Royal commission a trap for Bill Shorten

Prime Minister Tony Abbott's royal commission on union slush funds and corruption threatens to ensnare Opposition Leader Bill Shorten, with sweeping demands for information on unions closely linked to the Labor leader.

Unions targeted by the commission are reeling after being given just over a week to produce thousands of pages of financial, contractual and personnel documents stretching back seven years.

They have been warned that failure to produce documents could lead to up to six months' jail.

Insiders agree the commission's official written request for documents has the potential to entangle Mr Shorten, renowned as a hands-on factional player in the ALP, especially in his home state of Victoria.

The request for documents includes a period when Mr Shorten was Australian Workers Union (AWU) leader.

Most of the five unions targeted by the commission into union governance, slush funds and corruption have extensive links to Mr Shorten and his dominant Right faction, including the AWU, the Transport Workers Union, the Health Services Union and Communications, Electrical and Plumbing Union.

His personal power base includes the AWU and the plumbers division of the CEPU.

A group aligned to Mr Shorten now control the Victorian branch of the scandal-prone HSU after a bitter and expensive election in 2012.

The bank-rolling of the Shorten-linked HSU team in both the 2012 and 2009 union elections by other unions and union-linked slush funds, looms as a key point of interest for the royal commission.

The unions have been asked for details about donations to other unions or political parties, and any money or benefit received from companies with whom unions have negotiated.

AWU insiders fear that on financial dealings with companies, Mr Shorten may face a grilling over contributions to the AWU from construction companies during construction of the EastLink tollway in the mid-2000s.

The commission's request for documents from both the HSU and the AWU asks about specific slush funds, notably the AWU-linked Industry 2020, revealed by Fairfax Media in 2012. The fund generated more than $500,000 from employers, other unions and law firms since 2008. It was run as a sub-factional slush fund by sole director Cesar Melhem, a loyal Shorten lieutenant and his Victorian AWU successor.

Mr Shorten attended at least two of Industry 2020 fund-raisers. Money from the fund was used to bankroll HSU election campaigns by the Shorten-aligned Diana Asmar in both 2009 and 2012.

Copies of the requests for documents by the royal commission, obtained by Fairfax Media, ask for seven years of detailed financial records for each branch of the respective union in each state.

One senior union official described the demands as ''impossible'' to meet. Multiple union sources believe the process has set the unions up to fail due to the breadth of the commission's demands and the short time frames for providing information.

Victorian Trades Hall Council secretary Brian Boyd slammed the royal commission as a ''witch hunt'' designed to break unions and, in the process, weaken Labor. ''It is purely a political witch hunt that is designed to bring down the ability of unions to look after workers.''

Mr Boyd said the demands for documents were excessive. ''Any organisation of any substance to put together in readable form seven years of records in one week is absolutely untenable and unfair to the highest degree.''

Before the 2013 federal election, the Coalition promised a judicial inquiry into the 20-year-old corruption scandal at the AWU that involved former prime minister Julia Gillard doing legal work for her then boyfriend, AWU official Bruce Wilson.

But the scope of the inquiry was dramatically widened into a royal commission after extensive reports in Fairfax Media.

An important focus for the commission is slush funds, including the TWU's McLean Forum, and the left-wing Construction, Forestry, Mining and Energy Union, whose Victorian construction division was fined $1.25 million this week for criminal contempt of court.

Fairfax Media believes the CFMEU has been asked for information on the Victorian construction division's Building Industry 2000 Plus Limited fund.

A spokesman for Mr Shorten said unions should co-operate with the royal commission.

''Anyone who receives a request from the royal commission - whether they're from a union or an employer - should co-operate,'' he said. ''If they feel as though the time frames set are unreasonable, then they should discuss that with the royal commission.''

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