Sunday, September 23, 2012

The  school, the cliquey in-group who can do no wrong, and the unfortunate prefect who stuffed up counting the annual fete’s takings

The schoolyard is life’s stage at its Darwinian brutest.  And here I don’t mean “stage” as a chronological, passing thing; rather, “stage” as in the raised surface on which we rehearse, over and over, the script for the rest of our lives.  You might be initially reassured by its being only a rehearsal – there’s no real audience – but there’s quite enough happening backstage (i.e. in-school) during these years to make opening night and beyond, before an actual audience (i.e. the big wide world), seem like no big deal.  At least for some.  For others, if you struggled during the “rehearsal” years, the rest of one’s life can seem like the teenaged backstage bullies have merely moved 20 metres, into the prime seats, in adulthood.

Following the last week’s oh-so-Melbourne, storm in a pinafore (or so I initially thought) saga of sacked MLC principal Rosa Storelli has had all the elements of a Year 9 drama.  Whether you see this drama as set in the primal schoolyard (as I suspect Ms Storelli does), or the boardroom (where Year 9 is only a fondly remembered, middlebrow David Williamson school play) makes all the difference as to who you perceive as the baddies.
The known facts seem to be in surprisingly little dispute. Ms Storelli’s employment was subject to a salary-packaged arrangement.  Salary packaging, which basically means (legally) minimising assessable income for tax purposes, is common for highly-paid executives and for workers across the board in the not-for-profit sector (who are usually not highly-paid).  Where these two groups coincide, as they appear to in Ms Storelli’s case – a highly-paid principal of a not-for-profit school – a salary packaging deal would appear to be both irresistible and complex.

A “secret Deloitte report” into alleged overpayments to Ms Storelli shows two types of shortfall, totalling $716,905. The first is a relatively straightforward imbalance between money that the school has paid to third-parties (including a nanny) under salary sacrifice arrangements, versus that which the school has so far been reimbursed by Ms Storelli.  This apparently amounts to about $267,000 (accrued since 1997-98), of which more than $100,000 is for the nanny alone.  The nanny’s $100,000+ is separately itemised because this was an amount Ms Storelli apparently had previously agreed (in early 2012) to repay the school, with the Board’s full knowledge and consent, at least at that time.  We also know in some detail how and when this particular debt accrued:

“As the nanny's salary went up, so did the amount deducted from Ms Storelli's salary. In 2001-02, the nanny was paid $31,151 - the same amount deducted from Ms Storelli's salary. But there [i.e. from 2002-03] the salary deduction stayed: $31,151 a year being deducted, while the nanny's wages climbed to $45,433 by 2012”.
The second type of shortfall is the more complicated matter* of fringe benefits tax (FBT).  Apparently, the school has paid FBT of $1.33 million on Ms Storelli's expenses, but allegedly recovered only $882,105 under salary sacrificing, leaving what the board says is a FBT-reimbursement shortfall of about $450,000.

Ms Storelli appears to dispute her liability for repayment of the $716,905, other than for the nanny’s $100,000+.  Her main defence here seems to be that one or more of three previous chairs of the school board (Christine Kilpatrick, Margaret Jackson and Lyndsey Cattermole) – not the board itself – had made oral and written representations to her stating that those other liabilities were properly the school’s, and not Ms Storelli’s personally. Ms Storelli has also pointed out that all of the disputed arrangements were on the record, at least such that accounting-consulting firm Deloitte (which has done the school’s external audit every year since 2006), must have been aware of them, and so at least implicitly approved them.

On the other hand, the school board and Deloitte have presented a formidable and united flank.  Their strategy here appears threefold:  to continue throwing further mud at Ms Storelli; to not even address suggestions of past negligence on their own (or their predecessors’) part; and to profit from (in the case of Deloitte, and possibly at least one other large accounting-consulting firm) doing the first two of these. (I am assuming that the “further Deloitte review  . . . into the salary packaging arrangements of other senior staff at MLC” now under way is not pro-bono.  Less clear is whether the two other big accounting-consulting firms, which both have partners on the school board, PwC (at whose offices Ms Storelli was formally sacked at) and KPMG also have/had vested financial interests here.)

The mud-throwing by the school board and profiting by one or more big accounting-consulting firms is transparent, once you juxtapose their repeated, shrill cry of “governance”, against the reality of corporate boardroom seats in 2012.  Interlocking directorships make boardrooms – and here the school was moulded identically to just about any given listed company – self-perpetuating** cliques.  Calling them “bullies”, as Ms Storelli has, may strike you as childish regression, or desperation, but in this case their pack behaviour and systemic abuse of power over a visibly weaker victim is stark.  If you think I’m exaggerating, here is how “governance” has been sanctimoniously invoked by the board three times in recent days:          

“A source close to the board said Ms Storelli had previously offered to repay the outstanding nanny money interest-free over four years.  To accept the repayment interest-free caused a fringe benefit tax problem for the college, and would not represent corporate governance best practice”.  [Note that this doesn’t explain why the board was happy to renegotiate Ms Storelli’s contract in March 2012, apparently including the interest-free element, against its own high standards of “best practice”].   

“‘You can't have your CEO able to hand out largesse bonuses to the people she was the boss of.  This is a standard governance issue’ [also] said a source close to the board” (emphasis added and quote edited). [This refers to annual bonuses of $40,000 to $50,000 allegedly paid in several years to MLC's director of corporate services Christian Gusner and funding for Ms Storelli’s long-time personal assistant Prudence Vernall to attend a professional development course in the USA, both apparently “approved by Ms Storelli without the knowledge or authority of the board's remuneration committee” (same URL).  Wow, so the board, or its remuneration committee at least (aka the clique within the clique), thinks that one of its important jobs is to mind absolutely everyone’s lunch money.]  

Board treasurer Tony Peake said: “after detailed forensic financial analysis by Deloitte, the board's unanimous decision was taken with deep regret, but with good governance as the foundation for the decision” (emphasis added).  [Translation:  after Deloitte were paid more money, they picked up things that they missed the first time.  You might say that Deloitte’s regular audits were “standard” governance (like public schooling, darling, you DO get what you pay for), its second bite at the cherry (the one that led to Ms Storelli’s sacking) “good” governance, and its pending further review promises to be no less, I’m sure, than “best” governance.]      

Talking of corporate waffle, the pending further Deloitte review “is also looking at why another staff member [Christian Gusner, I’m guessing] and Ms Storelli’s salary packages were handled internally, and not by Salpac, the external company that handles salary packaging for the majority of MLC staff”.  Translation:  when it comes to minding your lunch money, the bully clique has some hired muscle, too.  Or at least the services of a company whose apparent proficiency in the tax minimisation industry overcomes the dubious literacy of its website’s self-promotion section: 

Update 25 September 2012

When I read yesterday yet another media snippet from a “source close to the board” (i.e. presumably a board member, speaking off-the-record), I was confused by its tone:

On one hand, the anonymous board member invokes the parol evidence rule as confidently as a know-it-all first year commerce student, but on the other hand there is something disconcertingly personal about “Why would the school pay for her house to be cleaned”.  Apart from its vagueness as to which house is meant (Ms Storelli has apparently lived in off-school residences since 2004), there is the odd focus on cleaning as an apparently dubious element of Ms Storelli’s salary package.  Out of all the expense items that might, in the court of public opinion, scream that Ms Storelli was living the high life of the expense of “the school” (= school fee-payers and taxpayers), house-cleaning doesn’t seem to be up there (especially as Ms Storelli has not, so far, been accused of overpaying and/or sending off her cleaner on “professional development” courses overseas).        

My first strong hunch is that this anonymous board member was a woman (who generally have much more of a “thing” about cleaning than men), and more specifically, a woman with a bee in her bonnet about cleaning.   More specifically still, my profile suspect is of a formerly high-flying woman who is currently “reduced” (as she sees it) to doing her own cleaning.  Enter Belinda Probert.

The MLC board’s official website (as accessed today), and most of the non-Fairfax media coverage in the last week have referred to Ms Probert as “the Deputy Vice-Chancellor of La Trobe University”.  In fact, she left this position more than a year ago, in July 2011,“to do more policy and research work”. 

Judging by Ms Probert’s subsequent appearances on Google – but more importantly, her plain desperate reluctance to give up an old job-title that has long been someone else’s – she has spent the last 15 months with plenty of time on her hands, and with much less money that she has long enjoyed.  I therefore suspect that Ms Storelli’s cleaner – and much of the fuel in the current fire more generally – boils down to a matter of concentrated, venomous jealousy – as magnified by Ms Probert’s current under-employment. 

It would appear that sitting on various corporate/school boards is Ms Probert’s only paid current role – it is unclear whether MLC board members are paid (most corporate boards, of course, pay generous “honorariums”) but judging from KPMG partner and etiquette-columnist Bernard Salt’s carefully worded We-are-saints-doing-a-thankless-task column in today’s Herald Sun***, which notably doesn’t invoke the “and we’re not even paid for it!” angle, I would guess that the MLC board members are paid – and quite well – for doing their jobs.  For most, this honorarium would be merely the second/third/fourth layer of icing on their nice main-job package, but for Ms Probert, who AFAICT currently lives on this “icing” alone, the task of demolishing Ms Storelli’s cake – admittedly, it’s a bit rich – is her main job.  This task has even, it seems, involved Ms Probert going back to her first year commerce notes on the parol evidence rule.

And so far, you’d have to say, it’s been a job well done.  The cake has gone, and its eaters (not just Ms Probert) are loudly proclaiming what a thankless task it was, too.    

Further update 26 September 2012

Belinda Probert wrote a column published yesterday (which I didn’t see until today) in which she seems to claim that the MLC board are all unpaid.

Personally, I have trouble swallowing many things said by Ms Probert.   Her prose in this snippet:  “the discovery by a completely independent and highly regarded firm such as Deloitte” (same URL) seems out of the “completely unique and highly acclaimed” Bali villa-rental (or whatever) web-ad songbook.

Then again (and granted I probably should have made this disclosure earlier), I have taught and marked w-a-y too many contract-law-for-first-year-commerce-students to not have my own “thing” about such students’ textual follies and legal over-simplifications.  What’s worse, Ms Probert seems to show that they don’t ever grow out of this.

Herald Sun journo James Campbell (“Sacking of MLC principal Rosa Storelli is rich drama” 23 September 2012) is oblivious to the messy complications of salary packaging. “[T]hanks to the generosity of the Federal Government, Ms Storelli was able to pay for a lot of things including her mortgage, her car, her private credit card bills and her nanny from her pre-tax income”.  The fact that Ms Storelli apparently owes a large bill for FBT indicates that the “generosity of the Federal Government” does rather come with strings attached.  Even more dubiously, Campbell waxes on about the good old days, “[b]ack in the 1980s . . . being the headmaster or headmistress of an elite private school was a prestigious, but not especially well-paid, position. This is why they and [the school] staff were given free housing and discounted school fees for their children”.  FBT was introduced in the mid-1980s, and it seems to me to be precisely Ms Storelli’s “free” housing (etc) that has got her into her present predicament in the FBT minefield.  She was clearly well-paid (over $500k annually), but if she had, say, the present-day benefit of a “free”, executive-standard house around Domain Road South Yarra (where Campbell went to school in the good old days), the imputed market rent for this would be at least a quarter of her total package.  And the possible FBT headache with this – priceless.

** The MLC board has been literally self-perpetuating since 2008, with all new directors, other than the principal, “elected” by the existing board.  As an aside, so it’s evidently now not just we gays who are tampering with nature by reproducing asexually or its corporate equivalent, the spawn of a board's naturally-infertile, collective wank. But in a possible strange bed-fellows twist, here I also concur with the words of former MLC chaplain David Bell:  “I'd like to see a return to more church influence in the school. I do suspect the corporate model has now failed. It's not a corporation, it's not a big business, it's a school for heaven's sake.” (Footnote added 5pm 23 September 2012)

 *** Bernard Salt “MLC board member defends merits of a community board following sacking of principal Rosa Storelli” Herald Sun 25 September 2012

Other References (URLs paywalled):

Ellen Whinnett and Fiona Hudson, “How Methodist Ladies' College's powerbrokers rang alarm on principal Rosa Storelli's expenses” Herald Sun 22 September 2012

Ellen Whinnett and Fiona Hudson, “MLC board asks sacked principal Rosa Storelli to repay $700,000” Herald Sun 22 September 2012

Stuart Rintoul “Sacked principal faces demand for $700,000 following 'overpayments'”
Australian 21 September 2012 (Reference added 5pm 23 September 2012)

Tuesday, September 11, 2012

Archbishop Peter Jensen – YOU need to resign as Archbishop of Sydney

Following my recent post on the perils of “we”, comes a particularly egregious jump from the singular to the plural:

Evidently, Archbishop Jensen is quite the amateur actuary.  I am puzzled why he first emphasises the “I”, because I thought that it was uncontroversial that gay men and lesbians have higher rates of the following than the general population:  substance misuse, mental illness, and suicide.   Gay men (at least in Australia and some other first-world countries) additionally have higher – this time much higher – rates of HIV infection, and related diseases, than the overall male population. 

From this list, suicide is the only item which incontrovertibly shortens one’s lifespan.  If Archbishop Jensen really thinks that the suicide rate of gay males and lesbians in Australia is unacceptably high – and for adolescents, especially, it clearly is – then I suggest that invoking the Australian Christian Lobby’s Jim Wallace as exhibit one here is curious.  In fact, it is rather like stabbing a blameless victim, and then turning the knife, while piously muttering to the dying figure: “See, we told you that your life expectancy was less than ours.”     

The other items in the above list also probably shorten one’s lifespan. AFAICT, tobacco is most actuarially contra-indicated substance to misuse, but again, if Archbishop Jensen is really saying gay men and lesbians should give up smoking (and if so, I’m all with him), his worthy micro-message is hopelessly lost in his broadside.  Likewise, if he is concerned about gay men’s continuing high rates of HIV infection (and who isn’t?), why on earth wouldn’t he use last night’s media spotlight to plug the single, scientifically-accepted prophylaxis for this highly-preventable (since c.1985, at least) condition – condom use in male-to-male anal sex?

Of course, the previous paragraph is rhetorical – Archbishop Jensen’s use of the qualifier “practising”* gays makes it plain that his concerned body-politic “we” does not, by definition, include gay men, other than non-practising ones.  His logic is impeccable, though.  Non-practising gay men don’t need to worry about HIV infection – if you hate yourself enough to deny your core being, then you’re “objectively” all the more likely to add to Archbishop Jensen’s oh-so “compassionate” body count.

* I assume by “practising” he means sexually-active.

Update 7 October 2012

See now:

Monday, September 03, 2012

Julia Gillard’s beige-picket fence

In a nation supposedly obsessed with real estate, last week’s crescendo of media coverage over PM Julia Gillard’s links with corrupt union practises distinctly lacked in solid, irrefutable bricks and mortar.  Instead, what you might call the mere chattels were being lobbed thick and fast. 

It is no accident that the language of real estate – e.g. the property “ladder” – is largely interchangeable with career-speak.  Both presume an only upwards (or at worst, sideways) trajectory; no one ever seems to have the misfortune of riding the property (or career) “snake” all the way down – not within the discourses of the main game, anyway.

Careers and houses can also be broken down into the same three, sometimes conflicting components, of which getting the mix right is the best chance for success:  income earned (or rent saved, for owner-occupiers), capital accumulation, and work-life balance/property liveability (jobs with oppressive hours/conditions are akin to “renovator’s delights”).   There is also arguably a fourth component, which I’ll label “cosmetic improvements” (“if any”, as the usual real estate disclaimer continues, while leaving out, of course, the “cosmetic” prefix).  In the career sphere, CVs are notorious for “cosmetic improvements”; i.e. such “improvements” are presumed to be a negative force, needing to be stamped out.  In real estate however, cosmetic improvements are eminently fair play in general, and a well-trodden path to enhancing capital gain in particular.

Quite enough has been said about Julia Gillard’s chattels (including apparently corrupt ex-partners), whether cosmetically or otherwise.  What I now propose is to focus on Julia Gillard’s improvements; including, more specifically, whether they are cosmetic or structural.  I mean this in the literal, real estate sense:  I’ll leave to my readers to extrapolate whether the PM’s early career can now be regarded as cosmetically-, as opposed to structurally/legitimately enhanced. 

Before we can get to the actual bricks and mortar however, we need to canvass the prerequisite loan application form.  As we are talking about pre-low doc/sub-prime loan times, career/income is an essential box-to-be-filled on this form.  We know that from October 1987*, Julia Gillard was a solicitor, and then from sometime in 1990, a partner at Melbourne law firm Slater and Gordon.  In or in the months after September 1995, she left Slater and Gordon (the date and circumstances of this appear to be in dispute).  In the March 1996 federal election, she ran unsuccessfully as a Labor Senate Candidate (if Julia Gillard was still in the employ of Slater and Gordon up to this time, she appears to have been “on leave” during the campaign).  Sometime during 1996 (but after March), she became Chief-of-Staff to the then Opposition Leader of the State of Victoria, John Brumby (same URL), and then from 1998 began, after being elected MP to the federal seat of Lalor, her current career trajectory (ibid).  All up, it’s an impressive career ladder with no “snake” in sight, although there is perhaps a rung, or two, of detail missing from 1995-96.

In any event, the known real estate adventures of Julia Gillard are more or less limited to the years 1991 to (September) 1995, years during which her career/income, as a partner of Slater and Gordon can be presumed to have been stable or upward.  Hence let the bricks and mortar analysis begin.   

In May 1991*, Julia Gillard purchased 36 St Phillips St, Abbotsford (an inner suburb of Melbourne).   Settlement was in July 1991*.  While the purchase price is not known (Sydneysiders – where the daily broadsheet rattles off seemingly any given house’s historical purchase prices like they were today’s train times – no doubt find this weird), we do know that a deposit of $40,000* was paid.  I am presuming that this was a deposit of at least 20%, i.e. that the purchase price was $200,000 or less.  If I am incorrect here, PM Gillard appears to have significantly overpaid for what was, AFAICT, her first non-rented home.  My point of reference here is my recollections of Melbourne’s property market at that time (it was in deep recession, down significantly from its 1989 peak), and also the fact that an objectively superior inner-Melbourne property also connected with Julia Gillard– 85 Kerr St, Fitzroy – was purchased two years later in 1993 for $230,000.  [Update 24 November 2012: some documents refer to the property as “1/85 Kerr St”, and the Age has called it a “flat”.  From the street, however, it appears to be a single-occupancy terrace]
Even at $200,000, the most likely figure Julia Gillard paid for 36 St Phillips St in 1991, I would surmise that the 1991 vendor/s would have been ecstatic.  Abbotsford was not one of the more desired inner-suburbs at that time, and narrow, low-lying St Phillips St clearly was (and is) not one of Abbotsford’s better streets.  Whether, as well as (allowing me some exaggeration here) possibly buying in the worst street in the worst inner-suburb (at least at the time), PM Gillard additionally purchased the worst double-fronted** house in this street can only be conjectured, but we do know that number 36 needed, or at least received, significant renovations during PM Gillard’s first four years of occupancy/ownership there.  So let us now turn to these improvements, and see whether PM Gillard’s apparent disregard for real estate’s “Position, position, position” maxim, in buying 36 St Phillips St, was fiscally overcome – or compounded – by what she did and spent next.    

As I said near the outset, even the most flagrantly cosmetic improvements in real estate are usually fiscally- (and seemingly also for most people, although not in my case, ethically-) sound.  In the present case of Julia Gillard and 36 St Phillips St, we do not know her sale price (I’m assuming here that she sold this property when she purchased her present residence in Altona), but we do know the cost, and most other details, of the renovations she undertook there between late 1992 and 1995.  Hence, whether these renovations were capital-gains successful for PM Gillard is necessarily a moot point.  However, renovations, at least when not intended for short-term on-selling, also can be presumed to have a “liveability” factor gain (as set-off against an “income” loss).   Julia Gillard’s renovations at 36 St Phillips St – given that her apparent intention was to continue residence at that address – are notable for being a seeming exception to this presumption.  The available evidence suggests that these renovations were so botched as to cause the very property “ladder”, in the PM’s case, not just a missing rung, but to verily slither away.

Media coverage of Julia Gillard’s botched renovations has either replayed them as comedy or racism – the latter (if not also the former) because the ethnicity (Greek) of two of the seven (at least) tradesmen PM Gillard had working for her was portrayed by her, in her 1995 interview, both stereotypically and negatively.  I’ve extracted the renovations parts of the 1995 interview transcript below (square brackets are my annotations).  For me, contra to the hapless-Julia comedy angle, and a necessary factor to be considered in the “racism” question, the key issue is: whether, with her renovations, Julia Gillard was the architect of her own misfortunes?  As she expressly – but oddly stumblingly (“No, I, I, I suppose . . .”)* –  acknowledged in 1995, PM Gillard at no time had a builder in charge of the overall renovations, never mind an architect.

The only logical answer to my “architect” question therefore seems to be “yes”.  Again, I’ll leave it my readers to ponder the present-day implications here.  I will allow one caveat in my answer, however: the timing and necessity of the 1970’s décor (but apparently otherwise functional) bathroom, specifically, was dictated to Julia Gillard by her then partner Bruce Wilson:

Bruce whilst I was away [in Aug-Sep 1994] decided that I should just get it done so he commenced with a group of friends demolishing the bathroom.”*

Evidently, and perhaps not surprisingly, Julia Gillard and Bruce Wilson’s relationship broke up soon after this “Surprise!” bathroom demolition (the 1995 interview does not give a more exact date, but clearly the relationship was over sometime before the date of the interview).

Finally, back to the cosmetic vs structural renovation issue.  Although I’m no builder/engineer/architect, it seems to me that Julia Gillard has pioneered a new hybrid between cosmetic and structural renovation (“cosmuctural”, perhaps?).  A cursory look at the lie of St Phillips St reveals the unusually deep east-west open drain, masquerading in the Melway, at least, as a pedestrian path.  This suggests, to me, an area with poor natural drainage, and so a susceptibility to damp from the foundations up.  And PM Gillard indeed encountered damp foundations at no. 36*.  What is more surprising is her apparent understanding of the reasons for this dampness: 
“[It] was because the way in which the glasswork and the paving were done at that time was causing water to go into the foundations.”*      
Paving’s permutations could certainly exacerbate run-off into the foundations, but I am genuinely at a loss to understand how window (I am assuming) glazing, however configured, could do so also.  Perhaps PM Gillard meant the window frames and seals, as opposed to the glass itself.  Either way, I can’t help but think that Julia Gillard has gone for a “solution” here that is both expensive and slapdash, and not particularly pretty to boot.  An external inspection (front street and rear lane) of 36 St Phillips St the other day reinforces the latter point. The front façade looks serviceable and correctly heritage; certainly there is no hint of the two front sliding aluminium windows that were mistakenly installed in 1994, and then promptly de-Greeked (i.e. replaced with heritage-orthodox wooden sash windows) at PM Gillard’s demand*. 

This is a shame, in some ways, as these two front-facade aluminium windows would quite possibly have possibly have been the last of their kind to be installed anywhere in Melbourne’s inner-suburbia, given that the “heritage” bandwagon was already well and truly rolling in 1994 – albeit not yet in Abbotsford, it appears***.  More than as a mere token relic of the thousands of Melbourne inner-suburban terraces given Mediterranean façade makeovers between the 1950s and early 1990s, however, PM Gillard’s retaining, post-1994, of the front-facade aluminium windows would have given 36 St Phillips St an architectural unity.  You see, beyond the beige front façade and beige picket-fence, no. 36 appears to be structurally unaltered since the 1970s – its sides and back are peeling, ramshackle even.
* All references here are to “Slater and Gordon transcript of a meeting between Peter Gordon, Geoff Shaw and Julia Gillard on September 11, 1995”, published as “What Julia told her firm Australian 22 August 2012; URL paywalled, but edited extract below

** The housing stock of St Phillips St is approximately evenly split between single- and double-fronted

*** No one has been accused, to date, of breaking heritage rules in 1994.  There is an official heritage report on 36 St Phillips St available via Google search, complete with a photo of a ramshackle-looking (but judging by the car in the photo, last ten years or so) façade and front fence.


Slater and Gordon transcript of a meeting between Peter Gordon [PG], Geoff Shaw and Julia Gillard [JG], at the time respectively senior partner, general manager and partner at the firm, on September 11, 1995.

[Extracted from an edited, apparently leaked, transcript published as “What Julia told her firmAustralian 22 August 2012; URL paywalled]


JG: Yep. I've, I moved there [to 36 St Phillips St] in July 1991. When I first moved there I shared it with two other people. It's a two-bedroom place, I shared it with a couple. And when I first purchased it, interest rates were quite high and my salary was lower than it is now, and I didn't really do anything of substance to the property for 12, 18 months, something like that [i.e. JG started renovating sometime between mid-1992 and early 1993]. I then started to get various bits of work done, go relatively slowly and as I could afford to get them done bit by bit. I remember commenting to Geoff [Shaw] at one point that I renovated so slowly other people would call it maintenance because not much was happening.

Then substantial renovations got done on the property last year [1994], which included the kitchen being entirely redone and the bathroom and laundry being entirely redone and internal plastering and painting being done, and yes, so I got all that work done in September, October, Novemberish last year.

PG: OK. Did you contract all of those works to the one subcontractor or builder or did you manage them yourself?

JG: No, I, I, I suppose I should do it piece by piece. I originally got glasswork and [external?] paving work done; that was because the way in which the glasswork and the paving were done at that time was causing water to go into the foundations. I contracted with a glassworker/ woodworker person called Athol James, who I found in the local newspaper, and contracted with a paving place that I got from the local newspaper after getting, I got three quotes and then picked the lowest one of them, so that got done first.
I then, I then got the floors done and I got Athol back to do that, so the front of the house, the old part was the original baltic pine floorboards. The back part was chipboard and I wanted to get the floorboards matched with old baltic pine so I could get it all sanded down and polished. I'm sure this detail is really exciting you. And Athol came and did that, got old pine and matched it all up and you know all of that sort of stuff, which was a substantial job. And then I got some bloke in I think that he recommended to do the sanding, so that was what happened next.

Then what happened after that was I got the kitchen done, I purchased Ikea cupboards and stuff, purchased the actual appliances from a Radio Rentals place in Clifton Hill, and purchased a granite bench top from a local place near me called the Marble Centre, that's also in Abbotsford, and then I had installers who were recommended by Ikea put it all in. His name was Taugney the Swedish Builder, and he took a substantial amount of time to do all of that though I was the envy of Leonie, I recall at that stage, for having a Swedish builder.

That left me with the kitchen functional but the, the kitchen had like cork in it, all of that had basically been ripped to shreds when they had taken the old cupboards out and put the new cupboards in so it needed tiling, it needed tiling on the splashbacks, you know around the sink and around the stove, it needed plastering work, kitchen ceiling, that sort of thing, and I had had a long-held plan to fix the bathroom and laundry. Both were a sort of 70s renovation which amongst other things was red and yellow in colour and I therefore wanted to get it replaced.

I went away to, for a holiday, in late August early September last year [1994] and I had been talking for a long time about getting this bathroom and laundry work done.

And, Bruce whilst I was away decided that I should just get it done so he commenced with a group of friends demolishing the bathroom.

By the time I came back the bathroom had been demolished so I had no option but to get the rest of the renovations done and a series of tradespeople who Jim Collins predominantly organised, Jim Collins being an organiser at the AWU, who he recommended through his local football club, a series of tradespeople came in and did the renovation which predominantly consisted of the bathroom, completing the kitchen, tiling on the kitchen floor, plastering work, replacement of ceilings and the like.

PG: To the extent that in respect of the bathroom it was required to purchase product tiles or grout or whatever, how was that paid?

JG: I went and picked tiles both for the bathroom and the kitchen from various tile shops and paid for them.

PG: Right.

JG: When they were delivered.

PG: Yep. In terms of the tradesmen who did the work in those areas, who were they?

JG: I don't, I don't recall their names. I have some of their receipts at home. There was a tiler, an electrician, a plasterer who had with him a general roustabout person and a plumber and they all knew each other and had worked together before, but it wasn't like one of them was the builder who was organising everybody else. So they came in and did it and I paid each of them. I've had occasion over the course of the weekend to look through my personal records in relation to this matter and I do have a series of receipts from various of them about bits of the work that was done.

PG: Right, and I take it the inquiry over the weekend may have extended to this work as well, the Athol James work, the glasswork, the paving, the floors and the sanding.

JG: Yes, I've got, I recall, I recall particularly dealing with Athol because he came back more than once and sort of lived at my place for a substantial period of time whilst he did the floors, I don't specifically recall whether I've got a receipt from him, I think I do. I've certainly got his number and stuff in my address book from having used him.

PG: OK. Julia, it would be helpful to us if we could have copies of those.

JG: Yes.

PG: Do you have a problem with supplying them to us?

JG: No, no problem at all.

PG: Good. So that, is it fair to say as a general summary of that work that all of the work was paid for by you?

JG: I believe all of the work was paid for by me. I was getting receipts, I was paying it. I at that stage borrowed an additional $20,000 from the bank to pay for the renovations. I had occasion to ask Geoff if I could be pre-paid, which he did. I don't recall the amount. But that was recouped out of my pay for the first six months of this year. And, between that pre-payment and the borrowing of the $20,000 from the bank, I paid for that work.

PG: Right.

JG: I should say that, when I say the 20,000 from the bank: that was the bathroom, the work that was organised subsequent to the demolition of the bathroom. Athol James, the tiler, sorry Athol James, the paver, Taugney the Swedish builder I had paid over time as work was done.


This year [ie. 1995] I had additional work done on my place to try and do something about the outside, the outside is still not painted the right colour, and needed, needed further work done on it. Bill the Greek recommended to me a friend of his called Con, the last name I believe to (be) Spiri, Spiridis or Spiritis or a word to that effect. Con organised for me, or Con came and did the following things.

There are, there were two of the original Victorian windows on either side of the house that were not functional and the wood was rotting. I wanted them replaced by new windows. Contrary to the directions I gave him about that he replaced them with aluminium sliding windows which I was particularly unhappy about. The veranda was slate and it was coming up and the posts which held up the veranda in part were rotting so I contracted with him to replace the posts and to tile the veranda. He did tile the verandah after a fashion, but the job is uncompleted. He did put in posts but he put in, ah, what's the word, decorative posts chiselled out with patterns, rather than plain posts. Given it's a Victorian weatherboard house I was pretty unhappy about that as well. And he mortared the fence and put pickets in it which was required to complete the fence.

When I came home and saw the posts and the windows which got done in, done in one day I raised it immediately with Bill the Greek in fairly vociferous tones and said this has just totally buggered up this job. This is just hideous, you know, you need to talk to Con about it. Bill had been the link to Con. Bill said he would speak to Con about it. Con came back subsequently and did the fence and I raised it with Con. Con said he would get, he knew he had made an error with the windows. He would get the windows replaced with wood windows. He didn't think the posts were his fault because that was the sort of posts that were described to him so there was an ongoing debate about whose fault it was that the posts were the wrong posts. He basically half finished, did most of the fence though bits of it are uncompleted and then he didn't return. I periodically raised with Bill what on earth is happening with Con and these windows and these posts and the tiling's uncompleted and the fence is uncompleted. Bill would say I'll fix it, I'll fix it but it never got fixed.

Life got a little bit more crazy than it had been and I ceased to sort of pay much regard to it or think about it but there was this uncompleted work at the property or to the extent it was completed large bits of it were done wrong. I don't know what transactions Con and Bill have had about the account for that work, but I believe what has happened is Con has gone to the AWU looking for Bill or looking for payment for the account.


PG: OK. Is there anything else that you think we need to know about?

JG: No, I think that's it, I can't think of anything else.

PG: OK. Thanks. The interview was continued because we needed to talk about . . .

JG: Sorry, I'm getting confused, the, Geoff when we were not on tape asked me a series of questions about things that I have had done to the house that I don't recall getting invoiced for. It occurred to me that one of those things is, and Geoff has actually seen this with his own eyes. Bill the Greek, whilst I was at work one day, built for me a low level brick fence. I didn't ask him to do that. The result was truly hideous and I think Geoff saw it when he dropped me off one night and everybody else who's passed my house has commented on it. In order to try and make it look less hideous, part of the work that Con was to do was to mortar it and put pickets on it that goes like that to try and stop it looking quite as Greek, dare one say.

I didn't, I've never, I didn't pay for the bricks, I didn't pay for the bricks. I've never had an account in relation to the fence. Now, I don't, I don't know what that means about where Bill got the bricks from, and I don't know whether that means anybody worked with him on the fence, that I haven't paid. He, you know, he pleased as punch sort of said he had built it for me. That he had built it for me. Whether that means he himself did it, given Bill's obvious difficulties with the truth I no longer know.

PG: What are Bill's obvious difficulties with the truth?

JG: He's just a big Greek bullshit artist.

[snipped to end]

Front facade of 36 St Phillips St, Abbotsford

East facade (view over back fence) of 36 St Phillips St, Abbotsford

South facade of 36 St Phillips St, Abbotsford

Update 23 November 2012

The plot thickens, as (mostly) minor document after minor document is drip-fed onto the broadsheets’ front pages.  If Little Red Riding Hood (22/11 corrected from "Goldilocks") had been a lawyer (or ex-lawyer), she would have had no trouble with her trail of breadcrumbs disappearing when they were most needed.  A lawyer’s every billing moment leaves at least a footprint in the forest.  But in Julia Gillard’s case, piecing together these footprints into a coherent trail remains a work in progress.

In the mean time, the two most major recent developments* have received scant follow-up.  The first is that the money defrauded by Wilson and Blewitt largely came from big-end-of-town corporate pockets – i.e. “donations” presumably used to buy industrial peace.  The second is that “big Greek bullshit artist” Bill Telikostoglou was not just an over-promising tradie working on Ms Gillard’s home reno, but a senior AWU figure, at least one senior enough to receive a “large” redundancy cheque of $16,218, in August 1995, apparently to smooth Telikostoglou’s exit from his (oddly unspecified) AWU role.  Admittedly, in dollar terms here, we are not talking sheep stations – just cosmetic, structurally-pointless cheque-writing for dumps in the back streets of Abbotsford (and yes, that’s a metaphor as well).

Julia Gillard’s position at the moment reminds me of a certain ex-US president.  “No, I did not have legal relations with that conveyancing file” is her current line.  If she is further grilled about these matters today, I suggest her next holding-the-line defensive mantra could be “Yes, the paralegal passed me the file, but I didn’t inhale”.

* These two developments are covered in Hedley Thomas, “Rushed cheques and a quiet exit: how the AWU 'covered up' fraud”, Australian, 16 November 2012

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