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Gillard may have made a false start in the toughest race of her life

12 January 2013 No Comment

THE Coalition’s strategists were on high alert in the second half of last year as Julia Gillard made a flurry of policy announcements that could have been used as a platform for an early election.

The announcements – on health, disability and education – contained no details and there was no funding allocation but they had electoral appeal.

It now appears that this activity was part of the Prime Minister’s scheme to protect her leadership from a resurgent Kevin Rudd and to calm the frayed nerves of her Labor backbench. There is also the possibility the crossbenchers who support her government, particularly Tony Windsor and Rob Oakeshott, demanded some positive action to reverse the government’s slide in the polls.
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Whatever the reason, it may well transpire Gillard missed a golden opportunity to strike – as she is now facing a difficult election year with Labor mired in scandal. It will be a challenge to shake off the persistent allegations regarding the massive fraud perpetrated against the Australian Workers’ Union in the early 1990s. This scandal refuses to go away despite Gillard’s best efforts. The Prime Minister has strenuously denies wrongdoing, saying she knew nothing about the fraud. But she is up against a motivated group of people that includes former and current AWU officials; Labor party members; former Slater & Gordon lawyers; investigative journalists; and the Coalition.

This group also includes her former client Ralph Blewitt, who claims to have intimate details of the alleged fraud. Blewitt gave a statement to Victoria Police late last year and they have commenced inquiries.

The case was strengthened when former WA corruption commissioner Terry O’Connor QC wrote in ‘The Australian’ on December 19 that, based on the information available to him, Gillard’s conduct in providing legal advice to help set up the AWU Workplace Reform Association, which was later used to commit the fraud without her knowledge, appeared in breach of WA laws, including the Criminal Code. “Without some explanation from her as to what occurred, there is, in my opinion, a prima facie case that she could have been charged along with Blewitt as she drafted the rules of the association for Blewitt knowing that the rules did not disclose the purpose for which the association was being incorporated,” he wrote.

It would be fatal to Gillard’s election prospects if the Victorian or West Australian police launched an official investigation into the affair, particularly given that neither Gillard nor her then boyfriend and alleged architect of the fraud, Bruce Wilson, have so far been interviewed by police.

Polls have shown a majority of Australians do not accept Gillard’s version of her role in the AWU scandal, although it is too early to know whether that would translate into a loss of electoral support for Labor.

A second issue likely to come to the fore this year is the alleged corruption at the Health Services Union. Recent former federal president of the Australian Labor Party and former HSU head Michael Williamson is facing a range of serious charges relating to an alleged fraud of potentially millions of dollars. When this case comes before the court it is inevitable that some of Labor’s dirty laundry will be hung out for all to see. Williamson, who denies wrongdoing, held the most senior role within the Labor Party organisational wing as recently as 2009-10 and if he is found to have committed fraud against low-paid union members there could be a serious backlash.

Suspended Labor MP Craig Thomson is also facing civil charges by Fair Work Australia that he misappropriated hundreds of thousands of dollars of union funds. An investigation by the workplace umpire found Thomson had committed dozens of breaches of the law – including misusing union funds for his own purposes. Thomson denies this.

While the media has shown a prurient interest in allegations Thomson used union funds to pay for prostitutes, and lots of them, this overlooks the potentially more serious charges if he is alleged to have acted in establishing a scheme to defraud union members. Thomson is not facing any charges of that nature and vehemently denies any wrongdoing. However, his home has been raided as part of continuing police investigations – creating an air of expectation that the HSU scandal could erupt at any time.

Another potential time-bomb for Labor is the Federal Police investigation into Peter Slipper’s alleged misuse of Cabcharge vouchers. The media focus was largely on sexual harassment claims until that case was thrown out of court. However, should it be found that Slipper had engaged in fraudulent behaviour with respect to the Cabcharge vouchers he could face charges that threaten his place in the parliament. Now that the Australian Federal Police has announced that the Queensland MP will face dishonesty charges, this is now a serious possibility.

The Slipper matters are not only of concern to Labor, for he was a long-serving member of the Coalition and the public is rightly cynical about why he was repeatedly preselected as a Coalition candidate. However, Tony Abbott rightly argues that it mainly raises questions about Gillard’s flawed judgment as she elevated Slipper to the role of Speaker in a plot that enabled her to break her written agreement with Tasmanian independent Andrew Wilkie to introduce poker-machine reform.

Another distraction for Labor is the investigation by the NSW Independent Commission Against Corruption into former state Labor ministers Eddie Obeid and Ian Macdonald. While this is primarily a state matter, any stench of corruption within NSW Labor will have significant implications for federal Labor and the swag of marginal seats it holds in that state.

Any or all of these damaging issues could resurface this year and Gillard may well rue her decision not to call an early election.

Abbott also appeared to be somewhat off his game towards the end of last year. His relentless campaign against the carbon tax was not getting as much traction in the mainstream media and he often appeared rundown and tired.

However, Labor cannot assume this will be the case this year. Over recent weeks Abbott has wisely taken a break, and Labor should expect him to be primed to hit the campaign trail hard.

Prime ministers choose the timing of elections to give themselves their best shot at winning. Gillard may well have missed her opportune moment.

Emeritus Professor of History and Politics at Griffith University, Ross Fitzgerald is the author of 35 books.

‘The Weekend Australian’,January 12-13, 2013, Inquirer p 16.

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