Andrew Landeryou · @landeryou
20th Jun 2014 from TwitLonger
The Australian exposes the truth of Kathy Jackson's 'Book of Secrets' #turc
Unions reject Kathy Jackson on funds
BRAD NORINGTON THE AUSTRALIAN JUNE 21, 2014 12:00AM
THE claim by union whistleblower Kathy Jackson that most unions act like she did by transferring large amounts of members’ money to off-the-books “war chests” for spending on almost anything has been dismissed by colleagues who condemn the practice as wrong and possibly illegal.
Ms Jackson was unable to explain to the royal commission into union corruption this week how she spent large sums from an unaudited $284,000 fund she set up and operated alone with members’ money for six years when she led the Health Services Union No 3 branch in Victoria.
But the whistleblower, whose exposure of former HSU bosses Michael Williamson and Craig Thomson led to fraud convictions, insisted she had done nothing illegal.
Claiming that unions could not survive without accounts such as hers, Ms Jackson named three with similar funds: the Australian Workers Union, the National Union of Workers and the Shop Distributive and Allied Employees Association.
Leaders of these and other unions yesterday condemned Ms Jackson’s practice, telling The Weekend Australia it was isolated to her. They said union accounts had to be audited regularly, and individual officials did not have carte blanche to spend.
While all agreed that unions had “fighting funds” for elections or other political purposes, they claimed the money usually came from officials who contributed part of their wage, not members.
The murkiest union funds are those set up with “considerably broad scope for expenditure” for training or workplace safety, often with money donated by employers.
The royal commission will investigate one AWU slush fund called Industry 2020 that was run by Cesar Melhem when he was the AWU’s Victorian secretary after Bill Shorten moved to federal parliament. Funds from Industry 2020 were used to support Victorian HSU election candidates in Victoria in 2009 and 2012.
The Transport Workers Union got into trouble in 2007 over a slush fund that received $2.5 million from employers for training. Money found its way to Labor candidates as undeclared donations, and a Deloitte report found the fund had no governance or management.
The AWU’s acting national secretary, Scott McDine, said his union did not have any unaudited, offline accounts as Ms Jackson did. “This is a highly unorthodox practice and is not one we would ever support, authorise or even consider,” Mr McDine said.
Joe de Bruyn, the SDA’s long-serving national secretary, disputed Ms Jackson’s claim that his union had “offline” accounts. “No such arrangement exists for me or any other official in the union. Absolutely not,” Mr de Bruyn said.
Ms Jackson faced scrutiny at the royal commission this week over how she shifted union members’ money from a legal settlement reached with a Melbourne cancer hospital to her offline $284,000 slush fund, and then used the money for political and personal purposes.
She claimed she was authorised to spend the money as she saw fit, including $4000 a year for herself, after a general resolution by her branch committee of management. She recorded transactions in a now missing exercise book, she said, and could not remember why she made a long list of cash withdrawals ranging from $4000 to $8000, and in one case $50,000, between 2004 and 2010.
Ms Jackson admitted she paid $7000 in cash on one occasion to an ALP branch-stacker from her account, or from a box in her desk drawer.
Chris Brown, the HSU’s acting national secretary while Ms Jackson is on long-term sick leave, said her allegation that her fund was the way unions “did business” was false. “ Siphoning off union money into other accounts … not only defies good financial governance but it is wrong.”