Malcolm Turnbull faces serious threat of leadership challenge

WITH his leadership in jeopardy and rebel MPs circling, PM Malcolm Turnbull has announced a stunning backdown.

OPPOSITION Leader Bill Shorten has described Malcolm Turnbull as the “white flag Prime Minister” after the government dumped the carbon emissions reduction target from its energy policy.

Mr Turnbull announced today he would remove the target from the National Energy Guarantee (NEG) policy, as it doesn’t have enough support to get through the House of Representatives.

“It’s clear that in the absence of bipartisan support, the legislation to move forward the emissions component of the National Energy Guarantee will not be able to pass the House of Representatives,” Mr Turnbull said at a press conference this morning.

Mr Shorten said the move was not about lowering power prices or reducing pollution.

“It is just about appeasing Turnbull’s enemies in the Liberal Party so he can keep his job,” he said.

He said the problem with Mr Turnbull was that he gave up every time Australians or his party disagreed with his policies.

“Prime Minister Turnbull has never seen a fight that he won’t give up his principles in order to keep his job. He is truly a white flag Prime Minister,” Mr Shorten said.

Despite comments from Mr Turnbull that he could not pass the target through parliament because it did have support from Labor, Mr Shorten said he was prepared to discuss it.

“We won’t give Malcolm Turnbull a blank cheque ... but we are available to talk about energy prices as long as it includes more renewable energy, lower prices and less pollution,” he said.

“We are prepared to discuss the latest policy, but I think in all fairness, if you know what his latest policy is could you let us know? He keeps changing his mind every day.”

The Australian Conservation Foundation also condemned Mr Turnbull for putting his own interests ahead of the safety of the community and the resilience of the natural world.

“This government simply has no climate change plan, and no state or territory in their right mind should now sign up to the NEG at the COAG Energy Council,” ACF Chief Executive Officer, Kelly O’Shanassy said.

But the government’s National Party colleagues welcomed the move, saying it would bring prices down and coal-fired power stations would be “very much part of the mix,” leader Michael McCormack said.

“Coal is very much part of our thinking, part of our strategy and support and I am delighted that the (ACCC) recommendations are going to be acted upon quickly,” Mr McCormack said.

He also supported the “big stick approach” towards power retailers and companies that don’t do the right thing, including that they could be broken up to stop cartel behaviour.

EMISSIONS TARGET IS DEAD

Mr Turnbull originally intended to pass legislation as part of the NEG policy to reduce emissions by 26 to 28 per cent on 2005 levels by 2030.

The policy was approved by the coalition party room last week and was also backed by industry, experts and consumer groups.

“I’ve never seen an energy policy that has broader support,” Mr Turnbull said.

However, since then a number of backbenchers including former prime minister Tony Abbott have pushed back against the policy and Mr Turnbull’s leadership, feeding speculation that Peter Dutton would launch a leadership challenge. The Prime Minister has now abandoned the target.

“In a parliament where there is just a one-seat majority, the outstanding reservations of a number of our colleagues, combined with the absence of bipartisan support means that as long as that remains the case, we won’t be in a position to take that legislation forward,” Mr Turnbull said.

He said he would bring the measure forward again if there was sufficient support in the lower house.

While Labor has not confirmed publicly whether it would support the policy, Mr Turnbull pointed out that the rival party’s emissions reduction target was 45 per cent, compared to the government’s target of 26 per cent.

“Labor have given no indication whatsoever, that they would support this,” Treasurer Scott Morrison said.

“If Labor support it, they should come out and say so. I don’t think there is any reason why the government would think anything other than the Labor Party would continue to play the wrecker role and not seek to engage constructively on this issue.”

Bill Shorten says Malcolm Turnbull is just trying to save his own job. Picture: Lukas Coch/AAP

Ahead of the press conference, Sky News reported the President of the Liberal National Party of Queensland, Gary Spence was urging MPs to withdraw their support for Malcolm Turnbull and get behind Peter Dutton.

When asked whether he had spoken today to potential leadership rival Mr Dutton, Mr Turnbull said: “Peter Dutton was at our leadership group meeting this morning and he was at the cabinet last night. He’s a member of our team. He’s given me his absolute support”.

But the changes to the National Energy Guarantee, which appear to be aimed at keeping his colleagues happy, are not a good look for Mr Turnbull and are already being seen as a huge backdown.

“Make no mistake about it, you have just witnessed the Prime Minister Malcolm Turnbull running up the white flag on energy policy,” Sky News Australia host Ashleigh Gillon said after the press conference.

News.com.au political editor Malcolm Farr said the panic overhaul of the NEG was Mr Turnbull’s launching of the lifeboats.

“He has cut adrift his energy policy in the face of a small cranky group of back mutineers and in the hope he had myself won’t be tossed overboard,” Mr Farr said.

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FOCUS ON CUTTING POWER PRICES

Mr Turnbull used the press conference to flag a shift to lowering power prices as a priority, rather than emissions reduction.

“Power bills are one of the biggest cost of living pressures,” Mr Turnbull said. “They’ve risen over the last decade by 56 per cent above the rate of inflation.

“Cheaper power has always been our number one priority when it comes to energy policy.”

Prime Minister Malcolm Turnbull at his press conference this morning. Pic: AAP

Mr Turnbull said the government would adopt a recommendation from the ACCC to establish a default market offer that would give consumers a clear picture of how much they should be paying for their electricity.

“By setting a default market offer from which all discounts must be calculated, consumers will be able easily to compare offers from different companies and recognise when they’re being ripped off or when they’re getting a fair deal,” he said.

He said the Australian Competition and Consumer Commission (ACCC) estimated moving to a default market offer could save customers between $183 to $416. Average small to medium businesses could save between $561 and $1457.

The government will also provide $31.9 million to the ACCC and the Australian Energy Regulator to better monitor the electricity market and pricing.

“We will introduce significant new powers so the ACCC can step in where there has been an abuse or misuse of market power,” Mr Turnbull said.

In the worst cases, where warnings are not acted on, the government will be given extra powers to issue directions to power companies on operations and functional separation. As a last resort, it will also be able to force big companies to sell off parts of their business.

The move comes after Mr Abbott told reporters in Canberra on Monday that debate about energy policy was not about personalities or the future of Mr Turnbull’s leadership.

“It’s about what is going to give Australians the best possible energy system that delivers affordable reliable power,” he said.

Mr Abbott said he had been railing against high power prices for the better part of two years, arguing the first fix would be to keep the Liddell coal-fired power station open.

Ending subsidies for renewable energy, stopping price gouging by energy retailers and locking in new baseload power were next on his list. He said the government should also withdraw from the Paris agreement on climate change, and should have prevented the closure of Hazelwood power station in Victoria.

“We’ve got to be the party that is on the side of getting power prices down and let Labor be the party that is all about getting emissions down.”

RELATED: Tony Abbott urges policy contest on energy, not consensus

‘THAT’S A LIE’: HADLEY HITS BACK

Meanwhile, radio host Ray Hadley, who last week predicted there would “100 per cent” be a move against Mr Turnbull’s leadership within a fortnight, has now accused a senior minister of lying about the Prime Minister’s level of support.

Opening his 2GB show this morning, Hadley took aim at Defence Minister Chris Pyne and his claim that Mr Turnbull still enjoyed the full backing of the cabinet.

“That’s a lie. That’s a lie. And Christopher Pyne knows it to be a lie. I know at least three cabinet ministers that want him (Mr Turnbull) gone,” Hadley said.

“For the first time, Malcolm Turnbull knows he’s in strife.”

According to Hadley, Home Affairs Minister Peter Dutton “knows he doesn’t quite have the numbers yet to challenge”, but also knows he will lose his marginal seat at the next election if Mr Turnbull remains leader.

“His only hope of remaining in parliament is to lead the party,” Hadley said.

Broadcaster Ray Hadley. Pic: AAP

TURNBULL UNDER SERIOUS THREAT

Ministers gathered for an emergency meeting at Parliament House last night, where discussions focused on the controversial National Energy Guarantee (NEG) — which promises to slap penalties on overcharging power companies.

But the real action may have been happening on the phones.

According to The Australian, multiple MPs called Home Affairs Minister Peter Dutton over the weekend to promise their support, should he choose to challenge Mr Turnbull for the leadership.

“It is now almost inevitable, the question is timing,” one senior minister told the paper.

It also reported that Tony Abbott told a Young Liberals meeting over the weekend he was looking forward to serving under a “Dutton government”.

Mr Dutton was late to last night’s emergency meeting, reportedly because his flight was delayed.

It’s understood he missed the dinner, but arrived later at Parliament House after taking a VIP flight from Brisbane, the Courier-Mail reported.

PM’S SUPPORTERS SCRAMBLE

Meanwhile, The Daily Telegraph reports, Mr Turnbull’s supporters were contacting their colleagues and urging them to stick with the Prime Minister.

And Mr Turnbull is planning to fight back.

Christopher Pyne told ABC radio today Mr Turnbull would have announcements on energy policy “and I believe my colleagues will be extremely impressed with the direction the government is taking”.

Mr Pyne said Mr Dutton had not indicated a challenge would be happening and condemned what he called a “media parlour game” on the leadership.

As he spoke, the so-called parlour game was in full swing.

“It is very serious. Peter Dutton is considering resigning from cabinet and launching a leadership bid,” Channel 9’s political editor Chris Ulhmann told Today this morning.

“It goes beyond the National Energy Guarantee. The rumblings are about all manner of things, including, one said to me yesterday, ‘Malcolm Turnbull is just not one of us.’ There are deep values arguments that are being made. A lot of them might well be spurious, but this is a dangerous time for the prime minister.”

Ulhmann said the people he had spoken to indicated they would make a move “sooner rather than later”.

Former Labor minister Graham Richardson was even blunter writing in The Australian today, calling Mr Turnbull “a dead man walking”.

“The only question on his leadership is whether it will be taken out first by the electorate or the Liberal Party caucus,” Mr Richardson said.

Future PM Peter Dutton? Pic: AAP

HORROR POLL BLINDSIDES PM

Mr Turnbull’s case will not be helped by a horror Fairfax/Ipsos poll released overnight, which showed support for the government plunging.

In its worst result since early last year and it would result in the government losing more than 20 seats at a general election.

According to the poll, the Coalition’s primary vote has dropped from 39 to 33 in just one month, and Labor now leads 55-45 on the two-party preferred measure.

Mr Turnbull’s support as preferred prime minister dived from 57 to 48, with Bill Shorten’s rating improving by six points to 36 per cent.

“Polls like this are disasters. People do not like governments that fight among themselves, and polls like this lead to infighting, which leads to more bad polls. It is a downward spiral and it is very difficult to get out of it,” Seven’s political editor Mark Riley said this morning.

Riley said he does not believe Mr Dutton has the numbers to overthrow Mr Turnbull, and suggested the “real game here” was an effort to damage the Prime Minister before the election and pave the way for “the return of Tony Abbott after an election defeat next year”.

TENSION BUILDS

The terrible numbers come as the Liberal Party struggles to achieve internal consensus on the National Energy Guarantee.

The public divide has led to speculation Mr Dutton may make a move for the Liberal leadership with the support of conservative members.

The speculation gathered steam after a radio interview last week where Mr Dutton said further disagreements could lead to his resignation from Cabinet.

He took to Twitter on Friday to “make it very clear” that Mr Turnbull had his support as did the policies of the Government.

The National Energy Guarantee has been a sticking point within the government which has been used to pile pressure on Mr Turnbull.

On Friday, it was revealed that the prime minister is now planning to control emissions by regulation an option he condemned only days ago.

Mr Turnbull has effectively rejected the 26 per cent reduction established under the Paris Agreement, made under the prime ministership of Tony Abbott.

The decision makes it more likely the Government’s NEG will be implemented.

However, on Tuesday he condemned the regulatory approach.

“Labor wants to have it done by regulation so that the Parliament would not have a voice,” Mr Turnbull said on Tuesday.

“Now, we believe in democracy. We believe the Parliament should have a say in this and so if we legislate that, then a subsequent government — whether it’s of our side of politics or the other — would have to persuade both Houses of Parliament to make any change to it, and that is a great security.”

Pressure is growing to replace Malcolm Turnbull. Picture: Kym Smith

Some conservative colleagues unhappy with the NEG have begun drifting towards Mr Dutton as their preferred prime minister.

But senior Liberal frontbencher Christopher Pyne said Mr Turnbull had the backing of his cabinet and the party room.

“There are some people who don’t support the current leader, and that’s quite obvious,” he told the Nine Network.

“The overwhelming majority of my party room are 100 per cent behind Malcolm Turnbull, as is the entire cabinet.”

The leadership chatter grew much louder last week after Mr Dutton warned during a radio interview that further disagreements could lead to his resignation from cabinet.

In a bid to quell the bubbling unrest, the prime minister took to social media to propose a number of changes to his signature energy policy.

Mr Turnbull has promised to wield a “big stick” over electricity retailers who charge too much, and make it easier for power consumers to tell when they are being ripped off.

During Sunday’s dinner in Canberra, the prime minister was expected to float the idea of abandoning big business tax cuts rather than fighting for them up until the next election, if they are defeated in the Senate.

In relation to media stories today, just to make very clear, the Prime Minister has my support and I support the policies of the Government. My position hasn’t changed from my comments last Thursday.

— Peter Dutton (@PeterDutton_MP) August 17, 2018

However, it remains to be seen if these changes will be enough to win over restless colleagues, or whether they could potentially backfire by alienating his supporters.

Mr Turnbull tried to brush off talk of rising numbers against him in the coalition party room.

“I’m focused on getting energy prices down and I’ll leave you to all of the speculation,” he told reporters on Sunday.

Meanwhile, Nationals deputy leader Bridget McKenzie twice refused to say whether she would like to see him stay on as prime minister before eventually saying “yes” when asked for a third time.

“I think Malcolm Turnbull is our prime minister and I would like to see him stay as our prime minister, and that is actually a decision for the Liberal Party,” Senator McKenzie told Sky News.

— with wires