Former Australian Workers Union official Ralph Blewitt has told the royal commission into unions he used $7000 from a union “slush fund” to pay for renovations to former prime minister Julia Gillard’s Melbourne house.

Mr Blewitt, who has admitted to acting fraudulently, alleged he attended Ms Gillard’s home in Abbotsford, a suburb of Melbourne, in 1994 and handed over $7000 to a builder.

He told the Royal Commission into Trade Union Governance and Corruption on Monday Ms Gillard ushered him into her house and told him his union colleague, Bruce Wilson, her boyfriend at the time, was inside.

“My recollection is Julia Gillard was in one of the rooms adjacent to the front door,” he said.