John Pesutto able to pay Moira Deeming thanks to Liberal Party loan

A deal struck in a secret ballot at the party’s administrative committee will allow John Pesutto to cover Moira Deeming’s legal costs and avoid bankruptcy.

John Pesutto’s political career has been saved with the Victorian Liberal Party agreeing to loan him $1.55m.

The move means he can repay colleague Moira Deeming the $2.3m in legal costs he owes her ahead and avoid bankruptcy that would have seen him ineligible to sit in parliament.

It is understood Mrs Deeming first learnt of the deal when party president Phil Davis sent a bulk email to members shortly before 9pm on Thursday.

John Pesutto has been saved from bankruptcy. Picture: Wayne Taylor

It followed a lengthy meeting of the party’s administrative committee meeting during which Mr Pesutto pleaded for his political future.

The committee voted in a secret ballot to loan Mr Pesutto $1.55m, on a secured basis, which would be paid directly to Mrs Deeming.

In his letter to members outlining the deal Mr Davis said the loan should end the matter and boost the party’s prospects ahead of next year’s state election.

“The Party’s Administrative Committee met this evening and resolved that Moira Deeming should be paid what is owed to her, and therefore the Party will contribute $1.55 million directly to Mrs Deeming,” he said.

“Mr Pesutto will be required to re-pay this amount to the Party on a commercial loan basis, with a market-based interest rate, ensuring that the Party earns additional income from this investment.

“Settling this matter once and for all is in the interests of the Party, as it will see an end to the ongoing commentary that is letting Labor get away with their appalling performance.

“By ensuring that Mrs Deeming has been paid, there will be no Hawthorn by-election, and the State Parliamentary team can focus on the urgent needs of the Victorian community, particularly campaigning to change the government at the 2026 Election.

“Victorians need a change of government. By ensuring that Mrs Deeming gets paid what she is owed, the Party will be stronger as we head towards November 2026.”

However senior Liberals warned the deal would do little to bring immediate stability within the party and warned Opposition Leader Brad Battin faced an uphill battle to unite his partyroom.

It is not known how Mr Battin, who sits on the administrative committee, voted and he did not comment following the meeting.

Senior Liberals say Opposition Leader Brad Battin is facing an uphill battle to unite his partyroom. Picture: Nadir Kinani

“Realistically the main challenge now is the conservative block needs to be convinced about the political pragmatism of this deal,” one senior Liberal said.

“Can Brad bring the conservatives back into line and convince them this was worth it?”

Conservative MPs and members were vehemently opposed to Mr Pesutto being bailed out by the party.

“Brad’s leadership is now in question and the conservative block will want a please explain.

“But John is now an indentured servant of the party, and as long as Brad can maintain his leadership, he can call in that debt at any time.”

Mr Pesutto pleaded for his political future at the party’s administrative committee meeting. Picture: David Crosling

There is speculation the deal might prompt a shadow cabinet reshuffle as a way to placate “apoplectic” MPs and members over the deal.

It could see younger conservative MPs promoted in favour of more moderate, older MPs.

Mrs Deeming did not comment after the meeting but angrily rejected claims she blackmailed Mr Pesutto in a fiery parliamentary speech.

It followed her referral to the state’s corruption watchdog over a proposed deal that would have guaranteed her preselection in exchange for sparing Mr Pesutto bankruptcy proceedings.

“Senior Liberals were begging me to come up with a peace plan,” she said.

Moira Deeming angrily rejected claims she blackmailed Mr Pesutto. Picture: Andrew Henshaw

“First they tried threatening me. Just so you know, I have never, ever committed blackmail. That’s just a lie.

“Yes, I handed over the five point plan and yes it included my preselection but I never blackmailed anybody.

“Pesutto came back to Battin and said sure Moira can have all of that, including her preselection but only if she pays $1 million of my debt, so you can stop with that kind of a lie.”

The Herald Sun has seen evidence that Mrs Deeming rejected Mr Pesutto’s offer to accept a deal – including her guaranteed preselection – in exchange for a $1m discount off his debt.

Originally published as John Pesutto able to pay Moira Deeming thanks to Liberal Party loan