Turnbull waits to learn fate amid Australia leadership crisis

Australian Prime Minister Malcolm Turnbull and right-wing populist Peter Dutton. (Bloomberg pic)

CANBERRA: The fate of Australia’s embattled Prime Minister Malcolm Turnbull is likely to be decided within hours as rivals seek enough signatures to force a vote on his leadership.

After a week of turmoil, the governing Liberal party will hold a special meeting at noon if Turnbull’s main challenger — right-wing populist Peter Dutton — can gather enough signatures on a petition. As of Friday morning, Dutton appeared to be short of the 43 names needed.

Amid a flurry of ministerial resignations on Thursday, Turnbull said he wouldn’t contest if the party demands a leadership ballot in the meeting, with reports saying Treasurer Scott Morrison and Foreign Minister Julie Bishop would challenge Dutton. Whoever wins will need to make up ground against the main opposition Labour Party ahead of a general election due by May.

The crisis, spurred by internal dissent over the government’s slumping poll ratings and Turnbull’s policies, has started to hit the nation’s financial markets, with the local dollar weakening as much as 0.9% against the greenback on Thursday. No Australian prime minister has served a full term since 2007 and the latest upheaval prolongs political turmoil that’s scuppered efforts to craft coherent policies from taxation to energy.

Dutton, from the right wing of the party, has proposed a populist manifesto to win back support. It includes curbing immigration, removing a tax on electricity bills for families and pensioners, and holding a wide-ranging investigation into energy companies blamed for spiralling prices.

But the father-of-three faces a potential hurdle to his leadership ambitions. Turnbull has sought legal advice on Dutton’s eligibility to sit in parliament. Labour says he may have breached constitutional law by being a beneficiary of a trust that owns a childcare company receiving government subsidies. Dutton has labelled the allegations “spurious and baseless.”

Turnbull said Thursday the solicitor general will make a determination Friday morning, calling it a “critically important” issue. If the matter is referred to the High Court, it could be months before it’s resolved.

The latest crisis has been driven by infighting between moderates and conservatives in the Liberal party as its poll numbers fall ahead of the next election. Labour led by 10% in a poll released on Monday.

The potential change of leadership adds more uncertainty for businesses in the world’s 13th-largest economy amid repeated policy missteps and flip-flops over the past decade.

“Turnbull is holding to power by his fingernails, but his goose looks cooked,” said Zareh Ghazarian, a Melbourne-based political analyst at Monash University. “On his way out the door, he seems to want to frustrate his enemies and perhaps help install a successor more to his liking than Dutton.”

Turnbull himself came to power in 2015 in a party coup before winning an election the next year with a razor-thin majority. Amid internal party dissent, he abandoned signature policies this week designed to restore energy security and give tax relief to big businesses.

Turnbull’s troubles have come even as polls show he’s more popular among the general public than any of the potential candidates to replace him. That includes the challengers within his own party, as well as opposition leader Bill Shorten.

His authority over the party has always been in doubt. The self-made millionaire tried to appease conservative forces by retreating from some of his most strongly held convictions such as tough action against climate change. Yet those same people are now trying to tear him down, and voters have become disillusioned with his policy reversals.