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This morning’s TV on Channel 10 clearly showed that public discussion about Gillard’s involvement in the establishment of a slush fund in the name of the AWU is far from over. As might be expected, Andrew Bolt ran the issue (including within an interview with Abbott) but, more importantly, Gillard appeared on Meet the Press apparently because she felt it necessary to repeat her accusation that the Opposition is only engaged in smearing while Labor is concentrating on putting out meaningful policies ie Gillard herself accepts the slush fund issue is not all over.

Perhaps she also felt it necessary to counter the extraordinary outcome of a Galaxy Poll showing that nearly one-third believe she lied and nearly another third believe she has been “economical with the truth”. While 56% said it would not affect their vote, 26% said they would be less likely to vote Labor. Some 60% thought Gillard should make a statement to Parliament. Whichever way one looks at it, Gillard’s handling of the questioning in Parliament last week was not a success. Nor does Labor’s 34% primary vote suggest a promising outlook. This is not a major poll but it sends a signal.

The poll has also to be interpreted against the background that, as is its wont, most of the media has written up the questioning in a way that minimised the extent of adverse implications for Gillard and Labor more generally (see article below by Kenny). However, note that editorials state that the situation “cries out for official investigation” (AFR), support Abbott’s call for an official inquiry (The Australian) and, while sitting on the fence, The Age identifies considerable defects in Gillard’s responses to questioning.

Will anything happen before Parliament resumes on 5 February? As I mentioned yesterday, there are a number of possible developments and it would be surprising if a grub did not emerge from the woodwork. With the likelihood also that more problems will emerge with union behaviour under the Fair Work Act, there may also be some focus on Gillard’s ongoing close connection with the union movement and her apparent inability to contemplate the kind of changes that Hawke and Keating did.

The latter has recently had a lot to say about the importance for workers of improving superannuation but very little about reviving the enterprise bargaining approach he claimed in 1993 to have started. It is interesting to recall that in 1992 Keating had stated that old regulatory system “is finished” and we have “now come to do things in a new way”. Unfortunately that old regulatory system has returned with knobs on.

Des Moore

PS For those interested in the existing regulatory arrangements, it is not too late to attend tomorrow the HR Nicholls AGM and dinner at Montague Hotel, South Melbourne. The AGM starts at 5.30 pm and the dinner at 6.30 pm.

Prime Minister Julia Gillard's fight-back stalls over
AWU affair

Samantha Maiden, The Sunday Times, December 01, 2012

One-third of voters believe Julia Gillard lied over the AWU affair. Source: The Sunday Times

ONE-THIRD of voters believe Julia Gillard lied over the AWU affair, while another third believe the Prime Minister has been "economical with the truth".

Just one in five voters believes she has been completely open and honest but a majority say it will not change their vote at the next election.

An exclusive poll conducted for The Sunday Times this week has found the political fight-back by Ms Gillard is stalling after a toxic parliamentary year ended with political attacks, smear and accusations of criminal conduct.

Of 1015 people surveyed across Australia on Thursday and Friday nights, 31 per cent said she lied and 31 per cent said she was economical with the truth.

Regardless, 56 per cent of voters said it would not influence their vote.

According to the Galaxy Poll, 26 per cent said they were less likely to vote Labor and 9 per cent were more likely to vote Labor, suggesting a net loss for Labor in voter intention.

Tony Abbott would be elected prime minister if an election were held now, with the Coalition ahead 54 per cent to 46 per cent on a two-party preferred basis.

Assuming a uniform national swing, that would deliver the Coalition up to 20 seats if an election was held now, including Treasurer Wayne Swan's Queensland electorate and end the political careers of other Cabinet ministers including Gary Gray, Craig Emerson, and Peter Garrett.

Sixty per cent of those surveyed supported the Prime Minister making a full account of her involvement in the AWU slush fund affair through a statement to Parliament.

A statement to the House would expose her to censure if she was found to have misled Parliament.

Fifty-six per cent said the AWU affair would not influence their vote but 26 per cent said it would make them less likely to vote Labor.

This sample included Coalition voters.

"Unless Julia Gillard is able to quash these allegations there is a real prospect this issue will affect support for the Labor Party," Galaxy's David Briggs said.

Liberal voters make up the lion's share of voters who are convinced the Prime Minister is lying, with 50 per cent of Coalition voters surveyed accusing Ms Gillard of not telling the whole truth.

Voters split down party lines with 47 per cent of Labor voters and 8 per cent of Liberal voters backing the Prime Minister as being completely honest over the AWU affair.

Among Coalition voters, 81 per cent believe the Prime Minister should explain herself over the AWU affair with a statement to Parliament. That compared with 36 per cent of Labor voters.

But among Labor voters, 51 per cent believe the allegations do not warrant another airing.

Primary vote support for the ALP was just 34 per cent a drop of 1 per cent since the last Galaxy survey on November 2-4 but within the poll's margin of error.

Support for the Coalition increased from 47 to 48 per cent and support for the Greens was unchanged at 11 per cent. Nearly 10 per cent of those surveyed were uncommitted.

Labor wins the media battle, but convincing voters of PM's honesty is harder

Chris Kenny, The Australian, December 01, 2012

WHETHER it demonstrated increased Balkanisation of our media or the amplification of traditional media bias, the final parliamentary week was a fascinating study in the political-media dynamic.

As ever, Labor won the media battle, but communicating with mainstream voters is another matter. Take Tuesday's extraordinary rolling of the Prime Minister on the touchstone Middle East foreign-policy issue. This was a dramatic repudiation of Julia Gillard's authority and it kiboshed her strong and principled position to oppose upgraded Palestinian representation at the UN.

Instead, by abstaining, Australia diminishes our solidarity with Israel and the US.

On their regular Radio National chat, The Age's Michelle Grattan and the ABC's Fran Kelly talked down the rebellion. It was "not a great look", according to Grattan, but had left the government with a "better position" that wouldn't trouble "ordinary voters". Kelly suggested the episode was "a good thing" and an example of "democracy at work".

A contrary view might be that mainstream Australians would see abstaining in the UN vote as a spineless position, and that a Prime Minister overruled by her party was wounded.

The best way to test bias is to imagine the mirror image: would the chat have been as soothing and calm if Tony Abbott had lost a core argument in his partyroom? Histrionics is a word that springs to mind.

But the main issue of the week was the Australian Workers Union corruption scandal.

From the moment the spectre of the AWU affair reappeared to haunt Gillard, largely thanks to a speech by her former attorney-general Robert McClelland, it was clear where it was all going to end. (That was a joke - the only certainty in this complex story has been doubt about where it would lead.)

Strangely, however, many journalists have been incurious - bristling at the very mention of the story, and echoing Labor spin aimed at killing it off. Melbourne-based ABC broadcaster Jon Faine said last week he never thought much of it. "The emperor's got no clothes as far as I'm concerned, and I've said so from the beginning; I pooh-poohed it."

A crucial building block for the government's spin has been to demand a "smoking gun". Journalists were revealing facts and asking pertinent questions yet Labor sought to raise the bar, claiming the story wasn't worthy unless it contained a killer blow.

Journalists less susceptible to spin were simply interested, as ever, in discovering who, what, when, where and why.

The essential elements of this matter make it compelling: a fraud involving hundreds of thousands of dollars was perpetrated by a former boyfriend and a former associate of the current Prime Minister, through an entity she helped to incorporate without taking the usual precaution of opening a file to notify her fellow Slater & Gordon partners.

We now know the fraud would not have been possible - knowingly or unknowingly - without Gillard's assistance incorporating the association in this way and arguing for it in a letter to the West Australian Corporate Affairs Commission. We know the official documents describe the association as one thing when its real purpose was to facilitate a union "slush fund".

Yet probing of this story has been criticised, not just by the Prime Minister but by other journalists. Another ABC commentator, Jonathan Green, wrote this week that the story ought to be dropped: "An independent, thoughtful and self-confident media might pull the pin on the spiral ... "

There were no similar urgings during previous investigations by The Australian into the children overboard affair or the Australian Wheat Board bribery scandal.

Nor was the love media reluctant to follow 30-year-old allegations about Abbott's behaviour at university.

Still, the broader context amplifies the issue's significance. A government that has re-regulated the labour market, installed a new leader at the behest of union leaders, battled the taint of the Health Services Union corruption scandal in its ranks, and is dominated by former union leaders and industrial lawyers is struggling to demonstrate that it can manage national affairs in the interests of the wider, non-union electorate.

So the AWU story goes to professional conduct, political transparency, prime ministerial integrity, union corruption and a government's ability to break the perceived and actual yoke of union domination.

What political journalist would not be interested? And why wouldn't the Prime Minister's stonewalling heighten their interest? A fortnight ago this column called out the mysterious, corporation-wide, ABC silence on this story. The following week, miraculously, the groupthink was reversed, the national broadcaster's many arms all dared to cover the issue, and even revealed some important developments.

The change in the political dynamic was dramatic. And it culminated in a final week of illuminating, desperate and ultimately inconclusive hand-to-hand combat in parliament.

The implications, even with the issue left unsatisfactorily unresolved, are great. A Prime Minister who had grown in confidence after weeks of vicious character assaults on the Opposition Leader and a steady recovery in the polls, has herself suffered debilitating character damage and been left vulnerable, limping to Christmas to rebuild rather than rebound.

Abbott has again been prepared to cloak himself in negativity to inflict this damage. Importantly, he has signalled the government's deference to union bosses, and links to union corruption, will form a central part of his critique in the looming election year.

But to watch much of the coverage out of Canberra this week, most of this has been lost. We have seen simply daily jousting in a contest chosen by the opposition but framed by Labor spin.

Both sides attempt to frame the political debate. The point is that most journalists ignore or even expose blatant spin from the Liberals - as they should - while far too many simply parrot spin from the government.

How else to explain the relentless focus on the legitimate but transparent opposition tactic of having Julie Bishop rather than Abbott lead the attack?

Journalists, bizarrely, took seriously Labor's attack on Bishop for meeting and speaking to confessed fraudster Ralph Blewitt, with nary a mention of Labor's hypocrisy given the point of this controversy is Gillard's close association with Blewitt across a number of years.

If it is appropriate to expose the tactic of Bishop doing the Opposition Leader's heavy lifting, would it not be appropriate to mention that the confected attacks on Bishop were designed to distract from the Prime Minister's woes?

Sorting substance from spin should be how press gallery journalists add value every day. Yet like Shane Warne's South African batting bunny Daryll Cullinan, journalists are not much value if they are capable of picking spin in only one direction.

Bitter feud blocks national progress

AFR Editorial, 01 Dec 2012

Parliament has ended a politically turbulent sitting year with Prime Minister Julia Gillard and Opposition Leader Tony Abbott locked in hand-to-hand combat as the worst of political enemies.

And yet, the two leaders, who have been scrapping since their student days, need one another, as the Weekend AFR pointed out in October. Mr Abbott is so unpopular that Ms Gillard has a chance, albeit remote, of beating him. Similarly Ms Gillard may be the only Labor leader Mr Abbott can win against, certainly when compared with her predecessor, Kevin Rudd.

But both leaders are dragging each other down in the public’s estimation, as has been reflected in opinion polls, while the government that Ms Gillard is meant to be running remains trapped by its minority status.

For not only does the government lack the capacity to make the hard political choices about needed reforms, many of its policy decisions are sub-optimal and have been dictated by its need to stay in power. Ms Gillard’s agenda is to win voters’ favour through government spending programs such as the Gonski education funding reforms and the national disability insurance scheme, which are worthy enough reforms, but their funding depends on squeezing out more tax revenue even as signs emerge that the mining boom is turning down. This is reinforced by news that mining investment is expected to fall in 2013 and by Rio’s Tinto’s plans to cut costs by $5 billion as commodity prices fall.

The Gillard government has hit upon the Asian Century white paper to provide a framework for its agenda, but greater engagement with Asia is an obvious tack and the white paper does not provide concrete strategies to achieve its goals in any case. In the meantime the government has ducked hard decisions that would make a difference to our competitiveness in Asia, such as fundamental tax and industrial relations reform.

That skewed agenda, which comes at a cost to the economy, Ms Gillard’s desperation to cling to power and Mr Abbott’s relentless battering and goading have resulted in a chaotic Parliament, a debased national debate and voters calling down a plague on both their houses.

All that said, Mr Abbott has been handed considerable ammunition for his style of political battle with Ms Gillard, by revelations of union corruption, some of which touches Ms Gillard.

Although the full details have yet to be revealed, the opposition did not make a compelling case that Ms Gillard broke the law in setting up the association which housed the slush fund for her then boyfriend, AWU official Bruce Wilson. That fund was used to channel money collected on behalf of the union to the benefit of union officials, but there is as yet no evidence that Ms Gillard had any involvement with the fund other than that her legal work facilitated this wrongdoing. But she veered close to the ethical line, if not stepped over it, in not informing her own firm about her work for the fund and what it was being used for.

There are indications that she knew something was amiss in 1995 but did not alert her firm until 1996. Nor did she make any efforts to alert the police or the ACTU.

The fact of her involvement and the attendant revelations of union officials filling bank accounts with money extorted from construction companies cries out for official investigation. Mr Abbott has called for a judicial inquiry even though he must be concerned that such an inquiry would uncover corrupt payments by companies to unions.

At the very least, now that officials of both the AWU and the HSU have been caught out in flagrant misuse of union funds, Ms Gillard should be leading efforts to clean up the area and considerably toughen governance rules for unions, perhaps by bringing them up to the level of governance standards for company directors.

Labor is, after all, not only backed by the unions, it is the political wing of the union movement. This clean-up could extend to a closer look at the undue influence the union movement has over the superannuation movement, through being able to specify a single default fund in the union award. Victorian building unions have decided to choose a new default fund after the incumbent Cbus declined to change investment policies, despite pressure from the Construction, Forestry and Mining Employees Union.

Yet there is no indication that Ms Gillard’s government has the political resolve to tackle union coercion and malfeasance, just as during the sitting year it has shown neither the fiscal discipline required to bring the budget well into surplus, nor the political will to push for sweeping reform of our tax system. The review of the goods and services tax led by Nick Greiner released on Friday called for tax reform, including to the GST, even though the government ruled that out in its terms of reference.

Meanwhile, although Mr Abbott has announced some Coalition policies, most of his effort has focused on attacking the Prime Minister. This constant warfare is the result of the minority government in which Ms Gillard is trapped and will remain until next year. With the two leaders dragging each other into the gutter, they are becoming increasingly unpopular with voters. Overall, it has not been a productive political year.

The Australian Financial Review

Name-calling gives politics a bad name

The Age, Editorial, December 01 2012 (No editorial or other comment in today’s Age)

Does Julia Gillard inspire optimism? Does Tony Abbott? In the last election, neither the Prime Minister nor the Opposition Leader won the clear support of voters, and for good reason. Politics can either be about building up or tearing down. The latter approach has dominated in recent years and Parliament's final sitting week was a new low. Policies that will shape our future were neglected for hand-to-hand combat aimed at tearing down the character of each leader and their parties with them.

This is not to excuse Ms Gillard's handling of questions about a legal entity for two union associates, one her then boyfriend, that was later used as a slush fund. She may resent events of 20 years ago being raked over again, but that does not justify her evasions in question time. (Labor has used even older allegations against Mr Abbott in branding him a misogynist.) When evidence then emerged of her representations as a lawyer to the WA Corporate Affairs Office to incorporate the Australian Workers Union Workplace Reform Association, Ms Gillard said she had prepared a letter that asserted the fact that it was not a trade union. ''So what?'' Why not say so the first time?

The opposition went much too far, however, in accusing the Prime Minister of criminal conduct. This grave charge was recklessly repeated by Mr Abbott, his deputy, Julie Bishop, and George Brandis, who would be attorney-general in a Coalition government. The ''evidence'' was too flimsy to sustain anything more than a charge of dubious conduct in her days as a lawyer. Mr Abbott has moved censure motions by the score and it is telling that he did not do so this time. Yesterday Ms Bishop was still insisting Ms Gillard ''prove her innocence''. That is how twisted the politics of reciprocal character assassinations has become.

Consider the week's legislative context. The bills introduced canvass historic changes: the Gonski education reforms; Murray-Darling water use; the National Disability Insurance Scheme; constitutional recognition for indigenous Australians; and poker machine laws to tackle problem gambling. These demanded debate - the education and NDIS bills, in particular, lack critical policy detail. The burning ''character'' wars starved them of oxygen. Such dysfunctional priorities lead to public contempt for politicians and the media, who are seen as players in a cynical game. A recent Australian National University survey found only one in three people trusted politicians to look after their interests.

After all their sound and fury, Ms Gillard and Mr Abbott looked forward to resuming hostilities next year, an election year. Most Australians shudder at the prospect. It doesn't have to be this way. Kevin Rudd's vision of hope won office for Labor, even if he promised too much. In the US, whose politics so influences ours, the successful campaigners of modern times have been Ronald Reagan, Bill Clinton and Barack Obama. For all their differences, all conveyed messages of hope. John F. Kennedy was a famously flawed character, but no one did more to rekindle the belief that public service can be a noble calling.

Maybe that is beyond our leaders. Mr Abbott won't ''throw the switch'' to positive until nearer the election. Ms Gillard ploddingly describes Labor's agenda: ''You will see us in 2013 continue to design policies and plans that fit with those values and that strategy for the nation.'' They should at least try to show respect for their offices, the body politic and voters - whatever happened to Mr Abbott's 2010 pledge of a ''kinder, gentler polity''? And if they want to win over Australians, try focusing on issues that matter to them. Offer a better way forward and let voters judge leaders' characters from their long public records. That is what we hope against hope to see next year.

Our testy parliament is not a chamber of horrors

Editorial, The Australian, December 01, 2012

"EVERYBODY is well and truly sick of politicians," said Barnaby Joyce as he left Canberra yesterday.

"And I think that politicians are well and truly sick of themselves."

The LNP senator's self-deprecation and bush wisdom showed not the decrepitude but the strength of our democracy. After a week of intimidation and interrogation, debate and debilitation, it is fashionable to lament our politics and our politicians. To be sure, a hung parliament, torrid controversies and a looming election have elevated the temperature and lowered the tone. Yet, to varying degrees, it has ever been thus. The parliament performs as a pressure valve for the confrontations of the nation.

Julia Gillard is a formidable leader who has been placed under enormous and justifiable pressure over the AWU affair. The Australian maintains she would have been best served to open up with a detailed account long ago, and we support opposition calls for a judicial inquiry. The Prime Minister owes voters a better explanation for a series of troubling revelations. Yet her strategy of stonewalling, obfuscation and counter-attack has been executed expertly. She has many in the press gallery cowed, not to mention some on the opposition benches and in her own ranks. In a minority government, facing a rampaging Opposition Leader, and with a former leader breathing down her neck, survival is her top priority. Her skill and grit is a prime asset for her ambitions and those of her party.

Ms Gillard has weathered disastrous polling and a leadership challenge to adhere to a long-term recovery plan based on a diminishing carbon tax backlash. So far -- however scrappy and tenuous -- her plan is providing hope for Labor. Her performances on the world stage have shown how Ms Gillard has grown into the job, and while her National Disability Insurance Scheme, Gonski and Murray-Darling Basin plans face massive gaps between promise and delivery, they form a worthy agenda. This newspaper has always accepted her government's legitimacy, so long as it commands a majority in the house. We have never called for an early election, and now it can only happen in the scheduled year.

When Ms Gillard challenged Tony Abbott to detail his AWU case in parliament, the Opposition Leader calmly put a compelling case. He eschewed invective in favour of facts and specific accusations. It was a better effort than Ms Gillard's shrill response. His argument will haunt the government to the election. Mr Abbott seized his leadership three years ago today, turning around a moribund outfit. He triggered a crisis of self-confidence in the government and a prime ministerial coup before Labor lost its majority at the 2010 election. Mr Abbott pushed the Prime Minister to the brink this week, and found time to publish a book of positive policies. His position is secure, he has his party well ahead in the polls, and if an election were held tomorrow he would almost certainly win. We saw a fierce struggle between worthy adversaries this week -- a battered government holding off an impatient opposition. Despite occasional overreach, each showed plausible strategies. We have seen testy parliaments before -- Keating versus Hewson, Howard versus Latham -- but the theatre and toxic debates test ideas, policy and character.

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