Moira Deeming ‘shocked’ that Victorian Liberal Party bailed out John Pesutto

Moira Deeming says Victorian Liberal chiefs used party funds to bail out John Pesutto with a $1.55m loan.

Former leader John Pesutto before Thursday’s Victorian Liberal Party administrative committee meeting. Picture: Nadir Kinani

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Moira Deeming says she was shocked to learn Victorian Liberal Party chiefs used party funds to bail out John Pesutto with a $1.55 million loan.

In a statement to The Australian, the Liberal MP revealed she had been told senior Liberal MPs and party officials originally backed a peace deal to settle Mr Pesutto’s legal bill without using party funds in exchange for her guaranteed preselection.

Instead, Mrs Deeming said the party chose to rescue Mr Pesutto with internal funds at a meeting of the administrative committee on Thursday night.

Liberal MP Moira Deeming leaves the Federal Court after her defamation win against Victorian Liberal Leader John Pesutto. Picture: Ian Currie

“My understanding was that senior Liberal MPs and members of admin supported the original five-point peace plan and Mr Pesutto himself accepted those terms (including my guaranteed preselection) in exchange for my agreement to pay over $1m of his debt,” Mrs Deeming stated.

“I said no. However, I made it clear on Sunday to those same senior Liberals, that I was genuine in my intentions and that if Mr Pesutto needed extended financial terms, so long as the loan was guaranteed by private individuals, I’d have approved it.

“So to find that Mr Pesutto instead arranged a loan from the party, using party money, on almost exactly the same financial terms that I’d offered was a shock.”

The former leader on Friday said he was “grateful and humbled” after the party agreed to loan him the funds to cover a Federal Court defamation bill owed to his fellow MP.

The party’s powerful 19-member governing body approved the loan and spared Mr Pesutto from bankruptcy after he defamed Mrs Deeming by suggesting she was a Nazi sympathiser.

Mr Pesutto said on Friday he was “grateful and humbled”. Picture: Nadir Kinani

The decision, determined by a secret ballot, means Mr Pesutto no longer faces expulsion from parliament and avoids the need for a by-election in his seat of Hawthorn.

Mr Pesutto had been under a three-week deadline to come up with the money since Mrs Deeming filed bankruptcy proceedings against him on June 2.

He thanked the party for its support and signalled his intention to remain in public life.

“I am grateful and humbled by the Administrative Committee’s decision,” he said. “I am totally committed to continuing my work as the Member for Hawthorn and also serving as a member of Brad’s team as we focus all our energy on winning the next state election and giving Victorians the change they are asking for.”

It comes after Mrs Deeming likened her treatment by the party to “institutional abuse” after it gave Mr Pesutto a lifeline to avoid ending his political career.

Taking to X after the decision, Mrs Deeming posted a graphic of herself with a caption stating the Liberals had “failed to protect her when she was attacked”, “punished her for defending herself”, “financially profited off her trauma”, and falsely claimed they had done her a “favour”.

“This is what institutional abuse looks like,” the image reads.

Mrs Deeming later said she was “delighted” she would be able to pay back NSW property developer Hilton Grugeon who bankrolled her victory at the Federal Court.

“Nevertheless, I am delighted that Mr Grugeon will be reimbursed for his generous loan, which ultimately saved my family,” she said. “Without that loan, I’d have been bankrupted as a declared Nazi sympathiser and my life would have been over.

“I am grateful to all who supported me and look forward to concentrating my efforts on fighting just as hard for the rights of all Victorians.”

Victorian opposition leader Brad Battin. Picture: Nadir Kinani

Opposition leader Brad Battin, who backed the bailout, said he would speak to Ms Deeming privately about the post, but refused to criticise her publicly.

“I supported the party’s Administrative Committee decision to pay Mrs Deeming the $1.55 million owed to her by Mr Pesutto, to satisfy the Federal Court costs order following its decision that Mr Pesutto had defamed Mrs Deeming,” Mr Battin said.

He said the bailout was necessary to avoid “further financial and reputational damage” and it allowed the party to “refocus our efforts where they belong – holding Australia’s worst government to account”.

Mr Battin said he had acted in accordance with the rules and maintained “impartiality”.

Institute of Public Affairs’ Colleen Harkin, who was part of the Liberal Party committee, said she voted against providing Mr Pesutto with a bailout.

“I understand people’s concerns that you don’t sue the leader, but there were also previous issues that were going on as to why that actually even happened in the first place,” Ms Harkin said.

“With the federal election results as well, it is a time for the Liberal Party to actually shake itself off and work out who it is and what it stands for.”

Mr Pesutto led the party for less than two years before being replaced by Mr Battin after a sustained period of poor polling and fallout from the Deeming saga.

Before claiming victory at the Federal Court, Mrs Deeming was suspended and later expelled from the partyroom over her response to the allegations – a move that split the Liberal ranks and triggered a prolonged public brawl.