The $15 billion question: what corruption on Victoria's Big Build may have cost you

How much of the money Victoria has poured into its Big Build ended up in the wrong hands?

Geoffrey Watson SC, the barrister who investigated the Victorian branch of the CFMEU's construction division, has put a number on it: about $15 billion. The Victorian government disputes the figure. Nobody, including Watson, says it is an audited sum that went missing. But it's the best estimate on the public record, and it is now at the centre of a royal commission and a state election.

Where the $15 billion comes from

Watson's report on the Victorian branch, Rotting From The Top, was tendered to Queensland's Commission of Inquiry into the CFMEU on 11 February 2026. The public version estimates that the Big Build will cost more than $100 billion by the time it is finished.

An earlier draft estimated the union's conduct had cost Victorian taxpayers around $15 billion, much of which Watson wrote went to criminals and organised crime gangs. The union's then administrator, Mark Irving, had that estimate redacted from the public version, along with Watson's criticisms of the state government, on the basis that they were outside the inquiry's terms of reference. The figure was reported anyway.

The number works out to roughly 15% of the program. Watson has described it as conservative, and says it covers inflated contract prices and delays as well as money lost directly to criminals.

What the report found

Watson describes a branch that, under its former leadership, "collapsed into a squalid mess" and became "a violent, hateful, greedy rabble". His conclusion: the Setka-led Victorian branch "was no longer a trade union, it was a crime syndicate."

He traces the decline to the money. When the Big Build ramped up from 2015, labour was scarce and the union held the bargaining power. In the words of one industry figure quoted in the report: "All of a sudden there was too much government money, and too many really big jobs." Among the report's findings:

• Bikies on site. Watson found outlaw motorcycle gangs worked with elements of the union, and that some large building sites became drug distribution points.
• Jobs for sale. Big Build labouring jobs were so lucrative that, according to the report, corrupt organisers and delegates bought and sold them.
• Labour hire. Watson calls labour hire "the single worst source of corruption" in the sector, an industry that generates more than $1 billion a year on the Big Build.

Watson says he made adverse findings only where he was satisfied they were correct, and gave the benefit of any doubt to the people involved. Irving has stressed that the allegations have not been tested in court, and referred the report to the Australian Federal Police, Victoria Police, the Fair Work Commission and other regulators.

What did the government know?

In the redacted material, Watson argued the state government had been "cowed" by the union's industrial power, knew about the problem, and "did nothing", because keeping the union on side was the only way to finish the projects.

The government's position, under then premier Jacinta Allan, was that it did not contribute to Watson's report, that it has "zero tolerance" for this conduct, and that Big Build cost blowouts were driven by inflation. It pointed to its own review by Greg Wilson, which made eight recommendations in December 2024, and to referrals to Victoria Police and the anti-corruption commission, IBAC.

Two pieces of evidence have since put pressure on that position:

• The Metro Tunnel payment. The Age has reported that Allan approved an $837 million payment to the Metro Tunnel consortium after a legal letter set out how union demands had driven up costs. Allan has denied any wrongdoing.
• The 2023 briefing. At the royal commission's first public hearing, counsel assisting tendered a June 2023 briefing to Allan, then transport infrastructure minister, from the Major Transport Infrastructure Authority. According to the ABC, it cited "anecdotal reports" of criminal elements on its projects, including members of the Mongol and Bandidos motorcycle clubs.

A premier falls, a royal commission begins

Allan had consistently refused to call a royal commission. By the time she resigned, police had laid more than 90 charges, including against bikies, senior union officials and labour hire company owners, and the Labour Hire Authority had cancelled the licences of 164 construction firms.

Carroll's royal commission has a $50 million budget and terms of reference that cover the union, construction companies, labour hire firms, consortia, criminal actors, and the role of government itself, including "inflated, misdirected, or wasted funding" and whether any of it can be recovered. "Nothing is off limits," Carroll said. The opposition called it "a cover-up commission", arguing the terms show too little interest in the cost to taxpayers. The union's current administrator, Michael Crosby, said it will cooperate fully, and urged the commission to "follow the evidence wherever it leads", including to developers and contractors.

What it costs you

If Watson's estimate is right, the bill is enormous. The state opposition has claimed corruption is costing every Victorian household more than $5,000. The government says the estimate is wrong. Only the royal commission, with the power to compel witnesses and follow the money, is likely to settle it, and its report isn't due until after Victorians have voted.

We'll update this story as the royal commission hears evidence.

Top photo: a Metro Tunnel construction site on A'Beckett Street, Melbourne (file photo, 2020). Photo: Philip Mallis, CC BY-SA 2.0, via Wikimedia Commons.