Updated 12pm

Revelations about corruption at the country’s largest urban construction site are concerning and an investigation into activity at the Barangaroo South development is warranted, NSW premier Barry O’Farrell says.

A joint ABC-Fairfax Media investigation has found Victoria’s desalination plant and the Barangaroo development in Sydney were among a number of projects that companies connected to major crime figures are reportedly involved in.

The report implicated a number of Construction, Forestry, Mining and Energy Union (CFMEU) members in NSW and Victoria in dodgy deals, including bribery and extortion.

It was revealed that a lucrative contract at James Packer’s $6 billion casino project had been granted to a labour hire company run by George Alex, who has known links to criminal and bikies gangs, after intervention from allegedly corrupt Construction, Forestry, Mining and Energy Union (CFMEU) officials.

“Matters like this are of serious concern, not just to the state government but also to the construction sector,” Mr O’Farrell said.

But, he added, it is important to remember that only about 50 of the 600 workers at the site were caught up in the allegations.

“It appears to be a limited involvement by very colourful characters,” the premier told reporters outside his office on Tuesday.

Mr O’Farrell has asked the Barangaroo Development Authority to investigate and report to the government “as soon as possible.”

No state funding was provided to programs associated with Mr Alex’s company Active Hire, Mr O’Farrell said.

The federal Greens and Labor need to take as a “wake up call” the allegations raised and stop blocking federal legislation to reinstate the construction industry watchdog, Mr O’Farrell said.

The construction sector union says it will take immediate action if it’s made aware of any illegal or corrupt activity by its officials following allegations of corrupt deals to help companies linked to organised crime secure construction contracts.

It reported that Victorian CFMEU official, Danny Berardi, resigned immediately after the media companies supplied evidence that he had two companies help renovate his properties in exchange for getting them work on Melbourne construction sites.

CFMEU national secretary Dave Noonan said he was “concerned about any criminal activity in the industry”, but that the union was not the regulator.

“These are issues for ASIC and the police force and we have consistently called on them to do their job,” Mr Noonan said.

Mr Noonan says the union acts in the interests of workers at all times.

“The vast majority of our officials are hardworking people who are dedicated to improving the lives of construction workers,” he said in a statement on Tuesday.

“If the leadership of the CFMEU is made aware of improper, illegal, corrupt or criminal activity by any official of the union, we act immediately.”

The union has terminated the employment of officials who have engaged in such activity in the past, he said.

“We would not hesitate to do so in the future, if warranted.”

The CFMEU has adopted new governance rules for our officials which have been ratified recently, he said.

Mr Noonan says he wants to see a full police investigation of any allegations.

Australian Building Construction Commission chief Nigel Hadgkiss told the ABC he was aware of evidence about “the payment of bribes to senior union officials” in Victoria, but said police not previously acted on evidence of corruption in the industry.

He said the lack of action made way for criminals and corrupt officials, and that was “very frustrating”.