Eddie Obeid twice lobbied then-premier Morris Iemma to promote Ian Macdonald, court hears
Former NSW premier Morris Iemma is the first Crown witness at the NSW Supreme Court trial of his two former ministers Eddie Obeid and Ian Macdonald.
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Former NSW minister Eddie Obeid twice lobbied ex-premier Morris Iemma for his Labor colleague Ian Macdonald to get a promotion, their mining licence conspiracy trial heard.
Mr Iemma is the first witness in the prosecution’s case against his two ex-MPs and Obeid’s 50-year-old son Moses, who are fighting conspiracy to commit misconduct in public office charges at a NSW Supreme Court trial.
The Crown alleges the trio schemed for then resources minister Macdonald to grant a lucrative exploration licence on coal-rich Obeid family land at Mount Penny in the Bylong Valley between 2007 and 2009.
Mr Iemma told the court Obeid suggested Macdonald should take up a key portfolio ahead of an expected 2008 cabinet reshuffle, telling the then-premier that he “would make a good planning minister.”
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Macdonald’s lawyer has labelled claims he favoured Eddie Obeid to repay the powerbroker’s past support and secure future backing as “pure speculation and conjecture.”
Mr Iemma, a 17-year political veteran who led NSW from 2005 to 2008, said Obeid also spoke to him privately before he took the top job about Macdonald, who at the time was a backbencher.
“He said Mr Macdonald was someone who was worthy of promotion to more senior positions,” Mr Iemma said.
The court has heard the pair had been powerful allies during their two decades in office despite being in different factions, and Mr Iemma said the pair often “spoke in support of each other” in the upper house of parliament.
“They had a cordial, good relationship. They appeared to work well together,” he said.
The court heard Obeid played a large role in Mr Iemma’s decision to stand down more than a decade ago amid a fierce internal debate over the proposed sale of electricity generators.
Mr Iemma said he didn’t have time to collect many personal belongings on his resignation day as “I was escorted from the premises.”
Macdonald has stressed he and Obeid never conspired and were only in constant contact due to that privatisation issue, with Obeid being a numbers man in the party’s right faction and Macdonald a key figure of the hard left.
“The right was the majority faction overwhelmingly in the caucus,” Mr Iemma said.
“Most of the conflict appeared within each of the two factions, not faction versus factions… I was a victim of some of the conflict.”
Under cross examination, Mr Iemma agreed Macdonald had an important role in marshalling support for the government’s privatisation proposal as energy minister, adding he expected factional negotiators to speak daily during such crises.
Macdonald says he pushed the release of new mining tenements because he needed to raise revenue to ease the budgetary strain of a 2.5 per cent efficiency dividend imposed on the entire government.
Instead of cutting public service jobs which would disproportionately impact rural communities, Mr Macdonald proposed to parcel up packages of the state’s resources and put them out to market, Mr Iemma said.
This meant the private sector copped multi-million dollar exploration and drilling costs that would have otherwise fallen to the state while also boosting mining royalties, the court heard.
“He had a much better idea than redundancies and cuts to services,” Mr Iemma said.
Mr Iemma also agreed that Macdonald was backed by influential union bosses who ensured his political survival, adding that Obeid was irrelevant to preselections in the hard left faction.
Retired senator George Campbell testified about meeting Macdonald with the then- Labor MP Anthony Albanese and then-NSW upper house MP Luke Foley to discuss preselection ahead of the 2007 state election.
Also eating with them at Sydney’s Noble House Chinese restaurant was the then National Secretary of the Australian Manufacturing Workers’ Union Doug Cameron, along with the group’s current boss Paul Bastian.
Macdonald was keen to run again to help cover “considerable financial expenses” as his intellectually disabled stepdaughter was doing the HSC and would soon be off to university, Mr Campbell said.
“I didn’t give much weight to (that). I thought it was a big ask for another eight years which would have given him 28 years in the parliament,” he said.
“I wanted a metal worker in the job. Little did I know that Mr Foley himself had his eye on the job, but that’s another issue.”
Mr Campbell said he and Mr Cameron later had coffee and sandwiches at a Surry Hills cafe, where the former Labor senator told him he’d been overruled and Macdonald would be guaranteed preselection on the proviso he promised to resign before his term ended.
“He said he was supporting Ian, as Ian was a good mate,” Mr Campbell said.
Mr Albanese, now the federal opposition leader, and Mr Foley, who went on to a stint as state Labor leader, will give evidence on Wednesday as the judge-alone trial before Justice Elizabeth Fullerton continues.