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Coalition leadership issues back in the spotl -

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Coalition leadership issues back in the spotlight

Broadcast: 15/08/2007

Reporter: Michael Brissenden

Federal Treasurer Peter Costello has not denied telling three journalists in 2006 that he planned
to challenge Prime Minister John Howard. But he has continued to deny in parliament that he told
party and business colleagues that he could win the next election, but John Howard could not.


KERRY O'BRIEN: But first, the story of Peter Costello's dinner two years ago with three senior
journalists from the parliamentary press gallery including our Political Editor Michael Brissenden,
where Mr Costello ventilated his leadership plans, and it dominated Parliament today.

The leadership tensions between the Prime Minister and his Treasurer have been a matter of public
record on and off over the years, but the headlines do just keep coming back.

This time, they were sparked by Mr Costello's denials yesterday that he'd said in 2005 that only
he, not Mr Howard, could win the next election, denials which in turn sparked reports on this
program last night, and in the Melbourne Age and on the Bulletin magazine's website today, giving
much greater detail of the conversation in question.

That detail included a quote attributed to Mr Costello that if Mr Howard didn't make way for him by
April last year, he would destroy Mr Howard's leadership.

In a press conference today, Mr Costello confirmed that the dinner had happened, albeit on a
different night to the one we reported, and denied some but not all of the damaging quotes
attributed to him. Then came Question Time.

Michael Brissenden reports.

MICHAEL BRISSENDEN: It's a relationship that's been through some tempestuous times. Today, the
tension is on public display again, due to reports aired on this program last night and this
morning in the Melbourne Age, and the Bulletin website, about Peter Costello's ambitions, his views
on who was best placed to win the next election and the deadline set to take on John Howard by
April 2006.

It is now history the challenge didn't happen as we know. But it was said to three journalists,
including myself at a dinner in 2005, as was his assertion, strenuously denied yesterday, that he
told some of his colleagues and business associates that he could win, but John Howard couldn't.

This morning, Mr Costello correctly took issue with the date the dinner took place, but not all of
the content.

REPORTER 1: So, you are denying all account that the three journalists agreed upon?

PETER COSTELLO, TREASURER: No, what I'm saying to you is I never told my supporters to carp at the
Prime Minister, I never told .... I never went to the backbench, I never carped at the Prime
Minister. And as you know, I never withdrew from the treasuryship. Now, there was no dinner on the
date that Michael Brissenden said there was, but there was a dinner with Michael Brissenden, I have
very accurate records.

REPORTER 2: And the other two journalists?

PETER COSTELLO: And the other two journalists. In the course of this discussion, by the way, which
is an off the record discussion. I think that point ought to be made because I think that's an
important point of journalistic ethics, There was a long discussion about politics. I never had any
doubt in that discussion that John Howard could beat Kim Beazley, who was the Labor leader. I don't
think there was any doubt about that.

MICHAEL BRISSENDEN: There's no denying this discussion of journalistic ethics has become part of
the story, and probably will for some time. The three journalists at the dinner believed this was a
discussion on background that was designed to inform our stories. The Treasurer's press secretary
was present when notes were taken at the end of the dinner after Mr Costello had left. At no time
did he suggest any of it was not to be used, nor did he take issue with any of our recollections of
what Mr Costello had told us.

The two Bulletin journalists had already begun working on their story the following day when a call
came from the press secretary, requesting all of the conversation be considered off the record. The
7:30 Report decision to go public last night came as a result of Mr Costello's two vigorous denials
yesterday of quotes recently published in The Bulletin that all of those present at the 2005 dinner
knew to be true.

REPORTER 3: The Bulletin quoted you as saying to supporters in 2005: "Howard can't win, I can. We
can, but he can't". Is that quote correct and do you believe that?

PETER COSTELLO: No, I don't know where The Bulletin got that from, certainly not from me. You find
actually over the years that you get attributed with a lot of things you didn't do and you don't
get reported a lot of things that you did do, and I must say when I read some of these things I
wonder where the journalists get them from. They generally speak to somebody who has spoken to
somebody who was down the back of a pub who heard the barman say, and in fact gradually finds it
way into magazines or articles. But no, that's not the case.

MICHAEL BRISSENDEN: Naturally enough, this has dominated the political debate today. But this
leadership tussle is nothing new. It has been a perennial feature of the political life of the
Government. Today Mr Costello was asked directly in Parliament if the discussion had taken place,
if he declared John Howard couldn't win the election, if he said he'd was prepared to challenge and
had set a deadline of April 2006, and was prepared to go to the backbench and carp to destroy the
Howard leadership. Mr Costello denied he'd ever said John Howard couldn't win the next election,
but let the other quotes stand.

PETER COSTELLO: Mr Speaker, and can I say apart from a very enjoyable dinner and a nice chat about
political life, Mr Speaker, all of the things that were allegedly going to come true, didn't.
Didn't. And if you want to judge 2005 conversations, Mr Speaker, by what they carry of import in
Australian politics, presumably you would look at what actually happened. And Mr Speaker, all of
these predictions Mr Speaker, did not come true, Mr Speaker.

MICHAEL BRISSENDEN: And as Labor pointed out, that's a significant part of the ongoing leadership

WAYNE SWAN, SHADOW TREASURER: Why is the Treasurer prepared to be brave at the Water's Edge
restaurant and to say to journalists that he would "destroy" the Prime Minister's leadership, but
never ever have the guts the challenge.

PETER COSTELLO: You need a brave heart, and Mr Speaker, what you need to do in Australian politics
to show bravery, Mr Speaker, is you need to put in place those policies which will change your
country. Mr Speaker, things like balancing a Budget, that takes bravery. Things like paying of
$96-billion worth of debt, that takes bravery.

MICHAEL BRISSENDEN: For his part, the Prime Minister wasn't asked any questions by the Opposition
during Question Time today, but he did have this to say about his long-serving Treasurer.

JOHN HOWARD, PRIME MINISTER: I wasn't there, I don't know what was discussed. I can only say though
that I have always found in my dealings with him, Mr Costello, to be a honest and forthright man,
and I trust Mr Costello. He is an ambitious man, there's nothing wrong with ambition.

KERRY O'BRIEN: Political Editor Michael Brissenden.