL:  They will have to answer questions just like everybody else. There's no premier exception. If a question is asked about, for example, the nature of the oversight in which the government engaged in the industry, they'll have to answer it.

MIKE LORIGAN:  At the centre of many of the allegations facing the sector is the CFMEU. For years its Victorian branch was controlled by John Setka. 

JOHN SETKA:  If so many people are coming out and saying we are doing it wrong, we must be doing it right. 

MIKE LORIGAN:  He resigned as state secretary in 2024  after media reports exposed criminal infiltration of engulfed the union. Its construction division was subsequently put under administration by the federal government. 

CHRISTOPHER CARR SC, COUNSEL ASSISTING:  it has been alleged that some people paid hundreds of thousands of dollars to organised crime figures, said to include Mick Gatto, in order to obtain an EBA.

MIKE LORIGAN:  Mick Gatto, the Melbourne underworld veteran runs a mediation business in the construction sector. Gatto was arrested and his property raided by the Victoria Police construction sector taskforce in June.

REPORTER:  Why were you arrested today Mick?

MICK GATTO:  Over a speeding fine. 

REPORTER:  They said they're investigating you over alleged financial offences.

MICK GATTO:  All a load of crap, all a load of crap. It'll all come out in due time. I really can’t talk about it now. 

MIKE LORIGAN:  He hasn't been charged and has denied he's engaged in any improper conduct.

The state's largest construction companies, known as Tier One builders, have also been singled out...

CHRIS YOUNG:  What steps did these leaders of the industry take to manage industrial relations risks and corruption and criminal conduct and serious misconduct on these projects? What did they know about the alleged conduct and when did they know it? What did they do about it?

MIKE LORIGAN:  The commission's investigative work is underway. Secret closed hearings have been held and a senior Victoria police officer appointed lead investigator.

JOHN AGIUS SC, SENIOR COUNSEL:  This Royal Commission is also dealing with complaints about standover people, bikies, people who pride themselves on being able to extract money from subcontractors. People who lie about their capacity to produce an EBA for a subcontractor, and maybe some who had associations with members or officers of a CFMEU where there was true corruption involving that officer and the person extracting the money.

He says witnesses may be hesitant to participate.

JOHN AGIUS:  a number of these people will be people working in the industry who hope to have a future in the industry when this commission is over. They will be concerned that if they're seen as a volunteer of information, they may be forced to pay a price for that,

MIKE LORIGAN:  At least two public hearings will be held before Christmas. The Royal Commission's work won't be interrupted by the upcoming Victorian Election in November.

Voters will be expecting answers on where millions of dollars funnelled into the Big Build ultimately went.

KEVIN BELL:  $150 billion is a very large slice of the Victorian budget. If the expenditure of that budget has been corrupted on the government's watch, then the community is right to be deeply concerned.

For years, allegations of criminality and corruption have plagued big infrastructure projects in Victoria. In July, when Ben Carroll became premier, his first decision was to call a royal commission into the construction sector which has now begun. Mike Lorigan reports.