Red Shirts rorts cost Victorian taxpayers $1.3m

Victorian Labor’s misuse of parliamentary allowances have hit the state’s taxpayers, newly released records show.

Victorian Premier Daniel Andrews hit out at the Opposition’s calls for Victorian Labor to pay back the cost of the Ombudsman’s investigation. Picture: AAP

Victorian taxpayers have shelled out more than $1.3 million as the result of Victorian Labor’s so-called Red Shirts rort and misuse of parliamentary allowances, according to new records released by the Victorian Ombudsman’s office.

An annual report from the Victorian Ombudsman’s office reveals the agency spent $878,588 on an investigation into Victorian Labor’s misuse of $388,000 in MP staff allowances to pay campaigners during the 2014 election campaign.

The near $900,000 Ombudsman’s bill includes the cost of the actual investigation, as well as internal and external legal advice on how to proceed while the Andrews government launched successive rounds of legal action attempting to stop the probe.

The Ombudsman’s office spent $133,993 on external legal services during the three year probe and legal action, and $744,862 on investigation costs, including staff and other professional costs, for the actual investigation.

This comes in addition to the near $140,000 in legal fees the government spent fighting the Ombudsman’s probe, as well as another $332,000 in extra legal fees billed to the Legislative Council.

Combined, taxpayers have now spent almost $1.3 million as a result of the botched staff pooling scheme.

The scheme, which came to be known as the ‘Red Shirts’ rort for the red shirts the campaigners wore, initially began as a pooled staffing arrangement but “crossed a line” and broke parliamentary rules when MP staff funds were used to pay campaigners for political work.

Victorian Labor has since paid back the $388,000 in MP staff allowances, but the issue continues to dog the government particularly as vast uncertainty remains about how much Premier Daniel Andrews knew about the scheme and whether he was complicit in its operation.

Under questioning in Question Time today, Mr Andrews hit out at the Opposition’s calls for Victorian Labor to pay back the cost of the Ombudsman’s investigation.

But the Opposition said it believed the true cost was likely to be even higher than the current total of $1.3 million.

“This ... doesn’t even include the Parliament’s costs or the Government’s total costs,” Opposition spokesman for legal affairs John Pesutto said.

“The Ombudsman’s figures now put an onus on Daniel Andrews to reveal the total staff costs, in addition to external legal fees, involved in Labor’s cover-up. The Premier must also reveal the costs to taxpayers for the Solicitor General.

“Labor have now spent millions of dollars of taxpayers’ money in rorts and trying to cover up their rorts which is money better spent on police, schools and hospitals.”

Victorian Ombudsman Deborah Glass noted that she faced serious challenges determining the full scale of the rort, given that her frame of reference was limited to the upper house which precluded her from interviewing lower house members, including the Premier.

Within the annual report, she outlines how she first received the referral to investigate the rort in November 2015, but the investigation was delayed by legal proceedings which finally wrapped up almost two years later in April 2017.

“The office received separate funding from the Department of Premier and Cabinet to carry out this investigation, which the Ombudsman considered to be in addition to the core work of the office.

“The department agreed to provide this funding without limitation.”

She revealed that the investigation included four full-time investigators, as well as costs for transcription services, security, additional computer equipment and fees paid to professional editor. The Ombudsman’s office also hired the Honourable Murray Kellam QC to act as an adviser on the investigation.