‘They knifed us’: The spat that could come back to haunt Albanese

Anthony Albanese’s hopes of being returned to the Lodge with teal backing have been damaged by an escalating feud between the independent MPs and Special Minister of State Don Farrell, who have traded accusations of sexism and berating of government staffers.

Farrell pushed landmark reform to cap political donations through federal parliament last month over the objections of teals as well as Labor cabinet ministers who argued it would damage relations with the independents whose backing Albanese may need if he fails to win a majority at the election due by May.

From left: Special Minister for State Don Farrell, Prime Minister Anthony Albanese and teal MPs Kate Chaney and Zoe Daniel.Credit: Marija Ercegovac

The Coalition agreed to pass the laws over teal objections that the reforms would give major parties a financial advantage, angering independents who had repeatedly met with Farrell as he sought to build a consensus that the reforms were fair.

Goldstein MP Zoe Daniel warned that Farrell’s changes had badly damaged Labor’s relationship with the teals ahead of an election. Labor has ruled out entering into a formal coalition with the independents but could need crossbench support to stay in power and pass individual bills.

“We had spent three years building trust with the government on a whole range of issues, then in the end they knifed us,” Daniel said. “That makes it really difficult facing a potential minority government situation where that trust has been broken.”

Labor promised to reform donation laws after mining magnate Clive Palmer spent $100 million on successive federal campaigns, but the details have proved contentious.

They include capping spending at $800,000 for each candidate in a seat and $90 million for a party’s nationwide campaign, while donors can contribute up to $50,000 per recipient each year.

Some teal MPs spent more than $2 million in their last campaigns, much more than many major party MPs but similar to the high-profile Liberals they deposed.

Labor MPs, including Industry Minister Ed Husic and Energy Minister Chris Bowen, according to sources familiar with their thinking, warned internally against the election funding bill. Some feared it would hurt environmental groups that work with Labor and make it harder for the teals to defend their seats from the Liberals.

But Farrell convinced the prime minister in key meetings in October and February that the reform was worth pursuing because it would stop a Palmer type spending money on an American scale to win many more seats than the single Senate spot the Queensland businessman gained in 2022. Husic and Bowen’s offices declined to comment.

Farrell, nicknamed the “Godfather” for his backroom dealmaking, secured Coalition support for the laws in a face-to-face meeting with Opposition Leader Peter Dutton on Tuesday, February 11 – the same night teals and other crossbenchers attended a drinks event at The Lodge with Albanese. The opposition was wary of the laws, but backed the changes in part because Dutton feared Farrell would do a deal with the Greens and teals that would hurt the Coalition if he refused to co-operate, according to those involved in the negotiations.

Meetings with the teals had gone badly before Labor struck its bargain with the Coalition, which included raising a series of disclosure and donation limits.

At one briefing with the crossbench in Parliament House on November 19, Farrell and his office claim teal MPs Monique Ryan, Zali Steggall and Kate Chaney were verbally aggressive towards Labor staff.

“I try to treat people the way I would expect to be treated. Some do not,” Farrell said. “I strongly believe difficult but fundamental reform is achieved through honest negotiation and building consensus. Sometimes that means forgoing the headline or the grab on social media, and working towards the outcome.”

The teal MPs rejected Farrell’s claims, saying none had acted aggressively, and suggested the accusation was sexist. Chaney said the meeting was “assertive” and that she conveyed her opinions to the government.

“I’m not one to leap to a sexist explanation quickly, but [Farrell’s office] saying we were aggressive; I think there’s a sexist element in that,” Chaney said.

The teal MPs were elected in part on a platform of promising to restore integrity and civility to politics. A spokesman for Farrell said of the February meeting: “All parliamentarians and stakeholders should be frank in their views – it is integral to our system of parliamentary democracy. This should never extend to the targeting of staff, whether privately or publicly.”

Like Chaney, Steggall said she “completely rejected” the government’s version of events. Farrell’s staff had been questioned in the same way as ministers who had attended similar meetings with the crossbench, Steggall said.

“This is Minister Farrell and his team backgrounding to try and gain some credibility when they have none in respect to this legislation,” Steggall said.

Independent Zali Steggall (left) confronted Farrell during his press conference in Canberra during the week he secured the funding overhaul.Credit: Alex Ellinghausen

Ryan has been contacted for comment.

Relations between Chaney, who led the teals’ talks with Labor, and Farrell’s team were particularly poor over the 2023-24 summer after details of Farrell’s private meetings appeared in the media. Farrell then refused to take private meetings with the West Australian for several months.

Rather than negotiating on the details of the policy, sources close to Farrell said Chaney instead opposed key planks of the funding overhaul outright, including by refusing to offer amendments to change campaign spending limits.

Her view, people familiar with the talks said, was that independent MPs who raised small amounts of money from many donors had a right to spend it to overcome the advantages of an incumbent MP with high name recognition.

Asked about the negotiations, Chaney accused Farrell of treating teal MPs like a “short-term annoyance” at a time when major parties’ share of the vote were at historic lows.

Some of the top political donors in the country, who gave about $1 million each last year, were Climate 200 backers. In 2023-24, 72 per cent of Climate 200’s $5.9 million in donations came from just 23 people who gave more than $50,000 each.

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