Gangsterism runs unchecked, while our governments largely refuse to act

It is widely accepted that gangster-related violence, organised crime, and related corruption are currently at their worst levels in living memory.  Shootings, arson, home invasions and stabbings are now at epidemic levels in some cities, and Australia clearly has a bigger gangster problem than most comparable developed countries.  It is hard to identify much effective action by governments but, without policy change, the problem will remain and communities will feel increasingly unsafe. 

In Australia, the economic impact of gangsterism is greatest in non-residential construction.  This is due to the sector’s economic importance, the entrenched nature of building industry corruption, and the huge impact on costs of anti-competitive behaviour and intimidation by union bullies.  These higher costs get passed on to business, taxpayers, and ultimately the consumer in the form of higher build prices and higher commercial rents.  At the same time, the standover men and their allies rake in the money.

The tobacco wars, illegal drug trafficking, bikie gang crime, and (in some areas) rampant youth crime impact differently on the community.  Their main impact is to make ordinary citizens feel unsafe.  This is because the associated violence takes place in the suburbs, is highly visible, and is heavily reported in the media.   Perversely, the tobacco wars keep cigarette and vape prices low, but in doing so they deprive government and legitimate retailers of revenue.

If you go back 50 years, Australia had a historic problem with gangsterism, but it was only in very defined areas.  It was less institutionalised than now, and far less costly to the community. 

Australia was always noted for corruption on its waterfront (involving unions like the Waterside Workers' Federation of Australiaand the Federated Ship Painters and Dockers Union).  While these unions played a role in raising poor wages and conditions, they (especially the latter) also became associated with organised criminality.  While the move from manual handling to containerisation provided a natural end to most thieving on the waterfront, the Hawke Government and the Costigan Commission put paid to the FSPDU’s involvement with organised crime and tax evasion.  The Hawke Government also helped clean up the building industry by deregistering the Builders Labourers Federation (BLF), which followed a Royal Commission into corruption by the union.

Other historic areas of gangsterism involved illegal casinos, SP betting, organised prostitution, narcotics (less prevalent back then), and police corruption.  Most of these problems were greatly diminished by either legalisation (legalised brothels, legal on-line gambling, legal casinos) or by regulation.  More widely, a lot of Australia’s economic life up until the 1970s was also infected by widespread restrictive practices and unwarranted economic regulations, since greatly eased.

In the past, both sides of politics had gangster associations.  In NSW both the Askin government (1965 to 1975) and the Wran government (1975 to 1986) were tainted by corruption allegations.  In Queensland a Royal Commission into Police Corruption exposed corruption within the Bjelke-Petersen government (1968 to 1987) and within the Queensland Police.  Some corrupt ministers were identified, while Terry Lewis, Commissioner of the Queensland Police, was convicted and jailed.

Times have changed since then. 

The Rudd and Gillard governments were somewhat bland in their reaction to the excesses of the unions, including in the building industry but didn’t seem to noticeably worsen things.  On the other hand, Coalition governments from Abbott to Morrison vigorously attempted to curb the excesses of union power, especially in construction, though targeting of Bill Shorten introduced a political taint to their efforts.

The coming to power of the (left wing) Albanese government has heralded a big change in policy.  The Albanese government has systematically dismantled most of the institutions and laws policing the construction industry, shifted away from enterprise IR bargaining, and placed little priority on the need to curb criminality within unions.  Federal Labor and their Green and Teal allies have also shown reluctance to deport non-citizen offenders. 

State Labor has had a perceived permissive attitude towards crime, especially by certain immigrant groups and Indigenous youth.  This has included policies of soft sentencing and loose bail laws, and was most noticeable in Victoria in the Andrews/Allen era, and when Labor was in power in Queensland and the NT.

The Albanese government’s IR policy has been primarily oriented towards increasing union power, and both the Albanese and (especially) the Victorian Labor governments have been minimalist in reacting to Construction, Forestry and Maritime Employees Union (CFMEU) corruption.  They largely only reacted when they were forced to, and it has taken a change of Premier for the Victorian government to initiate its own royal commission into the union.

The full depths of criminality that plagues this union have been revealed in a report by Geoffrey Watson SC  commissioned by the Queensland government.  Among dozens of people named as benefitting from corrupt conduct are convicted and alleged killers employed as CFMEU health and safety officers.  He also identified untrained relatives of CFMEU delegates picked to work shifts, where they made as much as $15,000 a week.  The report also exposed the role outlaw motorcycle gangs played, alleging they were so embedded in the CFMEU, that they were using government building sites as drug distribution centres.

"The CFMEU was actively employing criminals.  During the [John] Setka era, the CFMEU was forcing contractors to employ patched bikies, meth-abusers, violent stand-over men, killers, boxers and cage fighters," the report states.  "The CFMEU succeeded in casting a shadow of fear over the whole building sector."  The report estimated that $15 billion of taxpayer money was wasted on corrupt payments linked to the CFMEU, mostly money generated by the Big Build, Victoria’s $100bn plus infrastructure program.  In some tunnelling projects, unskilled labourers were entitled to a “base salary of over $1,900 per week”, and even more once overtime and shift work were included.  Such roles became “so lucrative” that “corrupt organisers and delegates bought and sold the jobs”, Watson alleged.

Donating more than $3 million to Labor in the year before the 2022 federal election, the CFMEU was the party’s top single donor for Labor’s victory.  Since 2019-20, the union has made donations to Labor totalling $6.2 million.  Labor more recently moved to ban donations from the CFMEU.  Labor’s National Executive also suspended the CFMEU Construction Division’s affiliation to the New South Wales, Victoria, South Australia and Tasmanian branches of the ALP.

Issues involving ACT Labor’s association with the CFMEU have also come to light.  Enterprise agreements with the CFMEU are believed to have blown out the cost of major public projects like the light rail.  In the ACT, according to its Integrity Commission, Education Directorate officials and ministerial staffers engaged in serious corrupt conduct.  They "dishonestly provided a back door by which the strategic interests of the CFMEU were given priority" in the way a contract was awarded for a primary school upgrade.  In dispute was the $18 million contract for construction work at Campbell Primary School, where union-favoured Lendlease got the job and taxpayers picked up a higher bill.  Labor’s Yvette Berry, the ACT's Deputy Chief Minister resigned in the wake of the report.

Overall, the CFMEU needs complete dismantling to eliminate its institutionalised criminality.  It should never have been allowed to grow by merger, as it did.  The necessary changes will only come about following either a change of government or a perception by the left of the ALP that it is in its political interests to act more drastically.

The tobacco wars in our major cities are the direct result of Albanese Government overreach in tobacco excise.  By making tobacco very expensive, the illegal importation and distribution of cigarettes became both feasible and very profitable.  Currently, the Albanese government refuses to admit that raising tobacco excises to some of the highest levels in the world was a big mistake, so that the tobacco wars are destined to continue.

It should have been possible to identify and close the unlicensed tobacco retailers, who are prominent in suburban locations.  Enforcement, however, is patchy, and anecdotal information suggests that enforcement is more active in South Australia and Queensland than in other states and territories.  The location of illegal tobacco and vape outlets are widely known in the community, yet to date relatively few have been prosecuted or shut down.

A two-tier approach could fundamentally close the illegal tobacco and vape industry within 12 months.  A huge cut to excise would shift business back to licensed retailers, while vigorous enforcement coupled with stronger laws could target individual illegal outlets.  A reduction in the rate of excise could even increase revenue, if the increase in sales by licensed outlets offset lower per unit excise.  Excise rates could subsequently be raised to moderate levels, as the market permits.

SA Police Commissioner Grant Stevens has said consumer-side penalties for the purchase of illicit tobacco "is a question that needs to be considered".   It is illegal in SA to sell or import unauthorised tobacco products, but not to buy them, the commissioner said.

Turning to Middle East organised crime gangs, this element of gangsterism largely reflects the failure of past immigration policies, which should have filtered out undesirable immigrant groups before they entered Australia.  It is very difficult to later deal with such groups after they have been granted residence.  Our laws and appeal processes, coupled with restraints from international treaties Australia has signed, make it very difficult to deport both overstayers and convicted migrant criminals.

Decriminalisation of drugs has encouraged additional drug use and enriched drug dealers.  People can even get prescriptions for medical cannabis over the internet.  Many jurisdictions have reduced penalties for drug possession, while the NSW government recently announced that it would introduce legislation that would see drivers with a medicinal cannabis prescription no longer face a three-month licence suspension or fine for having the THC in their system.  Such a policy seems to place road users at risk.  Surely the issue is the level of THC that impairs driving so that any alleged medicinal purpose is irrelevant.

Ever since the decriminalisation of small amounts of illicit drugs in the ACT, the black market is said to have boomed, and the ACT has become known nationally and internationally for growing demand.  A person caught with drugs in the Territory reportedly only has to tell police where they got the drugs and the police will let them go.  Ground-level policing for drugs is becoming more difficult, and the bottom end of the distribution system has become virtually penalty-free.  The ACT is home to a thriving illicit drug market and bikie hub.  It has no consorting laws, and there is even a "Cocaine Lane" in the heart of Civic.

Overall, the core question is what to do to rid Australia of our serious gangster problem.  I think the solution ultimately lies with the voting public.

It would be fair to say that in both Queensland and the Northern Territory voters rebelled against the perceived soft positions of incumbent Labor governments on youth (especially Indigenous) crime.  While not the only issue, a desire for change in this area of policy contributed in a big way to the downfall of these governments and their replacement by regimes more committed to law and order.

The Labor government in Victoria faces an election in November 2026 and is widely expected to lose office.  The prospect of rejection by voters led to the dumping by Labor of Premier Jacinta Allen.  Her replacement, Ben Carroll almost immediately announced additional measures against the CFMEU and a crackdown against crime.  Whatever the result of the election, the tide appears to be turning.

The latest date for the next simultaneous House of Representatives and half-Senate elections is 20 May 2028.  With the Albanese government already diving in the polls, there are predictions of about-faces in several policy areas.  Infighting among opposition parties (One Nation v Coalition) and the split between Liberal factions is all that is saving Labor.  I think change is in the offing.