‘Absolutely disgraceful behaviour’: Victorian Labor’s rotten culture exposed

A new parliamentary watchdog to monitor the behaviour of politicians will be the first step the government will take in response to a landmark report that exposed a rotten culture and rampant nepotism inside Victorian Labor and prompted an apology from the premier.

The report from Victoria’s integrity watchdogs, released on Wednesday after a two-year investigation called Operation Watts, provided a damning assessment of the party’s culture and outlined a “catalogue of unethical and inappropriate behaviour”, including misuse of public resources and ongoing corruption risks.

Premier Daniel Andrews committed to adopting all 21 recommendations of the joint investigation by the Independent Broad-based Anti-corruption Commission and Victorian Ombudsman and noted the “absolutely disgraceful behaviour” of former members of his leadership team.

“As leader of the party and leader of our state, I take full responsibility for that conduct,” he said. “That is what the top job is about, and I apologise for it.”

The inquiry followed an exposé by The Age and 60 Minutes that revealed former minister Adem Somyurek’s branch-stacking operation, which prompted the premier to sack him from the Victorian parliamentary party in June 2020. Since then, Somyurek has attempted to resurrect his reputation and positioned himself as a critic of Andrews and the integrity agencies.

The report made adverse findings against Somyurek and another former minister, Marlene Kairouz, but stopped short of referring the pair to the director of public prosecutions for criminal charges.

Somyurek claimed he was the most scrutinised politician in Australia and that the report exonerated him, despite Ombudsman Deborah Glass saying earlier that the report should not be described as “exoneration”.

The report said that while the former ministers’ conduct had been “egregious”, the law around the employment of parliamentary staff was weak and it would be difficult to prove criminality. While the report was damning about widespread cultural practices in the party, it made no adverse findings against the premier or any of the other MPs and staffers it named.

Andrews’ first steps in response to the report will be to seek the approval of both houses of parliament to establish parliamentary ethics committee to enforce beefed up codes of conduct. The government will also begin the consultation process for appointing an integrity commissioner to keep MPs in line and mitigate the “serious ongoing corruption risks” in Victoria, with a deadline of June 2024.

Speaking at a press conference on Wednesday, IBAC commissioner Robert Redlich said the saddest feature of the Operation Watts investigation was listening to young people who had sought a career in politics but discovered “that the only pathway to that objective was by engaging in this unethical factional behaviour”.

“These young people start their career with a distorted moral compass,” he said.

Glass, speaking alongside Redlich, said the government’s response to her 2018 investigation into the so-called red shirts rort, in which Labor MPs misused taxpayer funds during the 2014 election campaign, was “tepid”. She said it was crucial the parliament acted now to crack down on taxpayer funds being used for political purposes.

“The current legislative framework provides few, if any, consequences for abusing public resources and allowed the conduct we revealed in this investigation to continue unchecked,” she said.

“Trust in our politicians is declining and will decline further if real action is not taken. The case for meaningful reform is now both compelling and urgent.”

The report said Victoria has become a “laggard rather than a leader in parliamentary integrity” and listed a litany of failures.

“The evidence established that there was inadequate scrutiny of grants; that staff in the ALP head office turned a blind eye to evidence of branch stacking, payment of members’ fees and the harvesting of their votes; that staff and MPs were aware of practices such as the forgery of signatures and yet took little or no action to address the practice; that staff, with the knowledge of MPs, let other staff use their identity and password to log into ALP databases containing sensitive electorate office data on electors and misused that data; and that there appears to have been little if any effective auditing of such activities.”

It found an environment in which MPs bullied staff and hired unqualified people to undertake factional work, “rampant nepotism, forging signatures, and attempts to interfere with government grants to favour factionally-aligned community organisations, which, in some cases, failed to use the funds as intended.”

Opposition Leader Matthew Guy said the findings show “a Labor government mired in corruption, cover-ups and political games at the expense of Victorians”.

“[It] has exposed a political party unsuitable to hold office,” he said.

Prime Minister Anthony Albanese was questioned about the report, but said he had not seen it at that time. He asserted Labor had cleaned itself up after reforms triggered by allegations of branch stacking against Somyurek.

“I intervened two years ago,” he said, referring to a federal intervention in response to branch stacking revelations.

“I’m pleased [with] the work that (former federal Labor MP Jenny Macklin) and (former Victorian Premier Steve Bracks) have done to clean up the branch here in Victoria.”

IBAC and the ombudsman called on the Victorian parliament to ban publicly funded staff from undertaking party-political activity, including administering, organising or managing a political party, including recruiting and maintaining the membership of party members.

Under another recommendation, MPs would be guilty of an offence if they directed or allowed staff to engage in party-specific jobs during taxpayer-funded working hours.

Other reforms include:

• Banning MPs from employing close family members in their electorate office, and examining whether the prohibition should be extended to parliamentarians hiring family members or colleagues.
• Appointing the secretary of the Department of Parliamentary Services as the employer of electorate officers, and reviewing the process for recruiting and selecting staffers.
• Establishing an alternative pathway for people to make complaints about MPs. Currently, whistleblowers or victims must make complaints about parliamentarians via the president or speaker of parliament.
• Amending the ministerial code of conduct to clarify ministers must ensure public resources are not used for party-specific activities.
• Undertaking a comprehensive review of existing conflict of interest controls for ministers and ministerial staff.
• Strengthening the scrutiny of grants to ensure they are not misused.

As part of his pledge to go further than the report’s recommendations, Andrews has also promised to prohibit any political party from receiving public funds if they did not have thorough internal rules, in what members of the opposition and the crossbench claimed was an attempt to deflect criticism of the Labor party.

Crossbencher Fiona Patten questioned the focus turning to smaller parties and said it was up to the major parties to “get their house in order”.

Andrews conceded to investigators in his private examination that branch stacking in the Labor Party was a “serious problem” that heightened the risk of corruption and must be eliminated but denied the party did not take the misuse of public resources seriously.

He said he had been aware of branch stacking inside the Labor Party – and across the factional divide – over the past few decades but denied “any personal knowledge or involvement in such practices”.

Adem Somyurek attempted to play down his role in Labor’s branch-stacking scandal, despite the damning findings.Credit: Paul Jeffers

When asked on Wednesday what steps he took to investigate the rumours he had heard, Andrews refused to answer the question. Media have been reporting on branch stacking inside the Labor Party during the tenure of Andrews’ leadership, including a 2018 ABC investigation that detailed Somyurek’s branch stacking operation. The premier’s office refused to comment at the time as it was a matter for the party.

On Wednesday, the premier said he could not change what had happened in the past, and that he “was wrong” to call Somyurek a “good friend” who was “a better man than he’s ever been” when he promoted him back into cabinet after the 2018 election. Somyurek was sacked from the ministry in 2015 over allegations he bullied his staff.

“As soon as we became aware of this unprecedented, shameful, disgraceful behaviour [in 2020] we took action,” Andrews said.

The report casts a shadow over the Andrews government’s response to the red shirts rort and calls out Victorian politicians for refusing to act on the ombudsman’s 2018 recommendation to ban MPs from directing staff to perform party-political activity.

Catalogue of Unethical Behaviour by Andrew Dyson.Credit: Andrew Dyson

In a statement to Labor members, Victorian ALP president Susie Byers said the party took the investigation’s findings seriously.

“As a branch, we have made great progress towards a better party,” Byers said.

The integrity agencies acknowledged the work by the Victorian Labor Party to address the endemic practice of branch stacking since June 2020, but said it was too early to assess whether those changes would eliminate the practice and associated integrity risks.

The Morning Edition newsletter is our guide to the day’s most important and interesting stories, analysis and insights. Sign up here.