Victoria Government Directed Removal of Subcontractor from Hospital Project

A retired executive director of the Victorian Health Building Authority said the state Labor government directed the agency to remove a plastering subcontractor from the Royal Victorian Eye and Ear Hospital redevelopment because the firm was in a dispute with the CFMEU.

The project, completed in April 2024, received $320 million in combined state and federal funding. The former official said the instruction came after the CFMEU applied pressure on the government and met with government representatives regularly.

Background on the Allegation The former official stated that decisions about which subcontractors could work on government sites should rest with project managers rather than politicians or unions. He said the CFMEU in Victoria exercised greater influence over subcontractor selection than unions in New South Wales.

He added that he would be willing to testify before an independent inquiry about the government intervention.

CFMEU-aligned plastering firms accused in official reports of improper dealings with former union officials secured subcontracts on the Frankston Hospital redevelopment and the Footscray Hospital redevelopment. A third subcontractor on the Ballarat Hospital redevelopment was identified as having paid funds to an underworld figure through a front company.

Victoria Police have stated they do not have the legal authority to investigate alleged wrongdoing on taxpayer-funded construction sites and that many witnesses are unwilling to cooperate. A government spokesperson said the claims about the Eye and Ear Hospital project have no basis.