Missing Millions A Symptom Of Liberal Party Problems

THE REVELATION this week that the former state director of the Victorian division of the Liberal Party, Damien Mantach, allegedly embezzled up to $2 million from party coffers is an outrage, and the impending prosecution warranted; even so, the episode raises serious questions about governance within the Liberal Party both in Victoria and nationally, highlighting a deeply entrenched insider culture that must be smashed and terminated.

Like thousands of other disgusted, betrayed, and increasingly angry Liberal Party members in Melbourne, I found out on Wednesday about the story that broke publicly on Thursday — that former state director Damien Mantach had allegedly helped himself to somewhere between $1.5 and $2 million of the party’s funds between 2010 and 2014 — and my first response (as some would have seen on Twitter) was, quite bluntly and unapologetically, “fuck him.”

After all, it’s not the sort of news one would reminisce over with a glass of Chardonnay.

First things first: for those who’ve missed the media coverage of this issue to date, a selection of articles may be accessed here, here, here and here, and I would point out that before the Fairfax press gets too complacent in its sanctimony over this issue, it might serve interests of balance for that moribund behemoth to apply the conveniently rigorous scrutiny it deems appropriate in this case to the ALP’s record of fiscal management in government — and to pull its head in if unprepared to do so.

And whilst I’m aware Mantach was also outed yesterday as being on the hacked list of members from infidelity website Ashley Madison, we’re not going to dwell on that either: his wife, I’m sure, will deal with that particular issue all by herself.

Mantach has apparently admitted to taking the money, which is why he can be freely named in media; there seems to be some doubt over the quantum of funds involved, but with $1.5 million sitting at the lower end of the numbers being bandied about, it’s certainly serious enough.

Allegedly, the money was spent on paying down a mortgage, acquiring a share portfolio, and “lifestyle factors” — not that any or all of these uses justifies or excuses the act.

There are a lot of very, very angry Liberals in Melbourne and Victoria this weekend: from Mantach’s colleagues at 104 to the party’s state and federal MPs, and from beaten candidates in under-resourced marginal seats to the loyal rank-and-file membership who campaigned fruitlessly on their behalf at last year’s state election debacle.

There might be some room for sentiment had Mantach amounted to any tangible kind of political asset, but setting aside the kind of sentiment personal knowledge among friends and colleagues invariably engenders he was, objectively, nothing of the sort.

The campaign for last year’s state election was a strategic and tactical abomination; its messages turgid and poorly communicated; its grasp of the campaign initiative repeatedly usurped by the ALP and — reprehensibly — the violent, militant unions who poured money and resources in on Labor’s behalf, and who weren’t actually standing at all.

As “campaign director,” blame for all of these failures must be sheeted home to Mantach.

Now it has emerged that a solid seven-figure amount has been drained off the Victorian Division over a four-year period, the realisation has dawned on many of those angry Victorian Liberals that last year’s state election (which this column resolutely maintained was winnable until the end — and I still believe it was) might have produced a different result despite Mantach’s ineffective stewardship had it been better resourced. It turns out the means with which to resource the campaign were at hand. The only problem is that the “hand” helped itself to a five-fingered discount.

I’m not going to dwell on the nature of Mantach’s alleged crime, for despite reports he is “contrite” and made a full admission when confronted by state President Michael Kroger on Wednesday, great care should be taken to ensure that the coming prosecution is not compromised, for any punishment meted out by a court seems well indicated and should not be jeopardised or pre-empted.

But where all of this becomes relevant for the Liberal Party in the wider sense starts with the circumstances of Mantach’s recruitment to the Victorian Liberals, and ends with the insiderish cabal that runs the Liberal Party around the country, whose members mostly do not comprise the best available people to steward the party’s interests or the aspirations of the millions of Liberal voters their roles charge them with advancing.

It does not matter, for example — as media late this week have excitedly trumpeted — that Mantach’s father was a long-serving director of the Tasmanian Liberals before Mantach himself filled the post, or that his uncle Rob was also a stalwart of the Tasmanian party: dynasties for their own sake are unjustifiable.

The hard, cold fact is that as state director of the Tasmanian Division of the Liberal Party, Damien Mantach presided over one of the worst state election defeats the party has ever suffered on the Apple Isle in 2006 — winning just seven of 25 lower house seats — and followed that up by overseeing a clean sweep of the five federal seats in Tasmania by the ALP the following year, including the loss of marginal seats in Bass and Braddon.

And the financial scandal he now finds himself enveloped in arguably had its genesis in Tasmania, where he was dismissed after helping himself to some $50,000 from the Tasmanian Liberals — an amount that all parties concur was repaid in full.

Even so, questions must be answered by current Liberal federal director Brian Loughnane — his predecessor in the Victorian role, and who played a key role in recruiting the disgraced Mantach following his departure from the party in Hobart — over what he knew, and when, of Mantach’s misdemeanours in the Tasmanian post.

To date — aside from making it known he was aware of “a minor overclaim involving credit cards” — Loughnane has stoutly refused to comment. That, simply, is not good enough.

Nobody is suggesting impropriety on Loughnane’s part or, indeed, on the part of any other Liberal Party employee. Even so, were it to emerge that Loughnane was fully aware of the circumstances surrounding Mantach’s departure from the Tasmanian Liberals, his present position at the head of the party federally would become untenable.

And this brings me to the problem that bedevils the Liberal Party nationally — and of which the Mantach revelations are a mere symptom.

The Liberal Party, for too long, has made an artform of recycling the same handful of people through a procession of executive employment roles around the country; a failed state director in one state suddenly reappears in another, or people who have underperformed disastrously in one of the states suddenly pop up at the Party’s federal secretariat in Canberra.

Many of the people who work in Liberal secretariats across Australia are related to MPs, longstanding senior employees, powerful grassroots figures, or are ostensibly hired on account of internal connections they have; the practice is so widespread that arguments about merit are pointless: the senior echelons of the party are a clubhouse, when what is required is a powerhouse.

At the apex of the structure are the same people who have done the same things the same way for years: the Loughnanes, the Credlins, the Nutts, others like them, and the band of loyalists they have accrued over the years: all of whom owe something, and to which newcomers are not admitted unless they know someone, or owe something, or boast some kind of connection.

You can add Mantach’s name to the list, for any objective justification in keeping him on the payroll — a sorry use of hard-won donation monies and membership dues, even before any charge of embezzlement or fraud is considered — had already expired when he was given the boot in Tasmania in 2008.

Yet Mantach’s departure only came in March of this year — seven years later — and after more political damage was inflicted on a Victorian division that ranks among the most poorly run and least professional of all the Liberal state divisions.

Since I started writing this piece yesterday, veteran political journalist Laurie Oakes has weighed in, with an article in Sydney’s Daily Telegraph that notes, among other things, that Mantach was due to go to Perth next week to “help” on the by-election campaign for the vacant federal Liberal seat of Canning: the fact this manoeuvre was contemplated at all, let alone certain to occur but for the revelations that have been made public this week, shows that those in charge of the party just don’t get it: for once again, a political failure was being recycled into a sensitive strategic political battlefield despite little evidence to suggest he had anything meaningful at all contribute.

Who knew what about Mantach’s pilfering from Liberal Party coffers is a question that will be answered conclusively in the fullness of time; if it transpires Loughnane was fully aware of Mantach’s earlier transgressions in Tasmania then the party must summarily dispense with his services — for there is no justification in recruiting someone with that particular track record, and the consequences of taking such a risk have now been laid bare for all to see.

What is encouraging is that there is at least one razor-sharp, shrewd operator in the Liberal Party’s ranks — Kroger — whose correct instinct that funds had gone missing in Melbourne proved that years of complacent blindness or ineptitude on the part of those around Mantach (or, more worryingly, who were charged with providing rigorous financial checks) was an exacerbating factor to a forseeable crime that characteristic bad judgement on the part of Liberal office bearers had not only enabled, but perhaps invited.

But for the most part, those charged with the effective management of the party behind the scenes are not worth the money it pays them.

If there is any good that can come from this despicable episode, it should be a root and branch shake-up of all the Liberals’ state and federal offices; there is too much deadwood soaking up salaries their performance does not and cannot warrant, and this is an extravagance and an indulgence that the party — chartered to represent Australians from all walks of life, and expanding the horizons for opportunity and choice and reward for endeavour — can’t afford.

It is not inconceivable that the Liberal Party, this time next year, will be out of power everywhere except New South Wales and Tasmania, and on shaky ground approaching a re-election attempt in WA, but that terrible prospect should not be allowed to materialise before action is taken.

Perversely, Mantach may have done the party a favour. The torpid mismanagement is like a cancer, and needs to be cut out. The wrong people have discharged their obligations to the party poorly for too long and have been handsomely rewarded for their efforts. Yet even after a federal election defeat, some of them will survive, or even be promoted.

But nobody would argue the Liberals have “won” the politics of the past ten years nationally, and in the prevailing conditions the fault for that lies squarely with the people the party has entrusted with jobs they arguably did not and do not deserve. The markers of the malaise are everywhere.

In this sense, the Mantach debacle — whilst rightly destined to end in a prosecution — should also signal the point at which the Liberal Party’s back offices are overhauled, and parasitic time-servers rooted out.

There are those who believe Kroger is a divisive figure in the national organisation, but to date he is the only key player to have exhibited a shred of nous or sound judgement in identifying an alleged fraud that, unforgivably, was perpetrated over years and under the very noses of others who should have recognised something was seriously wrong.

If anyone is capable of instituting  root and branch reform of the party, it is Kroger. The party’s other jurisdictions across the country could do worse than to open their divisions to the Victorian President. The price for doing nothing is a potential decade in opposition. The Mantach disaster need not be for nothing. Now is the time to act, and to act broadly.

 

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4 thoughts on “Missing Millions A Symptom Of Liberal Party Problems

  1. Your points are well made. The sooner the Liberal party cleans up its act the sooner the pressure will be on the ALP to do likewise. It has to be a two way street.

    In regard to your point re recycling people – a prime example is Scott Morrison who after his major fail as NSW State Director at the 2003 state election was parachuted into a highly remunerated sinecure with Tourism Australia where he mindermasterd the “So where the bloody hell are you” campaign ($160 million down the toilet) which featured, for some reason totally unrelated to her expertise in Ugandan matters, the gorgeous, pouting 19 year old Lara Bingle.

    After that he was deemed to be suitably qualified to represent an electorate covering an area in which he had evinced no interest in previously.

  2. Meanwhile Labor’s retrospective changes to Queensland’s donation laws have found 100k of donations to the LNP that can’t be linked to specific individuals or companies. The fact the LNP books Didn’t record who made the donations are disturbing and an indictment on the current treasurer and his predecessor who sits in the senate.

    You would think these operations would look after their money in an accountable way with rigorous oversight.

  3. 100k of donations which are unrecorded might well be the aggregate of the donations which were all under the reporting threshold at the time and it should not surprise anyone that this should show up with retrospective examination. Fact is that this amount is a drop in the bucket of total recorded donations and is much less than what labor get from businesses and unions which have not only gone unrecorded but have been concealed. No one gives donations without expecting a benefit, the question is whether that benefit is direct or indirect, or rather general or specific. In the latter case it is clearly in the nature of a bribe and deserves to be exposed. However labor governments love to expose liberal donations from businesses by legislation while not making Union donations subject to the same treatment.
    I think a good thing would be to make unions and political parties subject to the oversight and compliance arrangements of the Austrlaian Tax Office, together with the applicable penalties but without necessarily being liable to tax. This is the only way this problem is going to disappear from the political agenda.

    • I agree it is nothing compared to the unions and the alp, but the LNP should be able to trace where money is coming from and to poor governance that there system allows mystery donations.

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