Australia PM Rudd faces crisis week
(Adds detail, parliament questions)
By Rob Taylor
CANBERRA, June 22 (Reuters) - Australia's Prime Minister Kevin Rudd was facing his biggest political crisis on Monday with rivals accusing his government of abuse of power and a belligerent Senate poised to reject a key election promise.
Rudd said on Monday that his centre-left government had been targeted in a "farrago of lies" mounted by conservative rivals, who accused Rudd and Treasurer Wayne Swan of doing favours for a car dealer who lent Rudd a campaign vehicle.
Australian media have dubbed the affair "Utegate", as the car in question was a pickup, known in Australia as a 'ute' (short for utility).
An email detailed in weekend newspapers at first appeared to back accusations that both Rudd and Swan misled parliament over favours done for the dealer to help him gain finance amid the global credit crunch.
"The problem is, no such email exists. It is false, it is fake, it is a forgery, notwithstanding the fact that that is the single piece of evidence," Rudd said, censuring conservative opponent Malcolm Turnbull for failing to resign or apologise.
As Turnbull countered with a failed censure motion against Labor, police raided the home of a Treasury department official as part of an inquiry into whether an email had been forged to damage Rudd's credibility.
Police said in a statement that the email appeared to have been faked, but conservative lawmakers questioned why Swan's home fax and personal email were on other communications.
"What we have here is a shocking abuse of power. We have a Treasurer who has used his considerable influence to get a favour for a mate. And not just any mate. A mate who is a benefactor of the prime minister," Turnbull said. The furore, while unlikely to claim any political scalps, threatens Rudd's stellar popularity and claims of cleaner government, with an instant television poll showing 75 percent of respondents doubted Rudd and Labor's version of events.
Rudd's standing in polls has suffered in recent weeks since the resignation of Defence Minister Joel Fitzgibbon for helping his brother's business access senior officials in his department. [nSYD184870] [nSYD465155]
Despite coverage blanketing newspapers and television, the markets took no notice with few traders expecting either Rudd or Swan to fall victim.
HEAT ON OVER CLIMATE
But an even bigger problem loomed for Rudd in the upper-house Senate, with a balance-of-power alliance of conservative and swing-vote senators pledging to reject Labor's promise of a carbon trade regime to help green the emissions-heavy economy. [nSYD445808]
"It is absolutely crazy for Australia to go it alone," said independent Senator Steve Fielding, who said Labor's vaunted laws should be put aside until the completion of global climate talks in Copenhagen in December.
"You've got China, you've got India. We've got to wait till Copenhagen. We need to see what the rest of the world are going to do, and then Australia can respond, because frankly, going alone is suicide," Fielding said.
With Labor needing seven votes to get laws through the Senate and conservatives promising a filibuster to avoid a vote, Fielding's refusal meant the carbon regime faced certain defeat. The only bright for Rudd was a conservative backflip on a revived budget bill raising taxes on alcoholic soft drinks, which if defeated would have given Rudd a constitutional trigger to call early elections.
Opposition spokesman Peter Dutton said his side would reluctantly support the tax, which had already been rejected once by the Senate. A second rejection would have allowed Rudd to call a "double dissolution" election in both houses of parliament. The next election is due in about 18 months.
(Editing by Jeremy Laurence)
By Rob Taylor
CANBERRA, June 22 (Reuters) - Australia's Prime Minister Kevin Rudd was facing his biggest political crisis on Monday with rivals accusing his government of abuse of power and a belligerent Senate poised to reject a key election promise.
Rudd said on Monday that his centre-left government had been targeted in a "farrago of lies" mounted by conservative rivals, who accused Rudd and Treasurer Wayne Swan of doing favours for a car dealer who lent Rudd a campaign vehicle.
Australian media have dubbed the affair "Utegate", as the car in question was a pickup, known in Australia as a 'ute' (short for utility).
An email detailed in weekend newspapers at first appeared to back accusations that both Rudd and Swan misled parliament over favours done for the dealer to help him gain finance amid the global credit crunch.
"The problem is, no such email exists. It is false, it is fake, it is a forgery, notwithstanding the fact that that is the single piece of evidence," Rudd said, censuring conservative opponent Malcolm Turnbull for failing to resign or apologise.
As Turnbull countered with a failed censure motion against Labor, police raided the home of a Treasury department official as part of an inquiry into whether an email had been forged to damage Rudd's credibility.
Police said in a statement that the email appeared to have been faked, but conservative lawmakers questioned why Swan's home fax and personal email were on other communications.
"What we have here is a shocking abuse of power. We have a Treasurer who has used his considerable influence to get a favour for a mate. And not just any mate. A mate who is a benefactor of the prime minister," Turnbull said. The furore, while unlikely to claim any political scalps, threatens Rudd's stellar popularity and claims of cleaner government, with an instant television poll showing 75 percent of respondents doubted Rudd and Labor's version of events.
Rudd's standing in polls has suffered in recent weeks since the resignation of Defence Minister Joel Fitzgibbon for helping his brother's business access senior officials in his department. [nSYD184870] [nSYD465155]
Despite coverage blanketing newspapers and television, the markets took no notice with few traders expecting either Rudd or Swan to fall victim.
HEAT ON OVER CLIMATE
But an even bigger problem loomed for Rudd in the upper-house Senate, with a balance-of-power alliance of conservative and swing-vote senators pledging to reject Labor's promise of a carbon trade regime to help green the emissions-heavy economy. [nSYD445808]
"It is absolutely crazy for Australia to go it alone," said independent Senator Steve Fielding, who said Labor's vaunted laws should be put aside until the completion of global climate talks in Copenhagen in December.
"You've got China, you've got India. We've got to wait till Copenhagen. We need to see what the rest of the world are going to do, and then Australia can respond, because frankly, going alone is suicide," Fielding said.
With Labor needing seven votes to get laws through the Senate and conservatives promising a filibuster to avoid a vote, Fielding's refusal meant the carbon regime faced certain defeat. The only bright for Rudd was a conservative backflip on a revived budget bill raising taxes on alcoholic soft drinks, which if defeated would have given Rudd a constitutional trigger to call early elections.
Opposition spokesman Peter Dutton said his side would reluctantly support the tax, which had already been rejected once by the Senate. A second rejection would have allowed Rudd to call a "double dissolution" election in both houses of parliament. The next election is due in about 18 months.
(Editing by Jeremy Laurence)
© Thomson Reuters 2009 All rights reserved
Mini-dress drama in Brazil