ANALYSIS

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The O'Farrell aftermath

What does Barry O'Farrell's departure mean for state and federal politics? Analysis with Mark Kenny and Chris Hammer.

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When Barry O'Farrell stunned everyone by suddenly pulling the cork on his premiership, it must have sent shards of fear through two other men: Tony Abbott and Arthur Sinodinos.

The former because, as the Prime Minister, Abbott has backed the latter so completely despite facing genuine questions over conflict of interest issues and due diligence as a company director.

Senator Arthur Sinodinos.

Under pressure: Senator Arthur Sinodinos. Photo: Andrew Meares

And the latter because, notwithstanding the serious weight of those very questions, the suspended assistant treasurer has refused to do what O'Farrell has done, which is resign outright.

Instead, Sinodinos has opted for a half-way house by standing aside while the Independent Commission Against Corruption investigates his role as chairman of the subject company, Australian Water Holdings. He wants to return to the Abbott frontbench and the PM has given him every reason to think he can.

In a straight comparison, the O'Farrell and Sinodinos cases seem in different leagues. O'Farrell, clearly one of the best premiers NSW has produced for a long time and a standout among his contemporaries, has quit because he received a bottle of wine from someone trying to duchess him, and then apparently forgot about it. It is not as trivial as it sounds, but it is not Watergate either. I'll return to this directly.

Prime Minister Tony Abbott.

Prime Minister Tony Abbott. Photo: Sasha Woolley

Sinodinos, by contrast, was chairman of a company partly, if secretly, owned by the notorious Obeid family, and which was corruptly seeking to secure a lucrative public contract from the state government – a contract which, according to the ICAC counsel, Geoffrey Watson, SC, would have netted Sinodinos himself a multimillion-dollar pay day.

Moreover, Sinodinos was an AWH director and then chairman at a time when that near insolvent company was falsely charging Sydney Water for its own expenses, and was making multi-thousand dollar donations to the NSW division of the Liberal Party. The public is being asked to take on trust the claim that Sinodinos knew nothing about making the donations in one guise, nor receiving them in another.

That fails the pub test. It would be curious indeed if Sinodinos were allowed to return to the federal ministry with responsibility for corporate governance and ethics, given O'Farrell's resignation.

That said, a final few points can be made on O'Farrell:

  • The Premier is to be admired for acting honourably and decisively, but there are nagging questions over the bottle of Grange.
  •  He said under oath that if he was given such an expensive gift, with the vintage deliberately matching his birth year, 1959, he would remember. Well, unfortunately, it was exactly that – a fact we now know that he specifically referenced in his hand-written ''thank you'' note to AWH's Nick Di Girolamo.
  • No pun intended, but there are few more liquid assets than Grange Hermitage, given its prestige, its trade-ability and its appreciation potential. People buy it as an investment, sometimes not intending to drink it at all. To that extent, it might be seen as a way of handing someone cash in a less obvious form.
  • If this were a cash gift, say, an envelope containing nearly $3000 tucked into the inside pocket of the Premier's suit jacket by a businessman, it would constitute a bribe – plain and simple – and could result in jail time.
  • The expensive gift was not merely forgotten under oath, it was not declared in the parliamentary register of interests at the time.

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