A Labor MP gave a staffer more than $33,000 to pay the party memberships of people within her faction, according to evidence provided to the Victorian anti-corruption commission.
But the MP, Marlene Kairouz, whose evidence is considered critical to the investigation into the alleged misuse of public funds by paying staff to do factional activity – including branch stacking – will not be subject to a public examination by the Independent Broad-based Anti-corruption Commission (Ibac).
Branch stacking is not illegal but it is a breach of party rules, as is the payment of other people’s party memberships.
Chris Carr SC, counsel assisting the commission, told the hearing on Wednesday that Ibac investigators had obtained bank records showing transfers between Kairouz and Kirsten Psaila, her electorate office manager.
Psaila worked for Kairouz from 2008 when she was elected. In 2015, Kairouz transferred Psaila $14,700, Carr said, followed by $18,300 the next year.
Both transfers were made during “renewal season”, Carr said, around the time membership fees were due. Psaila agreed during her evidence on Wednesday that following both transfers she withdrew the cash to pay for memberships.
She said that Kairouz also paid for memberships in 2017, but that she had provided her cash, rather than a bank transfer, that year.
Carr told the commission that Kairouz would be the next witness, but that because Ibac had received “credible” information a public examination could unreasonably damage her reputation, safety or wellbeing she would be examined in private.
There were four “stringent” criteria within the Ibac Act that must be satisfied to allow public hearings, Carr said, and the emergence of evidence that suggested Kairouz would be unreasonably damaged meant that her “critical” answers to matters of “significant public interest” had to be given in private.
Kairouz stood down as a minister after an Age-60 minutes investigation last year aired allegations of her involvement in branch stacking. She has denied all wrongdoing. She took leave from parliament in September following the sudden death of her sister.
Carr asked Psaila about the details of the work she did on behalf of Kairouz and the moderate faction, including the bulk collection and filling out of ballot papers on behalf of members so as to control their votes in party elections.
She gave evidence of “captains” within the faction, who were responsible for doing this on behalf of dozens of members, and also took responsibility for renewing their memberships every year.
Carr said Ibac had uncovered evidence of systemic forgeries of party member signatures occurring across the electorate offices of two MPs, including the office of Kairouz, but Psaila said she did not know who was responsible for this.
After extensive questioning from Carr and the commissioner, Robert Redlich QC, Psaila – who herself had been accused but denied forging a document on behalf of a member in the mid-2000s – conceded that it had crossed her mind such forgeries could be occurring.
The reason for forging signatures, Carr said, was that it would dramatically speed up the laborious process of obtaining ballot papers on behalf of members, taking it to them to sign, before numbering each ballot (from one to about 120 in some instances) and sending it back to ALP head office.
Psaila said she was idealistic as a Labor staffer, had ambitions to become an MP herself, and had been brought up in a Labor family.
She said she was introduced to factional politics by George Seitz, who she agreed was a “notorious branch stacker”.
Seitz organised the preselection of Kairouz, and she also became responsible for some of his members after he retired, Psaila said.
Carr described Psaila as a small cog in a much larger machine, and suggested to her that those who used this machine to become MPs would not have a strong moral compass.
“I can only comment for Marlene,” Psaila said. “She’s a stand-up MP in the local community and she does what she can for the area.”
Carr responded: “That may be so, but she’s administered a part of this corrosive and corruption factional machinery, hasn’t she?”
“They all have,” Psaila replied.
Earlier in Wednesday’s hearing, Redlich raised concerns he had about evidence provided on Monday by Christine Kelly, an electorate officer for Kairouz.
Kelly had claimed she had no knowledge of or interest in the 2018 ALP national conference election, despite Ibac hearing evidence on Wednesday that Kelly was standing as a delegate during that election.
At one stage in Psaila’s evidence, Redlich also warned her not to fall into the same “trap” as Kelly, of moving from a position of knowing nothing at all about anybody doing any factional work in the office, to admitting significantly more knowledge after several hours of questioning. Public hearings are scheduled to resume on Monday.
