FEW events in politics work out precisely as expected. Some issues burn intensely, like a flare that lights up the sky but then fades quickly from view, with little to no ongoing impact on the political process.

The Coalition’s attempts to link then opposition leader Kevin Rudd to disgraced former Western Australia premier Brian Burke is an example of what could have been an all-consuming scandal that went nowhere.

The more dangerous issues usually start off slowly, often taking months or years to reach the perilous proportions of a political scandal.

Labor backbencher Craig Thomson’s alleged exploits while at the Health Services Union show that the wheels can sometimes turn slowly, but they do keep turning.

The PM has lit the fuse on another issue that has the potential to reach deep into her office and destabilise her leadership and her government. While it may not in itself be a short-term vote-changer, this issue says much about the character and competence of Julia Gillard.

The Australia Network, a broadcast service into the Asia Pacific region, is funded through the Department of Foreign Affairs and Trade. After receiving cabinet approval to conduct a competitive process for the $223 million contract over 10 years, DFAT called for tenders in late 2010.

An independent panel was established to advise DFAT Secretary Dennis Richardson, who had responsibility for the final recommendation. It is widely accepted that of the two tender submissions, the panel judged the Sky News bid as superior to that of the current broadcaster, the ABC.

This evidently did not please the PM, and at some yet to be determined point, she interfered in the process to block the decision to grant the contract to Sky News.

What is known is that the decision deadline passed without comment from the government until June 24, when a joint statement from the PM, Foreign Minister Rudd and Communications Minister Stephen Conroy claimed the tender process had to be aborted, allegedly because of the uprisings in the Middle East.

This was arrant nonsense, as the Australia Network does not broadcast to the Middle East, and if any tender were to be cancelled every time there was another global event to consider, no tender would ever be awarded.

However, it later emerged that the Prime Minister had stripped DFAT of responsibility for deciding the tender and it was put in the hands of Conroy, who happens also to be responsible for the ABC.

The obvious conflict of interest was apparently of no concern to a PM intent on achieving her desired outcome. A second tender was called and again no decision was made by the expected deadline.

By this stage, the Deputy Leader of the Opposition, Julie Bishop, who had been pursuing the issue, had written to the Auditor-General seeking an investigation into the whole affair.

The Auditor-General declined to investigate at that point as he had been informed that a decision on the tender was imminent. Weeks later it was reported (in this newspaper) that the independent review panel had once more recommended Sky News.

Minister Conroy then made the utterly ludicrous claim that leaks to the media (which had come from the government) prevented him from making a decision. He ignored the fact that the review panel had concluded its work weeks prior to the leaks; he then announced there would be a police investigation, presumably into the government itself.

After Conroy suspended the second tender process because of the police investigation, Bishop wrote again to the Auditor-General who, not surprisingly, agreed to an investigation.

With Australian Federal Police and Auditor-General investigations under way, Conroy announced suddenly that the government would award the contract to the ABC, in perpetuity.

Such breathtaking arrogance showed utter disregard for due process, including the outcome of the investigations.

The PM, as a trained lawyer, must have been well aware of the need for probity and integrity in public tenders and of the legal and ethical pitfalls that come from seeking to manipulate a tender process. Tenders are deliberately conducted with strict confidentiality to prevent communication between the tenderers and those making the decisions so that neither undue pressure is brought to bear nor inducements offered.

It is difficult to understand how a prime minister with legal training and with all the resources and advice of government could blunder headlong into the minefield of a public tender process.

Not only has Gillard manipulated this tender, she has done it brazenly and without a hint of subtlety.

The consequences for this interference could well come home to haunt her and her office. The police and Auditor-General investigations are yet to report their findings.

There are already fertile grounds for further investigation, particularly regarding the communications between Gillard, Conroy, the ABC and the independent panel that twice recommended Sky News.

Added to the mire is the fact that two cabinet ministers raised concerns in July about inappropriate lobbying by ABC managing director Mark Scott in relation to the tender.

The consequences of this chain of events could easily end up harming the PM personally and also her Communications Minister.

Ross Fitzgerald is the author of 35 books. The Weekend Australian December 17-18, 2011