The best thing the stricken government could do would be to make Craig Thomson disappear - to the crossbenches.
The Health Services Union stinks so much that the entire trade union movement this week felt obliged to distance itself. So how long can the Gillard government continue its blithe pretence that all's well while it has the former head of the union and a chief suspect sitting on its parliamentary benches?
The Prime Minister has options. She is not exercising them. Julia Gillard has assumed a peculiarly supine air over this scandal. Does she think it's going to go away? She, like the rest of her government, knows that this is a crisis still building to its climax, not a receding one. "The HSU," says a Labor powerbroker with detailed knowledge of its affairs, "is not a union or an organisation - it's a crime family."
It is quite possible that Gillard and her office are exercising poor political judgment. It wouldn't be the first time. But there is another possibility: That this government, consciously or not, has despaired of winning the next election. Is it now just battening down, trying to endure this term in full rather than win another? One union leader suspects so: "This government just doesn't have the hunger to win - it's resigned to defeat."
The union movement is positioning in anticipation of a Labor defeat. That was the real purpose of the recent coup against the secretary of the ACTU, Jeff Lawrence. The pleasant Lawrence was replaced by a hard-fighting, hard-driving campaigner. The secretary of the Australian Manufacturing Workers' Union, Dave Oliver, is to take over in the full expectation that the union movement will have to do battle with an incoming conservative government.
Oliver won his spurs with his successful, aggressive campaign to win government concessions for the manufacturing sector last year. Just as the ACTU girded to defeat the Howard government's WorkChoices laws, it is now moving to a war footing.
This also helps explain why the ACTU has now publicly disavowed its blackened member, the HSU. The union movement wants to preserve its integrity and its reputation, not to be weakened by this ugly scandal. The question is, why doesn't the government have the same concern?
To be very clear, Craig Thomson is entitled to retain his seat in Parliament; he is entitled to the presumption of innocence. There is no legal need to for Thomson or the government to take any action.
Section 44 of the constitution stipulates that an MP is disqualified only if he or she "has been convicted and is under sentence, or subject to be sentenced, for any offence punishable under the law of the Commonwealth or of a state by imprisonment for one year or longer". Thomson has not been charged with any offence, much less convicted. Indeed, no current or former official of the HSU has been charged with any offence. Yet.
But there is the law, and there is politics. This is a three-year scandal that continues to build. It has harmed the government already and the pain will increase in the months ahead. The ACTU decided that the pain of close association and the stench of corruption were becoming intolerable and severed the rotting limb. There was no legal need; it was a political decision.
But the Gillard government? Contrast the ACTU's position with the government's. An emergency meeting of the ACTU's full executive said on Thursday that it had decided to suspend the union from the peak body "until it can resolve serious issues of governance and financial management".
The leadership of the union movement, over the signatures of ACTU president Ged Kearney and the outgoing Lawrence, went on to say: "The Australian union movement has zero tolerance for corruption or the misuse of members' funds or for maladministration of union affairs."
Reporters asked Julia Gillard on the same day about the implications of the fast-accumulating developments in the story:
First, that the industrial relations workplace regulator, Fair Work Australia, had compiled a report on the HSU national office during Thomson's tenure listing 76 minor technical breaches of the Workplace Relations Act and 105 more serious breaches; second, that Fair Work had sent its report to the Director of Public Prosecutions for consideration; third, that the DPP complained that the report did not constitute a brief of evidence for a possible prosecution - in other words, it was useless.
In the face of all this, the Prime Minister offered only a stock response: "Fair Work Australia, the Commonwealth Director of Public Prosecutions, these are both independent agencies. They work independently of government, that's the right thing for them to be independent so any questions and comments about the way in which they work are really matters for them."
She was asked four more times, and, in slightly different forms, she gave the same answer. "Don't shoot me, I'm just the Prime Minister."
Consider the next part of the ACTU statement: "In making this decision, the ACTU executive is acting in the interests of and to give encouragement to the officials, delegates and members of the HSU who are dedicated to a strong, democratic and accountable union."
Gillard had no similar leadership to offer her government or the wider Labor Party. The ACTU's action, by simple contrast with the Prime Minister's passivity, has exposed the government's feebleness and irresolution.
But could it be that the ACTU is responding to a different set of developments in the HSU? We know, courtesy of revelations in the Herald by reporter Mark Davis in 2009, that Thomson is suspected of misusing more than $150,000 in union funds for personal expenses, including visits to brothels.
Davis, armed with bank statements and credit card details, broke the story on April 8, 2009: "The federal Labor MP and former union boss Craig Thomson faces allegations that his union credit cards were used to pay for escort services and to withdraw more than $100,000 in cash, as well as bankroll his election campaign for the central coast seat of Dobell. Documents provided to the Herald show that Health Services Union officials concluded last year that union credit cards issued to Mr Thomson - and other financial resources - were used for election campaign spending. These had not been disclosed under electoral law."
But we also know, after revelations last September by the Herald's Kate McClymont, that the NSW police have set up Taskforce Carnarvon to investigate allegations against the then national president of the HSU, Michael Williamson, and other officials. McClymont reported that the HSU had paid hundreds of thousands of dollars to private firms affiliated with Williamson, and hundreds of thousands more to the architects renovating Williamson's home. An HSU official filed a complaint with the NSW police alleging "systemic and organised fraud within the HSU, including the procuring of secret commissions and corrupt rewards from suppliers and contractors".
Thomson and Williamson maintain their innocence.
Williamson was suspended last October, but remains on full pay, collecting his $330,000 a year, and working from an assistant secretary's desk in the union office every day.[!!!] The HSU called in Ian Temby, QC, to conduct an internal audit. The union movement is now bracing for the Temby report; Labor gossip says it will be explosive.
The ACTU was seeking to inoculate itself against this and other coming explosions in the affairs of the HSU.
Is it possible Craig Thomson - Julia Gillard's particular part of the problem - could emerge as a minor piece in the larger HSU scandal? Yes, it is possible. But he is the central figure in the Fair Work investigation. The Fair Work report is not yet published, so how do we know? Because a man who has read it, the acting national president of the HSU, Chris Brown, told ABC Radio: "There's over 170 contraventions that are directed at those four individuals [current and former HSU officials] and I know that the vast majority of those contraventions involve Craig Thomson. So I am very confident that this is not the end of it."
He said that while the Director of Public Prosecution's complaint that the Fair Work report was useless meant that Thomson "may have dodged a bullet … it doesn't necessarily mean he's off the hook if he's in fact found to have undertaken any corruption or criminal activity."
The Gillard government's biggest problems are that it is considered to be illegitimate by many voters, and regarded as dishonest by many more. Is this a government that can really afford to continue to shelter on its parliamentary benches a man subject to a gathering storm of investigation for defrauding the low-paid aged care workers of the HSU so that he could pay for prostitutes?
Gillard has options. For instance, at the next opportunity, she should explain the facts of life privately to Thomson. She should then announce that her government will not allow itself to be smeared any longer by the sordid allegations. Until the Thomson affair is settled, he will not sit on the government benches in Parliament. He will go to the crossbenches.
Labor's grip on power would be unchanged. Not only did its one-vote margin become two last November thanks to Liberal turncoat Peter Slipper, the government should still enjoy Thomson's support in the House. Provided Labor manages him prudently, he would continue to side with Labor on important votes.
Tony Abbott would still complain that Labor was accepting the vote of a man under a serious cloud; but Gillard would have a new riposte. And she would have demonstrated some leadership. Or she could sit passively in protecting Thomson. Which is what Labor might do if it has indeed resigned itself to losing the next election.
