Julia Gillard has said “decency” should require coalition members who falsely accused her to apologise after the royal commission into trade union corruption found no evidence she had engaged in serious wrongdoing or criminality.

The royal commission recommended criminal charges be considered against scores of officials from three unions but found the former prime minister committed no crime and was unaware of any crimes committed by others.



“Australians may well ask themselves whether the millions of dollars the Abbott Government has spent on a twenty-year-old matter that was already in the hands of the police would have been better allocated to health, education or law enforcement,” Gillard said in a statement after the royal commission released its interim report.



In opposition several members of the coalition suggested Gillard had committed a crime, including the now Attorney General George Brandis who said in November 2012, “it is already clear that, from its inception, Ms Julia Gillard’s involvement in this matter has been characterised by concealment, deception, professional misconduct and, it would appear, several breaches of the criminal law.”

One volume of the royal commission’s interim report has been kept confidential because it deals with serious threats to witnesses which it says amount to “grave threats to the power and authority of the Australian state”.



The workplace relations minister, Eric Abetz, repeatedly refused to summarise the findings of the report about the former prime minister and said calling the royal commission had “never been about the pursuit of Ms Gillard, it was about hundreds of thousands of dollars being obtained by fraud and no one ever being brought to justice”.

“The report speaks for itself … it shows clearly our request to have these issues ventilated has been vindicated,” Abetz said.

Senior Coalition figures had made serious allegations against Gillard and legal advice she gave as a young lawyer to her then boyfriend, the Australian Workers Union official Bruce Wilson, as he set up what was later revealed to be a union “slush fund”.

But the interim report says that “findings are made that Julia Gillard did not commit any crime and was not aware of any criminality on the part of … union officials”.

By discussing the name of the slush fund on an application for its incorporation, it says, “Julia Gillard’s conduct in this respect must be regarded as a lapse of professional judgment, but nothing more sinister.”

The report does recommend Victorian and West Australian authorities consider fraud charges against Wilson and his union “bagman”, Ralph Blewitt.

The royal commissioner, Dyson Heydon, said he accepted evidence from a retired builder, Athol James, and another former AWU staffer, Wayne Hem, that Gillard had received “certain funds” from Wilson. But he said “the skimpy nature of the available evidence does not make it possible to infer on the balance of probabilities that Julia Gillard was aware that she had received the $5,000 which Wayne Hem put into her bank account on Bruce Wilson’s instructions”.

Heydon also said he had found it hard to judge Gillard’s credibility as a witness because she was well-prepared.

“Her intense degree of preparation, her familiarity with the materials, her acuteness, her powerful instinct for self preservation – made it hard to judge her credibility,” he said.

“Normally, cross-examination of a non-expert witness is a contest between a professional expert who is familiar with every detail of the case and a relatively unwary member of the public who is not. But Julia Gillard had 20 years’ knowledge of the case and immense determination to vindicate her position.”

In 2012, when a interview between Gillard and the senior partners of her law firm became public, the prime minister, Tony Abbott, said: “Well, clearly on the basis of the exit interview, the documentary evidence of the exit interview which was done at the time all of this information was available before the file disappeared out of the West Australian Corporate Affairs Commission, plainly on the documented evidence of the unredacted transcript she gave false information to the West Australian authorities ... Now, for a legal partner, for a senior lawyer to make false claims to an important statutory body like this is a very, very serious matter. It is in breach of the law, I would think, and it is certainly very, very unethical.’’

In the same year Julie Bishop, now the foreign minister, told the Coalition party room that Gillard had been a knowing accomplice to Wilson. “She provided the stolen vehicle, she drove him to the bank and she looked away while he robbed the bank,”’ Bishop said, according to the official party spokesman.

“She [Gillard] and Wilson and [sidekick Ralph] Blewitt wanted to hide from the AWU the fact that an unauthorised entity was being set up to siphon funds for their benefit and not for the benefit of the AWU,” Bishop said to reporters, although she toned down her remarks later that same day.

Major recommendations in the interim report include:

That the commonwealth director of public prosecutions consider criminal charges against officials from the Construction, Forestry, Mining and Electrical trade union and the Health Services Union.

That blackmail charges be considered against the Victorian secretary of the CFMEU and the union’s assistant secretary.

That the Australian Securities and Investment Commission consider charges against the Queensland state secretary of the CFMEU.

Abetz said the report bolstered the government’s case to introduce the Registered Organisations Commission – an independent oversight body for unions and employers – and reintroduce the building industry watchdog, the Australian Building and Construction Commission. Neither organisation is specifically mentioned by the royal commission.

He said the report revealed a “systemic culture” of criminality within sections of the trade union movement and called on Labor to pass legislation introducing both bodies if it wanted to see “a clean trade union movement”.

The president of the ACTU, Ged Kearney, said the report was “designed to weaken the unions” but failed to expose any wrongdoing by Gillard.

“The Abbott government owes former prime minister Julia Gillard an apology, the smoking gun wasn’t there,” Kearney said.

She said it was a waste of taxpayer money because it had “nothing to say there’s widespread corruption” in the unions.

Targeting Gillard’s involvement in the AWU affair was widely seen as a key motivation for the government setting up the royal commission, and the former prime minister John Howard said in a televised interview he was “uneasy” at the move.

“I’m uneasy about the idea of having royal commissions or inquiries into essentially a political decision on which the public has already delivered a verdict … I don’t think you should ever begin to go down the American path of using the law for narrow targeted political purposes,” he said. “I think the special prosecutions in the US are appalling.”

The royal commission also foreshadowed its final report was likely to recommend changes to legislation setting up compulsory superannuation. It says parts of that legislation mean some collective agreements can effectively force employees to contribute to a union-run fund.

“The consequence of the provision is to deny employees genuine freedom of choice,” the royal commission finds.

The government has given the royal commission a one-year extension – until December 2015 – to provide its final report. The said it would respond to the interim report next year.