Prime minister points finger at Labor after being asked on radio about the damage done to the NSW Liberal party by the Icac revelations

This article is more than 6 years old

This article is more than 6 years old

In the wake of the resignation of two NSW Liberal MPs over corruption allegations, the prime minister has said the “problem” was the former Labor NSW government banning property developer donations in the first place.



Hunter Valley MPs Tim Owen and Andrew Cornwall stepped down from parliament last week over revelations at the Independent Commission Against Corruption (Icac) they accepted money from property developer Jeff McCloy. Donations from property developers were illegal at the time.

Questioned on talkback radio about the damage the revelations were doing to the Liberal party, Tony Abbott said: “The problem was that the former state Labor government, because of a predicament it found itself in, introduced laws banning donations from developers.”

“Who exactly is a developer? That can sometimes be a difficult question. [They] also introduced legislation to limit the total amount of donations and political parties need to raise money,” he told 2GB on Monday morning.

“I think it’s right that political parties have to go to the public and seek support that way rather than just being able to rely solely on the taxpayer. And plainly, some people have cut corners. It’s quite possible some people have broken the law and if that’s the case, whatever party they’re in, they should face the consequences.”

Abbott said the revelations of Icac were a “very bad look” but he and the premier, Mike Baird, wanted to clean up the NSW Liberal party.

“I think this whole question of donations does need to be looked at again, but in terms of the Liberal party itself, what we need to do is to ensure that it belongs to its members, not to factions,” he said.

Abbott said he hoped to see party reforms implemented in the NSW Liberal party in the next year. Last year he commissioned an expert panel, headed up by former Liberal prime minister John Howard, to examine the preselection process in the Liberal party and look at party reform.

The panel has delivered its report, which has been sent to members but not released to the wider public. Abbott endorsed the report, saying he hoped to see the reforms implemented in the next year.

In Icac hearings on Monday, the deputy chair of the “inner city business chamber” Newcastle Alliance said she was “shocked” to find the group had given $60,000 to an anti-Labor campaign to unseat a Labor member opposed to millionaire Nathan Tinkler’s coal loader being built in the city.

Icac has heard the money was funneled to the Alliance by Tinkler, who was banned from donating to political parties because of his property development interests.

Tracey McKelligott, who was deputy chair of Newcastle Alliance, told Icac she first became aware of how much money the alliance had given the Fed Up campaign when a Newcastle Herald journalist rang her.

“I didn’t know, I wasn’t advised, I was shocked,” she said.

“[I was] hurt, shocked, disappointed, at that point in time I was the deputy chair.”

The Newcastle Alliance also had $70,000 listed as “donations” on its return in the lead-up to the state’s 2011 election.

“I don’t know anything [about the donations], I should have asked at the time, I should have looked more carefully, I should have paid more attention,” she said.

When junior counsel assisting at Icac, Greg Mahoney, suggested this was extraordinary, McKelligott replied: “Yeah.”

McKay lost her seat in the 2011 election after an aggressive campaign which included a flyer drop saying she supported a container terminal that would have trucks going through Newcastle 24 hours a day. The pamphlets said “Stop Jodi’s Trucks In Our Streets” and were also funded by Tinkler. Her colleague Joe Tripodi helped orchestrate the campaign.

Tinkler wanted her unseated, Icac has heard, as she opposed his coal loader project.

McKelligott said Newcastle Alliance had “absolutely no” political affiliations but wanted to have a marginal seat in Newcastle, which had traditionally been a Labor heartland, as they thought they would get better treatment by a government of either persuasion if the seat was winnable for both sides.

The Fed Up campaign did not specifically endorse a candidate but another Icac witness, hotelier Rolly de With, said it could be described as anti-Labor and the campaign wanted either an independent or a Liberal representing Newcastle.

Newcastle Alliance listed receiving $50,000 donations from Serene Lodge – owned by Tinkler’s father – and two donations of $10,000 from 6.5, described in Icac as a networking group.

Owen eventually won the seat of Newcastle at the 2011 election and, along with Charlestown MP Cornwell, resigned from parliament last week over allegations he accepted donations from McCloy. McCloy resigned as mayor of Newcastle on Sunday.

Parliamentary Speaker Shelley Hancock announced on Monday the by-elections for Newcastle and Charlestown would be held on 25 October.



Both seats have traditionally been pro-Labor and are expected to fall back to the ALP. The Liberal party announced at the weekend it would not be fielding candidates as an “act of atonement”.



The by-elections are forecast to cost the taxpayer a total of about $1m.