Labor rorts: Daniel Andrews heckled over campaign pay deal

Daniel Andrews is heckled by passers-by as he denies claims MPs confronted him in 2014 about dodgy pay deal for campaigners.

Victorian Premier Daniel Andrews has been heckled by passers-by during a press conference as he was forced to deny claims that MPs confronted him in 2014 with concerns about a controversial pay deal for campaigners which broke parliamentary rules.

Mr Andrews this morning hit back at unidentified MPs who say they approached him in 2014 to raise concerns that a pay deal using MP staff allowances to pay campaigners was dodgy.

But the press conference was almost derailed by passers-by yelling abuse, including “dodgy c***” and “pay us back our f***ing money”, as they passed the Premier at a busy intersection near Melbourne’s Chandler Highway.

Unruffled by the slurs, Mr Andrews insisted he had done nothing wrong.

“No such approaches were made,” he said, of the reports members of his team had approached him about the deal.

“And if you look at what the Ombudsman has found, it’s been completely consistent with that, that Ombudsman has found that each and every person involved in this acted in good faith and acted on a reasonable assumption that this was simply the extension of long standing parliamentary pool arrangements,” he said.

“The notion that there were people concerned and they chose to raise these matters, that’s not what the Ombudsman finds.”

The comments and the public response comes the day after Victorian Ombudsman Deborah Glass found the party had “crossed a line” during the 2014 election campaign, with a staff pooling arrangement which saw MP staff allowances used to pay campaigners’ wages for two days a week.

The Ombudsman calculated that all up, the scheme rorted almost $488,000.

Unnamed MPs have come forward to say that the Premier knew the funding arrangements tested the boundaries of the parliamentary rules and they told him as such.

Against the criticism, Mr Andrews has defended all members named in the report, which include Attorney-General Martin Pakula, Police Minister Lisa Neville, Special Minister of State Gavin Jennings and a raft of other frontbenchers, and have said they all deserve to keep their jobs.

But the Coalition is ramping up pressure for heads to roll over the scandal, and has called Attorney-General Martin Pakula’s position untenable.

Mr Pakula this morning defended himself and also rejected suggestions that the Andrews government had cheated it’s way to victory in the 2014 with the dodgy deal in place.

“You might want to say that this is the reason that the government won the election, but I don’t accept that,” Mr Pakula told Neil Mitchell on 3AW.

‘We told Andrews it was dodgy’

Victorian Attorney-General Martin Pakula has defended the Andrews government against claims senior members knew a pay arrangement for campaign staff was dodgy.

A day after the Coalition said the Attorney-General’s position was untenable, Mr Pakula stood by the Premier’s claims that he was never consulted about the controversial pay deal.

“The Premier has said it wasn’t [discussed with him] and my take on what he said is that he doesn’t recall anyone raising it with him,” he said.

“Members genuinely believed and were told it was an approved scheme. They acted in good faith.”

He also dismissed comments that pay deal, which breached parliamentary guidelines, was critical to Labor’s election victory.

“You might want to say that this is the reason that the government won the election, but I don’t accept that,” Mr Pakula told 3AW.

The comments come after several unnamed MPs came forward to say they raised concerns with the Premier in 2014 that the pay deal went against parliamentary rules.

Under intense questioning, Mr Pakula denied ever discussing the scheme in the presence of the Premier. “It wasn’t a conversation we ever had ... I couldn’t exactly say why not,” he said.

Mr Pakula says he attended around four campaign meetings in as many years, and the pay deal — which used MP’s staff allowances to cover the cost of campaigners — was never discussed at campaign committee meetings he attended. Mr Pakula took aim at the anonymous MPs, saying they lacked credibility.

Two unnamed Labor MPs this morning directly challenged Mr Andrews’ assertion that MPs did not raise any concerns with him over the 2014 campaign funding arrangement.

Hours after the Victorian Ombudsman yesterday found Labor had misused $387,842 in taxpayer funds during the campaign, Mr Andrews was asked if colleagues had questioned the arrangement with him. “I don’t believe so,’’ he told reporters yesterday.

But at least two Labor MPs broke ranks over the Premier’s claim. “After watching him on the news and denying it, I can’t stay silent even for the sake of the party,’’ one MP told The Herald Sun.

“He (the Premier) knew about concerns about the funding model. I and several other MPs raised it with him. We told him it was a nonsense.

“We were willing to back him, but he’s just thrown people under the bus today. We raised the funding with him personally. ­Despite that, Daniel personally urged MPs to participate.”

A second MP told The Herald Sun there was “heaps of chatter” about how campaigners were being paid, adding: “It was common knowledge that Daniel and John (former state treasurer John Lenders) were putting people under huge pressure to participate in the scheme.”

Mr ­Andrews is resisting calls for some of his most senior lieutenants to resign in the wake of the explosive report that found Labor had broken parliamentary rules when it used the staff allowances of 21 MPs to pay for campaigners ahead of the 2014 election.

Mr Andrews yesterday apologised after the Victorian Ombudsman released the report, but he insisted that no MP should lose their job. The Coalition has ­demanded the Premier take ultimate responsibility for the rort, describing Attorney-General Martin Pakula’s position as “untenable” and accusing the government of “cheating” its way into office.

The report of Victorian Ombudsman Deborah Glass found the party had “crossed a line” in regards to a scheme that used politicians’ staff allowances to employ electoral officers who were instead engaged as campaigners.

Labor at 2014 Victorian election.

Mr Pakula and Special Minister of State Gavin Jennings were among the 21 MPs who took part in the scheme that saw their offices cover the cost of a campaigner for two days a week. Mr Lenders was named as the architect of the scheme.

Deputy Premier James Mer­lino, Police Minister Lisa Neville and lower house leader Jacinta Allan were found to be beneficiaries, receiving assistance from the campaigners.

“It was a picture of a well-organised campaign by the ALP to ­recruit and deploy full-time field organisers in the run-up to the 2014 Victorian state election,” Ms Glass said. “While some electorate-officer work was done for some members of parliament, the ­arrangement to employ field organisers as electorate officers was an artifice to secure partial payment for the campaign out of parliamentary funds, and was wrong.”

The Ombudsman’s findings end a two-year investigation that endured multiple legal challenges to stop it or limit its scope, with government legal fees exceeding $1 million.

Mr Andrews confirmed that Labor had repaid $388,000 — the cost of employing 21 field officers on an average salary of $63,300 pro rata — but rejected suggestions that any member or minister should quit over the findings.

However, one high-profile scalp has already emerged, with Mr Lenders this month announcing his intention to quit as chairman of the state’s rail owner, VicTrack. While Mr Lenders cited personal reasons for his decision, Ms Glass detailed how Department of Parliamentary Services had told Mr Lenders in early 2014 that parliamentary staff working as electorate officers could not be used as field organisers, and that he never told them about the ­arrangement that eventuated.

“There is undoubtedly a blurred line between permissible and impermissible uses of parliamentary funds, and ... in seeking to maximise the use of resources available to the party, Mr Lenders crossed the line,” Ms Glass said.

His resignation was made public just days ahead of the report’s release.

Defending his stance, Mr Andrews stressed that Ms Glass had found the MPs who took part in the scheme thought it was a legitimate use of funds and that none of them derived any personal benefit from the use of the funds.

“The Ombudsman has made it very clear that everyone involved in this acted with the not unreasonable assumption ... in good faith, deriving no personal benefit,” he said. “I am sorry this has occurred, and really the most important thing here is to ensure that we prove that we are sincere in that apology.”

Opposition Leader Matthew Guy said Labor members needed to be held to account. “If you take money from your employer, you usually lose your job,” he said.

“Those ministers and parliamentary secretaries involved in this rort must resign.”

Former Liberal premier Jeff Kennett echoed the call, saying all MPs involved should step down or withdraw or not contest the next election. “This is fraud, naked fraud,” he said.

Federal Labor leader Bill Shorten described the report as “a serious matter” but said it was a state issue.

Questions are being asked about the broader fallout for the party during an election year, with key members of the ALP’s campaign team also named in the report, including national secretary Noah Carroll and current assistant state secretary Stephen Donnelly.

The Ombudsman was most scathing about the lengths the government went to challenge the investigation, outlining the obstacles she faced including litigation that dragged on for more than a year. Ms Glass said the financial and practical toll of litigation and a government challenge, which went to the High Court, prevented her from expanding the scope of the investigation to the lower house, even though she thought it was warranted.

The government is understood to have spent up to $1m in court costs challenging the Ombudsman’s investigation, in addition to $420,000 spent by the Legislative Council and Department of Premier and Cabinet on external legal costs. Ms Glass was initially asked by the Legislative Council to investigate reports Labor MPs had misused staff budget entitlements during the 2014 election, but the government tried to argue it was not in her jurisdiction.

Mr Pakula defended the government’s decision to challenge the Victorian Ombudsman’s investigation, saying that it needed to test an important issue. The Australian asked each MP and minister implicated in the report whether they would resign. Ms Neville said the report found that participants had acted on the assumption they were working within the rules: “The Ombudsman has found no wrongdoing on my behalf or any other MP.”