Minister’s letter reveals details of allegations against opposition leader

The Andrews government has asked the state’s corruption watchdog to investigate whether Opposition Leader Matthew Guy and his former chief of staff may have committed a crime by conspiring to engage in potentially corrupt conduct.

In a letter obtained by The Age, Government Services Minister Danny Pearson asks corruption watchdog chief Robert Redlich to consider whether an unrealised proposal from Guy’s chief of staff to receive $100,000 in payments from a Liberal donor, in addition to his taxpayer-funded salary, could have constituted corrupt conduct.

Matthew Guy speaks to the media on Tuesday.Credit: Wayne Taylor

“I write in relation to matters published in The Age newspaper ... concerning Mr Matthew Guy MP and Mr Mitch Catlin, and their engaging or conspiring to engage in potentially corrupt conduct,” he wrote in the letter to the Independent Broad-based Anti-Corruption Commission boss.

Pearson said the “attempted entering into of an agreement involving the disbursement of funds in a political context for ‘supporting business interests’ naturally invites consideration” of a finding of potentially corrupt conduct.

Guy on Tuesday accepted the resignation of his friend and chief of staff Catlin, who unsuccessfully sought payments from wealthy Liberal donor Jonathan Munz in addition to his publicly funded salary.

Despite being chastised by integrity agencies for its own woes last week, Labor seized on revelations in The Age, claiming they were proof Guy “could not be trusted”, in an attempt to tear down the Liberal leader three months before the state election.

Munz, whose family was estimated to be worth $1.24 billion in 2019, made his fortune as founder of plumbing supplies company Reliance Worldwide Corporation. The horse racing figure funded a High Court bid that unsuccessfully sought to prove the Victorian government’s COVID-19-related restrictions on movement were unconstitutional. Companies he controlled have made large donations to the Liberal Party, including a $100,000 donation in 2017-18.

The Age contacted Munz and Catlin for comment.

Munz told News Corp: “I do not know how many people received this unsolicited and unwanted email, but when I got it, I rejected it out of hand.”

Guy told nervous MPs in the Liberal party room that the swift resignation of his top adviser would clear the decks and allow the Coalition to continue criticising the government’s record on integrity, which the opposition was planning to make a central campaign issue before the November election.

Mitch Catlin.Credit: Tash Sorensen

However, some MPs expressed concern about the political impact of the revelations and in a meeting of Coalition MPs former leader Michael O’Brien spoke up about the importance of integrity.

Addressing the media on Tuesday morning, Guy said Catlin offered his resignation even though the contract was never signed, and he denied forwarding the email to the donor.

Credit: Matt Golding

Guy also committed to introducing a code of conduct for his advisers, which Dr Catherine Williams from the Centre for Public Integrity previously flagged as “a gaping hole in Victoria’s integrity framework”.

“I value integrity,” Guy said. “We didn’t do this. We didn’t agree to this. Nothing was signed. There was nothing signed.

“We value integrity, which is why Mitch has resigned today despite signing and agreeing to nothing.”

Asked whether the proposed payments were linked to Catlin’s employment as his chief of staff, Guy said “of course that was part of the discussion”.

“But the point is that was not considered transparent enough … and nothing was ever [acted] on,” he said. “Mitch and I believed it was better to have everyone employed through the [regular] budget, which is what it is today.”

The Age on Tuesday reported details of a proposed agreement for a donor, who rejected the proposal, to pay $8333 a month to Catlin’s private marketing company, Catchy Media Marketing and Management, for services as a contractor described as “supporting business interests”.

“Hey MG. Attached is the proposed agreement between [the donor] and Catchy Media Marketing and Management,” Catlin wrote in an email, obtained by The Age, to Guy’s private Hotmail address. “It’s as per the original email agreement between you and me. Can I leave you to forward onto him?”

Speaking under parliamentary privilege on Tuesday, which protects MPs from defamation action, Pearson claimed Guy and Catlin had conspired to subvert the state’s strict donation laws.

“[It was a] scheme designed to donate to the Liberals through sham contracts ... This person cannot be trusted,” he said.

“It’s up the authorities to investigate this matter and do their job.”

In addition to IBAC, the government asked Victoria Police, the Victorian Electoral Commission, the Victorian Ombudsman and the Australian Federal Police to look into the matter.

Guy said the government’s request for authorities to investigate the matter was a “desperate attempt from a tired, corrupt and arrogant government to distract from its own integrity failings”.

He said he would fully co-operate with any investigation and “will not waste taxpayer money to block the work of integrity agencies and cover-up the truth. Unlike Daniel Andrews, I will increase, not cut, the funding and powers of the ombudsman and the IBAC.”

In Pearson’s letter to Redlich, he asks that IBAC consider whether Guy and Catlin’s proposal could have constituted corruption as outlined in the IBAC Act of 2011 if it:

• Adversely affects the honest performance of the function of a public officer;
• Constitutes or involves the dishonest performance of functions as a public officer;
• Constitutes or involves a public officer knowingly or recklessly breaching public trust;
• Constitutes a conspiracy or attempt to engage in such conduct

Further, Pearson wrote that the proposal may have breached the Electoral Act of 2002, which prohibits “entering into” a scheme to circumvent donation laws.

The Victorian Electoral Commission posted on social media on Tuesday that it was “aware of recent issues raised regarding political donations being potentially disguised as alternate payments or funding to political entities”. It did not name any individual MPs or staff.

“We take the regulation of political donations very seriously and have commenced preliminary inquiries into these issues. In the lead-up to state election, we’ll continue to monitor and follow up on activities that may constitute an offence against the Electoral Act, including where a person appears to have entered into a scheme to avoid donation disclosure and reporting requirements.”

Integrity experts told The Age that if the proposed contract was acted upon and was determined to be a donation, it could breach the state’s $4210 cap on donations.

Former opposition leader Michael O’Brien, an ex-barrister, said during the meeting of Liberal MPs on Tuesday that opposition MPs and staff often took pay cuts to be involved in politics because it was a service to the public.

On Tuesday afternoon, O’Brien tweeted: “Sick of dodgy politics? So am I. It’s why I’ll fight for more power and more funding for our anti-corruption watchdogs.”

Coalition MPs expressed nervousness about the potential political damage that could be caused by the episode. In particular, they were worried that Guy was susceptible to attacks on political integrity because of the “lobster with a mobster” dinner, where he dined with an alleged mafia boss, and scandals as a planning minister in the Baillieu-Napthine government.

Federal Liberals were also worried if Guy could withstand any further revelations about his involvement in the proposed arrangement with Catlin.

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