July 25, 2012
IT ALL began with allegations that federal MP Craig Thomson had misused a union credit card before his election in 2007. The Labor Party should not have preselected him, and certainly not again in 2010. Prime Minister Julia Gillard was belatedly forced to distance her government from Mr Thomson, who now sits as an independent. That is not the end of the affair. A can of worms has been opened in the Health Services Union, prompting questions about whether it is the proverbial, isolated ''rotten apple''.
An internal audit commissioned by the HSU East council last September is the latest of a series of reports to shed light on the disturbing context to the Thomson scandal, albeit only after the report was leaked. The Federal Court last month placed the union under administration, sacked its top elected officials and ordered that a 2010 merger of the NSW, ACT and Victorian branches be undone. Federal Workplace Relations Minister Bill Shorten, who initiated the court action, says the government is tightening regulations on union governance and the HSU East problems are isolated. Of course, the government would say that, given Labor's reliance on union funding and support.
The audit report by Ian Temby, QC, and accountant Dennis Robertson paints such a disturbing picture of an unaccountable leadership culture that assurances that all is well in the broader union movement are simply not enough. Much of the focus is on recent years after Mr Thomson was HSU national secretary. The report makes no firm findings against him, but notes that ''many see him as the protege of Michael Williamson'', the HSU East boss who is damned by the report. While no one has admitted wrongdoing, Labor cannot escape the voters' verdict on its endorsement of Mr Thomson as a suitable person to represent them.
Union members will also expect greater accountability to ensure they get value for their money and to stop union officials from pursuing personal and factional agendas at members' expense. The HSU has been split by factional warriors, including national secretary Kathy Jackson, chief accuser of Mr Williamson and Mr Thomson. The inquiry ''has not entered this territory, fearing it may prove to be a Balkan bog out of which there is no escape''. The harm done to the union and its members is still plain to see.
Lacking the power to obtain evidence and compel key players to co-operate, the Temby inquiry could not make firm conclusions on key questions. Crucially, it was unable to test allegations that Mr Thomson and Mr Williamson received secret commissions from suppliers of services and products to the union, often at multiples of the market rate. It is clear that questionable deals worth more than $20 million were not subject to competitive pricing or tendering. A lack of formal guidelines enabled Williamson family members and friends, who accounted for half of the dozen highest-paid HSU officials, to get away with spending and practices they could not have justified to members.
If they are to restore credibility, the new HSU branches need to elect new leaders. The betrayal of members' trust by the HSU is also a problem for the whole labour movement, even if no other union is led so deplorably. The union movement is in no position to be complacent. The damaging doubts that many members must harbour should compel every union to review its own governance, rigorously and openly, and put in place the formal checks and balances, including transparency, that the HSU blatantly lacked.
The government, too, must ensure regulations make it impossible for members to be kept in the dark about gross misuse of union funds and offices. The Temby report stresses the need for ''acceptance by all concerned that the union has not been governed for and by the members, as ought to be, over a past extended period''. That is the standard of governance by which all unions must be judged. They ignore it at their peril.