In a scathing report into the Health Services Union East branch, a high-level audit has found at least five contracts awarded without any tender.
And it says union members - many of them low-paid hospital workers and cleaners - were ripped off by greedy union officials paying well above market rates.
The release of the report yesterday adds to the woes of the Gillard Government.
It details how the HSU East - which combines the Victorian and NSW branches - is run by a small cabal who have awarded contracts to companies affiliated with their families and friends.
Ian Temby, QC, and auditor Dennis Robertson - who wrote the report - lashed out at the HSU East for having "inadequate" controls, which it says expose the union to fraud and inflated prices.
Mr Robertson said he had seen "few systems with such lack of formalised controls" in his 40 years of work.
Among a raft of contracts awarded without tender, the union paid Sydney printing firm Communigraphix $3.4 million over four years.
NSW Police are pursuing Mr Thomson and former HSU national president Michael Williamson over allegations they received secret commissions from this firm - which receives around $750,000 to print the union's internal newsletter.
Mr Williamson and Mr Thomson could face jail if charged and found guilty.
The Prime Minister has tried to distance her Government from the Thomson scandal by announcing he will sit as an independent.
But Labor sources say the HSU East report is a further blow to the Government. "It's damaging because it demonstrates systematic fleecing of the union," one said.
heraldsun.com.au 01 May 2012
Another government fraud under the strict supervision of Labour MP Craig Thomson.
This is just the tip of the iceberg of the fraudulent activities, that have yet to surface in the corporate media, but are well known within the parliamentary circles.
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