Senior Liberal warns against $2.3m bail out of John Pesutto

The call for party donors to cover John Pesutto’s legal bill – backed by ex-premier Jeff Kennett and others – has been described as ‘a new low’.

Moira Deeming and John Pesutto pose for a selfie in a photo posted to social media in February 2023. Picture: Facebook

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A senior member of the Victorian Liberal Party’s administrative committee has launched an ­attempt to scuttle a deal for the governing body to bail John ­Pesutto out of his $2.3m crisis.

In a lengthy written statement to The Australian, the Liberal figure warned colleagues on the 19-strong administrative committee that providing the ex-opposition leader with a financial lifeline would be a “betrayal of the very principles the party claims to ­uphold”.

The Liberal figure, who has asked to remain anonymous, ­described the call for party donors to cover the bill – backed by ex-premier Jeff Kennett and others — as “a new low”.

“It isn’t just tone-deaf. It’s a betrayal of the very principles the party claims to uphold: individual responsibility, freedom of speech, truth, accountability, and the rule of law,” the figure wrote.

“John Pesutto was repeatedly availed opportunity to settle the matter, to apologise, to correct the record. Instead, he belligerently powered ahead.

“He ignored every off-ramp, every chance to limit the damage – to Deeming, to the party, and ultimately to himself.

“Now that he’s been found ­liable for serious and damaging defamation, he faces the financial consequences. And suddenly, it seems we’re expected to believe this is everyone’s problem?”

The dramatic intervention sets the scene for fireworks at next Thursday’s scheduled administrative committee meeting which is expected to debate bailing out Mr Pesutto.

Former Victorian Liberal leader John Pesutto. Picture: Wayne Taylor

The Australian has been told the so-called administrative committee’s moderate faction, which would normally be counted on to support Mr Pesutto, commands 12 votes to the conservative faction’s seven. But given that emotions are running so high over this crisis, some anti-Pesutto figures can’t rule out the moderate faction splitting over a potential rescue package. The Liberal figure’s call to arms on Friday to oppose a $2.3m rescue deal comes as the Pesutto camp believed it was close to stitching-up a deal ahead of a 21-day deadline – which falls on June 23 – to save him from bankruptcy and being ousted from parliament, triggering a damaging by-election in Hawthorn.

One deal being discussed this week would likely see Vapold Pty Ltd, the party’s cashed-up investment arm, lend Mr Pesutto about $1.5m, with the former leader providing $800,000 to settle the legal bill to Liberal MP Moira Deeming over her successful defamation case.

Mrs Deeming sued Mr Pesutto in the Federal Court over allegations that he falsely portrayed her as a Nazi sympathiser after she helped organise and attended a Let Women Speak rally that was gatecrashed by neo-Nazis.

In the statement released to The Australian, the administrative committee member likened the support for bailing out Mr Pesutto to “loyalty to ego-driven leadership”. “What message would the party funding Pesutto’s debt send to constituents, party members, and women in particular? That the party abandons its principles when they become inconvenient?” the Liberal figure wrote. “That donor money – given in good faith to fight Labor-Green ideology – can be rerouted to bail out an MP’s personal, financial liabilities?

“What precedent would that set? There is nothing remotely consistent with Liberal Party values and funding Pesutto’s debt.

“Yes, it’s sad to see someone face bankruptcy. But Pesutto chose this path. He made this bed. Now he must lie in it. He didn’t stumble into a defamation suit. He bulldozed into it. He played a stupid game – and he won the stupid prize.”

The Australian understands that the Pesutto camp remains hopeful that a rescue package can be structured to stave off bankruptcy and save the Hawthorn MP’s career. “Everyone wants to get this done,” a pro-Pesutto Liberal MP familiar with the negotiations said. “The consensus view, even among those opposed to (Pesutto), is that Moira needs to be paid the $2.3m … this is not so much about John and Moira anymore, it’s about the party and preventing a by-election that would be very challenging.”

The Liberal figure said Mr Pesutto and his supporters were in breach of the party’s values, writing: “Should the Liberal Party fund the $2.3m owed by Pesutto?

“Let’s consider what the Liberal Party stands for: Freedom of speech? Flagrantly trashed by Pesutto, defaming a woman many times over for exercising it.

“Individual responsibility? Kennett wants to shift Pesutto’s burden onto party donors. Pesutto wants anyone but himself to pay for his self-inflicted mess.

“Respect for truth and the rule of law? Pesutto was found to have gravely defamed – on five separate occasions. Paying his debt would endorse that behaviour. It would reward … recklessness.”