More than $2 million in union and parliamentary resources were thrown at the two HSU elections.

Fairfax Media published several stories about Bill Shorten this weekend including this lengthy feature article today:

Bill Shorten, the man who grew good at manipulating Labor's machine

The article is huge and you'll need to go to a Fairfax website to read it in full - link here.   Many Fairfax journalists know Shorten personally.   The great tragedy for Australia is that these "revelations" weren't reported until it became clear that Shorten was finished.

Here's one element of the report:

HSU scandal

On entering Parliament, Shorten and his allies continued to consolidate and extend their factional strength. One organisation - long used and abused as a political plaything in the ALP -  became a focus of attention.

With financial support from Shorten's core union base - the AWU and the plumbers' union - Landeryou and factional numbers man David Asmar sought first in 2009 and again, successfully, in 2012 to seize control of the disgraced HSU No.1 branch in Victoria. In both cases their opponents were a team linked to one-time Shorten ally turned bitter enemy, the controversial Kathy Jackson.

More than $2 million in union and parliamentary resources were thrown at the two HSU elections.

It was a risky move. The HSU was a political quagmire and, now in government, Shorten needed to be seen to have risen above union dogfights lest they land him in scandal.

He was also the workplace relations minister and in 2012 launched Federal Court action that eventually ended with the HSU being put into administration. And later that same year, his allies were targeting its main Victorian branch.

The HSU elections, and the actions of Shorten's anointed successor at the AWU, Cesar Melhem, are among a string of scandals that now threaten Shorten's long-cherished dream to become PM. The Abbott government established a $60 million royal commission, in part, to do precisely this. A long career building, patching and rebuilding a Labor factional machine has left plenty of material.

In 2012, Fairfax Media revealed details of a secretive slush fund, Industry 2020, linked to the AWU, which was used to fund the HSU elections. Founded by Melhem in 2008, and actively supported by Shorten, it raised $500,000 from companies and unions, including from key AWU employers from Shorten's union days, billionaire Richard Pratt's Visy group, and major builder John Holland.

Melhem used the fund for his - and Shorten's - factional chess game. Notable among recipients of Melhem's largesse were the HSU challengers and the Cairnlea soccer club, the factional base of the Suleyman clan in Shorten's seat of Maribyrnong.

Evidence would later be tabled in the trade unions royal commission of AWU emails that encouraged employers to attend the Industry 2020 fund-raisers as a means of ensuring harmonious relations with the AWU - apparent evidence of trading industrial peace for cash.

Melhem took a seat in the State Parliament in 2013, despite the controversy, but his political career has since been dashed by the royal commission's allegations of phantom AWU members, employers paying union members' dues, and deals with companies that allegedly short-changed workers.

The votes controlled by the Health Services Union were critical for Shorten.  Those votes were secure while the great Labor mate Michael Williamson ran the show - however that all changed when Williamson was cut loose by Labor and the ACTU - meaning Shorten had to face the prospect of a HSU with Kathy Jackson in effective control.   I hope the TURC has a very close look at the events leading up to Shorten's move to appoint an Administrator to the HSU.  Crack that nut and you'll go a long way towards the heart of the Labor/Union corruption.

Here are a few reminders of the issues in play.   The first is an extract from Labor's former federal leader Mark Latham's book The Latham Diaries - it could be the preamble to the Trade Union Royal Commission's final report!

Patronage is the issue at the heart of the Labor/Union corruption problem.  I'd rate it more highly than greed - because its the patronage that drives the ability to profit financially.

The timing of Kathy Jackson's falling out with Shorten is set out by former Shorten mate and now AFR journalist Aaron Patrick's book Downfall - extract here:

http://www.michaelsmithnews.com/2014/06/bill-shorten-versus-kathy-jackson.html

http://www.michaelsmithnews.com/2015/06/bill-shorten-puts-peter-mullin-from-the-spotless-group-up-for-the-seat-of-corangamite.html

Finally to the mechanism Shorten adopted to bring on his Application to the Federal Court for the highly unusual motion to appoint an Administrator to the HSU.    He retained the former HSU official, former HSU lawyer and then legal advisor to the Craig Thomson investigation at Fair Work Australia Val Gostencnik.   Some months later Gostencnik was rewarded with an appointment as a Fair Work Commissioner.  Gostencnik had the then secret Craig Thomson HSU Fair Work Investigation report in his hands - but saw no conflict in acting for Shorten to put the Administrator in place.

• Val Gostencnik, Bill Shorten, Gerard Hayes, Sam Dastyari ...

  www.michaelsmithnews.com/.../val-gostencnik-bill-shorten-gerard-hayes...

   

  Sep 3, 2014 - Recall that the former HSU Official Val Gostencnik was acting for Fair ... At the same time Gostencnik took a brief from Bill Shorten to act for ...

• Val GOSTENCNIK met with lawyers for Williamson's HSU to ...

  www.michaelsmithnews.com/.../val-gostencnik-met-with-lawyers-for-wil...

   

  Jun 27, 2014 - Bill Shorten's lawyer Val GOSTENCNIK attended a conference with lawyers acting for Michael Williamson friendly elements of the HSU days ...

• Bill Shorten's lawyer Val Gostencnik had all the documents ...

  www.michaelsmithnews.com/.../bill-shortens-lawyer-val-gostencnik-had-...

   

  Feb 24, 2014 - Bill Shorten's lawyer Val Gostencnik had all the documents - why not release ... Gostencnik/Shorten had one of the rarest editions in legal publishing history. ... http://www.michaelsmithnews.com/2013/11/val-gostencnik-and- ...

• Bill Shorten based his HSU application to the Federal Court ...

  www.michaelsmithnews.com/.../bill-shorten-based-his-application-to-the-...

   

  Feb 25, 2014 - Bill Shorten says he made the decision to appoint an administrator to the HSU ... On 12 April 2012 Bill Shorten retained Val Gostencnik.

• Mr Val Gostencnik who gave legal advice on how not to ...

  www.michaelsmithnews.com/.../mr-val-gostencnik-who-gave-legal-advic...

   

  Nov 7, 2013 - This is the remarkable Mr Val Gostencnik On 28 March 2013 Bill Shorten appointed Mr Gostencnik as a Fair Work Commissioner.

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• I've asked Victoria's Legal Services Board to investigate Bill ...

  www.michaelsmithnews.com/.../michael-smith-wwwmichaelsmithnewsco...

   

  Mar 21, 2014 - Michael Smith www.michaelsmithnews.com Mr Russell Daly ... Legal Services Board to investigate Bill Shorten's lawyer Val Gostencnik.
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• Did Bill Shorten act properly in using taxpayer resources to ...

  www.michaelsmithnews.com/.../did-bill-shorten-act-properly-in-using-ta...

   

  Feb 24, 2014 - On 30 April, 2012, Val Gostencnik filed the application to have an ... Workplace Relations Minister Bill Shorten took the rare step of moving to ...

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