Peter Malinauskas look to block John Setka’s plan to expand workers fund Incolink

The Victorian fund which channels millions of dollars into John Setka’s CFMEU faces a major hurdle in its national expansion plans.

South Australian Premier Peter Malinauskas. Picture: NCA NewsWire / Brenton Edwards

Worker entitlements giant Incolink – the Victorian fund that channels millions of dollars into John Setka’s CFMEU – faces a hurdle in its national expansion plans, with the South Australian Labor government looking to block it from entering the state.

The move has national ramifications for the building industry amid growing tensions within the Master Builders Association about the closeness of MBA Victoria to the Construction, Forestry, Maritime, Mining and Energy Union and their reliance on Incolink for financial support.

Incolink is Australia’s biggest worker entitlement scheme, holding $885m in funds under management, and gave $20.5m in the past financial year to the CFMEU and MBAV for “industry-based training”.

The Australian revealed last month that Incolink is moving to take over worker entitlements in SA, despite the state’s building industry being served since 1989 by its own scheme, BIRST, which holds $43m in worker funds.

Incolink has already gained a foothold in Tasmania, and The Australian has spoken to building industry figures in NSW, the Northern Territory and Western Australia who fear Incolink wants to muscle out state schemes to cover the building industry there.

The biggest prize would be the NSW scheme ACIRT, which has about $780m in funds. And with a new state EBA to be struck, the NSW building industry worries the CFMEU will insist on Incolink being the “agreed fund” between employers and workers.

Builders in SA have been particularly concerned that the latest building industry EBA in Victoria means that from October, contributions for employers and subcontractors will double in that state from $81 to $160 per week per employee to cover the cost of redundancy and retirement benefits into Incolink.

Incolink chief executive Erik Locke has reassured SA builders weekly contributions would remain around $80 to $90 per week, with Mr Setka telling The Australian the CFMEU recognised that SA was a smaller economy and could not pay Victorian rates.

But the reassurance has failed to quell the broader concerns of the building industry about the principle of SA builders paying worker funds into an entity wholly managed out of Victoria and used to fund the CFMEU and MBAV.

CFMEU leader John Setka. Picture: Roy VanDerVegt

The Incolink board includes Victorian and now SA CFMEU secretary John Setka, CFMEU president Robert Graauwmans, Plumbing Trades Employees Union secretary Earl Setches, Master Plumbers CEO Peter Daly, and MBAV CEO Michaela Lihou. The Incolink president is the immediate past MBAV CEO Rebecca Casson.

Premier Peter Malinauskas has told The Australian he shares SA builders’ concerns and is seeing if his government has the power to stop Incolink taking over.

“We are going to look at this to see what levers we have got at our disposal, Mr Malinauskas said.

“These schemes are there to provide an outcome for workers, particularly those who are made redundant, and that’s where the bulk of the money should go. Why would we want to see money move out of South Australia and into Victoria unless it somehow is contributing to a better outcome for workers? That I think is a live question.”

Echoing what SA builders describe as the “brazen” nature of Incolink’s push into SA, the Premier said he had heard nothing from anyone at Incolink explaining their plans.

“Not to me, no,” he said. “Here’s my question – what’s the problem we are trying to fix here? What’s the problem that Incolink professes it can fix? BIRST has been operating in a way that has satisfied the workers who are reliant on such schemes and been supported by employers. If the existing model in SA is working, why change it? There might be an answer to that question, but I haven’t heard what it is.”

The move puts Mr Malinauskas on another collision course with the CFMEU, after the Premier ordered SA Labor to repay a $125,000 donation sought without his knowledge from Mr Setka’s branch last year, saying he wanted nothing to do with the Victorian union boss.

Mr Setka again defended the expansion of Incolink, telling The Australian it was the biggest and best scheme in the country and that workers nationwide deserved access to its training, safety and mental health programs.

“It’s just nuts,” Mr Setka said. “It’s like we have arrived with a brand new Bentley and been told no thanks I want to keep driving my rusted out EH Holden with three on the tree and bald tyres.

“Incolink is easily the best scheme in Australia. I don’t run it. I’m just a director. All the money has to go back to members.

“It is all above board and it’s the best of its kind in Australia. It’s going to inject more money into the South Australian economy. Talk about looking a gift horse in the mouth.”

Mr Setka’s view was echoed by Mr Locke, who said BIRST was “a sub-standard fund” that offered less to workers and the industry.

“Incolink’s offer for members is a vast improvement on what they currently receive as members of BIRST,” Mr Locke said.

“Sadly, over some years BIRST has declined in its level of service to members and has very little ­internal capacity to improve, with few staff or resources.

“By comparison, Incolink would deliver a very wide range of services from counselling and suicide prevention to onsite health services, industry-based training and much more.”