Gloves off in Australian leadership battle
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CANBERRA: Ambitious Australian Treasurer Peter Costello has taken the gloves off in his unofficial leadership fight with Prime Minister John Howard, publicly contradicting his long-serving leader over a succession deal.
"He told me that he intended to do one-and-a-half terms as prime minister and then he would hand over. Obviously that did not happen," Costello told reporters, after Howard denied the existence of a secret 1994 deal to leave power to Costello.
The conservative prime minister had earlier told reporters: "The situation is very simple, there were no deals made".
Political analysts said Costello had now openly challenged Howard, who is in his fourth term and is Australia's second-longest serving prime minister after 10 years in office.
"Hostilities have been declared," Australian National University political analyst Michael McKinley said.
"You have now got the two principal contenders to run the Liberal Party effectively calling each other a liar."
Costello has run the national economy since Howard won power in 1996, delivering sustained growth, tax cuts, and budget surpluses which have eliminated net government debt. As prime minister, he would not be expected to make any major economic or foreign policy changes. Leadership speculation has grown in recent weeks in the run-up to Howard's 67th birthday in late July, particularly after reports of a succession deal first surfaced in newspapers. The next general election is due in the second half of 2007.
Costello, 48, has also fuelled leadership talk by stepping outside his treasury portfolio in recent speeches to outline a blueprint for a more socially progressive Costello government.
"Whilst this country can be improved and whilst there are still things to be done to make it better, I intend to give it every ounce of energy I have," Costello told reporters.
Australian media said that a full-blown leadership challenge was inevitable.
"You have a treasurer accusing the prime minister of being a liar and the situation can only be resolved in a couple of ways and it is not for both of them to continue in office," said Glenn Milne, political correspondent of the Australian newspaper.
Neil Mitchell from 3AW radio in Melbourne said: "The treasurer cannot stay as treasurer under John Howard, and John Howard cannot tolerate him if he tries to stay. You can't have the No 2 in government calling the prime minister a liar".
The leadership issue has been a major issue in Australian politics over the past five years after Howard said he would consider retiring around his 64th birthday.
But he changed his mind in 2003 and has said he would remain leader as long as the Liberal Party wants him.
Details of the secret 1994 succession deal between Howard and Costello were published in a weekend newspaper.
Costello said Howard gave the undertaking during a meeting with him and former Liberal party frontbencher Ian McLachlan in December 1994 – about 16 months before Howard first won office. McLachlan has confirmed the pact.
A secret leadership deal between Labour Prime Minister Bob Hawke and long-serving treasurer Paul Keating in the 1990s fell apart in acrimony, with Keating stepping down as treasurer before toppling Hawke in a party ballot.
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