Venom
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Turnbull’s enemies had cried out for a concession to remove the Paris target from legislation. Turnbull had met their demands. Now they curled their lips at his weakness.
Dutton continued his public silence throughout this desperate attempt to salvage the policy and protect the Prime Minister, but his allies were already mobilising to change the leader. Some were putting questions on Friday afternoon and evening to likely supporters on the conservative side of the party. We’re going to spill. Are you with us? The intent was clear even if the timing was uncertain. Late on Friday came a preview of the Daily Telegraph’s Saturday edition with a stark front-page headline: ‘Dutton ready to roll: Minister considers Turnbull challenge as PM backflips on 26 per cent emissions target.’ The report said Dutton was seriously considering this move.5
Morrison was on the phone early the next morning, Saturday 18 August, to speak to ministers about Dutton’s equivocation and the government’s plight. He was loyal to Turnbull in these conversations and presented himself as chief protector to the Prime Minister, an ideal position for one seeking to be the anointed successor. The discussions made it obvious the puzzle over Dutton’s intentions could not go on. It was untenable for one of the most senior cabinet ministers to cast such a shadow over the leadership. Dutton was urged to make his position clear and did so that morning in a social media post.
‘In relation to media stories today, just to make very clear, the Prime Minister has my support and I support the policies of the government,’ Dutton wrote on Twitter at 8.33 a.m. ‘My position hasn’t changed from my comments last Thursday.’ This ended more than 24 hours of silence in the media but did not end the disquiet over Dutton’s ambitions. The last sentence had ministers worried that he was leaving his options open, that a more emphatic statement would have been better. My position hasn’t changed. Dutton’s position on Thursday had been that he would resign from the ministry if he could not support the government and its policy. That prospect remained. The speculation over the leadership was so intense that only an explicit and definite statement of loyalty could stop the conjecture. Some Liberal MPs sent messages to Dutton to tell him they appreciated his post. ‘Thanks,’ Dutton replied to one colleague. ‘We’re in a bind so let’s hope the miracle materialises.’
Turnbull wanted to keep the focus on energy prices ahead of a cabinet meeting on Sunday night to discuss the retreat on the emissions legislation and the renewed fight when Parliament returned on Monday. He was proceeding with a recommendation from the Australian Competition and Consumer Commission, put forward in July, to set a default price for standard household electricity packages, a drastic intervention in conflict with the Liberal Party’s free-market philosophy. This was a guideline, not a price cap or a fixed price across all packages, but it added to the threat of ‘big stick’ regulation of the energy companies. Labor announced a similar proposal on Sunday, embracing the ACCC idea, but the attention was on the Prime Minister and his accommodation on the emissions targets.
Turnbull could see the consternation among Coalition MPs over the way a future Labor government might deepen the emission cuts by signing a regulation. He took to social media on Saturday night to assure Australians he was getting prices down, provoking 1,000 thumbs up and 198 frowns in the emoji world of Facebook, but he also sent a signal to conservatives that his plan also allowed for federal financial help to underwrite new power projects, another ACCC proposal, and that this did not rule out financial support for coal-fired power stations.
‘We will provide support for more competitive baseload generation, as the ACCC recommends, on a technology agnostic basis — whatever gets the job done — stepping in to ensure these projects get financed so they can go ahead,’ Turnbull said in the Facebook post. The emissions targets would be set by regulation but would be subject to a legal safeguard. ‘We will introduce a new law that ensures that before any new emissions target is set, or changed, the energy regulators and the ACCC must advise what that means for your electricity prices. This will ensure that any government who wants to change this, has to tell you up front what the cost will be.’
It was not enough. The climate change debate within the Coalition party room had reached a point where no settlement worked. ‘It’s no way to run a government, making absolute commitments on Tuesday and breaking them on Friday,’ Abbott told 2GB. Another Liberal, Molan, had hardened his warnings against the Paris targets, while Abetz, Andrews, Hastie, Kelly and Pasin were known to object to the policy. The Nationals MPs against the plan included Christensen, Gee, Joyce, O’Sullivan and Pitt and a new voice, New South Wales Senator John ‘Wacka’ Williams, who said he was ‘very concerned’ at the idea that a future Labor government could easily adjust the target. The splintering of the backbench continued on Sunday when two Victorian Liberals, Tim Wilson and James Paterson, aired their doubts about the new accommodation on the target. ‘Parliamentary sovereignty should not be sidestepped by ministerial discretion on such a significant, long-term policy question,’ said Paterson. The Liberal Party’s history showed that a dispute over climate could be a short step towards a challenge to the leader. The party room was arguing over a box of matches next to a petrol bowser.
Turnbull wanted every cabinet minister to return to Canberra on Sunday night, but the response from some was ominous. The Health Minister, Greg Hunt, did not reply to the request when it was issued on Friday, a delay that intrigued the Prime Minister’s Office. Hunt, the architect of the ‘direct action’ climate change policy during the Abbott government and a senior conservative in the Victorian division of the Liberal Party, was eyed with suspicion after years of media reports that speculated about a new leader for the party and, uncannily, always named Hunt as the next deputy. Cormann could not make it from Perth. The response from Dutton was more troubling. He told the Prime Minister’s Office he could not attend the meeting because he had a family event on in Brisbane a few hours before cabinet ministers were meant to assemble for dinner.
The hesitation was telling. This was a crucial meeting of cabinet in the midst of a split on energy policy and open speculation about the leadership, yet some ministers were in two minds about whether to attend. Cray decided on Friday night that Dutton had to make the meeting and that a Royal Australian Air Force jet should be arranged to fly him to Canberra. Dutton was joined on the flight by the Trade Minister, Steve Ciobo, his Queensland friend and former flatmate. Ciobo had voted for Turnbull three years earlier and vaulted into cabinet soon afterwards; now he was backing a different challenger.
Cray was frank about her suspicions when she messaged Ciobo on Sunday to confirm the VIP jet would be ready at the Hawker Pacific jet base in Brisbane at 4.30 p.m.
‘You can plot all the way down,’ she texted him.
‘Why do I feel like this is the kiss of death for me?’ he replied.
‘It’s fine,’ she responded at 1.54 p.m. ‘Abbott isn’t there to give the instructions. Just be careful his strategy doesn’t blow up and we don’t have PM ScoMo on Friday.’6
Ciobo offered a neutral reply and asked if he could ‘calm the waters’ but it was too late. Cray had spoken to Queensland Liberal MP Bert van Manen earlier that day and been told Spence had called him to urge him to back Dutton. She thought the manoeuvring was madness and could see that Morrison would move if Dutton chose to strike, but Dutton and his allies seemed blind to their own chances of failure.
Ministers were meant to gather for dinner at The Lodge for an informal discussion, but the venue was changed to the cabinet rooms of Parliament House to prevent media crews interrogating everyone. Dutton and Ciobo arrived after the meal and joined the formal meeting around the cabinet table as attention turned to the National Energy Guarantee. Turnbull put the focus on price. One key decision was to force the adoption of the default price scheme for electricity by imposing severe regulation on energy companies including the threat of a divestment power for the ACCC to break up companies. The energy policy changes were accelerating to a
point where a Coalition cabinet quickly approved an idea it might have slowed or stopped in a different era. The most important decision was political. Cabinet decided the government would not attempt to legislate the emissions targets at any point if this meant relying on Labor’s support in the Parliament. The energy policy would only proceed if the Coalition could carry the policy on its own numbers.
Pyne turned to Dutton after ministers had expressed their approval for the political strategy. Dutton had been silent for much of the discussion. He had never made the National Energy Guarantee a test of Turnbull’s authority in cabinet and had never tried to stop the policy. Even so, some of his colleagues thought he had become more reticent in cabinet since the Longman by-election. Now everyone wanted to hear from Dutton. Pyne asked him to speak up.
‘Well Peter, we’ve all had our say and we haven’t heard you — and everyone wants to know what you think,’ Pyne said, according to those in the room.
Dutton responded that the energy policy was not ideal, but it was cabinet policy and he would support it. And the leadership? Dutton was not turning the energy policy into a test of leadership. Some of those in the room took his answer as continued support for Turnbull. At least one thought Bishop rolled her eyes.
Dutton viewed the energy policy not in terms of philosophy or ideology but political reality. He doubted Turnbull’s judgement in pursuing a scheme that did not have unanimous support in the Coalition party room and would require Liberal and Labor MPs to vote together while Abbott and other rebels crossed the floor.
‘I was pragmatic about it, but my major concern was facilitating a process where twenty of our people crossed the floor or abstained,’ he said later.7 ‘I thought that would have been the end of his leadership at that point. It comes back to the question of political judgement.’
While Dutton was positioning for a challenge, he was not ready to admit it in the cabinet room. His supporters were so confident of his prospects they were already telling others he had half the party room and was willing to move. ‘Supporters of Peter Dutton say the Home Affairs Minister is leaning towards challenging Malcolm Turnbull for the prime ministership and has the numbers to win,’ wrote Peter Hartcher and this author in the Sydney Morning Herald and The Age in a report that went online at 9.31 p.m. on Sunday night and was on the front pages the next morning.8 The Liberal party room had 84 members returning to Parliament on Monday. Another member, Arthur Sinodinos, was on leave. Dutton supporters claimed he had at least 43 votes already.
‘It doesn’t matter what the NEG turns out to be now,’ one conservative Liberal said on Sunday. ‘It’s broader than that — it’s now about our direction, our base, and our personnel.’ The preparations for a spill were reported alongside the government’s worst loss in an Ipsos survey in more than a year: the Coalition was behind Labor by 45 to 55 per cent in two-party terms, a result that would cost more than twenty seats if repeated at a general election.
Morrison’s closest companions met at his apartment in Canberra as the Sunday night cabinet meeting wound down. His flatmates, Steve Irons and Stuart Robert, were joined by Alex Hawke, the man they considered their ‘spear-thrower’ because he was so brutally effective at marshalling numbers for a ballot. They began at 9 p.m. and were joined by Morrison when he returned from cabinet. They talked past midnight while they considered the Ipsos poll and the next day’s headlines about a spill. Hawke was frustrated at the Dutton camp’s briefings to the media and discussions with the backbench, feeling he should have been alive to the manoeuvres much earlier. ‘They’re ahead of us,’ he said. ‘We should have been expecting this.’
The four men were one of the tightest groups in the Liberal ranks. They had all entered Parliament in the same year, 2007, and attended bible study and prayers every Tuesday night when in Canberra. This shared belief bound them together in a world where so many politicians, advisers and supporters could shift their allegiances. The four had worked together through the schisms of the party over more than a decade. Abbott had won and lost supporters. Turnbull had seen some of his allies drift away. Not Morrison. His inner circle was small but committed.
Morrison made sure to have another friend by his side. He called Scott Briggs, his campaign manager in the electorate of Cook, to ask him to get to Canberra as soon as possible. Briggs was a former deputy director of the New South Wales division of the Liberal Party and a man with strong ties to both Morrison and Turnbull. He had helped Turnbull launch his political career as the member for Wentworth in 2004, and had once worked at Turnbull’s investment bank, but his more recent work had been as Morrison’s indispensable ally. He drove to Canberra on Monday.
Conservative commentators were not gunning for Turnbull alone on Monday morning. Alan Jones also attacked Frydenberg for his ‘naïve’ energy policy and his earlier insistence on a legislated target that was now rejected by Turnbull. ‘Mr Frydenberg, you deserve what’s coming your way. You should have resigned at the weekend,’ Jones said on 2GB. It was a reminder that anyone who sided with Turnbull would become a target. Joining Dutton might be risky but helping Turnbull could be costly for anyone who wanted to appease the conservative critics. Even Pyne, the indefatigable defender of the government, could not quell the sense of a crisis when stopped by reporters in the Press Gallery corridor after a morning interview: ‘Obviously it’s damaging. Quite clearly, disunity is damaging.’
Turnbull stood with Morrison and Frydenberg at a press conference on Monday morning, 20 August, to reveal the cabinet decision of the previous night. Turnbull argued in one breath that the National Energy Guarantee and its emissions target had the clear support of the party room but in the next breath that it could not be put to Parliament. ‘I’ve never seen an energy policy that has broader support,’ he told reporters in the Blue Room of Parliament House, before admitting the complaints from his own Liberals and Nationals colleagues were so strong that he could not legislate. The policy remained to have an emissions intensity standard in legislation. The commitment to reduce emissions by 26 per cent also stood. Friday’s proposal to require an ACCC report on any increase in the target also remained, but only in theory. ‘It is a moot point until such time as we have enough support to pass it through the House,’ said Turnbull.
Turnbull presumed the government could not get support from Labor to pass the legislation, but he made no attempt to negotiate with Shorten to succeed. He did not put this to the test and therefore put no obligation on Shorten to cast a vote. The journalists in the Blue Room tried to make sense of this new position. ‘The only people saying on the record they would vote against your bill are your people,’ asked one. ‘So this will be seen as a capitulation to the conservatives in your party room. At what point do you stand and fight?’ There was no will in the cabinet for such a move: the decision the night before ruled out negotiation with Labor. It would split the party for Turnbull to vote with Shorten while conservatives led a revolt on the floor of Parliament.
Life was draining from the National Energy Guarantee even if Turnbull and Frydenberg could not admit it. The scheme was the result of more than a year of work by the nation’s most senior energy regulators, largely supported by industry and shaped by hundreds of public submissions. The states and territories were preparing draft legislation to enact their part of the mechanism. The policy had been approved by federal cabinet at length and had passed the Coalition party room three times. Now there would be no federal law, not even regulation, to enforce the cut in emissions. It is a moot point. The target was all ambition and no action. ‘The NEG is dead,’ said Rattenbury, the Climate Change Minister in the Australian Capital Territory government. The Business Council of Australia and the Australian Industry Group despaired at the diminishing prospect of ever getting a political settlement on energy.
Turnbull was now exposed to a political tempest. His belief in the science on climate change was central to who he was. Voters knew him as the Liberal leader who wanted to reduce greenhouse gas emissions
when so many of his colleagues dismissed the need to act. His words from 2009, when he lost the leadership, were in every profile of his political career: ‘I will not lead a party that is not as committed to effective action on climate change as I am.’ Now he tried to save his leadership by sacrificing conviction. What did he stand for?
The Prime Minister, his cabinet and his government revealed their astonishing loss of nerve to the Australian public. They repeated the April 2010 upheaval when Kevin Rudd followed the advice of his colleagues and retreated on Labor’s emissions trading scheme in the face of an attack from Abbott. Labor cabinet ministers had urged the backdown and weakened the leader, then cut him down two months later. How long would it take the Liberals to do the same to Turnbull?
Abbott triumphed again. This was revenge served cold with ingredients taken from the political deep freeze: the ideological divide of the 2009 clash, the lessons from Rudd’s surrender in 2010, the tactics of Abbott’s campaign as Opposition Leader against a price on carbon. And the crisis was only possible due to the tight numbers in Parliament from Turnbull’s own performance at the 2016 election. The size of the Coalition revolt on the emissions bill was never tested in the House of Representatives. It might have included Abbott, Andrews, Christensen, Gee, Hastie, Joyce, Kelly, Pasin and Pitt, separate from the critics in the upper house. The numbers varied but the group certainly represented a minority of the 76 government MPs in the House. They might have been overcome by an agreement between the government and Labor, but Turnbull did not dare to make the attempt. There was no doubt who blinked in this grudge match. The narrow majority from the 2016 election had given Abbott enormous leverage. He used it without mercy.