Opposition Leader Bill Shorten needs senator Sam Dastyari. Credit:Penny Stephens All of them were important populist causes that helped the NSW senator carve out a personal political brand as a scrapper who takes on Goliath. All of them were perfect for burnishing his status within the opposition beyond what would usually be accorded a young and relatively inexperienced senator. The dogged pursuit of causes partly explains why Opposition Leader Bill Shorten has defended him so loyally. But this is Labor, where the true reason for most puzzles can be explained with one word: factionalism.

Senator Sam Dastyari arrives to deliver a statement to the Senate. Credit:Alex Ellinghausen Prime Minister Malcolm Turnbull has said that Dastyari should resign from the Senate, and that if he refuses to do so, "Shorten should dump him from the Labor Party and let him languish in contempt on the crossbench". But Shorten has so far refused to do so, despite having a full bouquet of reasons why he should: Dastyari took money for himself from a Chinese businessman and Labor donor, Huang Xiangmo, who Labor (and the government) had been warned had links to the Chinese government. He disavowed the Australian government position, and the Labor position, on Chinese expansionism at a press conference, standing alongside Huang. He misled the public about the nature of those remarks. And he warned Huang his phone could be tapped, and, when visiting his house, suggested they talk outside and leave their phones inside in case they were being bugged by ASIO. Why would Shorten stand by him? The answer lies in Dastyari's importance in the NSW Right, which is in a constant battle for dominance with Shorten's faction, the Victorian Right. The two factions are rivals but also inter-dependent. Dastyari, a former general secretary with NSW Labor, backed Shorten into the leadership in his contest against Anthony Albanese in 2013. The integrity of that vote was later questioned, when an ALP tribunal found the mailing addresses for dozens of ballot papers had been altered at the request of one of Dastyari's staff members.

In 2015 Dastyari was given a spot on Shorten's frontbench, despite being a relative newcomer to Parliament. Dastyari is close to Chris Bowen and Joel Fitzgibbon, who lead the NSW Right, and is protected by those relationships. As one Labor source puts it: "If Shorten were to move on Sam, that would tribally get people upset in the NSW Right, even though a lot of them don't like Sam. Touch one, touch all." A second Labor source says Shorten is a "transactional" leader who needed Dastyari to shore up his leadership. "Shorten could sack him from the Labor Party but I don't think he's got the ticker to do it. Bill's captive of the Right, he doesn't have a strong support base, there are not many people who are rusted on loyal to Bill," says the source. "He wouldn't want to create an enemy in Sam. Sam's not a bad human being, and he's certainly not a Chinese spy, but he doesn't think things through."

A third Labor source is less forgiving. "It's not a talent or a personality thing, it's a factional thing," the person says of Dastyari. "The money he got from China wasn't just for himself." This source points out that of all the recent NSW Labor general secretaries, many have gone on to work for or with Chinese interests. Dastyari's successor Jamie Clements was suspended from Labor for misconduct and established his own legal practice. He has Chinese clients and the Sydney CBD office suite where his practice is based is owned by Xiangmo's company, the Yuhu Group. Other former general secretaries Karl Bitar and Mark Arbib left Labor to work for James Packer, whose main investment focus is the Chinese gambling market.

Another former general secretary, Eric Roozendal, went on to work for Xiangmo at the Yuhu Group. All Labor sources contacted by Fairfax Media believed Dastyari's political career was over, that he would be unable to come back from the latest revelations. "It's just ironic that a member of the NSW Right, which was based on fighting communists in the left, has hit the fence for being too close to the Chinese Communist party," said one. @JacquelineMaley Follow Jacqueline Maley on Facebook