Bitter opposition forces leader into U-turn after he gave Labor written agreement that he would back party funding plan

This article is more than 7 years old

This article is more than 7 years old

The Coalition has forced its leader Tony Abbott to back down on a written agreement he gave to Labor that his party would vote for a deal to increase public funding to political parties.

The party’s leadership group made the final decision to overturn the deal – which Abbott promised to support in a letter to Labor just six days ago – on Wednesday morning after a revolt by the backbench, senior members of the shadow ministry and state divisions of the Liberal party organisation.

In a letter to the attorney general, Mark Dreyfus, on 24 May, Abbott wrote: “I am satisfied with the agreement reached and indicate the Coalition’s intention to support the legislation and to deal with it, as requested, before the end of the sittings. I note that I have been provided with a near-final draft of the bill and will leave settlement of the final legislation with the shadow minister.”

Abbott said on Wednesday he had gone back on his written undertaking because “the people have spoken”.

He said there was “an argument” for more public funding, including that large private donations to political parties might not be made “for entirely altruistic reasons”, but these arguments had been “trumped” by public disquiet about the timing of the now-dead funding deal.

And despite having put no qualifications in his letter to Dreyfus, Abbott claimed that all undertakings of Coalition support were “naturally subject to the party room … and due processes of the party”.

Most Coalition MPs, including senior frontbenchers, were unaware of the deal negotiated in secret earlier this year between the former special minister of state Gary Gray, his replacement, Dreyfus, and shadow special minister of state, Bronwyn Bishop, with the full knowledge of both party leaders.

Abbott’s letter was copied to the managers of opposition business in the House of Representatives and the Senate, Christopher Pyne and Senator Mitch Fifield.

The leader of the government in the House, Anthony Albanese, said Abbott “wants to be the leader of the country but you can’t believe a word he says. You can even have it in writing but that doesn’t seem to mean much either.”

Albanese said: “He needs to explain why he has put this in writing and then completely flipped.”

The deal caused deep anger on Labor’s backbench, with veteran Senator John Faulkner saying he was “ashamed” and the ALP was “diminished and tarnished” by the deal.

Coalition MPs and frontbenchers had raised deep concerns and a leadership group meeting this morning resolved the Coalition would not support it.

In the letter, Abbott says: “I have been briefed by shadow special minister of state, the hon Bronwyn Bishop MP about the agreement reached between former special minister of state, the hon Gary Gray, Mr Brian Loughnane and Mr George Wright on various disclosure and funding matter.”

For days, Abbott’s office has told journalists it cannot comment on the deal because it had not seen its final form.

As well as a revolt on Abbott’s backbench, the deal was bitterly opposed by state Liberal party directors, who saw it a centralisation of power in the head office.

The $58m agreement was to deliver parties an extra $1 per vote in taxpayer funding with a $300,000 top-up per electoral term.

Coalition MPs said on Wednesday the agreement was “completely toxic” in the electorate and were fiercely lobbying that it should be rejected.

Some, such as Queensland LNP backbencher George Christensen, took to Twitter to question the move. He wrote: ‘‘In time of budget crisis should we be boosting funds to parties?’’

Liberal backbencher Russell Broadbent told Guardian Australia: "I will not support this bill. There has been no public discussion about this. It's been dumped on us out of the blue. This bill has not been through the shadow cabinet or the party room."

Others expressed their extreme disquiet at the deal privately. One MP described it as “the kind of grubby tactic you would expect from the Labor party … it’s pretty disgusting”.

A long-serving MP said he had “never seen this level of antagonism in the party room against anything … the Nationals hate it, the Senators hate it, the Queenslanders hate it. It’s hard to find anyone who is for it.”

Another said it was “a bad look when we are telling people we have to make spending cuts because there is a budget emergency”.

The government argues that an extra $1 per vote, and an additional $300,000 a year for parties with at least five MPs or Senators to pay for administration, helps address public concern about “escalating donations and campaign costs”. The $1, which would also be received by independents is on top of the $2.47 per vote parties already receive after election campaigns.

The Greens leader, Senator Christine Milne, also called for the agreement to be dumped.

“The community doesn’t want it and neither do the Greens,” she said.

“Growing concern about the legislation across the parliament, and strong opposition from the community, means this is fast becoming a quagmire and threatens other important reforms for which people have fought for nearly a decade.”