By Chris Uhlmann, Anna Henderson and Eliza Borrello
Tuesday 24 Feb 2015
Photo: Power couple ... Peta Credlin and Brian Loughnane. (AAP: Alan Porritt)
The Prime Minister has defended his chief of staff in the wake of a leaked internal letter attacking Peta Credlin and her husband Liberal party Federal Director Brian Loughnane, dismissing the criticism as a "storm in a teacup".
The ABC has obtained two letters sent from the Liberal Party's honorary federal treasurer Philip Higginson, an avowed long-time friend of Tony Abbott, to the party's Federal Executive.
One letter foreshadows Mr Higginson's resignation and criticises the conflict of interest he believes has been created by having two such crucial positions held by a married couple.
This morning Mr Abbott said he stood by both Ms Credlin and Mr Loughnane and said "it is no problem" that the two are married.
"If Peta Credlin was able to be deputy chief of staff to Malcolm Turnbull when Brian Loughnane was federal director, there was no problem then and there's no problem now," he told Macquarie Radio.
Mr Abbott was asked this morning if Ms Credlin's job was safe.
"I stand by my team, I stand by my cabinet colleagues, my parliamentary colleagues, I stand by my staff," he told Channel Nine.
"I certainly have full confidence in the party president, the party's federal director.
"Look, I'm aware of that particular storm in a teacup but the [Liberal party] treasurer signed off on the party accounts so I'm not quite sure what the fuss is over."
In his first letter, Mr Higginson, outlines his concerns.
"How this party ever let a husband-and-wife team into those two key roles, where collegiate competitive tension is mandatory and private consultations between colleagues to see that each side is served well, is a complete mystery," the letter said.
"The persons in our party's history that allowed it to occur should hang their heads in collective shame.
"The federal director has a fiduciary duty to act in the best interests of the organisation at all times, repeat, at all times.
"How can this possibly happen when the COS [chief of staff] to the PM is his wife?
"It immediately brings about the cessation of open communication to the federal director, contributes to wooden and unreliable communication, and a reluctance towards open and trusting lines of communication and, dare I say it, retribution.
"In corporate Australia the chairman of the board would never allow his EA [executive assistant] to be the wife of the managing director, or the managing director would never allow his EA to be the wife of the chairman."
Mr Higginson's second letter is about the Liberal Party's accounts. He laments there was "a significant delay in obtaining the information I sought" on the accounts, which he and Mr Loughnane jointly approve.
Liberal Party president Richard Alston responded to both letters by writing to the federal executive saying he was not aware of any breach of duty by Mr Loughnane.
"On the contrary, I have always found Brian to possess the highest ethical standards, as well as being a devoted and highly committed servant of the party," Mr Alston wrote.
"In my experience he forcefully represents the interest of the party in discussions with the PM and his office. I have no reason to expect anything less."
Suggestions leaked emails designed to keep pressure on PM
Party sources told the ABC that the leaking of the letter was designed to keep up the pressure on Mr Abbott and Ms Credlin.
They said there had been a steady drip of leaks in the fortnight since the failed leadership spill aimed at getting the Prime Minister to sack Ms Credlin, or force him out of office.
Despite a messy fortnight for the Government, during which a spill motion was moved against the PM's leadership, the latest Newspoll has the Coalition's primary vote up three points to 38 per cent.
In the two-party preferred stakes the Coalition's gained four points but still trails Labor 47 per cent to 53.
The poll's margin of error is 3 per cent.
Mr Higginson's letter appeared to have been triggered by the belief that he was about to be replaced as honorary treasurer.
"I am reliably informed that the new federal president, Richard Alston AO, wants a new treasurer and that's the bottom line," his letter said.
Mr Alston denied the claim.
"This is the first time Phil has ever suggested I have asked, let alone demanded, that he move on," Mr Alston's response said.
"I have never raised his position with him, let alone asked him to stand down or sought a new treasurer."
In the letter about the party's accounts, Mr Higginson suggested an audit committee be created that included the treasurer, president and an additional independent member.
He said the federal director and chief financial officer should be able to "have a voice on all matters, but not vote" on the committee.
Mr Higginson did not indicate what that information he sought was or suggest any impropriety, and said only that he was "energetically inquisitive" about the accounts.
He said that he was finding it more difficult to "enthusiastically assure our donors that their monies was being vigorously and prudently cared for with strong internal controls".
"I was therefore convinced only a vigorous pursuit of facts would produce results.
"This pursuit has now produced them and I am confident that a new dawn will break with respect to future disclosures by the management of the federal secretariat, if the federal executive do not adopt a supine position."
Who is Peta Credlin?
- Has worked for Tony Abbott since 2009 when he became opposition leader
- Prior to 2009, was chief of staff to preceding opposition leaders Brendan Nelson and Malcolm Turnbull
- In 2013, long-serving Senator Ian Macdonald criticised her and the PM's office for its "obsessive centralised control phobia"
- In December 2014, Mr Abbott slammed internal critics of Ms Credlin as being sexist, a claim dismissed by Julie Bishop and one that prompted an official complaint from veteran backbencher Warren Entsch
- In January, Rupert Murdoch called for Ms Credlin to be replaced
- In June 2013, Clive Palmer accused her of masterminding the Government's paid parental leave scheme for her own benefit; he later said he regretted the comments
- She spoke publicly in 2013 about her unsuccessful attempts to conceive through IVF
- In 2013, she was caught drink-driving, blowing 0.075 when breathalysed on her way home from Mr Abbott's budget reply speech, but had no conviction recorded
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