Labor suspends party boss who kept quiet about donation

Kaila Murnain has been suspended after admitting she kept quiet about an illegal party ­donation.

NSW state Labor’s head office boss Kaila Murnain leaves the ICAC hearing in Sydney yesterday. Picture: Dylan Robinson

NSW Labor’s head office boss Kaila Murnain has been suspended after admitting she kept quiet when told Chinese property developer Huang Xiangmo had made an illegal party ­donation.

The ALP’s NSW parliamentary leader Jodi McKay said last night she had ordered an urgent meeting of party officials to suspend Ms Murnain because “I no longer have confidence in her judgment”.

Swift action against Ms Murnain followed her explosive evidence to a corruption inquiry that she remained silent in September 2016 after then Labor MP Ernest Wong allegedly told her that Mr Huang was the source of a large donation that had been declared in another person’s name.

The now-suspended Labor boss linked the party’s lawyer, Holding Redlich national managing partner Ian Robertson, to her admitted cover-up during evidence to an Independent Commission Against Corruption investigation into alle­gations that electoral laws were circumvented.

She alleged Mr Robertson told her “don’t tell anyone about it” when she sought his advice on what to do about the suspect Huang donation.

In sworn evidence to the ICAC yesterday, Ms Murnain said the party lawyer told her: “There is no need to do anything from here. Don’t record this meeting, don’t put it in your diary, forget the conversation happened with Ernest and I won’t be billing this for you ­either …”

“And so I initially didn’t tell anyone about it,” she said.

With the NSW Labor Party in crisis over a donations scandal that could get worse with more revelations expected in the ICAC’s six weeks of scheduled hearings, Ms McKay said she was “taking steps to clean up the mess at ALP head office”.

“I am appalled by the ­evidence of the past three days,” she said.

“I have therefore asked the party officers to convene a meeting tonight to suspend Kaila Murnain as general secretary as I no longer have confidence in her judgment.”

Ms McKay said Ms Murnain’s deputy, Pat Garcia, would act in the role of general secretary and she would have more to say about party governance after the ICAC inquiry.

Labor’s national president Wayne Swan today defended the decision to suspend Ms Murnain rather than sack her immediately and said people who make $100,000 donations “don’t get anything” from the ALP.

“This whole issue of donations is one that the Labor Party has tackled on,” he told ABC radio. “The decisions taken last night reflect that decision ... the inquiry will go on and we will act appropriately when it is completed. As an interim step, that’s fine.

“You don’t get anything by donating to the Labor Party.”

The ICAC’s investigation is focusing so far on a $100,000 donation. The sum was officially declared as coming from many individuals who attended a Chinese Friends of Labor fundraising dinner in Sydney’s Chinatown in March 2015. The inquiry is seeking to determine whether or not the “true donor” was Mr Huang, and not those who were named on declaration forms as giving $5000 each.

Property developers are banned from donating to political parties in NSW, and the legislated cap on individual donations at the time was $5000, with small adjustments allowed over time for CPI.

Huang Xiangmo. Picture: Renee Nowytarger

Giving evidence under oath to the ICAC, Ms Murnain said she met Mr Wong outside the back of state Parliament House at 6.45pm on September 16, 2016, at his request where he first told her “in an upset state” that a person was worried a donation was falsely alleged to have been made in that person’s name by another.

Ms Murnain said she had a recollection Mr Wong possibly mentioned a sum of $100,000 and told her Mr Huang was the true source of the donation declared in another person’s name.

She said she connected the suspect sum to the Chinese Friends of Labor fundraising event that was held in March the previous year in Sydney’s Chinatown when she was deputy to the then party secretary Jamie Clements.

According to Ms Murnain, she told Mr Wong to urge the worried person to come forward.

When the meeting with Mr Wong ended, she said she immediately called Sam Dastyari for ­advice on what to do because he was a close friend, one of her predecessors in the job she now held, and he knew Mr Huang well.

Mr Dastyari drove straight away from his nearby office to the back of NSW Parliament House to meet Ms Murnain, and allegedly told her in a conversation about Mr Wong’s revelation that she should speak to the party’s governance manager or to lawyers about the issue. Ms Murnain said she was very upset and crying at the time.

Ms Murnain said she then called Mr Robertson and asked to meet him in his office as soon as possible. Still at work on this evening, Mr Robertson allegedly met her at the top of the MLC building escalators and then took her to one of his firm’s meeting rooms.

She said Mr Robertson asked her whether she had any evidence from Mr Wong about what had happened on the funding matter, and she replied that she did not.

He also asked if she believed Mr Wong and she said she did.

At the conclusion of a 20-­minute conversation, Ms Murnain alleged Mr Robertson then said there was “no need to do anything from here” and urged her to tell no one. Mr Robertson, who was in the ICAC hearing room yesterday, ­declined to comment when ­approached after proceedings ended yesterday.

Earlier, Ms Murnain said she could not recall seeing an Aldi bag stuffed with cash at party headquarters. “I found out there was a large sum of money that had come in that week … but I can’t remember who told me,” she said.

Meanwhile, a Sydney-based employee of a Chinese property developer feared his boss would “hire some scoundrel to hurt me” if he did not go along with a scheme to falsely use his name for a $5000 donation to the NSW Labor Party.

Steve Tong told ICAC he was “dumbfounded” and “very angry” when he received an invoice saying he had donated money to the ALP at a Chinese Friends of Labor event in March 2015. A project manager for Chinese-owned company Wu International at the time, he had no interest in politics and did not attend the fundraiser.