Ex-leader faces bankruptcy but the Liberal Party and its backer are rolling in assets

The wealthy Cormack Foundation – a heavy Liberal Party donor – is worth up to $120m and the Victorian party has more than $40m, according to new analysis.

Former Victorian Liberal leader John Pesutto. Picture: Wayne Taylor

You can now listen to The Australian's articles. Give us your feedback.

You can now listen to The Australian's articles.

The political ­donations goldmine known as the Cormack Foundation has up to $120m worth of assets and the Victorian Liberals are also rolling in assets, fuelling growing divisions over whether a former leader should be covered for legal costs over the Moira Deeming ­affair.

An examination of Cormack’s wealth shows it was worth close to $120m at the end of January, with much of it in blue chip shares such as Commonwealth Bank ($40m) and Wesfarmers ($20m).

The analysis suggests it received dividends of about $4.5m last financial year on a range of investments including ANZ, BHP, Coles, NAB, Rio Tinto, Trans­urban, Woolworths and Woodside Energy.

The exact value of Cormack will have shifted during the US tariff debacle and it may have changed some investments since the end of the last financial year but the analysis shows it remains fabulously wealthy.

The party is ablaze over the prospect of former state leader John Pesutto being sent bankrupt if the final legal bill from his brawl with Liberal MP Moira Deeming leaves him up to $3m in the red.

Liberal MP Moira Deeming. Picture: David Crosling

The Victorian Liberals also are wealthy, worth at least $40m or more, according to senior party sources.

Other estimates put it as high as $60m but the number is tightly held.

The Australian understands the Cormack Foundation was told before the court case began that the party would not be covering Mr Pesutto’s costs after he defamed Ms Deeming when neo-Nazis gate-crashed a women’s rights protest she attended.

Sources familiar with the discussions said the party at the time had been upset with the way Mr Pesutto had turned against Ms Deeming, who now faces a possible challenge to her preselection, and the impact it had on the Aston by-election.

“It was handled so badly by Pesutto that there is no way party money should be used to cover his mistakes,’’ a senior Liberal said.

Another senior Liberal said some federal MPs, including Peter Dutton, remained furious that the Pesutto-Deeming brawl had impacted on the Aston by-­election, which the party lost.

Federal Liberal leader Peter Dutton. Picture: Richard Dobson/NewsWire

However, the party leadership has changed and the membership of the Cormack Foundation has altered, leading to demands from other senior Liberals to prevent Mr Pesutto from being bankrupted over the case.

Mr Pesutto is being backed by former premiers Jeff Kennett and Ted Baillieu.

If Mr Pesutto is bankrupted, he will be ousted from parliament, exposing the party to a by-­election within the federal seat of Kooyong, which the Liberals want to win back from teal MP Monique Ryan.

The Cormack Foundation is run by Melbourne businessman Charles Goode and is a heavy donor to the Liberal Party, but its funds are not controlled by the party, as it ferociously guards its independence.

Melbourne businessman Charles Goode runs the Cormack Foundation. Picture: Ian Currie/NewsWire

Its directors include former federal treasurer Peter Costello and Australian barrister Allan Myers.

Sources said the Victorian Liberal Party itself was worth about $40m, with some of its funds held in the company Vapold Pty Ltd, of which former Victorian treasurer Alan Stockdale is a director.

Much of the wealth comes from the sale of its former 104 Exhibition Street offices.

The Liberal Party tried to gain control of the Cormack Foundation in 2016 when the foundation donated $25,000 each to Family First and the Liberal Democrats, both of which pre­ferenced against the Liberals in two seats, but it failed in its endeavour.

That legal battle also divided the Liberal Party but heavyweights are now openly questioning the rigid approach being taken by Cormack, which has been successful over the long-term guarding of its funds.

The corpus has grown from about $70m nine years ago to up to $120m.

Cormack was set up in 1988 with the proceeds from the sale of former radio station 3XY, its licence having originally been held by the Liberal precursor, the United Australia Party.

It held a significant amount of cash in NAB and derived about $4.5m in dividends from its shares and other investments last financial year.

Commonwealth Bank, however, is its prime investment.

Ms Deeming won a defamation action against Mr Pesutto last year, securing $315,000 in damages after a court found she had been defamed soon after the last state election after attending the rally that was gate-crashed by neo-Nazis.

The rally aftermath sparked a lengthy battle between Mr Pesutto and Ms Deeming.

It is now widely accepted that Mr Pesutto was too aggressive in his handling of the incident on the steps of the parliament, but he has been receiving growing support over his financial plight.

His total bill could well exceed $3m.

Mr Goode was contacted for comment.