Liberal senators pursue Attorney-General’s Department over CFMEU costs

A parliamentary hearing has descended into a row and been suspended after one politician made a wild claim about another.

A parliamentary hearing has been suspended after bickering senators descended into a row over a powerful union’s links to the federal government.

Labor senator Nita Green halted the senate estimates hearing she was chairing on Tuesday morning after Liberal senator Paul Scarr accused her of running interference for the Construction Forestry Maritime Mining and Energy Union.

Senator Scarr and his colleague Michaelia Cash were questioning Attorney-General’s Department secretary Katherine Jones over a settlement involving the federal government, the CFMEU, building giant Leandlease and the axed Australian Building and Construction Commission.

Lendlease sued the ABCC seeking to stop the construction watchdog from taking enforcement action to prevent the CFMEU flying a Eureka flag on a Lendlease worksite.

The ABCC won and was entitled to costs after a court ruled in March last year that companies subject to the Commonwealth building code could not allow the Eureka flag, or any union insignia, to be displayed on the job.

Liberal senator Michaelia Cash has used a senate estimates hearing to raise questions about the CFMEU. Picture: NCA NewsWire / Gary Ramage

The CFMEU came into the case as a third party with plans to appeal the decision.

Attorney-General Mark Dreyfus approved a settlement requested by the ABCC, sparking complaints from the Coalition that this amounted to a loss of $150,000 worth of taxpayers’ money that the union should have been pursued for.

Mr Dreyfus is understood to have made the decision to avoid further costs to the Commonwealth, given Labor repealed the law banning flags on worksites after it won government.

Given the change to the building regulations, Mr Dreyfus is understood to have believed the Commonwealth would have been likely to lose the appeal.

Labor has also followed through on its election commitment to abolish the ABCC, a government agency established by the Coalition in 2016 to regulate the commercial building and construction industry.

Senator Cash, the opposition’s legal affairs spokeswoman, has called for Mr Dreyfus to be referred to the National Anti Corruption Commission over his handling of the settlement once the new integrity watchdog is operational later this year.

It was also revealed in senate estimates on Tuesday that Lendlease and the ABCC had cut a deal on legal costs before the building company sued the government agency.

An Attorney-General’s Department official confirmed Lendlease and the ABCC had agreed that neither would seek legal costs against the other regardless of whether Lendlease won, lost or withdrew the case.

Attorney-General’s Department secretary Katherine Jones was grilled over the settlement. Picture: NCA NewsWire / Gary Ramage

Greens senator David Shoebridge, who was asking questions on the panel, described the agreement as a “sweetheart deal” which left the union as the only player in the matter exposed to a costs order.

Senator Shoebridge told the hearing Lendlease was making large political donations at the time to the Morrison government, with the building company giving more than $40,000 to the Liberals and $11,000 to the Nationals.

Tensions arose earlier in the hearing as Liberal senators brought up the CFMEU’s own financial ties to the other side of politics.

Senator Cash, a frequent, outspoken critic of the union, said at one point: “Blind Freddy knows the CFMEU is a significant donor to the Labor Party.”

Senator Green used her questions to try to establish that the ABCC sought a settlement to prevent the CFMEU appealing, prompting Senator Scarr to accuse her of “running interference” and Senator Green to temporarily suspend the hearing in turn.

The Australian Electoral Commission’s annual returns released this month revealed unions gave nearly $17m to the Labor Party in the past financial year, with the CFMEU donating $4.3m alone.