by David Crowe
PART TWO
THE MADNESS OF MANY
‘In this city of trees and roses, politics tend to become, all too easily, just a game.’
Warren Denning, Caucus Crisis, 1937
8
DUTTON RISING
SATURDAY 28 JULY TO THURSDAY 16 AUGUST
PETER DUTTON SHOWED NO outward sign of alarm at the government’s thrashing in Longman. The former police detective, known for his impassive manner, made sure he conveyed no sense of panic about the backlash from voters in the seat next door to his own. The anxiety was palpable among his Queensland colleagues, who were doomed if the swing in Longman crossed into their own electorates, but Dutton argued he had a strong campaign team, solid financial support from willing donors and years of experience in seeing off Labor attacks on his seat of Dickson. He had no need to parade himself as an alternative leader of the Liberal Party: he had made his ambitions clear since April. There was some caution, however, in how he talked about the future when he was asked about the leadership in the final days of July 2018.
‘I’ve been in Parliament seventeen years, I enjoy my job very much, I want to get re-elected in my seat of Dickson at the next election, that’s it,’ he told the Triple J Hack program.1 ‘And if the opportunity some years down the track came up, then yes, I think it’s a great honour to serve in Parliament and it would be a great honour to lead your party.’ Some years down the track. The Longman result three days later did not change his ambition. It changed his timing.
Dutton was more worried about the Longman result than he admitted in public at the time. ‘Certainly, after Longman I started to lose faith pretty quickly,’ he said several months later.2 In his view, the mistakes of the 2016 election campaign were repeated with a lacklustre performance in the by-elections. ‘I think it was also Shorten’s capacity to campaign that saw the result in 2016 and, in my judgement, that was going to be replicated in 2019.’ He thought Turnbull had been swayed by public polls that suggested Longman could be won when the government’s interest was in managing those expectations. This was Turnbull’s failure: ‘There was just no judgement.’
Liberals prepared for the resumption of Parliament on 13 August knowing that Dutton was the presumptive leadership candidate who would champion the conservative cause. He focused on Home Affairs business, such as stripping five Islamist terrorists of their Australian citizenship, and kept up his weekly talks with 2GB host Ray Hadley, where the discussion would usually turn to the virtues of tradition at a time of social change. Five days after the by-elections, with the government’s fate in question, the first topic of conversation with Hadley was the intrusion of gender-neutral language into everyday speech.3 The Home Affairs Minister sympathised by recounting his fruitless search for a men’s bathroom in an office lobby full of unisex toilets. ‘What is all of this about?’ he asked. ‘This is making a mockery of our society.’
But the real business was leadership, and Hadley wanted Dutton to act. The 2GB host harangued Dutton for showing too much loyalty to Turnbull. He urged him to stop using the confidentiality of federal cabinet to avoid open criticism of government policy, especially the second phase of the company tax cuts, which seemed unlikely to be removed from their deep freeze in the Senate. Hadley, unaware that Cormann had saved the company tax cuts from being dropped in June, castigated Turnbull and Morrison for standing by the policy.
‘Do they have any grey matter between the four ears there, to understand they’ve got to start talking to the electorate about things that matter, and big business tax cuts is not one of them!’ Hadley bellowed. Dutton struggled to be heard as Hadley stormed on: ‘I hope one day you can come on the program and say what you really think and you’re not hamstrung by your cabinet commitments.’
‘I say, I say,’ Dutton began, before being cut off.
‘I know you do on some things but when it comes to challenging the Prime Minister you have to watch your Ps and Qs because you might end up the minister for nothing,’ Hadley said.
‘Well mate, I’m not worried about that, that’s the last thing I’m concerned about. I speak my mind and say what I think,’ said Dutton.
Hadley told Dutton to go to Turnbull and Morrison and tell them to dump the tax cuts.
‘Morrison sits there with his head stuck up his bum, looking like a jug handle, you know, “yes Prime Minister, no Prime Minister”, that’s why he doesn’t appear here anymore, because he’s simply subservient to the Prime Minister. I want someone in your party to offer solutions, not just nod in agreement like one of those dogs on the back shelf of a car with Malcolm Turnbull!’
Hadley flayed the government. It was a brutal assertion of influence over a cabinet minister and it drew only the mildest protest from Dutton in reply. A visitor to the gorilla enclosure at the zoo could not have spotted the alpha male as quickly as a listener to 2GB at that moment. Hadley reminded Dutton why Morrison was no longer heard on his program, a reference to the rift of April 2017 when the radio host banned the Treasurer and invited Abbott on air instead, and he advanced the idea of what should come next. When it comes to challenging the Prime Minister. What Hadley wanted was never in doubt.
Dutton had the credentials to lead the conservatives after a more than a quarter of a century in the Liberal Party. The son of a bricklayer and a childcare worker, he went to St Paul’s Anglican school in the northern suburbs of Brisbane and joined the party at the age of nineteen. He seemed set on a life in business and politics until choosing instead, at twenty, to act on a childhood ambition to join the police. He had a zeal for law and order and became a detective in the drug squad, the sex offenders squad and the National Crime Authority before leaving after a decade and going into the construction business with his father and assembling a real estate portfolio that set him up for his next career. In 2001, in an election overshadowed by terror attacks in the United States and asylum seekers in the Indian Ocean, Dutton entered Parliament as the Liberal member for Dickson.
That beginning put Dutton on a path to the frontbench. He was a junior minister in the final years of the Howard government and a shadow cabinet member after Labor took power, solid in his portfolio and dependable when the conservatives needed a hard man in Parliament to go on the attack. His eagerness for a fight was apparent in 2008 when he became the only Liberal frontbencher to boycott Prime Minister Kevin Rudd’s national apology in Parliament to the Stolen Generation of Indigenous Australians. He regretted that decision but rarely took a backward step in a dispute — not when complaining that schools were silencing Christmas carols, not when arguing for asylum seekers to be kept on Nauru, not when telling business leaders to stop calling for same sex marriage. Yet this was the same man who supported a cabinet decision to accept 12,000 refugees from Syria and Iraq and later visited some of them to see them settling in Australian towns and suburbs.
To his supporters, it mattered not that Dutton leapt beyond the facts with his divisive rhetoric, as he did by declaring people in Melbourne were ‘scared to go out to restaurants of a night’ because of African gangs. What his supporters saw was a conservative warrior who would do everything to win an argument against his opponents. His face might be undisturbed by passion and his voice unvaried in tone but his attacks usually found their mark, so much so that Labor and the Greens howled in protest and conservatives praised him all the more. His wife, Kirilly, summed him up in the early months of 2017: ‘It’s black and white with him. There is no grey.’4
Dutton now had a pathway to promotion on his mind. Days after the Longman result, he called Cray to discuss the message from Queensland voters. He was calm and friendly and made no mention of Turnbull’s leadership, but he had a message about Bishop’s position as deputy. We’ve got to get rid of Julie. I can do better. I appeal to more people than she does. Turnbull and Bishop often appealed to the same group of voters and the government needed a strong appeal to conservatives, but a decision about the deputy’s position was not Cray’s role. She listened and o
ffered one piece of advice. Talk to Malcolm.
Dutton stepped with care after his lecture from Hadley in the knowledge that any public signal he made about his ambition would ignite the party room before Parliament resumed.
Attention was on Turnbull to see how he would respond to the message from voters and the increasing murmurs from government backbenchers about the two policy sagas the government could never end: company tax cuts and the National Energy Guarantee. The sharpest warning came from Luke Howarth, who had arrived in Parliament in 2013 with the suitable qualifications of a black belt in judo, several years running a pest control company and a broken nose from his willingness to get into a scrap. Howarth saw the danger signs in Longman, next door to his Brisbane electorate of Petrie, and wanted a stop to the vacillation on tax: ‘We should try once again to get it through the Senate. If the Senate rejects it again, then drop it and move on,’ he said. Those words carried weight with colleagues due to Howarth’s direct exposure to the electoral shift in Queensland and his widely known friendship with Dutton, a close contemporary within the party and his mentor in the years before he came to Canberra.
Turnbull was taking exactly this approach but was hamstrung in his public remarks about the second phase of the corporate tax cuts, with their controversial benefits for companies with more than $50 million in turnover. Would Turnbull keep the second phase as government policy all the way to the election? To rule this out too early would be to weaken any negotiations in the Senate, where there might be one last chance at success.
Turnbull had come close to cancelling the second phase in June but stayed his hand to give Cormann more time to pass the bill. He chose the same approach now. The decision intensified the political risk to the government and himself in the daily jousting with Shorten. Turnbull’s message to Cormann was simple. You’ve done so much for the government, you should have more time to get this done. As the Parliament prepared to meet, Sally Cray sent a message to Cormann that Turnbull believed in his capacity to seal a deal. They were trusting Cormann when the party room was unsettled.
Turnbull chose this moment to formalise a transition in his personal team to prepare for the election ahead, a concession that the Prime Minister’s Office would have to become sharper, more nimble and more assertive if it was to counter Shorten’s aggressive and confident political unit. Turnbull’s chief of staff, Peter Woolcott, a career diplomat, departed the Prime Minister’s Office to become Australian Public Service Commissioner. This cleared the way for the elevation of Clive Mathieson to run the office after serving as deputy chief of staff since the previous October. Mathieson gave the Prime Minister’s Office the nous it needed to become more competitive against Labor, drawing on his background as adviser to New South Wales premiers Gladys Berejiklian and Mike Baird and his time as editor of The Australian.
Mathieson was popular and effective, but the need for this change reminded outsiders there had been too many transitions already. Woolcott had lasted ten months in the job. His predecessor, Greg Moriarty, had joined the Turnbull office as national security adviser after the 2016 election, risen to become chief of staff and departed in September 2017 upon his promotion to secretary of the Department of Defence. The first of this line, Drew Clarke, had been chief of staff from September 2015 to April 2017.
Four chiefs of staff in fewer than three years: Turnbull paid a price for this rotation. He had wanted senior figures from the public service to run his office, believing this would bring stability and maturity to the position and help deliver on his ambition to restore steady cabinet government, but he overlooked the need for more political dexterity in his office to deal with the dual threats of Shorten on one side and Abbott on the other. Mathieson broke this pattern but arrived with too much to do in too little time. The office had lost other advisers too soon. Brad Burke, described as a ‘Malcolm whisperer’ after years of service as an adviser and deputy chief of staff, had left at the end of 2016 for the private sector. So had Tony Parkinson, a senior political adviser with long experience in Parliament House with Alexander Downer as Foreign Minister. Another gap was the absence of Arthur Sinodinos, the cabinet secretary in Turnbull’s first ministry and a source of political wisdom from his decade as chief of staff to John Howard as Prime Minister. Sinodinos had gone on leave in September 2017 to undergo treatment for cancer. Turnbull needed a larger and stronger personal guard around him.
Abbott encouraged the conjecture over the government’s direction by calling again for cuts to immigration and a rethink on emission reductions. ‘I don’t want to change the leader, I want to change the policy,’ he said.5 ‘If you change the leader without the policy you’re jumping out of the frying pan into the fire.’ His remarks raised an unspoken question. What if you changed the policy and then the leader? To separate the two was to draw an artificial line, as if the leader’s authority could be shredded with no damage when members of the party room were agonising over their political survival. Abbott scorned the idea that the National Energy Guarantee had been passed by the party room on 26 June. That meeting had agreed the policy would have to be discussed again in its final form. Turnbull was compelled to face the climate critics in the party room once more.
Labor state premiers saw Turnbull was exposed and chose to harden their positions on the National Energy Guarantee ahead of a meeting in Sydney on Friday, 10 August, to decide if the states and territories would pass uniform laws to give the federal scheme its expanded power over electricity retailers. Victorian Labor Premier Daniel Andrews and state Energy Minister Lily D’Ambrosio named four conditions for their support: emission reductions could only deepen over time; future targets would be set by regulation, not legislation in federal Parliament; the targets would be set every three years; and a ‘transparent registry’ would be developed to expose the inner workings of the emissions scheme.
This was a provocation for Turnbull, a demand for flexibility on the 26 per cent target that hard-core climate conservatives already abhorred for being too high. The idea of setting the targets by regulation created the prospect of a Labor government one day signing a piece of paper to turn the 26 per cent into 45 per cent, Shorten’s stated ambition if he secured power. Frydenberg had eliminated this option days earlier with the argument that any change so far-reaching to the economy could only come after a vote in Parliament. The Victorian proposal for a review every three years was another dare. The federal plan was to set the targets for the first ten years and allow reviews every five years, which meant the first chance to deepen the cuts would not come until 2031. Frydenberg had already given ground by accepting a review in 2024 to consider the targets applied in the second half of the decade, but to go further was to inflame his restive backbench colleagues, especially if a ‘transparent registry’ might reveal the cost of the emission benchmarks at the heart of the scheme — that is, a potential price on carbon.
D’Ambrosio challenged Malcolm Turnbull to stare down the ‘climate-crazies in his party’.6 The Victorians, supported by similar demands from the Australian Capital Territory, gave Turnbull a wretched choice: appease Abbott and the party room or strike a deal with the states and territories. It was impossible to satisfy both. Victoria and the Australian Capital Territory would only proceed with the National Energy Guarantee if Turnbull walked into the party room, lay his head on the guillotine and risked his neck with intransigent MPs who would gladly drop the blade.
Frydenberg salvaged the policy at the Friday meeting by gaining an extension of time. He had wanted the states and territories to sign off on the plan before he put it to the federal party room in Canberra the following Tuesday, but D’Ambrosio and others refused to go first and stipulated the scheme had to overcome the objections in the party room from Abbott and others before they would consider the next step. An agreement on the climate change target seemed as distant as ever: Victoria, Queensland and the Australian Capital Territory rejected 26 per cent as too low; Shorten wanted 45 per cent; the Greens wanted 90 per cen
t; Abbott demanded a retreat from targets altogether.
The differences between these positions meant little to the world when Australia was a small part of the global economy and China belched carbon dioxide from new coal-fired power plants, but the gulf was wide enough to ensure an impasse. Frydenberg prepared for another party room meeting where Liberals and Nationals would be looking with suspicion on any concession to Labor and the Greens, which meant he had to rule out the Victorian demand for easier changes to the targets. ‘We’re certainly not going down the path of regulation. These are targets that should be in legislation to provide investment certainty,’ he said.7 The pledge sounded definite. The mystery was whether he had the numbers in the party room and the Parliament to sustain the policy.
Turnbull headed into a decisive clash when Parliament met on Monday, 13 August. The jeers from Labor were a minor concern when the contest that mattered was within the government’s own ranks and when Shorten’s role as Opposition Leader was overshadowed by Abbott’s claim to the unofficial title. Turnbull and Frydenberg were confident of majority support for the National Energy Guarantee inside the party room but could not be sure this would be enough if Abbott and his friends chose to cross the floor and veto the policy in a momentary alliance with Labor in the House of Representatives. The full cost of Turnbull’s troubled election campaign two years earlier became grimly apparent in the machinations to come, with Abbott preparing to exploit his power as a single MP in a chamber where the government had a majority of one. When Turnbull was asked during Question Time about Abbott’s frank disbelief at claims the government policy would ease electricity prices, he ridiculed the ‘ideology and idiocy’ of those who opposed his energy policy. At that moment, Abbott threw his hands in the air in full awareness of all the eyes upon him. Abbott knew he had history on his side. Years of division on climate change had turned this policy into a sure way to test a political leader until he snapped.