Factional menace has potential to rear its head again

Nanjing Night Net

Balancing act: O’Farrell organised a “round table” to hammer out a peace agreement between the NSW Liberals’ warring left and right factions. Photo: Chris LaneOne of the keys to Barry O’Farrell’s success as a leader of the Liberal Party lay in an extraordinary meeting he organised not long after Peter Debnam’s disastrous attempt to tip Labor and Morris Iemma out of office at the 2007 election.

It was a period of intense factional brawling within the NSW division, which had already contributed to the tearing down of its former leader – and one-time great hope for premier – John Brogden. In short, the Libs were tearing themselves apart.

One of O’Farrell’s first moves as new opposition leader was to organise a “round table” with warring left and right factions. Behind closed doors and away from the glare of the media, they hammered out a peace agreement to provide the stability to win government.

O’Farrell recognised that if the Liberals were ever to earn the confidence of the people to run NSW, they had to get their own house in order first.

Watching the extraordinary events of a week ago, when O’Farrell fell on his sword after giving false evidence to the Independent Commission Against Corruption, it’s hard not to recall the achievement – and recognise that the same menace he tamed might have played a significant role in his downfall.

As has been well covered, O’Farrell told the ICAC under oath that he did not receive a $3000 bottle of Penfolds Grange Hermitage from businessman Nick Di Girolamo.

Di Girolamo was lobbying O’Farrell and others over a potentially lucrative government contract for the company of which he was chief executive, Australian Water Holdings.

The next day, Di Girolamo’s barrister presented the ICAC a handwritten note from O’Farrell thanking Di Girolamo for the lavish gift.

It later emerged that two News Corp journalists had been tipped off about the gift to O’Farrell before it was raised at the ICAC, but both failed to publish the story. Quizzed over who might have been the source of the leak, counsel assisting the ICAC, Geoffrey Watson, SC, asked Di Girolamo if he had passed the information to journalists or former energy minister Chris Hartcher. Di Girolamo said he had not and the next day Hartcher emphatically denied any knowledge of the Grange.

Without evidence to the contrary, we must take Hartcher on his word. But the reason Watson asked the question is clear: Hartcher had motivation.

Motive one: Hartcher was humiliated in December when ICAC officers raided his office in relation to a forthcoming inquiry into illegal political donations. He did not just step aside; he resigned from cabinet altogether in a strong indication O’Farrell had demanded it.

Motive two: the reason Hartcher will find himself in the ICAC witness box in coming weeks can be traced back to a factional skirmish on the central coast.

The $5000 donation that sparked the inquiry was revealed during 2011 preselection interviews with a local builder, Matthew Lusted, who wanted to stand in Dobell. Liberal senator Bill Heffernan reported his concerns about the legality of the donation to head office. They were passed on to election funding authorities and the ICAC by O’Farrell’s director-general.

In 2012, Heffernan clashed spectacularly with Hartcher forces over preselection decisions for Dobell and Robertson, forcing then opposition leader Tony Abbott to intervene.

Supporters of Hartcher – then a leader of the right faction – have long claimed the decision to refer the donation was an attempt by Heffernan to smear Hartcher, with whom he had a poor relationship. Hartcher will be given the opportunity to repeat his denial under oath in the course of the donations inquiry, which starts on Monday. Whatever happens, his political career has been irreparably damaged.

As Mike Baird monitors proceedings, he would do well to remember the history behind them – especially given the eruption of disquiet from the right wing in the days before he named his cabinet.

Senior right sources claimed the faction had been sidelined under O’Farrell. Baird seems to have delivered by elevating leading right-wingers Dominic Perrottet and Jai Rowell to the important finance portfolio.

The bigger issue is whether the factional genie – blamed by O’Farrell for keeping the Libs out of power for almost two decades – can be kept in the bottle.

This story Administrator ready to work first appeared on Nanjing Night Net.

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