Patrick Cusworth: Thomson credit card scandal gets worse for Australian PM Julia Gillard

Patrick Cusworth is a consultant adviser on science, research and energy policy, and a member of Brentford and Isleworth Conservative Association. He tweets at @Patriccus.

Life just doesn’t seem to get any better for Julia Gillard. Almost a year to the day from Australia’s last Federal Election, the latest crisis to engulf the Labor Prime Minister threatens to bring down her fragile coalition Government.

Following recent allegations that Australian Labor Party (ALP) MP Craig Thomson used trade union funds to hire a prostitute, Julia Gillard’s Labor-Green coalition Government – which has a majority of just one over Tony Abbott’s Liberal-National Opposition – further developments appear to cast doubt on his claims of innocence. Court documents published by the Sydney Morning Herald have confirmed that Mr. Thomson’s union credit card was used to pay $2,475 to an escort agency on April 8, 2005. Equally damaging, the mobile phone used to call the escort agency in question was also used to call political and union contacts from the ALP on April 7, 2005. The publication of these documents pours doubt on Thomson’s initial claim that someone else had used his credit card to pay the agency.

Since publication of these documents, the New South Wales MP has announced his resignation as Chair of the key House Economics Committee, though he will continue as an ordinary Committee member. Thomson’s resignation comes after continued pressure from Liberal Party leader Tony Abbott and shadow Attorney-General Senator George Brandis. Following this resignation from the Committee Chairmanship, Prime Minister Gillard – who only days ago expressed her “full confidence” in Mr. Thomson – has moved to distance herself from the New South Wales MP, claiming that his resignation was a “private matter”.

Matters have escalated further for both Thomson and the coalition Government, with the New South Wales police announcing an investigation into the Labor MP’s activities. The investigation was prompted by Senator Brandis writing to Police Commissioner Andrew Scipione outlining the breadth of evidence against Thomson. In his letter, Senator Brandis made the submission that “there is a strong prima facie case that he (Thomson) has committed one or more offences against the Crimes Act… I draw your attention, in particular, to the offence of larceny; fraudulent appropriation; larceny by a clerk or servant; and fraud”. 

Given its singular majority, any resignation – particularly one followed by an unpopular by-election – could bring down the fragile coalition Government. Unsurprisingly, neither Gillard nor the ALP are not about to let power slip just four years in Government (three of which under the polarising leadership of Kevin Rudd), so the desired situation – in the view of the ALP – is for Thomson to resign from the Party, and continue to sit in Parliament as an “independent”, while backing the Coalition Government. However, if a criminal conviction is made against Thomson, this would automatically bar him from Parliament and trigger a by-election in his marginal constituency of Dobell. Such a conviction is likely to depend on the willingness of the Health Services Union, for which Thomson was the Secretary at the time of the alleged credit card transactions, to assist with the police investigation. For this reason, Ms Gillard may need to convince the HSU (a Labor-aligned trade union) to withhold comment – just as it did when the allegations first surfaced.

Even if Thomson manages to hold on until the next Federal election, local Dobell constituency Labor Party officials have indicated that he has no political future as their representative, having “roundly and wholly lost our support”. For Julia Gillard, the pressure on her fragile coalition Government is growing at pace.