Liberal Party's Financial Crisis Deepens as John Pesutto Fights Defamation Costs

Strategic Insights -

Liberal Party heavyweights, including former Prime Minister Tony Abbott and former Victorian Premier Jeff Kennett, have made a series of desperate attempts to save John Pesutto from possible bankruptcy. However, a NSW property developer, Hilton Grugeon, has refused to forgive Liberal MP Moira Deeming's debt, which is currently standing at $300,000, and has offered her a "blank cheque" to pursue costs from Pesutto and his supporters, including to the point of bankruptcy. The crisis has the potential to force Pesutto out of parliament and trigger a byelection in his marginal seat of Hawthorn, which the Liberal Party is eager to avoid.

Key Takeaways:

  • Former Prime Minister Tony Abbott was involved in making representations to Grugeon to forgive Deeming's debt, with a view to sparing Pesutto from paying the full costs of the defamation case.
  • Grugeon, a long-time Liberal donor, has refused to bail out Pesutto or the party, viewing them as "a disgrace".
  • Deeming's legal team is seeking almost $2.4 million in costs, which, if successful, would push Pesutto perilously close to bankruptcy.
  • Liberal figures have explored other avenues to help Pesutto, including the Cormack Foundation, but without success.
  • Pesutto's team is seeking more specifics on what legal work was invoiced for and questioning whether costs had been unnecessarily high.
  • Deeming has declared Grugeon's loan and crowdfunding on her register of interests, and has also recorded his provision of flights, a hotel stay, and car hire in her most recent reporting period.

Statistics:

  • $300,000: The amount of damages and legal costs that Pesutto was ordered to pay to Deeming in the defamation case.
  • $2.4 million: The amount of damages and legal costs that Deeming's team is seeking from Pesutto's team.
  • 1.7%: The margin by which Pesutto won the seat of Hawthorn in 2022.
  • 3: The number of cornered contests that Pesutto has been involved in in Hawthorn.
  • 4: The number of Liberal Party figures who have been involved in the negotiations to save Pesutto from bankruptcy, including Abbott, Kennett, Dutton, and Battin.
  • 1: The day on which Pesutto's team needs to submit their request for more specifics on legal work invoiced for to the Federal Court.

Sources:

  • The Age
  • The Federal Court of Australia
  • Moira Deeming's register of interests
  • John Pesutto's register of interests
  • Hilton Grugeon's interview with The Age
  • Operation Spicer investigation report