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Victoria's Big Build Program: A Comprehensive Overview of Alleged Corruption, Government Response, and Reforms

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The Big Build: A Chronicle of Allegations, Investigations, and Government Response

An unbiased account of events, allegations, and government actions concerning Victoria’s infrastructure program, including the roles of IBAC, Victoria Police’s Taskforce Hawk, the CFMEU, and private sector involvement.

Background and Context

The "Big Build" Program

Victoria’s "Big Build" is a state-funded program of major infrastructure projects, including the Metro Tunnel, North East Link, and Suburban Rail Loop. The total cost has been reported as approximately $100 billion to $114.5 billion.

The Independent Broad-based Anti-corruption Commission (IBAC)

IBAC is Victoria’s anti-corruption watchdog, established in 2011 under the Baillieu government. It has been limited by a narrow definition of corrupt conduct, requiring reasonable grounds to suspect a crime before launching an investigation. Public hearings have been restricted to "exceptional circumstances." IBAC and other integrity agencies have repeatedly called for independent funding determination and expanded powers.

The Construction, Forestry, Maritime, Mining and Energy Union (CFMEU)

The CFMEU’s Victorian branch has been the subject of multiple investigations. In 2024, the federal government placed the union into administration over allegations of organised crime infiltration. The Fair Work Commission documented over 1,000 complaints regarding CFMEU conduct between July 2024 and mid-October 2025, with 600 specifically related to Victorian construction sites.

Timeline of Key Events

Initial Warnings and Reports (2023-2024)

  • June 2023: Kevin Devlin, head of the Victorian Infrastructure Delivery Authority (VIDA), reported to then-transport minister Jacinta Allan regarding "anecdotal claims of alleged criminal behaviour" on Big Build sites.
  • March 2023: The Spark consortium (building the North East Link) reported to government that the CFMEU was hindering construction. A later monthly progress report noted a "negative impact on progress" due to CFMEU actions, including delayed tunnelling by up to two months.
  • July 2024: The "Building Bad" investigation by media outlets (including The Age and 60 Minutes) exposed alleged links between bikie gangs, the CFMEU, and Big Build contracts.
  • July 14, 2024: Premier Jacinta Allan sent a referral letter to IBAC requesting investigation of alleged serious corrupt conduct on major government projects. IBAC informed the Premier’s office that the matters were outside its jurisdiction.

Taskforce Hawk Establishment

Operation Hawk was established by Victoria Police in mid-2024, evolving into Taskforce Hawk in 2025. The taskforce was created to investigate organised crime, corruption, and criminal activities in the construction industry.

Budget and Funding Issues (2026-27)

  • IBAC’s 2026-27 budget is $69.2 million, leaving a $6 million deficit. CEO Alison Byrne stated the agency would need to make staff redundant and delay investigations.
  • The Victorian Ombudsman received $22.9 million for 2026-27, about $1.2 million short of expected operating costs. Ombudsman Marlo Baragwanath warned that serious matters would not be investigated due to underfunding.

Allegations and Investigations

Geoffrey Watson SC Report ("Rotting from the Top")

Geoffrey Watson SC, appointed by the CFMEU administrator, authored a report submitted to Queensland’s Commission of Inquiry into the CFMEU. Key allegations include:

  • Systemic Corruption: Allegations of widespread extortion, violence, and bribery on CFMEU-run work sites.
  • Organised Crime Infiltration: Claims that bikie gangs, including the Bandidos and Rebels, used government building sites for drug distribution.
  • Cost Estimate: Watson estimated that union conduct cost taxpayers approximately $15 billion, a figure supported by Fair Work Commission general manager Murray Furlong as consistent with information from Victorian officials.
  • Redacted Material: Sections removed from the final report (at the direction of administrator Mark Irving KC) allegedly concluded that the Victorian government knew about corruption but took no action. Irving stated the sections were removed because he was "not satisfied that they were well-founded or properly tested."

Reports of Payments to Mick Gatto

Multiple sources reported that subcontractors on Big Build projects made payments to gangland figure Mick Gatto from 2020 to 2026. Subcontractors stated they paid Gatto for mediation or industrial relations services to resolve disputes with the CFMEU, describing it as necessary due to the union's power to block site access.

Labour Hire Company Allegations

  • Women in Construction (WIC): A labour hire company supplying female workers to Big Build projects, owned by Luke Ellery (convicted of domestic violence) and managed by Wayne Carter (former union official jailed for drug trafficking). The Labour Hire Authority refused to renew WIC’s licence, citing concerns that decision-makers were not "fit and proper" persons. The company supplied up to 250 workers weekly, generating an estimated $2.5 million per week.
  • 24-7 Personnel: Had its licence cancelled by the Labour Hire Authority after failing to declare Jie Zhu, a convicted murderer, as a senior decision-maker. The company had worked on the Golden Plains Wind Farm.
  • Other Firms: The Labour Hire Authority cancelled 151 construction industry licences and blocked 48, and Victoria Police laid 88 charges related to labour hire violations.

Metro Tunnel Fraud Allegation

Taskforce Hawk investigated an alleged $6 million fraud on the Metro Tunnel project involving Swiss company Schindler Group. The company claimed payment for replacement escalators after a flood in October 2024, but CCTV footage showed no damaged equipment was replaced. Schindler admitted the fraud, removed three employees, and repaid the funds. Police were not formally notified by government officials.

North East Link Delays and Costs

The North East Link project budget escalated from an initial $10 billion to $15 billion in 2019, and to $26 billion by December 2023. The government attributed increases to expanded scope, environmental compliance, and global economic disruptions (COVID-19, Ukraine war). Documents obtained by the opposition showed the consortium complained about CFMEU-caused delays in March 2023.

Alleged Metro Tunnel Cost Overruns

A leaked May 2024 report from the Cross Yarra Partnership consortium stated that $196.4 million in labour costs were driven by union-backed staffing rules, including non-productive workers. The consortium said the state government supported its approach of adopting "excessive union requirements" to avoid works being suspended. The total Metro Tunnel cost was reported at more than $15 billion, more than triple the 2008 estimate.

Ombudsman Warning on VIDA Record-Keeping

The Victorian Ombudsman warned that the Victorian Infrastructure Delivery Authority (VIDA) was exposed to corruption risks due to inadequate record-keeping regarding taxpayer fund expenditures. The Ombudsman referred concerns to IBAC and the Victorian Auditor-General’s Office.

Allegations of Government Pressure

Three sources from the Big Build stated that in mid-2022, then-transport infrastructure minister Jacinta Allan’s office pressured the Rail Infrastructure Alliance to reach an agreement with the CFMEU over the Gap Road level crossing removal project in Sunbury. The agreement allegedly led to the installation of a particular labour hire company costing taxpayers nearly $2 million more than the previous firm.

Political Donations

Victorian Labor received donations from firms that are now subject to police action over suspected corrupt payments or have links to organised crime figures on state-funded projects. These firms include B K Labour (owner charged with fraud), Anthony Ciccone’s companies (which engaged Mick Gatto), and CCL (linked to a former Bandidos boss). A Victorian Labor spokesperson stated that the donations were made prior to the surfacing of these allegations and complied with legal requirements.

Government Response and Positions

Statements by Premier Jacinta Allan

  • Denied that corruption added meaningfully to Big Build costs, attributing cost increases to inflation.
  • Dismissed Geoffrey Watson’s $15 billion estimate as "untested" and "not well-founded."
  • Stated she referred allegations to IBAC in July 2024 and later learned IBAC lacked jurisdiction.
  • Rejected calls for a royal commission, stating a previous royal commission "failed" and that existing bodies (Victoria Police, Fair Work Commission) are sufficient.
  • Acknowledged receiving anecdotal warnings from Kevin Devlin in June 2023, stating she ordered an investigation but was told there was no evidence of "systematic behaviour."
  • Declined to comment on alleged payments to Mick Gatto, referring any criminal evidence to police.
  • Maintained that Victoria Police have all necessary powers to investigate, despite Taskforce Hawk stating new laws are needed.

Statements by Other Officials

  • Taskforce Hawk Leaders: Stated that organised crime figures have infiltrated the Big Build. They identified a "grey corruption" area where certain rorting activities are not captured by current criminal laws and called for legislative changes to regulate debt collectors and industrial fixers. They reported difficulty recruiting witnesses due to fear of reprisal.
  • Labour Hire Commissioner Steve Dargavel: Stated that principal contractors are responsible for corruption, saying "the fish rots from the head."
  • Former Officials Robert Redlich and Deborah Glass: Called for a royal commission, describing the situation as "an unprecedented historic scandal."
  • Attorney-General Sonya Kilkenny: Stated the government is working with police on whether additional powers are needed.
  • Transport Infrastructure Minister Gabrielle Williams: Announced a new mandatory register for industrial relations consultants and mediators.

Opposition Response

  • Opposition Leader Jess Wilson called for a royal commission, describing the situation as "the biggest corruption scandal in Victoria's history."
  • The Coalition proposed US-style anti-racketeering laws, an asset seizure taskforce, and legislative reforms including expanded IBAC powers.

Proposed Reforms and Powers

IBAC Power Expansion

The government proposed changes to IBAC’s powers (announced June 1, 2026), which would not be considered before the November state election. Proposed changes include:

  • Follow-the-Money Powers: IBAC could investigate the spending of public money via private and third-party contractors.
  • Broader Scope: Definition of corrupt conduct widened to include serious disciplinary offenses, conduct warranting termination, or serious breaches of public trust.
  • Increased Transparency: IBAC could make and publish formal findings of corrupt conduct and table recommendations in parliament.
  • Digital Searches: Investigations not impeded by off-site or cloud-stored data.
  • Document Destruction Offense: Criminal offense to destroy or conceal documents relevant to IBAC inquiries.

Parliamentary Actions

  • The lower house delayed a vote on an omnibus justice bill to prevent a Greens-Coalition amendment granting IBAC "follow-the-money" powers from passing.
  • The Greens and Coalition have proposed amendments to grant IBAC expanded powers.
  • The opposition introduced a private member’s bill to expand IBAC powers.

Taskforce Hawk Recommendations

Police called for:

  • Legislative changes to regulate debt collectors and industrial fixers.
  • Character testing for those operating in certain roles.
  • New laws to address "grey corruption" areas not covered by current criminal law.

Arrests and Charges

Joel Leavitt

A 32-year-old former CFMEU official and patched member of the Bandidos, charged with blackmail for allegedly demanding $663,000 from a man in January. Leavitt was described in the Watson report as a "brutal criminal" who reportedly earned over $200,000 annually as a health and safety representative. He appeared in court facing bail modification issues and alleged bail breaches.

John Setka

Former CFMEU Victorian secretary, charged with multiple counts of using a communication device to menace, harass, and offend (alleged text messages and emails sent between October 2024 and December 2025). He also faces charges of alleged threats to an official of the CFMEU administration and bail violations.

Other Arrests

  • Two other men (32-year-old Watsonia man, 55-year-old Mernda man) arrested in connection with the blackmail investigation alongside Leavitt.
  • Multiple individuals charged by Taskforce Hawk for various offenses, with police stating 22 arrests for 72 offenses had been made as of one reporting period, and later 70 charges against 15 individuals.

Witness Intimidation

Australian Federal Police warned that investigations into building industry crime are being hindered by threats from organised crime figures. A confidential AFP letter stated that "companies have made facilitation/extortion payments to organised crime to enable building projects to progress uninterrupted" and that "business owners contacted for assistance by detectives have been intimidated into not co-operating with police after receiving threats."

Conflicting Claims and Unresolved Facts

  • Cost of Corruption: Premier Allan disputes the $15 billion estimate by Geoffrey Watson, stating it is untested. Watson’s figure was supported by Fair Work Commission chief Murray Furlong but removed from the final report by administrator Mark Irving as "not well-founded or properly tested."
  • Knowledge of Corruption: Allan states she was unaware of widespread problems until July 2024 media reports. Documents show contractors complained about CFMEU delays in March 2023, and her infrastructure chief warned her in June 2023 about "anecdotal claims of alleged criminal behaviour."
  • Government Response Adequacy: Allan maintains that existing bodies and actions (Taskforce Hawk, Labour Hire Authority, legislative changes) are sufficient. Taskforce Hawk police state new laws are needed. Former IBAC commissioner Robert Redlich stated the Premier and her department should have been aware of IBAC’s limited powers.
  • Metro Tunnel Costs: The government attributes cost increases to inflation. Leaked documents distinguish between inflation-related costs ($232 million) and surplus wages paid to appease the CFMEU ($196.4 million).

Regulatory Actions

  • The Labour Hire Authority cancelled or refused nearly 200 licences, including Women in Construction and 24-7 Personnel.
  • Victoria Police laid 88 charges related to labour hire violations.
  • The government established a mandatory register for industrial relations consultants and mediators (announced by Minister Gabrielle Williams).