Craig Thomson Quits Australia’s Labor Party, Gillard Says

Australian Prime Minister Julia Gillard told a lawmaker to quit the Labor party and asked parliament’s speaker to accept a longer suspension to restore respect for politics while the two are under investigation.

“Australians are looking at this parliament and, at the moment, they see a dark cloud over it,” Gillard said in Canberra yesterday. A “line has been crossed,” she said. “I want to ensure that Australians can look at this building, look at this institution, and feel respect.”

Labor lawmaker Craig Thomson has denied claims he used a labor union credit card to pay for prostitutes while working for the Health Services Union before entering parliament in 2007. Parliamentary Speaker Peter Slipper stepped aside a week ago to deal with fraud and sexual harassment claims that he denies.

The decision brings Labor’s vote in the 150-seat lower house of parliament below that of the opposition Liberal- National coalition for the first time since the August 2010 federal election, ahead of a key vote on the government’s budget due May 8.

Labor now holds power thanks to its 70 members of parliament plus five independent and minor party lawmakers, including Thomson. Two other members of parliament support the 71-member opposition coalition while Slipper and acting Speaker Anna Burke are standing aside from votes.

Tainted Vote

Opposition leader Tony Abbott called for new elections, saying that Thomson’s was now a “tainted vote.”

“The only way right now to restore integrity to our parliament and to restore the reputation of our politics is for this sad and sorry parliament to be dissolved and for there to be a new election,” he said at a press conference in Sydney yesterday.

An election would probably now take place within the next three months, said Ian McAllister, a professor of political science at Australian National University in Canberra.

“When you have a minority government it doesn’t last. It never does,” he said. Most successful minority governments hold fresh elections as soon as possible, McAllister said.

“The trouble is that this government has been so badly down in the polls that they haven’t had a chance to do so,” he said.

The opposition would win with 58.5 percent of the final vote against 41.5 percent for Labor under Australia’s two-stage voting system, according to a Roy Morgan poll conducted April 21-22.

Budget Surplus

Australia’s Treasurer Wayne Swan has promised to return federal finances to surplus over the year through June 2013 as part of the budget announcement. A failure of the budget bill to pass the House of Representatives would trigger a fresh election to ensure continued funding for the government.

Slipper said in an e-mailed statement that he wouldn’t take the speaker’s chair when the House resumes sitting on budget day. “This will avoid what could be a controversial debate,” he said, “which would not assist the standing of the parliament.”

Thomson said he would continue to support the government, and hoped to return to the Labor party once investigations into the allegations against him were complete.

“I am a Labor person,” he told a news conference in Tuggerah, north of Sydney. “On the cross benches I will continue to support the Labor agenda.”

Public Investigation

Australia’s workplace tribunal on April 3 referred to the public prosecutor an investigation into financial management at the Health Services Union while Thomson worked there. Fair Work Australia found 181 contraventions of industrial relations laws and union rules by former and current officials of the union.

Slipper stepped aside April 21 after a former employee issued a civil claim accusing him of making unwanted sexual advances and saying he’d committed fraud using government taxi vouchers. The fraud claim is being investigated by the Australian Federal Police.

Australia’s Labor government has struggled to build a reliable parliamentary majority since the August 2010 election left both sides with 72 votes in Canberra’s 150-seat house of representatives. Labor formed a government with the support of one Greens member of parliament and three independents, while the coalition has the support of two other lawmakers.

“Any movement of an MP at this stage is significant because of the closeness of the numbers,” Nick Economou, a political analyst at Monash University in Melbourne, said by phone about Thomson. “It just adds another level of intrigue to the operation of the House as we go toward the budget.”

Gambling Reform

One of the independents, Andrew Wilkie, has since distanced himself from the government over disagreements on gambling reform. Burke, now acting speaker of the House of Representatives, votes only in case of a tie.

That gives the government 74 guaranteed votes in the parliament, plus one more if it receives Wilkie’s support and another if Burke is called to break a tied vote. The total normal voting bloc in the parliament is now 148 if both Slipper and Burke stand aside.

The government is in a “precarious” situation, independent MP Tony Windsor told Australian Broadcasting Corp. television yesterday.

“I’ve been prepared for an early election since day one,” said Windsor, who supports the Labor government.

Slipper stood for the opposition Liberal party in seven elections before taking on the formally independent role of speaker last November. The move came over the objections of his own party, since it increased the government’s narrow parliamentary majority by depriving the Liberals of a vote, and he is now an independent lawmaker.

Wilkie told Australian Broadcasting Corp. television yesterday that he’d support a confidence motion against the speaker if Slipper was returned to the role before he has dealt with the fraud and sexual harassment claims.

“If the government mishandles this badly I would consider a motion of no confidence,” he said.

To contact the reporter on this story: David Fickling in Sydney at dfickling@bloomberg.net

To contact the editor responsible for this story: Paul Tighe at ptighe@bloomberg.net

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