*New criminal penalties and a scheme to identify company directors are urgently needed to crack down on the scourge of illegal phoenixing activity, according to the peak body of insolvency practitioners.
*Both measures are contained in the Morrison government’s Combating Illegal Phoenixing bill but the Australian Restructuring Insolvency & Turnaround Association (ARITA) is frustrated at the pace of reform after the bill was allowed to lapse at the May election.
“Despite the claims of action by government, unfortunately almost nothing is really being done,” the ARITA chief executive, John Winter, told Guardian Australia.
*ARITA wrote to federal parliamentarians this week urging them to do more to combat phoenixing – a practice where under-capitalised companies intentionally go into liquidation to avoid paying creditors and workers’ entitlements – warning that reforms should be in place ahead of potential economic downturn.
In February the Morrison government introduced the phoenixing bill, which lapsed when parliament was dissolved ahead of the May election. The assistant treasurer, Michael Sukkar, reintroduced it in July.
Sukkar told the House of Representatives illegal phoenixing “has been a problem for many decades” and boasted the bill would give regulators the ability to “prosecute or penalise directors and others who facilitate this illegal activity, such as unscrupulous pre-insolvency advisers”.
Under the new criminal offences illegal asset stripping would attract penalties of up to 10 years imprisonment.
The ARITA report to MPs and senators says the bill “goes some way to addressing this issue and is worthy of support but much more focus is still needed to protect the community as a whole from this scourge”.
ARITA noted the phoenixing bill would also create a director identity number, “linking their past and present directorships to help prevent illegal phoenixing and limit the damage done by inept entrepreneurs”. It said this would require “resourcing and prioritising a complete overhaul of the ASIC register”.
In addition to higher penalties and the director identity number, ARITA wants: a greater focus on enforcement actions by the corporate regulator, Asic; abolition of fees on its members which it claims are “effectively working as an extension of the regulator for free”; and a crackdown on unregulated “pre-insolvency advisors” it claims help companies avoid their obligations.
On Friday Guardian Australia reported that Asic is yet to use powers it gained in April to disqualify company directors or managers who improperly access the taxpayer-funded safety net to pay workers of their failed companies, because the lack of retrospective effect of the laws means no officers eligible for the penalty have yet been identified.
Winter said ARITA had been “pushing the government for reform” because its members “are at the frontline of combatting phoenixing – they uncover it long before the ATO or Asic are even remotely aware of it”.
The safety net for unpaid wages, the Fair Entitlement Guarantee, is expected to cost $882m over the next four years. In the last four years, the commonwealth has recovered just $170m from companies that accessed the scheme, a figure boosted by Queensland Nickel repaying $66m to taxpayers.
‘It’s almost been 10 months (!!) since City of Ryde supported my refusal recommendation on this Meriton monstrosity.
The Berejiklian State Government still haven’t formally refused it.
Get on with it.’
“People in Ryde are sick of state government-enabled overdevelopment in Ryde – our demands are simple – abolish priority precincts, exempt us from the Medium Density Housing Code and listen to our community,” council said.
Meriton calls off lawsuit against NSW government over towers
Apartment developer Meriton’s Karimbla Constructions Services has withdrawn its legal action against NSW Planning Minister Anthony Roberts and the Greater Sydney Commission over a stalled high-rise apartment project in Sydney’s Macquarie Park.
It was a second blow to Meriton which had already been knocked back on an initial 63-storey tower at the site by the City of Ryde council.
Following council’s plea to the NSW government to support its recommendation to refuse the project altogether – there were more than 400 public submissions opposing the development – Ryde Liberal MP and Minister for Customer Service Victor Dominello raised concerns with Ms Berejiklian before a moratorium was put in place.
In March, Karimbla filed legal proceedings against Ms Berejiklian, Mr Roberts, the GSC and the Department of Planning secretary Carolyn McNally in the NSW land and environment court in an effort to force an approval for the project.
Mr Dominello has welcomed the withdrawal of the lawsuit.
“A number of my opponents believed the Greater Sydney Commission’s review into local planning laws was a publicity stunt, but this decision proves the naysayers wrong. This is a big win for our community,” he told The Australian Financial Review.
Thewithdrawal follows an earlier court decision in June to allow the removal of Ms Berejiklian from the lawsuit. At the time, the court set down last Friday for a mediation between the parties and if that failed, a two-day hearing would follow.
The mediation didn’t take place following the withdrawal of the lawsuit.
*Macquarie Park has been the subject of many high rise apartment developments over the past few years since it was identified for urban renewal and given its access to two Sydney metro train stations.
CAAN Photo: Prime by JQZ a PRECINCT of 4 towers and 1 block within the Macquarie Park Precinct!
CAAN Photo: Park One 80 Waterloo Road by ICON
CAAN Photo: Natura by RomeCiti Waterloo Road next to the Icon development Park One and to a reserve; a deep excavation is underway
CAAN Photo: April 2019 Herring Road Precinct Macquarie Park. Much of Herring Road has been redeveloped for high-rise. Development is now underway on the opposite side of Herring Road to match this!
High-rise development extends into Peachtree Road, Epping Road, Talavera Road, Waterloo Road, Macquarie Park … to Lachlan’s Line Macquarie Park, North Ryde Station Precinct, throughout North Ryde, Top Ryde, Gladesville and the Godzillas of Meadowbank!
*In its refusal to support Meriton’s Talavera Road development, City of Ryde said there wasn’t sufficient infrastructure (particularly surrounding traffic and congestion) to support rising overdevelopment in Macquarie Park.
*“People in Ryde are sick of state government-enabled overdevelopment in Ryde – our demands are simple – abolish priority precincts, exempt us from the Medium Density Housing Code and listen to our community,” council said.
The co-author of a landmark report on how to fix Australia’s building industry has declared she would not buy a newly built apartment, given the scale of the problems.
“If I was going to be investing in an apartment, I’d buy an older one. It’s common sense, isn’t it? It’s just logical,” Bronwyn Weir told a Four Corners investigation into Australia’s building industry.
“I wouldn’t buy a newly built apartment. No.”
Ms Weir and former senior public servant Peter Shergold co-wrote the Building Confidence report commissioned by Australia’s federal, state and territory building ministers.
“The existing building stock is what it is. We have hundreds of thousands of apartments that have been built across the country over the last two, three decades,” she said.
“Probably the prevalence of noncompliance has been particularly bad, I would say in the last say 15 to 20 years. It’s gotten worse over that period. And that means there’s a lot of existing building stock that has defects in it.
“[The new reforms] won’t improve existing building stock unfortunately. So there’ll be legacy issues for some time and I suspect there’ll be legacy issues that we’re not even fully aware of yet.”
Beware of buying off the plan, Ms Weir warns
Ms Weir said for those looking to buy an apartment, it was more prudent to opt for a building “that maybe is, say, five years plus [of age]”.
CAAN: Mascot Towers 12 years old? Body Corporates tend to conceal building defect issues due to concerns for loss of property value
“You would like to think that if there are major issues with that building, they’ll have started to show,” she said.
“So I think if people are looking at investing, there are ways to do good due diligence. Buying off the plan is a really tricky proposition at the moment.”
Ms Weir said high-profile cases such as the evacuation of Opal Tower and Mascot towers in Sydney meant “there is a lack of confidence” in the building industry.
But she hoped some better builders would give people assurances it was safe to buy “and try to salvage what has been a pretty damaging impact of these latest news stories”.
A recent study of apartment building defects in Australia by Deakin University and Griffith University found 97 per cent of buildings examined in NSW had at least one defect in multiple areas. In Victoria the figure was 74 per cent and in Queensland it was 71 per cent.
One of the study’s authors, Deakin University’s Nicole Johnston, told Four Corners previous calls for reform had gone largely unheeded.
“People have been jumping up and down about this for years and years and years,” Dr Johnston said.
“There’s been lots of committees formed, there’s been lots of task forces, there’s been lots of consideration around these, but really nothing has happened“.
NSW missed opportunity to bring in stricter laws
One glaring example of inaction is how NSW failed to implement laws that could have addressed a major underlying reason for defective building work: dangerous or inferior products.
*The laws — known as chain of responsibility laws — ensure every person who uses or supplies a product on a building can be held personally responsible if it fails.
*Later that year, NSW showed a draft bill of its own proposed law to a meeting of building industry groups.
*”What we saw was a draft bill that was the Queensland legislation but on steroids — it was better,” Rodger Hills, the executive officer at the Building Products Industry Council, said.
“They had taken a lot of time to incorporate all the learnings and findings from the Queensland experience and wrapped it up into a piece of legislation that was robust, it was easy to use, and it would have done its job.
“The industry representative left that meeting very hopeful that this was something that was going to be useful and it actually worked properly.”
*When the bill entered the NSW Parliament, Mr Hills said the industry was shocked to see it had been “absolutely gutted.”
*“We counted up about 80 clauses that had been pulled out of the documentation,” he said.
“Those clauses were all around non-conforming building products. In fact, the definition of a non-conforming building product wasn’t even in the bill.
“All of the clauses to do with chain of responsibility and duty of care, they were all taken out. As were all powers, the recall powers the minister had to recall defective products.”
Government did not want to add more red tape
Four Corners has confirmed the NSW Cabinet rejected the proposed chain of responsibility law due to concerns it would impose more red tape on the building industry, potentially slowing it down.
The NSW Minister for Innovation Kevin Anderson would not comment on Cabinet deliberations but said: “The NSW Government is currently implementing the largest reform to the building and construction industry in the history of the state.”
“As part of those reforms, the Government is considering a raft of measures that will improve the transparency, accountability and quality of work within the sector,” he said.
Mr Anderson said the current situation “is a collective making of industry and the need for more modernised legislation”.
The property industry disputes that there is a crisis, but is backing calls for state governments to implement the recommendations of the Shergold-Weir report.
The chief executive of the Property Council of Australia, Ken Morrison, told Four Corners “the overwhelming majority of people in the industry are doing the right thing and, in fact, there’s great projects right across our cities”.
“I think that statistic [on building defects] points to the fact that when you’re doing something very complicated like building a high-rise apartment building, there are going to be things which need to get fixed up,” he said.
Asked if he would buy a new apartment, Mr Morrison replied: “I would, absolutely. I think I would be a discerning buyer looking for quality, but absolutely I would.”
Watch Sean Nicholls’ investigation, Cracking Up, tonight on Four Corners at 8:30pm on ABC TV and iview.
The personal health information of 317 people applying for Australian visas was accidentally emailed to a member of the general public, an ABC investigation has revealed.
317 names, dates of birth, passport numbers and medical test notes were sent to an unknown Gmail address
The subcontractor was removing data from secure Immigration Department systems, against government policy
Subcontractors are increasingly relied upon to handle sensitive public data
The security bungle occurred when a spreadsheet was sent by mistake to an unknown individual’s email address, because of a typo.
The privacy breach, which happened in 2015, occurred under the watch of Australia’s largest health insurance company, Bupa, and one of its subcontractors, Sonic HealthPlus (SHP).
Bupa is contracted by the Department of Home Affairs to assess the health of people applying for visas and permanent residency in Australia.
Documents obtained under a Freedom of Information request by the ABC reveal that in August 2015, an SHP employee accidentally sent the names, dates of birth, and passport numbers of 317 people, along with “brief notes, summaries and comments about the status of the medical tests being conducted” to an unknown Gmail address.
It was a mistake that would eventually lead Google Australia to intervene.
Bupa has also struggled with data security in the past. In 2017, the information of an estimated 20,000 Australians was compromised when a Bupa employee in the UK was found to have put client data from the insurance giant up for sale on the dark web.
Bruce Baer Arnold, a privacy and health law expert from the University of Canberra, said the latest privacy breach was “deeply concerning”.
“With this one, I’m just speechless,” Dr Baer Arnold said.
“The idea that we have an inadequately-supervised subcontractor using something like Gmail to transfer sensitive, personal health information is utterly appalling.”
In a statement to the ABC, the Department of Home Affairs said the matter was immediately brought to their attention and fully investigated.
“The document contained bio-data details of visa applicants. No actual personal client medical records were disclosed as part of this incident.”
The department said it was satisfied Bupa, and all of its subcontractors, currently only use systems that comply with the government’s data security protocols.
Contractors can be a security vulnerability
Following the freshly revealed 2015 privacy breach, the then-department of immigration and border protection discovered that subcontractor SHP was removing the data of visa applicants from “authorised departmental health systems” and creating status reports in the form of Excel spreadsheets to send to Bupa.
The information was being extracted and shared in this way between SHP and Bupa against the department’s policies and without its knowledge.
It led the department’s chief medical officer to write to the managing director of Bupa to inform him the company had “failed to comply” with the privacy obligations set out in its contract with the Federal Government.
The matter was referred to the Office of the Australian Information Commissioner.
Following the privacy breach, SHP and Bupa made several attempts to recall the email.
Bupa eventually went to the extent of contacting Google Australia, five weeks after the incident, to try and get the email back. Google agreed to remove the email from the receiver’s inbox after notifying them.
Seventy days after the breach, on 16 October 2015, the department contacted the people whose information had been disclosed.
“A routine report prepared by a SHP temporary employee was sent to a SHP clinical officer for clearance,” stated the letter, which was later published on the Migration Alliance website.
“The SHP clinical officer inadvertently mistyped the Gmail address of one of the intended recipients, and as a result, the report was sent to an email account … the identity of the recipient unknown.”
The department instructed Bupa to undertake an immediate review of all policies and procedures related to the security of personal information handled by Bupa and its subcontractors.
“Bupa acknowledges that the process used to share the document containing the data was outside of the authorised departmental health systems,” a spokesperson said.
“We know the importance of responsibly managing private data and took immediate actions at the time to address the matter.”
The spokesperson said Bupa had since improved its data security practices, and introduced mandatory privacy training for employees dealing with visa health assessments, and an audit program to assess subcontractors’ security practices.
More transparency needed
Dr Baer Arnold said incidents like this made it difficult for Australians to trust governments with their personal information.
He said private contractors were increasingly getting access to government data but that there was little transparency around the data security practices of those contractors or their subcontractors.
“I think it’s extremely likely that there have been other problems, we just haven’t heard about them,” he said.
“We’re increasingly relying on agents in the private sector to do work for government and many of those agents clearly are just not up to it.
“If this information is not encrypted, if it’s being shared by badly-supervised subcontractors using a Gmail address, we’re not up to speed. We need to do something about it.”
Dr Baer Arnold said security standards had to be a priority whenever the government awarded contracts that would allow private service providers access to sensitive personal data.
“Is this something we should bear in mind when we give contracts, sometimes very profitable contracts, to entities such as Bupa?” he said.
“If they’re not up to speed, we shouldn’t be rewarding them by encouraging bad practice.”
Bupa has the contract to provide immigration health assessments and medical services for the Government until 2021.
“The Government should be reasonably expected to have proper supervision of its contractor and by extension subcontractors,” Dr Baer Arnold said.
Who was affected?
Immigration medical assessments, carried out by Bupa and its subcontractors, are required for certain visa applications and for people applying for permanent residency in Australia.
The purpose is to protect the Australian community from public health risks, but also to assess whether applicants are likely to impose a significant burden on the public health system.
Late last year, NSW Premier Gladys Berejiklian proposed four routes for high speed rail (HSR) into Sydney:
A high speed rail project Premier Gladys Berejiklian has committed to start work on if she wins the state election could cost $100 billion…
“A reasonable figure would be $100 billion in Australian dollars to build it,” [Committee for Sydney Director of Advocacy James Hulme] said…
Ms Berejiklian announced yesterday that the government would spend $4.6 million investigating four possible high speed rail routes that stretched to Canberra, Goulburn, Newcastle, Gosford, Wollongong and Nowra…
High speed rail would cut the commute time between Sydney and Canberra from over four hours to just one.
A report by the Committee for Sydney concluded that creating a greater connection between Sydney and these regional centres would lead to $75 billion in “housing affordability improvements”.
NSW Premier Gladys Berejiklian has been given a first-hand look at Germany’s high-speed rail network, which if adopted in the state, could slash commuting times to Sydney by 75 per cent…
She said she was impressed by the smooth-running service – which reaches speeds of 300km/h – and could provide a blueprint for a future new NSW network.
“It’s certainly much faster and much smoother (than compared with NSW),” she told 9News…
The high speed train completed the 600kms journey in less than four hours compared with six hours for a conventional service…
The NSW Government wants to start a similar service across the state, with the promise of faster commute times…
It has flagged four future high-speed rail serviceswithin 300 kms of Sydney that would slash travel times by 75 per cent…
The journey from Canberra to Sydney would take just one hour, while Sydney to Newcastle would be only 45 minutes and Sydney to Wollongong 30 minutes.
But the planned new service has not been costed and Ms Berejiklian admits it could take years to build.
Gladys’ HSR vision contains a major roadblock: the massive cost of getting from the outskirts of Sydney into the CBD.
These trains are not compatible with suburban commuter trains unless they slow to the same slow speeds due to alignment and congestion, in which case they are no longer HSR.
Further, the current commuter train system in Sydney is already at capacity and cannot cope with existing demands, let alone imposing a HSR network.
This means HSR would need to be separated from the existing commuter network via new train lines and stations.
And since Sydney is already build-out, this would necessarily require acquiring some of the most expensive capital city real estate in the world or tunnelling under it, either of which would cost a small fortune. Moreover, the geography north of Sydney is incredibly hilly, thus requiring a series of expensive additional tunnels.
Indeed, the German representative in the 9News videostated that it needed to build its HSR line from scratch:
“Basically, we built a completely new stretch of track. Only by having a completely new line built we were really able to straighten the line and achieve higher speeds”.
Finally, the claim by the Committee of Sydney that creating a greater connection between Sydney and these regional centres would lead to $75 billion in “housing affordability improvements” is laughable.
Housing affordability could be ‘solved’ with the stroke of a pen and at zero cost to taxpayers by slashing immigration. As noted by the NSW Treasury in November: (PAYWALL: AFR: ‘Lower migration will reduce house prices, NSW warned’.
Housing Prices and Migration Flows, a NSW Treasury document obtained by The Australian Financial Review, shows Sydney and national house prices would be lower than the forecast trajectory due to fewer migrants.
Under one scenario modelled, a temporary reduction in annual net overseas migration to Australia of 64,000 over five years would cause national house prices to be 7.8 per cent lower and NSW house prices to be 6.8 per cent weaker than a business-as-usual “baseline”.
*Insteadof making Sydney’s population roughly double in 50 years by force-feeding mass immigration, how about slashing Australia’s immigration intake back to the historical average of 70,000 from circa 200,000 currently, thereby forestalling the need for expensive new infrastructure projects like HSR?
IT would appear that Ralan Group and the NSW Liberal Government have a history shared back to 2014 …. ‘Labor shadow minister Adam Searle told the February 12 protest that legislation to establish a building trust fund was passed through the NSW parliament nearly six months ago, but “the state government has not proclaimed the act.” ‘
Related Article shared recently on the Ralan Group.
Steve Nolan’s collapse affects about 200 workers and their families.
A builder who donated $200,000 to the Liberal Party last year has gone into administration owing sub-contractors and suppliers an estimated $30 million.
The collapse of Steve Nolan Constructions affects five building sites in the northern suburbs of Lindfield, St Leonards, Roseville and Gordon, where apartment blocks are being built for developer, the Ralan Group.
The company’s collapse could have a domino effect on the sub-contractors involved, with some of the small businesses owed as much as $2 million. The collapse affects about 200 workers and their families, who are also set to lose wages and entitlements as a result of Nolan’s failure to pay, said the Construction Forestry Mining Energy Union (CFMEU) NSW Construction branch.
About 50 workers rallied outside the Chatswood offices of Ralan Group on February 12, calling on the developer to pay money owed to contractors and workers.
CFMEU NSW construction branch assistant state secretary Rob Kera says Steve Nolan Constructions had failed to pay sub-contractors on the sites for the past few months.
*”Now we have been told Ralan Group is telling subbies to forget about the money they are owed and to just finish the job and they’ll pay them from here on,”
*Kera said. “It is outrageous to suggest that family-owned businesses suck up a $2 million loss while Ralan Group seeks to make millions of profit from the rampant housing market in Sydney.
“It is not good enough, and the CFMEU is calling on the Ralan Group to pay the debts that are owed.”
*Kera says it again highlights the urgent need for the Barry O’Farrell state government to move on the recommendations of the Collins Inquiry that called for mandatory trust funds for all development projects over $1 million.
*”Almost a year to the day that Bruce Collins QC made his recommendations on how to protect workers and sub-contractors caught in company collapses, the O’Farrell government has yet to act on major recommendations. Here we have another case where small construction businesses will go to the wall because this government continues to fiddle while Rome burns.”
*Labor shadow minister Adam Searle told the February 12 protest that legislation to establish a building trust fund was passed through the NSW parliament nearly six months ago, but “the state government has not proclaimed the act.”
The campaign to demand that Ralan Group pay the money owed to sub-contractors will continue, organisers told the workers.
“Many MPs have a concern about Australian university campuses and whether they’re both a bastion for free speech, which they need to be, but more critically the role that foreign influences like the Confucius Institutes are having — any influence over curriculum and of course the influence of foreign governments on protests,” Mr Wilson told ABC Radio.
“What we know is that around the world the influence of embassies and consulates from foreign governments can sometimes be an influence for domestic protests and we have to make sure that isn’t occurring.“
Queensland LNP senator Amanda Stoker said she believed universities were battling through a “crisis of leadership” on foreign influence.
The Canberra air was falling towards freezing when Scott Morrison walked to the apartment he shared with his closest allies for a Sunday night meeting that would define his future. It was late on August 19, 2018, and Morrison had left Parliament House moments earlier with his federal cabinet colleagues struggling to contain a crisis. He entered the modern flat, his home away from home when Parliament was sitting, to find his friends already preparing for an upheaval that would remake the government.
Morrison shut the door on the Canberra winter to join his two flatmates and fellow Liberal MPs, Steve Irons and Stuart Robert, and their tactical whiz Alex Hawke, the man they considered their “spear-thrower” because he was so brutally effective at marshalling numbers for a ballot.
They talked past midnight as they considered the deadly manoeuvres against the Prime Minister, Malcolm Turnbull, and the brazen claim, spreading through the media, that Peter Dutton, the Home Affairs Minister, already had the numbers to secure the ultimate prize in Australian politics.
*Hawke, a former army reservist who deployed his conservative Liberal Party faction like a battalion, vented his frustration at the way Dutton and his followers were dictating the terms of an imminent leadership spill. “They’re ahead of us,” he said. “We should have been expecting this.” He was anxious at the speed with which Dutton and his allies were briefing journalists and courting backbenchers. Hawke felt he should have been alive to the manoeuvring earlier.
*Robert, who had come to politics after careers as an army officer and recruitment executive, believed the divisions within the government had become so great that a leadership spill was inevitable. Malcolm is a dead man walking, he thought. Robert had initially prospered under Turnbull’s leadership, rising to Minister for Human Services, only to be dumped after a scandal over his private visit to China to attend a mining deal in Beijing involving a Liberal Party donor.
Cast out of the ministry, he had everything to gain from a leadership change. Robert calculated Dutton would move that week, most likely on Tuesday morning when the Liberals held their weekly gathering in their party room, and Australia would have a new prime minister. The implications were obvious. Morrison had to be ready to move.
The Morrison Government was born at this moment. Within days, Turnbull was holding a ballot on his own job, Dutton was bulldozing his way towards power and the Parliament was adjourned to allow the Liberal Party to wage its civil war.
The week would end with Morrison being declared the “accidental” prime minister. Except he wasn’t. Every step in his ascension could be traced to this Sunday night conferencewith the allies who would corral the numbers to make him leader.
Morrison would distance himself from their handiwork, even as he shared his victory with them.
Political correspondent David Crowe’s new book Venom reveals more details about the 2018 leadership spill and the role Scott Morrison played in bringing down a PM.
Australians were left to wonder just how this new leader had climbed through the rubble of that chaotic week, when Liberals tore down their own government and unleashed fury on themselves, and emerged to claim he had clean hands.
It was political mastery of a kind unseen in Canberra for more than a decade, and it explains why some Liberals see Morrison, 51, as the natural successor to John Howard. Christian. Conservative. Ordinary, perhaps. But crafty, too. And cunning. That is why the leadership convulsion that brought Morrison to power, one year ago this week, will have a lasting fascination in Australian politics.
Those who triumphed with Morrison are loath to speak publicly about how they did it, while those who tasted defeat with Dutton are reluctant to admit their incompetence.
In writing my book on these times, Venom: Vendettas, Betrayals and the Price of Power, I found the events littered with false storylines. The biggest was that the Dutton and Morrison camps only launched their campaigns for power after Turnbull stunned them with a sudden ballot on his own position, the critical point on the morning of Tuesday, August 21. Yet both camps were preparing long beforehand.
The four men who met that Sunday night were and remain one of the tightest groups in the Liberal Party.
Morrison and his friends had all entered Parliament in the same year, 2007, and attended Bible study and prayers every Tuesday night when in Canberra. There was no uneasiness here with Morrison’s Pentecostal faith. Their shared belief bound the four together in a world where so many politicians could change their allegiances with the weather or the polls. They were a small group but totally loyal to each other – and absolutely disciplined in a crisis.
Morrison, Robert, Hawke and Irons had worked together through the schisms of their party over more than a decade.
Robert had spoken of his friend as a future prime minister as far back as 2013, according to ministers who had watched the Morrison crew with suspicion.
Some of Morrison’s biggest supporters had asked him to replace Tony Abbott in 2015, when the knighthood for Prince Philip had shaken their confidence in him and triggered a desperate search for an alternative, but Morrison had played a longer game. Sure in the knowledge he would be treasurer in a Turnbull government, Morrison left Abbott to his fate when the leadership ballot came in September 2015. He had turned down Abbott’s invitation to run for the deputy’s position. He had voted for Abbott, in a public show of loyalty, while his friends threw all their force behind Turnbull. Now, not even three years later, the same ambiguity emerged over Morrison’s loyalties – only this time he would not leave the leadership for others.
As morning broke after their Sunday night conference, Morrison and his friends watched for any manoeuvre that would bring on a challenge. It did not take long for one to emerge. One of Dutton’s longstanding friends, fellow Queenslander Luke Howarth, spoke to colleagues on Monday night and again on Tuesday morning about his intention to call on Turnbull to resign.
Robert thought of this as what the army called a “feint” – a ploy to weaken Turnbull without needing Dutton to declare his hand and mount a challenge.
Meanwhile, Turnbull studied the options to corner his opponents. He knew Howarth would try to provoke him in the party room and had no intention of allowing it. Turnbull would not sit meekly while backbenchers turned to Dutton. He was awake before dawn that Tuesday to put his plan to those he could trust. He sent a message to his principal private secretary, Sally Cray, at 5.34am: Are you up?They spoke soon afterwards about a plan Turnbull had already put to his wife, Lucy, to force his opponent into the open.
Turnbull wanted to call a leadership ballot on his own terms. He would use the Liberal meeting at nine o’clock that morning to tell colleagues the time had come to settle the doubts over his position.
This meant declaring the leadership open and allowing a call for candidates. One option for the entire parliamentary party was to show loyalty and confirm Turnbull in his position.
But Turnbull was also inviting danger. A vote would be held if an alternative candidate rose.
Turnbull had only a few hours before the meeting to call his colleagues and test their views. Telling them of his plan would go too far because the word would reach Dutton and his supporters. The conversations, in about 20 phone calls, were general but the question was obvious. Would you support me? Turnbull seemed confident he had a majority.
“I believe you are with Dutton,” Turnbull told Robert when he called him at 7.13am. Robert rubbished the idea. He told Turnbull the Morrison group was behind him. “We’re all supporting you,” he said.
The reality was not so simple – some members of the wider Morrison bloc were quietly prepared to vote for Dutton. They were giving up on Turnbull after his long slump in the opinion polls, his inability to unify the party on policies such as climate change and his failed campaign to win the Longman byelection in Queensland weeks earlier. But Robert’s assurance eased Turnbull’s mind.
In another call, Turnbull told Hawke he believed he had support from more than 50 of the 85 members of the Liberal party room.Hawke told him this was wrong and his support was only in the high 40s – dangerously close to failure. How could Hawke be so sure? The PM and his team were not the only ones counting the numbers.
At 9am, Turnbull stood at the front of the party room in his position as leader and chair of the meeting. He spoke briefly – so briefly, in fact, that MPs had trouble remembering his words.
Then came the thunderbolt: he wanted a vote on the leadership to stop the speculation. Howarth began to stand to make the speech he had been preparing all night, but he was too late. Turnbull had started the formal process for a ballot. There were no speeches at a time like this: party tradition dictated a vote with few words. In a symbolic demonstration that the leadership was vacant, Turnbull left his place at the front of the room, his traditional location facing the assembled MPs, and walked to a seat in the front row.
There was a call for nominations. Turnbull stood. There was a pause. Dutton rose from his chair. There was a groan from some in the room. This moment shattered the fragile concord that kept the government together. Watching this without saying a word, some cabinet ministers were utterly shocked despite the long period of speculation and positioning toward exactly this decision.
Liberals waited with a sense of dread until the numbers came: 48 votes for Turnbull, 35 for Dutton. A murmur seemed to go around the room, as if a collective thought was given voice. Only eight votes in it. There were 85 Liberals in the party room but one had abstained and another was absent.
A second challenge was almost certain now that Dutton had made his fateful decision and the numbers were so close. Everyone knew it. History showed that challengers who failed at first could retreat to the backbench and strike again, just as Paul Keating had done against Bob Hawke decades earlier.
For Dutton, there was no turning back. He would look weak to his conservative colleagues, and his barrackers in the media, if he gave up now. Liberals dispersed quickly and the opposing camps weighed up their options in this dangerous new dynamic.
The Morrison camp gathered immediately in Alex Hawke’s office. Into the room came Robert, Irons and others, all of them knowing this ballot settled nothing. Hawke suspected at first that Dutton would challenge again in a fortnight, but he soon thought again. Hawke began to war game a second ballot to be held within days. He formalised his preparations with a WhatsApp messaging group, called The Project, with a membership that included Morrison, Hawke, Robert, Irons, and others over time.
There was no doubt some of Morrison’s supporters helped bring on this crisis. Members of the group estimated five of their 15 had deserted Turnbull and sided with Dutton in the Tuesday vote.
The Morrison camp portrayed the votes for Dutton that morning as spontaneous.To others they looked strategic – and devastating for Turnbull.
“Votes were split and spread and there was nothing co-ordinated,” Robert said later. “It was more shock than anything. When you spring it on people, they don’t have time to think. Nobody had planned anything because nobody thought he would be so stupid as to call a spill.”
Robert was able to send a text message to Morrison during the meeting but he denied trying to add to the numbers for Dutton. His account, long after the events, was that he had been waiting for Howarth to launch a denunciation of the leader and did not expect the leader to call a vote. “Malcolm established a crisis,” Robert said. “Dutton was trying to establish one. Malcolm established it for him. It wasn’t just a mistake. It was a horrendous mistake.”
Morrison’s group had the opportunity to encourage the Dutton challenge, weaken Turnbull and clear the way for their preferredleader to emerge.
Turnbull had arranged by 8.30am to tell the chief whip to prepare for a ballot, a piece of strategic information of immense value that morning.
The fact that one of Morrison’s allies, Bert van Manen, was a deputy whip, and therefore had access to more information than others, only deepened the suspicions that Morrison’s allies came to the ballot with an intent to force change. This required a level of co-ordination they all dismissed. Yet there was no question that about five of them – the precise number was conjecture – had helped tip the party room over the edge.
One Liberal encountered Irons in a Parliament House corridor in the hours after the vote. The Morrison ally did not look unhappy at the day’s events. “You know this is just the start. It’s not over,” he said.
One man had more power than most to control this agitated party room. The Finance Minister, Mathias Cormann, was shocked and angry at Turnbull’s tactics. Cormann, a man who had arrived from Belgium decades earlier and worked his way to the top of Australian politics, was one of the government’s most senior and reliable ministers, yet he struggled now to choose between stability or revolt.
Cormann and Dutton were so close they walked every morning at dawn when Parliament was sitting so they could keep fit and talk politics on their way up Canberra’s Red Hill. This made Cormann the natural intermediary to broker a peace agreement between the two leadership contenders, but the negotiations ended in an impasse over whether Dutton might serve as Turnbull’s deputy. It was an idea that appealed to Cormann but led to recriminations later when Dutton and Turnbull each accused the other of suggesting it first.
Sally Cray implored Cormann to steady the ship. As a confidante who had worked for Turnbull for years, in government or not, she was loyal to him at every stage. She and her fellow adviser, David Bold, made a crucial visit to Cormann to try to keep the government together.
This meeting, never before disclosed, was the final effort to prevent Cormann abandoning Turnbull and supporting a second challenge. It came at a critical stage when Morrison’s allies were persuading their colleagues to support him as an alternative leader.
Cray sent a message to Cormann to argue against the idea that Turnbull should resign to allow an orderly transition to the declared challenger. You do know if MT resigns that ScoMo will win, she wrote to Cormann at 10.56am on Wednesday.
The Prime Minister’s allies were still confident he had enough support to see off another challenge from Dutton in a second ballot that week, but they also calculated the party room would elect Morrison over Dutton if given the choice. The Home Affairs Minister was the hard face of controversial policies, not least offshore detention for asylum seekers, and considered too divisive for many Liberals outside his home state of Queensland.
Cray and Bold visited Cormann in his office that Wednesday to urge him to be more sceptical of Dutton’s claims. Cormann offered a simple message: I can’t hold back the tide. Cormann thought Turnbull was finished because the party was riven – and because Dutton would not stop.
It was 11.11am. Within the hour Cormann would visit Turnbull to tell him he should resign and allow Dutton to take his place. This was the vital moment when the energy and discipline of the Morrison camp put the leadership within reach. Morrison’s allies were moving more quickly than the Dutton camp had calculated. Robert told Morrison he could not stand on the sidelines. “The national interest requires you to run,” he said. “They’re coming after Malcolm. It doesn’t stop.”
Morrison did not want to authorise an open attempt to gain votes. He did not give “permission” for a recruitment drive, but his closest friends in Parliament did not need to wait for his blessing.
The leadership rivals circled each other while a media debate raged over the government’s chaos. The idea of a combined ticket, with Dutton and Morrison joining forces, came up briefly on Thursday morning when the two men met in the office of Christopher Pyne, the leader of the moderate wing.
Dutton put the question: “Is there an agreement to be struck here or not?” The numbers gave Dutton an advantage, given his conservative bloc numbered at least twice that of Morrison’s personal following, but neither man was interested in serving as the other’s deputy. There was no bond between them.Morrison had kept his distance from Dutton for years.
United, they could claim an easy victory. As rivals, they could not be sure of their chances.
Their conversation ended and they went their separate ways. Dutton had to find more supporters while preventing anyone deserting his cause.
Morrison could only succeed if he had the moderate wing of the party by his side, an unlikely prospect when so many moderates recoiled from his conservative social views – like the fact he’d not voted for same-sex marriage even when it was approved by the Australian public in a postal survey, while more pragmatic ministers like Dutton voted in Parliament to put the national “Yes” vote into effect.
Again, though, Morrison confounded his rivals. He not only secured support from Pyne and the moderates, but convinced one of Turnbull’s own allies to help.
Craig Laundy, heir to a pub empire stretching from Sydney to country NSW, felt wretched as he watched his colleagues desert their Prime Minister.
Laundy had helped elevate Turnbull in 2015 and would support him to the end, but he also wanted to ensure Dutton did not prevail. That meant helping Morrison.
Laundy joined a war council in Hawke’s office on the afternoon of Thursday, August 23. In the room were Robert, Irons, van Manen and other Morrison supporters.
Name by name, Hawke and Robert read out a list of MPs and discussed how they thought they had voted in the secret ballot on Tuesday and how they might vote in a second challenge.
Laundy found himself disagreeing over the names they claimed had voted for Dutton but would switch to Morrison. He told the group that one MP they mentioned was “100 per cent” with Turnbull on Tuesday.
Robert disagreed with a smile. “You’ve now worked out we haven’t always been on the same team,” he said, in Laundy’s account of this exchange.
Laundy fell silent. He pondered how this group could be so sure they had a cohort of MPs who would vote for Dutton in one ballot and move to Morrison a few days later.
“I felt sick in the guts,” he said later. “It would be fair to say I was in shock.”
He walked back to the Prime Minister’s suite, entered Cray’s office, shut the door behind him and spoke: “We’ve been played.” Laundy believed the Morrison lieutenants were not just speculating on names but knew with precision that a group of MPs had backed Dutton when they were loyal to Morrison.
This explained why the support for Turnbull was softer on Tuesday than Laundy had expected and why Dutton had gained 35 votes when his opponents thought he could not secure more than 30.
From this sprang the suspicion that Morrison had given his supporters approval, either tacit or explicit, to abandon the PM.
“I wasn’t shocked,” Cray said of this moment when asked about it later. “It was just confirmation of something I already sensed.” Bold, who was also in the office when Laundy returned from the meeting, had the same response. “It wasn’t like it came as a complete surprise,” he said later. They had all seen Morrison profess loyalty to Abbott as leader in 2015 when his supporters voted for the challenger.
*Why would he not do it again?
Robert denied trying to co-ordinate votes on Tuesday to build up Dutton’s numbers and make a second challenge inevitable. “The idea that you could inflate the numbers on a snap call is nuts,” he said. Even so, Morrison’s lieutenants had planned carefully to build their numbers while Turnbull was still leader.
Robert saw this as seeking the best outcome for the party: Morrison as prime minister.
To others it looked like treachery – and they claimed more proof of it when some of Morrison’s supporters, those who claimed to be with Turnbull, signed a petition to force the second ballot once it was clear Morrison was running.
The second ballot, held at lunchtime on Friday, shattered Laundy and other Turnbull allies.
Themotion to remove the Prime Minister was carried by 45 to 40 votes.
*Turnbull had lost by a margin so narrow it shocked many of those in the room. Three votes were enough to make the difference. The big lie of the week, that Turnbull had lost his majority days earlier, was exposed. He would have kept his majority if Cormann and other ministers, such as Mitch Fifield and Michaelia Cash, had stood by him.
It would have been a narrow majority, not enough to prevent another battering from Dutton, but it might have given Turnbull time.
The Liberals walked from their party room in a state of exhaustion, some of them gutted by the infighting, while others were relieved at the rise of their new leader.
Dutton and Cormann were stony-faced as they left the room. Cormann was diminished. The Liberals who had trusted his judgment wondered how he had misread the support for Dutton and brought on a stampede. Was he really the safe pair of hands they had thought?
The Morrison allies who outsmarted the Dutton camp now assumed positions of influence in the new regime.
Hawke became Special Minister of State, Robert became Assistant Treasurer and Irons was named an assistant minister.
There were smiles as the new ministers were sworn in, but most Liberals braced for an election disaster. Morrison alone conveyed total confidence in his capacity to win.Voters flayed the government in the published polls but the Liberal Party’s polling showed a slim chance of success: a narrow path to victory to be studied in dozens of meetings over months.
Like a goat track to a summit, the path was so difficult it could only be traversed in the best weather. The Coalition would need to win at least two seats from Labor, stem its losses in Melbourne and hold ground in Queensland and Western Australia. All this seemed unlikely, even outlandish, when the research was so dire, but there was only one way forward. The climb began.
Josh Frydenberg, declared the deputy leader with a thumping majority, chose the Treasury portfolio and tried to calm a rattled party room. He invited Morrison and his wife, Jenny, to dinner at his Melbourne home with his wife, Amy. Even small things like a home-cooked meal meant something after the hostilities of August.
Political leaders and their deputies are not always close but the two new leaders worked at it, to the point where Morrison asked Frydenberg to stay in a spare room in Kirribilli House when in Sydney for work.
Yet the words that defined the outcome were those of Morrison himself. The difference was not in the number of seats won but in the expectations for each leader.
Morrison appeared before a cheering crowd at midnight to declare the result was a win for the “quiet Australians” who aspired to work hard and do better in life.
Nobody could be sure who these quiet Australians were – by income, suburb, profession or belief – because they could be anybody and everybody.
Morrison, the cunning politician and suburban everyman, claimed the victory for a group of supporters only he could define.
This was a victory to savour for Morrison and the tight group of friends who had put him on his path to the prime ministership on that Sunday night the previous winter. They had shown themselves to be a political unit that could outmanoeuvre any opponent.
*Abbott was voted out of Parliament, while Turnbull left to write his memoirs. Dutton and Cormann kept their positions but lost power and prestige.All had fallen or failed, while the Morrison crew had prospered at every stage.
Robert rose to cabinet, Irons moved on to the frontbench’s lower rungs and Hawke gained a ministry with responsibilities in defence and the Pacific.
Morrison himself cemented his hold on power by amending the Liberal rules for spills. Any leader who wins an election can only be removed by a “super majority” of 66 per cent of the party room, up from a simple majority.
Perhaps this will end the cycle. Perhaps it will give dissenters a more challenging target when fostering unrest. No rule can stop a subterranean conflict. Given a higher threshold, those intent on their own advancement might resort to more vicious tactics, more public disloyalty, more briefing to the media, more aggression to achieve their ends. The rules adjust the price of power, not the hunger for it.
David Crowe is chief political correspondent for The Sydney Morning Herald and The Age. His book Venom: Vendettas, Betrayals and the Price of Power (HarperCollins, $35) is out August 19. Click here for more information.
GetUp and very many supporters hit back .. and remind the PM … of all that has been stuffed up …
SOME gems from among the comments … 584 at last count!
-I wouldn’t worry about
GetUp Scotty, I’d worry about the general public.
– Morrison’s outrage
against GetUp is that long-noted loathing of the ‘petty bourgeois’ against any
who would want to unsettle the status quo, especially if they’re from the
undeserving ranks of the great unwashed (i.e., the left). The mess he made of
the Pacific Forum is proof that the urgent global issues of our day are way
above his head, hence his attempts to make us turn inwards to our own little
worlds. And the empty words he uses to cover up are so transparent. We need
someone who has what it takes!
-This is a very worrying development, but it is also a distraction (like A Jones’ sock comment) from the policy failures of the Liberal-IPA coalition. I do not have anything to do with Getup! and they do not figure in my cogitations. They are irrelevant. I also think that the influence of groups like Getup! is over blown. The reason? They lack the clandestine access to power of groups like the IPA, which refuse to reveal their funders and membership, Unlike Getup! which is transparent. The Liberal party is merely the political arm of the IPA.
In a democracy any group can have a rant. But it must face scrutiny. As it stands, the IPA and the plethora of other right and extreme right “think” tanks do not.
The Liberals want to stop scrutiny. They use the instruments of state to attack their opponents (the AFP (M Cash), ASIO, Parliamentary committees – (T Wilson?). As for accusing Getup! of being misogynistic – well any member of the Liberal party would know about that. I really do fear for our democracy now.
-While you’re at it Morrison you can “treat” The
Institute of Public Affairs, The Mining Council & various other
Conservative organisations as arms of the Liberal Party…
…Hey, why not include News
Corp & the United Australia Party as well.
-Australians “have a go” through GetUp , now theyre going to get a “going over” by Morrison.
Or so he thinks.
Someone far smarter and more astute than Morrison may whisper in his ear about the absolute political stupidity of this idea.
Does Morrison really think that this obvious diversionary attack on GetUp will interest most Australians , who are daily confronted with issues which are much more pressing and which are not being addressed by this government?
The next election is supposedly 3 years away.
But go ahead Morrison , go after GetUp, then go after the IPA, and Advance Australia and any other group which involves itself in politics in Australia these days. See how much more public money your Liberal Party can waste on its ideological agenda.
Someone in the right wing of the LNP are still smarting and very upset that their erstwhile leader was shot down in flames and lost his seat at the last election , arent they?
Gee I wonder who that could be?
GetUp hits back at ‘extraordinary attack’ by the PM
Left-wing lobby group GetUp has slammed Scott Morrison for an “undemocratic attack” on the organisation, after the Prime Minister announced a new crackdown aimed at curtailing its influence before the next federal election.
Mr Morrison wants the group to be treated as an arm of Labor and the Greens and subjected to the same laws that apply to political parties.
“GetUp have to be accountable for what they say and do,” he told reporters on the sidelines of the Liberal party conference on Saturday.
“They want to be in the political space, fine, call yourself a political party. You’re against the Liberal party, we get that, that’s okay there’s no problem with that – just don’t pretend you’re independent.”
The Prime Minister would not give details of how he planned to revisit the question of GetUp’s electoral status, saying only that the government would “have more to say about it as time goes on”.
Mr Oosting said that forcing the AEC to investigate the group again would be “a political stitch-up and a waste of public money”.
“Politics belongs to everyone,” he said.
Mr Morrison said Australians knew where Liberals stood but that GetUp had not been “straight up” with the public, saying the group was now “a wolf in wolf’s clothing” after its actions in the federal election campaign.
Backbench MP Nicolle Flint recently accused GetUp and unions of “creating an environment” where abuse, harassment, intimidation and even stalking became the “new normal” in South Australian politics, but did not offer any direct evidence that GetUp officials had directly carried out that behaviour.
And he sought to link the group with an “anti-Semitic attack” on Treasurer Josh Frydenberg,although GetUp has condemned a legal challenge to the Kooyong MP’s constitutional eligibility – based on the Hungarian citizenship of his mother, who fled the Holocaust – as “beyond offensive”.
Mr Oosting said none of the events the Prime Minister referred to could be “fairly be attributed to GetUp or our supporters”.
“There is no evidence – that’s why the AEC has ruled on three occasions in our favour,” he said.
“The Prime Minister is levelling extraordinary attacks on everyday people who participated in politics this election.”
Senior Labor frontbencher Mark Butler said GetUp was “very clearly not a political party” and blamed the ongoing scrutiny on “an obsession within the hard-right of the Coalition party room”.
“They’re not running candidates,” Mr Butler said in Adelaide on Saturday.
“There are a range of other third parties that participate in Australia’s democracy and they should all be subject to appropriate regulation.”
Mr Oosting said GetUp members were “teachers and nurses, mums and dads, students and pensioners” who had spent the election campaign having “heart to heart conversations” with voters.
“Afraid of being challenged or held to account on having no policy on climate change and the lack of support for raising Newstart, [Mr Morrison] is trying to shut down democratic participation, slurring the name of everyday people participating in our politics.
“This would be the fourth attempt by the hard right to shut down independent grassroots campaigning.”
For the past two decades, Australia has been in an apartment building boom.
Governments have got out of the way, removing red tape and introducing private certification for an industry that’s worth more than $141 billion*.
But when Sydney’s Opal and Mascot Towers were evacuated because of structural cracking, the issue of defective high-rises was laid bare.
Experts have told Four Corners that the problem stretches across the country and many apartments built in the last 20 years are likely to contain some kind of defect.
So how bad could the problem be in your state? 667,394
There have been 667,394 apartments, flats or units built nationwide from the end of 2000 up until March this year, according to data from the Australian Bureau of Statistics.
*A study by Deakin and Griffith universities also surveyed buildings in Australia’s east coast states and found more than 70 per cent had at least one defect. All were built after 2003.
The Griffith-Deakin study’s co-author, Dr Nicole Johnston, told Four Corners high-rise defects were a problem in every state and territory.
“It’s systemic and it’s infecting lots of buildings across the landscape, in all parts of the country. It’s very clear and it’s very prominent, and we’ve got a serious problem here,” she said.
“I think it’s irresponsible for any government to pretend like this is not happening in their state.”
There have been 259,580 new apartments built in NSW since 2000, according to the ABS figures.
*Ninety-seven per cent of buildings in New South Wales surveyed in the Griffith-Deakin study had at least one defect in multiple locations. The study looked at buildings built between 2003 and 2018.
*The study found that the most common type of defect was waterproofing, followed by fire safety systems.
There have been 174,896 new apartments built in Victoria since 2000, according to the ABS.
The Griffith-Deakin study looked at buildings built there between 2008 and 2017 and found that 74 per cent had defects.
There have been 143,704 new apartments built in Queensland since 2000.
The Griffith-Deakin study looked at a selection of buildings built between 2008 and 2017 in Queensland and found that 71 per cent had defects.
*Dr Johnston said when defects were found, they were generally a chronic problem across a building.
*“It’s not isolated to one type or one part of the building. It’s across multiple areas in relation to how the building is being constructed,” she said.
There have been 39,680 new apartments built in Western Australia since 2000.
*The CEO of the Property Council of Australia, Ken Morrison, is not surprised that so many apartment buildings around the country are likely to have defects.
“When you’re doing something very complicated like building a high-rise apartment building, there are going to be things which need to get fixed up,” he said
There have been 14,418 new apartments built in South Australia since 2000.
In Tasmania there have been 1,849.
And in the ACT there have been 26,116.
In the Northern Territory there have been 7,150 new apartments built since 2000.
A structural engineer, John Scott, is facing a building inquiry after nine buildings in Darwin and Palmerston were found to not comply with national construction standards.
Right now, there are plans to build close to 140,000 more apartments around the country.
*There is no guarantee these new developments will be built under the stricter regulations recommended in a report by lawyer Bronwyn Weir and former senior public servant Peter Shergold, commissioned by Australian state and federal building ministers.
The report’s 24 recommendations included a crackdown on private certification, and registration of everyone involved in the building process.