Exclusive: Dutton intervened to save NSW party director

Richard Shields, the man blamed for the New South Wales Liberal Party’s failure to nominate scores of candidates in time for this month’s local government elections, would have been sacked months ago but for the intervention of Peter Dutton and Angus Taylor.

State party president Don Harwin and others on the state executive wanted to move against Shields in March. The party went so far as to sound out alternative candidates to replace him as state director. The plan was undone, however, when the federal opposition leader and shadow treasurer intervened to save Shields.

Five months later, Shields failed to get nomination forms to the state electoral commission before deadline, meaning 140 Liberal candidates will not be on ballot papers next Saturday.

According to a senior party source, this was not the first time head office had failed to get important paperwork to the commission during Shields’ short tenure.

In April there was a byelection for the seat of Cook, necessitated by the retirement from politics of former prime minister Scott Morrison. In the run-up to the poll, the source says, party headquarters received requests from electors for postal votes but did not forward them to the Electoral Commission.

This was unfortunate for the disenfranchised voters but not for the party, because Cook was not a close race. With Labor not bothering to stand a candidate, the Liberals’ Simon Kennedy romped in with more than 70 per cent of the vote.

Still, it was a serious issue, and Shields was then coming to the end of a six-month probationary period in the job. Harwin and party vice-presidents Geoff Pearson and Peter O’Hanlon wanted him gone.

The federal party leadership supported him, however, and he survived until the local government nominations disaster.

Shields was terminated by a unanimous vote of the state executive three weeks ago. Subsequently the former federal director of the Liberal Party, Brian Loughnane, was appointed to do a snap review of the matter. This week, in response to Loughnane’s report and at Dutton’s behest, the federal executive “requested” that the NSW division appoint a three-person committee to replace its state executive.

“The Federal Executive has recommended a committee of the Hon Alan Stockdale AO, the Hon Rob Stokes, and the Hon Richard Alston AO be appointed for a period of 10 months,” said the media statement issued by the party’s federal secretariat.

Of the three, only Stokes has any experience in NSW politics. He quit state parliament ahead of the 2023 election. Alston and Stockdale, both Victorians, have not held elected office since they served, respectively, in the Howard federal government and Kennett Victorian government two decades ago.

Dutton called them “wise elders”, and they are certainly elderly – Alston is 82 and Stockdale will be 80 next April.

“If the party’s trying to win back women and younger people,” says one senior party source, “putting in two conservative octogenarians seems like a bizarre strategy.”

Within hours of the announcement, Stokes ruled himself out, saying he was appointed without first being asked if he would take the job. The first he knew of it, he told The Sydney Morning Herald, was when he read it in that paper.

The fact an attempt to fix an administrative failing had begun with an administrative failing was received gleefully by Labor.

“If the NSW leadership of the Liberal Party has been dismissed for incompetence, how about you dismiss the federal leadership of the Liberal Party … for incompetence for appointing someone as an administrator who is not available and didn’t know anything about it,” Prime Minister Anthony Albanese said.

The snafu brought a new round of finger-pointing. The federal party leader, Dutton, claimed it was the state division’s fault for putting forward Stokes’s name.

The leader of the NSW parliamentary party, Mark Speakman, said the appointment had been discussed with Stokes but accused the federal executive of having “jumped the gun” in its announcement.

“The committee proposal went to federal executive without my knowledge,” he said. “How can I be responsible for something that occurs without my knowledge?”

Among pundits and members of the state division’s dominant moderate faction, the common suggestion is that ideology was as much a factor in the continuing ructions as incompetence.

The theory goes that the hard-right Dutton commissioned the right-wing Loughnane to produce a damning report that resulted in two other right-wingers, Alston and Stockdale, being appointed. Stokes was included as “window-dressing”.

The fear among the moderate faction is the sidelining of their powerbroker, Harwin, has opened the way for Tony Abbott to assume the presidency.

The fact remains that the state branch, to cite the old ruling-class lament, can’t get good help these days. As The Australian’s Margin Call column put it back in April: “It’s been a year since faceless man Chris Stone announced his retirement as NSW Liberal Party director, a development that led to a woefully drawn-out, even torturous, recruitment process that landed on Richard Shields as Stone’s replacement.”

In fact, says a senior party source, Shields was not the first choice of the state division to replace Stone, who had served eight years before pulling the pin.

“The party struggled for almost 12 months to get a candidate. In the end, a candidate was chosen by the panel. His name was Luke Dixon, a Victorian,” the source says.

“Within a day he withdrew, after he had a series of meetings with people in the division who were against him, and after it had been made very clear by the federal secretariat and the federal leadership that they didn’t want him and that they wanted Richard Shields appointed.”

There were tensions around Shields from the start. When the state executive sacked him following the nominations disaster, Margin Call was outraged on his behalf.

“Shields was banished not for any professional negligence but because of the ongoing personal hostility of party president Don Harwin and his band of flying factional monkeys.”

The column, which has close connections with the Liberal right, made the case that two of Shields’ subordinates were the culpable parties, because they were in charge of the nominations process. It named deputy state director Dorina Illievska and party affairs manager Wilson Chessell.

While the column pointed the finger of blame downwards, others were pointing up, suggesting Harwin should be held liable for the nominations fiasco. His defenders argue otherwise.

“In no organisation in the world does the chairman do the administrative work of the executive,” says one.

Nonetheless, Harwin has been sidelined. Stone has been prevailed upon to return and, at time of writing, the party is still in search of a third committee member to run the show. Speakman and the party’s women’s advocacy group, Hilma’s Network, have pushed for a woman.

The whole affair has exposed again the deep factional divisions that seem eternally present in the branch. These were aired live on radio, shortly after the nominations debacle first emerged.

Shock jock Ray Hadley read out to his listeners a text message he had received from right-wing frontbencher Alister Henskens, which said Speakman’s defence of Harwin’s role “couldn’t be further from the truth”.

Henskens subsequently claimed he had not intended to suggest his leader was lying, only that they had genuinely held differing views of Harwin’s responsibility for the mess.

Hadley accused Henskens and his fellow right-winger, Anthony Roberts, of covertly undermining their leader.

“One of you people get the balls to actually come on this program and say what you’re saying to me privately…” Hadley thundered. “Stop sending me text messages. Cowardly, letting me be your mouthpiece.”

When even right-wing radio is calling out conservative dysfunction, it’s a big problem. When a party cannot manage a simple administrative function such as lodging candidate nominations on time, it bodes ill not just for next week’s local government elections but for state and federal polls.

Dutton acknowledged as much in Adelaide this week. “Our party needs to be functional,” he said, “and the way that it was operating was completely unacceptable to me.”

It is not a new problem. Before the 2022 federal election, for example, the party was racked by infighting over candidate selection.

Alex Hawke, powerbroker in one of the two right-wing factions and NSW consigliore to Scott Morrison, was accused of delaying preselections by failing to attend nomination review committee meetings.

The stand-off resulted in an intervention whereby a three-person panel, including Morrison and then premier Dominic Perrottet, hand-picked candidates only a few weeks before election day.

In the rush, the vetting process was less than thorough. It subsequently came to light that one of those chosen, Katherine Deves, had a history of inflammatory anti-trans comments. She crashed out badly against community independent Zali Steggall in the wealthy, socially progressive seat of Warringah.

Things have got more fractured since then and since the Coalition lost to Labor at last year’s state election.

“Government disciplined the party,” says one source. “Opposition just turned it into a free-for-all.”

In part they attributed this to the resignations of the state party’s two dominant figures, Perrottet and Matt Kean, respectively from the Right and Left factions, who maintained a solid relationship and managed to keep a lid on things.

One local government contest, unrelated to the nominations debacle, illustrates the way in which apparently petty local differences can infect other levels of government.

It pits two significant Liberal figures – Philip Ruddock and Julian Leeser – against one another. They are, respectively, a former federal attorney-general and former shadow attorney-general.

Ruddock served 43 years in federal parliament, the second-longest tenure in Australian federal history. For half that time, he held the seat of Berowra, until in 2016 he “retired”. In reality, he jumped before he was pushed by Leeser, who now holds the seat.

Ruddock went on to become mayor of Hornsby, the local government area that overlaps the seat. He will not recontest the upcoming election, having been rolled at preselection. Ruddock believes Leeser was instrumental in getting the numbers for another councillor, Warren Waddell.

According to Ruddock’s version of events, Leeser had lost support among the rank and file – as well as with Dutton – by campaigning in favour of the “Yes” vote in the Voice referendum. In order to get some of that support back, he had thrown his lot in with Waddell, who owns a family orchard in the area and is part of a group of property developers who want to open up a large area for rezoning and new housing.

Ruddock is 81 and alleges Leeser was doing the rounds of party members, saying it was time for “generational change”.

Leeser did not respond to requests for comment from The Saturday Paper, but the upshot is a third councillor, Nathan Tilbury, has resigned from the Liberal Party in protest and now is running against Waddell.

The Ruddock home has a Tilbury election poster on the front fence.

“It had to be on the left-hand gate,” he explains, “because Mrs Ruddock is a tenant in common and has a half interest in the house, and she has resigned from the Liberal Party. It’s on her side.”

Ruddock himself has not quit the party, but he has endorsed the independent candidate, fully aware that doing so is an “expellable offence”.

If the party isn’t happy about that, he says, “they’ll have to take me out”.

The stoush matters not only at the local level. Two weeks after the local council elections, voters will go to state byelections for the seats vacated by Perrottet and Kean. Kean’s former seat is Hornsby. Perrottet’s is nearby Epping.

The fact that a party elder of Ruddock’s stature is now challenging the party to expel him will not help the Liberal cause.

It may be safely assumed that Leeser will be white-anted, too, come his next preselection.

Ruddock’s people also claim another state candidate, Rory Amon, was involved in fomenting the coup against him on the Hornsby Shire Council.

Amon was until recently the member for Pittwater. He entered the NSW parliament in 2023 and was considered something of a rising star on the party’s right, until a week ago when he quit after being charged with 10 child sexual assault offences, including five counts of having sexual intercourse with a person aged over 10 and under 14. He denies all charges.

The party now is under pressure to explain how he got through the candidate vetting process, and a byelection for his seat will be the third held on October 19.

There is little hope the Liberals will hold the seat, given a teal independent candidate, Jacqui Scruby, came within 1 per cent of beating Amon in 2023. Scruby is running again.

The NSW division of the Liberal Party is in a terrible mess. If Peter Dutton thinks a recycled state director, a couple of elderly right-wing committee members and possibly Tony Abbott can clean it up, well, he is more of an optimist than he appears. 

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