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Legislative Council - Fifty-Second Parliament, First Session (52-1)
2011-11-30 Daily Xml
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FEDERATED GAS EMPLOYEES INDUSTRIAL UNION

The Hon. D.W. RIDGWAY (Leader of the Opposition) (19:55): I move:

That this council notes credible allegations of serious malfeasance in the South Australian branch of the Federated Gas Employees Industrial Union during the time when a member of this chamber was in the employ of that union.

Unions play an important part in our Australian culture. The Australian Labor Party was born under a ghost gum, the Tree of Knowledge, at Barcaldine in central Queensland during a meeting of striking shearers and farm labourers. The year was 1891. By 1912, there were 408 separate unions in this new federation of Australia. Although some of the unions were as corrupt as their bosses were supposedly slavedrivers, there was a time, in 1951, when six in 10 Australian employees were in a trade union.

The more militant unions in the 1960s and 1970s—the builders labourers, the storemen and packers, the transport workers—all doubled their membership between 1969 and 1975. Unions themselves were by now multimillion dollar businesses in their own right, with state and federal-registered unions. There was a phalanx of extremely well-paid trade union secretaries, who took home vastly more each week than the men they supposedly represented. A hundred times that many more people were working and playing as union organisers, assistant secretaries, delegates and standover men.

One of the most combative and aggressive unions was based in the Adelaide suburb of Brompton. It was the Federated Gas Employees Industrial Union and it tolerated the intolerable. South Australia was, to use a slogan, cooking on gas. The furnaces of the South Australian Gasworks at Brompton were first fired in 1863. By 1863, this building, this Parliament House, was lit by gas. One hundred years later, the South Australian Gas Company (SAGASCO) was converting to natural gas and that is when the Federated Gas Employees Industrial Union stepped up to the burner.

Gas had previously been made from coal. Natural gas was much less labour intensive. In other words, SAGASCO needed fewer men. It had to scale down its blue-collar workforce. That meant redundancies. One hundred and fifty of the 220 men at Osborne and Brompton became surplus with the switch to natural gas. The company was not obliged to grant severance pay for its soon-to-be redundant employees and men over 65 years old were, as the 1986 book The Unquenchable Flame puts it, 'gently reminded of the temporary nature of their continued employment'.

But the union had other ideas, and finally the company and the Federated Gas Employees Industrial Union reached agreement. The company would give three months' notice of any retrenchment and there would be two weeks pay for every year of service and additional long service benefits. The FGEIU gloomily noted the decline in its membership, but protected those who remained.

Pat Savage has a history with the FGEIU. Not long after he joined the union he became a shop steward. A month later, as he tells it, he became chairman of the shop committee and six months later, and I am quoting him now, 'I was a union organiser or assistant secretary, call it what you will.' Was the position paid? Yes, it was paid all right, but not out of union funds. 'The gas company paid it,' Pat Savage says. The gas company paid his wages and bonuses to be a full-time union organiser—completely unelected.

Mr Savage was the right-hand man of the union secretary, Ron Hill, a man now serving a life sentence at the Port Augusta Prison for the murder of his wife. Ron Hill ruled the Federated Gas Employees Industrial Union with an iron hand in an asbestos glove. Half a dozen men were caught throwing hundreds of gas meters into the Wingfield dump. For more than a year, according to Pat Savage, they had been paid by the gas company to replace old meters with new ones. Instead of working for those 12 or 15 months, Mr Savage revealed in an interview with my office in September that they had been systematically dumping the new ones at Wingfield. 'They didn't work for over 12 months,' Mr Savage said to us. He said:

There were just a group, a few blokes that done that. They were lucky not to go to gaol because those meters back then were worth $100 I reckon, and they were throwing about probably $4,000 worth a week down the Wingfield dump.

Pat Savage's account continues:

The Wingfield dump rang. The Wingfield dump rang and said we're so sick of you bastards chucking all these meters here. Why is there so many?' And someone was sent down from SAGASCO, from the office, to pick the meters up, then they checked the serial numbers on the meters, realised they [were] supposed to have been changed but they hadn't been changed, then they challenged the blokes.

But the blokes did not get sacked. With union intervention, the men were given glowing references from the gas company and, with one exception, all got work around the corner at Clipsal the next week. And that was not all: they got redundancy payments from SAGASCO and nobody called the police. This was all courtesy of Ron Hill and his brigands, one of whom was the former gasworks apprentice and the current Minister for Industrial Relations, of all things, the Hon. Russell Wortley MLC.

I have a signed statutory declaration from Allan George Cotton, now of Minlaton on Yorke Peninsula. Mr Cotton declares that in 1972 he joined the South Australian Gas Company as an apprentice plumber and gasfitter. He received his ticket in 1975, the same year he was named apprentice of the year. In the early 1980s, Mr Cotton was employed by the South Australian Gas Company as a plumber and gasfitter in the domestic maintenance section at Chief Street, Brompton. He was a member of the Federated Gas Employees Industrial Union.

According to Mr Cotton's statutory declaration, Ron Hill was then the secretary of the union and Russell Paul Wortley was involved in union activities. There was a belief that Mr Wortley was paid by the gas company, even though he was doing no work on the shop floor or 'on the tools'. He was a full-time unionist and doing a lot better than his workmates, as you will learn in a minute. It was probably in about 1983, Mr Cotton says, that he heard the gas company wanted to downsize its staff.

He heard of redundancy packages offered to gasfitters prepared to leave voluntarily. So Mr Cotton went to the company's head office, then in Wakefield Street, and asked: what sort of redundancy was it; what were the conditions; what were the details? The human resources department said they did not know anything about it. One of Mr Cotton's workmates then said if he went to the union it would organise a redundancy deal. In the statutory declaration, Mr Cotton said he next approached Russell Wortley, who was a union rep in the union office. They went outside to chat.

There the conditions were laid out, says the signed statutory declaration. Mr Wortley told Allan Cotton that, if he handed over close $1,000 in cash (to the best of his recollection, Mr Cotton thinks it was $900), the union would organise a redundancy payout, and Mr Wortley mentioned 2½ weeks for every year of service. According to the testimony in the declaration, Mr Wortley told Mr Cotton he should 'pay the money direct to Danny Moriarty', another union official. Mr Cotton got together some of the money, a few hundred dollars short of what he had been asked for.

He had some 1980 gold coins which could make up the shortfall, but Mr Moriarty told him he did not want these: these were Perth Mint proofs and worth a lot but, unlike cash, are sometimes traceable. Mr Cotton went to the union offices to hand over the money and he gave the cash to Danny Moriarty. He then handed his resignation to the company. Mr Cotton says in his statutory declaration that he had been coerced into making the payment to get his redundancy.

He says he never wanted to deal with the union. That is why he first went to the SAGASCO head office for his initial inquiries. The only reason he paid the money in cash was that he could see no other way of getting his redundancy pay. 'In my view,' Mr Cotton says, 'I believed it was corruption. I wanted the practice to stop but did not see how I could take on the might of the union.'

I also have a signed statutory declaration from David Alan Butler of Elizabeth Downs, South Australia and, according to the declaration, Mr Butler was employed by the South Australian Gas Company as a leading hand in the maintenance section at its Para Hills depot in 1983. He was a member of the Federated Gas Employees Industrial Union. Ron Hill was then the secretary of the union and Russell Paul Wortley was, according to the declaration, working for the union as an employee or official.

Mr Butler was also told around the traps that the company was downsizing, accepting voluntary redundancies and offering three weeks' pay for every year of service. A union delegate told Mr Butler to speak to the union before accepting the company's redundancy offer, saying that the union could do 'better than that'. The Federated Gas Employees Industrial Union offices were just across the road from the gas company. In fact, they had been donated to the union—some say under duress—by the company.

SAGASCO, and ultimately every one of the thousands and thousands of gas customers, provided the union with a social club, and it was pretty well set up, too. 'Oh, it was...It was a huge magnanimous gift,' the union's Pat Savage said in his interview with us. Why? Because of the duress union secretary Ron Hill put on SAGASCO management, says Savage. So, the union got an indoor swimming pool, a games room, a bar and a billiard table. Mind you, it did come at a cost. We have examined the union records held in the official Canberra archives—records we were able to access through the descendants of the federal industrial register. They go back to the mid and early 1980s when the Hon. Mr Wortley was in the union—or was it the company payroll? I am not sure.

Consistently, the auditors had trouble with the social club's accounts—money in, money out, but not a proper paper trail; so, the union moved the social club completely off the books. It is a matter of historical record that the social club building eventually changed hands. It was bought by an equally respected association, the Rebels Motorcycle Club, and turned into a bikie clubroom, which was bombed in the early hours of 15 July 1999. Police suspected a rival bikie gang, but the wags in the union movement smirked that someone had not heard that the Federated Gas Employees Industrial Union had moved out.

So, it was to the union officers that Mr Butler went for advice on the redundancy offer. He went to see union secretary Ron Hill, another union official (his ex-apprentice), Pat Savage, and one Russell Wortley, who had been apprenticed to Mr Butler before going to the union full time. The first person he saw was Russell Wortley. He was then led into a room where he met Dan Moriarty, who told Mr Butler that he could arrange for Mr Butler to get 4½ weeks' severance pay for every year of service. Mr Moriarty said that this could happen if the union allowed Butler's position to become redundant and if the union did not challenge the company by insisting that the position be maintained. That is how it worked.

Mr Butler was naturally delighted. Moriarty told Mr Butler that there was a price to pay. He said that Mr Butler would have to make a cash payment of $5,000 and that there would be no receipt. Mr Butler was in his mid-30s, married, paying off his house and supporting three children. He had joined the gas company as a 16-year-old apprentice, and he had been there for 20 years. 'I thought the demand for $5,000 cash was outrageous,' Mr Butler swears, 'but I calculated that if I made the payment I would receive 90 weeks' salary, and the value of this was far greater than $5,000'.

Like most people, Mr Butler did not have that much cash, so he borrowed the money from his brother, his mother and his father. 'Carrying in the $5,000 in cash, I went back to the union office in Chief Street,' says the signed declaration. The declaration continues:

I was shown into a room. Ron Hill was in there, together with another man whose name I don't recall, and Dan Moriarty. Both Mr Hill and the second man left the room as I prepared to take the money out. In front of Dan Moriarty I placed the pile of cash on a table. He said words to the effect of, 'If you open your mouth it may not happen.' I left the money on the table with Dan Moriarty and walked out of the room. I discussed what happened with one trusted colleague who was also seeking redundancy, but from conversations with workmates at the Brompton works I knew it was common knowledge that the union officials or representatives were seeking and receiving cash payments to arrange redundancy and redundancy conditions. I was subsequently paid out 4½ weeks pay for every year of service. Later that same year I met Russell Wortley at the gas company's annual barbecue and drinks.

It is interesting that I happen to have a photograph of that annual barbecue and drinks. The Hon. Russell Wortley is in the photo—he is a little thinner but still with the same hair. The declaration continues:

He came up to me and asked me how I was going. I replied that I thought he was a crook and that I never wanted to speak to him again in my life.

As I said, we have unearthed a charming photo of that company picnic: there is Russell Wortley, slimmer but with the same hairstyle, as well as Stan Briggs (who was often mentioned in the Federated Gas Employees Industrial Union committee for management certificates) playing wicket keeper, and the very same Dan Moriarty, who we tracked down a few months ago to a house in the suburb of Hove. That is where we put the allegations to him and where he denied them. He claimed he could not remember anyone called Allan Cotton, but, yes, he did remember Dave Butler.

When it was put to Mr Moriarty that Allan Cotton and Dave Butler had both said they got a redundancy package on the condition they made cash payments to union extortionists, Mr Moriarty acknowledged that $5,000 was 'a lot of money in those days' and denied any knowledge of the deal. At Brompton, also in September, Mr Pat Savage was interviewed and he also denied ever receiving or knowing about cash payments even though they were apparently common knowledge. 'We all heard rumours. We all knew about the rumours behind us,' he said.

Yet I come back to the two men who signed these statutory declarations—Allan Cotton and Dave Butler. They are both nearing the end of their working lives but both still enjoy their work. They both have responsible and reasonably paid jobs, one in local government and the other in the mining industry. They both, until we came across this story, lived out of the public eye, and they both have a reason to be happy there.

The spotlight is not what they are seeking. What they want, they told us, is for the truth to come out. They want justice to be done even if the only justice likely to come out after all these years is public exposure of it. As David Butler put it to us—corruption. They are both brave men. They have nothing to gain and much to lose from speaking the truth. Even so, I will not be surprised if more people now come forward.

Ordinary employees expect to turn to their trade union for protection, not extortion. The Federated Gas Employees Industrial Union is no more. It was amalgamated with the Transport Workers Union—as I think you have reminded me, Mr President—and the Hon. Mr Wortley went on to be employed there for nine years. In his maiden speech in 2006, the Hon. Mr Wortley told this chamber about his union work:

When I got home at night, I knew I had a real and important job and that I had done a full day's work. Very often I would lay awake at night worrying about the outcome of the disputes or the security of members.

Documents from time the that the Hon. Mr Wortley was at the gas union shows there were two full-time union employees: the Hon. Mr Wortley and Mr Moriarty. I think the council would be interested to know their terms and conditions.

As part of their package they had: their salary; union paid superannuation; a gratuity of an undisclosed nature; nine weeks per year of service to be paid out when leaving the union regardless of the reason; private health cover; an annual clothing allowance; a fully funded motor vehicle (I think a VM Commodore, fully maintained and renewed every two years); a telephone with full rental and calls; five weeks' annual leave plus 20 per cent leave loading; rostered days off; a 38-hour week and a 19-day month, and all the rostered days off could be accumulated and taken at Christmas time; and sick leave of 15 days per year, which could be taken without a medical certificate. All the unused sick leave could be accumulated or paid out each year and all the sick leave could be paid out upon the termination of employment. How often would he lie awake at night worrying in those wonderful carpet slippers with a nightcap on nursing a large balloon of brandy?

Year by year the number of trade union members has been dropping. From a peak of 60 per cent of eligible employees, the figure was just 18 per cent last year. In the private sector it is even less—just 14 per cent. There are in Australia today at least 1.4 million employees who are not members of a trade union.

Under a ghost gum at Barcaldine in Queensland the Labor Party was born. Under this roof in Adelaide, South Australia, the Labor Party has been delivered a minister for industrial relations who should now go to the bush. I now seek leave to table the two statutory declarations and I also seek leave to conclude my remarks.

The Hon. G.A. Kandelaars: Why don't you go out there and say it?

The PRESIDENT: I am sure the honourable member will go outside tomorrow and say what he said in here.

Leave granted; debate adjourned.

The PRESIDENT: We look forward to seeing you on the steps of Parliament House tomorrow.

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