Scandal threatened to undermine Gough's chances of top job

TODAY, the Labor Party is renowned for its bitter infighting, systemic factionalism and a winner-take-all powerbroker ethos.

TODAY, the Labor Party is renowned for its bitter infighting, systemic factionalism, a winner-take-all powerbroker ethos and ruthlessly cutting down its leaders at the bloody hands of "faceless men".

But one scandal, culminating in a brutal political execution, has remained secret for more than 40 years: that of the party's first full-time federal secretary, Cyril Wyndham, who was accused of maladministering party funds.

The scandal threatened to embarrass the ALP on the eve of the 1969 federal election and undermine Gough Whitlam's chances of becoming prime minister three years later.

Essentially, it was part of a larger factional power-play to re-assert the dominance of the Left against those, such as Whitlam and Wyndham, who wanted to reform the party.

"I was played for a sucker," Wyndham told the ALP's finance committee when asked to explain accounting discrepancies in April 1969. "My political nose is highly sensitive and, gentlemen, I smelt a rat."

He told them: "I became a very convenient pawn in the power-play."

Wyndham, who died in July this year, believed he was the victim of a stitch-up by Left faction bosses determined to remove him as secretary, given his outspoken nature, his reform plans and closeness to Whitlam and the NSW ALP, run by the Right.

"It is necessary to understand how the federal executive operates," Wyndham wrote in one of a series of secret notes obtained by The Weekend Australian.

It was run by "a clique which dominate the executive", he explained. "They are simply a power cabal (which) insulates itself completely from public and party opinion. It hears and sees only what it wants to hear and see.

"It deludes itself into believing that they are the purists, the upholders of principles and the great defenders of the party. Anyone who so much as crosses their path must pay the penalty of their vindictiveness and jealousy."

Wyndham explained that the clique was "able to dominate party affairs because no one else will challenge their supremacy".

Eric Walsh, Wyndham's friend and later Mr Whitlam's press secretary, told The Weekend Australian: "He was a good man. What those bastards did to him was unforgivable."

What began as rumours spoken in hushed voices in the corridors of Parliament House, in Canberra's hotel bars and maliciously leaked to the media - although the detail of the accusations were unpublished - culminated in a series of internal party meetings in March-May 1969.

Mr Walsh said the allegation was that Wyndham, who had meticulously recorded the ALP's finances, was remiss in not accounting for about $1400.

"He was able to account for almost all of it," Walsh said. "Less than $10 was in question - a trivial amount. But it wouldn't matter what it was, they were out to get him - and they did."

Wyndham's personal papers - now in the State Library of NSW - show queries were raised about money being "wasted".

He was accused of spending too much on phone calls, travel and convening meetings in "luxurious" surroundings. Wyndham rejected these charges and argued he ran the ALP "on a razor edge". He often omitted paying his own salary, he said, "in order to keep the funds (party) solvent".

He believed the accusations were designed to ruin him and to bolster the authority of the Left.

The party's powerful federal executive was chaired by Queensland senator Jim Keeffe, with whom Wyndham had a poisonous relationship.

But the ruling "clique" was dominated by F.E. "Joe" Chamberlain, who had been the West Australian ALP secretary since 1949 and was a past federal president and secretary.

Victorian ALP officials were also agitating against Wyndham.

Chamberlain, who was instrumental in Wyndham's appointment as federal secretary in 1963, believed he would be supportive of the Left, even though Wyndham was factionally unaligned.

He expected Wyndham to temper the growing authority of Mr Whitlam, who wanted to radically overhaul the party's structures and policies.

In 1966, Mr Whitlam had savaged the executive as comprising "12 witless men".

Mr Whitlam had a toxic relationship with ALP leader Arthur Calwell, who was strongly backed by the Left. Mr Whitlam replaced Calwell as leader in 1967, but had many clashes with the executive.

Wyndham had previously worked for the British Labour Party and came to Australia to work for Labor leader H.V. "Doc" Evatt in 1957. He continued working for Calwell when he succeeded Evatt. In 1961, Wyndham was appointed Victorian ALP secretary - a position he held until becoming federal secretary in 1963.

Wyndham became an advocate for reforming the ALP's archaic structures and diluting the power of faction bosses. He spoke publicly of the need to revise policy and refresh the party's campaigning.

Put simply, he was on a collision course with the powerbrokers. By 1969, Chamberlain wanted to reclaim the post of federal secretary.

His relationship with Mr Whitlam had also deteriorated. Although Mr Whitlam cautioned the federal executive not to pursue Wyndham, he was powerless to stop it.

Fed up with the federal executive, Wyndham had secured appointment as the NSW ALP secretary, starting in April 1969. But, after he was censured by the federal executive in May, Wyndham was so distraught that he vanished and never returned to work. In his absence, the state executive dismissed him via registered mail.

"These past three weeks have been the most harrowing of my political life," Wyndham wrote in an April 1969 note. "I have reached the stage where I could not care less. These wretched people . . . are just not worth worrying about."

So sensational was the story that The Sydney Morning Herald went in search of the scoop.

Wyndham kept his silence. He exited politics and built a life outside the ALP.

He worked for Maxwell Newton-- founding editor of The Australian - who ran a publishing company.

He never again spoke to those, including Mr Whitlam, who he felt had betrayed and destroyed him.