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ABC News Labor Party Leadership Challenge Special -

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Live. Good morning and welcome

to Parliament House, I'm Emma

Griffiths. Seismic events are

unfolding in federal politics

this morning. In just a short

time Australia may well have a

new Prime Minister. As we go to

air Labor MPs have gathered in

the caucus room to vote in a

sudden leadership ballot. Their

choice - Kevin Rudd or his

current deputy Julia Gillard.

We'll go straight to the ABC's

political team led by editor

Chris Uhlmann. Emma, I'm joined

by Mark Simkin our chief

political correspondent. We're

standing at the north-west corner of Parliament House and just behind us through those

glass doors that you can see

about 2 metres behind that are the doors to the Government

party room. Up on the wall

there are the leaders of the Federal Parliamentary Labor Party stretches all the way

back to Chris Watson. The last

picture on that wall is Kevin

Rudd and today it may well be

replaced in fact we believe lit

be replaced by another picture the first Australian female

prime minister Julia Gillard.

Mark, you've just been inside,

can you give us a bit of a feel

for what you've seen in

there? There are two spaces on that wall that are empty that

you are talking about and the

key question of course today

will there be that extra

portrait. Already, at least

half an hour before the ballot,

the key ministers and power

brokers were already crowding

into that room. We saw Nicola Roxon the Health Minister,

Stephen Conroy, Communications Minister, two key Victorians

got there at least 30 minutes

before the ballot trying to get

a front row seat. Just over

here off camera is the staff

cafeteria, a very public a very

open place. In there some of

the key factional heavy weights

from Victoria who helped plot

this whole extraordinary saga

were actually doing the final

numbers, having an egg McMuffin

or egg muffin I think I was on

the mobile phones taking note

and this then they just filed

past us a few moments ago looking very confident and of

course that seems to be the

story of the day at the moment,

the Gillard forces are very

confident that they will succeed. As we understand it

the votes, the last count that

we had, there are 112 members

of the caution - caution kus

at the moment, they comprise

senators and MPs. Two there are

two missing, Peter Garrett is

overseas and Anna Bourke is

away. 112 member, 56, 57 slots

would get you across the line,

we understand Julia Gillard had

votes for the Prime Minister more than 07. There were 30

and there were many undecided.

We also understand those

undecideds were tending to flow

towards Julia Gillard. Do you

think Kevin Rudd will step

aside, that people will see

that too large an

embarrassment? If you are

speaking to people supporting

Julia Gillard they say it's

about 50/50 that Kevin Rudd

would step aside but of course they don't really know. You talk to the people who are

close to Kevin Rudd, they say

he stands by everything he said

late last night, that he will

fight, that he believes that he

has been elected by the people,

he doesn't think that the party

needs to be run by someone

elected by the factions so that

he is standing firm. But even

the people close to Kevin Rudd

concede this is going to be a

very, very tough fight for

them. That, I think, is code

that they don't expect to win.

Tellingly, it's only one

minister that we're aware of

who is actually doing the

numbers for Kevin Rudd, it's

his staffers who are doing a

lot of the ringing around, so

we haven't seen a full court

press or pretor ian - pretorion

guard working the phones or

number. Even some of the people

oing the numbers for him

concede this is not looking

good. The question question

then is do they say to him this

is all going to be very ugly,

retain some dignity, walk away

or do they say stay and fight? Remembering, of course, that

only a few months ago we were

in just a court yard - a few

court yards away speculating

about Joe Hockey trouncing

Malcolm Turnbull and Tony

Abbott being way down the list

and weirder things have

happened in this place. But

everyone seems to be convinced

today that Julia Gillard has

got the numbers and that it

will be a very large margin

indeed. If we walk our way back

through this to about 3 week

ago the genesis of all this was

that there wassen emissary,

we're told, that was sent from

Mark Arbib, who's the leader of

the NSW right, to David Feeney,

who's the leader of the

Victorian right and that was

testing the waters to see whether or not the Victorian

right would join with the NSW

right in a push against the

Prime Minister. Now, there wasn't a challenger at that

stage because Julia Gillard wasn't interested in

challenging. But yesterday

there was a story in the

'Sydney Morning Herald' that

said that the Prime Minister

had been testing the waters

himself. He'd been getting his

chief of staff, Alistair

Jordan, to ring around the caucus to see whether or not

that support that Julia Gillard

said that she had was actually

in evidence in the caucus. Well

that apparently enraged Julia

Gillard because she believed

that she had privately and

publicly repeatedly said that

she wouldn't challenge the

Prime Minister and then we also

saw another reaction against

the Prime Minister because of

that and that was that his

caucus once again saw that when

he had a job to do in speaking

to them he deputised his

staffer to do it. Some of the

words we've been hearing about

the Prime Minister have been

quite visceral over the course

of the last 24 hours. It's been an extraordinarily quick turn

around. There have been

rumblings as we know for some

time but for this to come to a

head so quickly has been quite

sphroordly and even last night

there were senior ministers,

there were close to both Julia

Gillard and Kevin Rudd, there

were their chiefs of staff who

had absolutely no idea that any

of this was going on. I'm told

that there was a major function

last night involving an MP who

has been in the parliament for

20 years, that was even the

Prime Minister was there, many

of the key members of the Labor

Party were there, the ABC

revealed that there were these

rumblings that these moves were

going on at 7:00. At 7:05 every

phone in that room started

ringing and at that point

people stood up, getting calls,

making calls, the Prime

Minister left the room running

to the telephones and as it turned out to the

barricades. When Julia Gillard

was tapped to go and tap the

Prime Minister the people that

said that to her said that they

did not believe that Kevin Rudd

could win the next election and

they thought Julia Gillard

could and that apparently is a

view that she shared. There is

almost a visceral hatred of the

Prime Minister among some of

those moving against him. One

of them said to me last night

this crypto fascist has never

built the party to support him.

The way the Prime Minister has

run the party has brought them

to where they are now. Some say

if you look at the decision

that have gone ahead, the

mining tax was made without a single Western Australian

member in the room. Someone

like Gary Gray may well have

perhaps given some warning on

that having also worked in the

mining industry. They also talk about some of the other

decisions that he has made

which have been made by a gang

of 4 or even just the Prime Minister's office and as one

said this morning, he wants to

return power to the caucus and

not to the group of adolescence

in the Prime Minister's office.

Emma. Thanks, Chris, and the

first the public knew of any

solid moves made on Kevin Rudd's leadership came last

night on ABC News. In the hours

since then the situation has

been rapid fire and frantic in

the national capital. Here's

political correspondent Greg

Jennett on events last

night. Sources have told the

ABC that MPs are being sounded

out about a possible move

against the Prime Minister. The

cover was blown, back room

power deal s -

And we just seem to have a problem with that tape item.

We'll go back to Chris Uhlmann

who's joined by Mark Simkin and

Anabel Crabb. I know you made a

dash from Sydney last night and

have been on the phone to

people, what kinds of things

have you been hearing about

what's going on today? Just

that matters are moving pretty

fast and everybody loves a win

ner these circumstances, Chris,

and the clearer it becomes that

Julia Gillard is commanding a

good percentage of the caucus

votes I suspect the more will

climb aboard and we're talking

minutes now until the

resolution of the situation and

I think that when we have a

resolution to the leadership

situation we'll see some other

changes pretty quickly. We're

hearing from the CFMEU that

they're expecting a decision

today on the resours tax. I

think that we can expect a few

quick new directions for the

Government to maximise the

advantage offered by a fresh

new face in the leadership.

Julia Gillard, of course, is

going to be dogged by exactly

the same difficulties being

pulled in different directions

on these policy issues that

Kevin Rudd is and keep in mind

she was extremely close to a

lot of these decisions at the

time at which they were made.

That does not mean she will not

take every opportunity to carve

out a new direction and take

advantage of the boost and the

ready ears that will be

prepared to listen to a prime

minister that's not Kevin

Rudd. Mark. Well that is a key

issue here, isn't it? As you

were saying before, Chris, and

Anabel, the Ministers are

saying things like this is all

about leadership style. If it wasn't just Kevin Rudd, a

one-man band making insulation decisions then perhaps some of

the union members with

occupational health and safety

experience would have had

something different to say.

Different decisions on the

mining tax if Western Australians had had something

to say. But of course the key

thing about all of this is that

the so-called gang of 4, well

Kevin Rudd was one of that

gang, Julia Gillard is also a

signed up member and the

Treasurer, Wayne Swan, is also

a member of the gang of 4 and

of course many people in the

party are expecting this morning that it's Wayne Swan

who will be standing as Julia

Gillard's deputy so. The key

challenge then becomes are they

tarred with this staple brush

and of course alternatively is

Kevin Rudd right when he says

that there is a push to the

right here in the party. Here

we have Julia Gillard, a member

of the Victorian left who is

being supported by key elements

in the party's right who are apparently trying to push her

to the right on issues such as

asylum seekers, such a vexed

issue that is burning so hard.

So it is really going to be an extraordinary time straight

after this, the amazing events

and it does not end at the end

of this party room meeting. Do

you get the feeling the ALP

factional situation is getting

more random by the day? You

have a situation now where the

left ring candidate for the

prime ministership of this

country is being backed in by

the right wing unions and right

facks and the nominally right

wing existing prime minister

only seems to be finding

friends on the hard left who are prepared to stick by him.

This gives you an idea of how

nonsensical the Australian

Labor Party's factional divide

is on an ideological level. One

of those people who is sticking

behind him is says one of the

concerns is they couldn't run a

show where people are

constantly looking over their

shoulder. You know where that

ends, that ends in NSW and

that's where some of this push

is coming from. There is again

alet of diquiet that some of

the people who are making this

move are the same people who

brought us the NSW Government,

Emma. And we're just going to

have a look at the Prime

Minister's press conference

last night, barely I think not

even 12 hours ago he took the

very unusual step of calling a

late night press conference to

announce this morning's ballot

to the nation and this is how

that unfolded. I was elected by

the people of Australia as

Prime Minister of Australia. I

was elected to do a job. I

intend to continue doing that

job. I intend to continue doing

it to the absolute best of my

ability. It's become apparent

to me in the course of the last

period of time, the last

several weeks that a number of factional leaders within the

Labor Party no longer support

my leadership. That is why it

is imperative that this matter

be resolved. I think it's

important for stability for the

party that this occur. As I

said before it's far better

these things be done quickly

than be strung out over a

period of time. I'd say one or

two other things as well. If I

am returned as the leader of

the party and the Government

and as Prime Minister, then I

will be very clear about one

thing, this party and

Government will not be lurching

to the right on the question of

asylum seekers as some have

counselled us to do. Also on

the question of climate change

we'll be moving to a timetable

on emissions trading which is

of the Government's decision,

contrary to the views of some.

And that was Kevin Rudd's

press conference late last

night where he announced to

nation that there would be this

leadership ballot this morning.

We'll go now again to Chris

Uhlmann, the ABC's political

editor and Anabel Crabb. One of

the things that's talked a lot

about Kevin Rudd is about his

personal style and if we rewind

to the beginning of his prime

ministership he did take real

ownership of this party from

the start? Yes, look, he was a

really opportunistic move and

one that worked for him very

well in the short term. Keep in

mind that Kevin Rudd has never

been one of these characters

that's deeply Beloved within

the Labor Party. He was a force

while he was on the front bench

and he was a cease less courter

of the media, he was around the

clock worker at all times and

when he finally rose to the

leadership after that crucial

deal with Julia Gillard in late

2006 he wasted no time in

putting his stamp on the Labor

Party and the most extraordinary thing that he did

in terms of what was to unfold

was to seize control of the

appointments to the cabinet. In

the past, the factions have got

together and dolled out cabinet

positions in a way that accurately reflects the factional make up of the party

and the State by State breakdown of MPs. Kevin Rudd, whilst absolutely retaining

nods to those structure,

retained the right to hire and

fire cabinet ministers and

junior ministers at with will.

Now I think that that is what

contributed to creating the

Rudd cabinet that we know which

is essentially an emasculate ed

sort of bodies that often finds

out about decisions through the

media or after they've been

made. I think it also meant

that Kevin Rudd's stock of personal loyalty was fairly

shallow and I think we can see

that in the speed of the events that have taken place in the

last day or two. And there's a question about the man himself

as well. If you rewind again to

October, I think it was, in

2007 with the one and only

leader's debate, a question was

asked then what do you stand

for, Kevin Rudd, what won't you

jettison to get elected and

that was based on the fact that

the community did think they

knew a little bit about Kevin

Rudd but they weren't entirely

sure about him. There were some hesitations but they were

willing to give him the benefit

of the doubt and they gave him

the benefit of the doubt for a

long time but it was his moral language more than anything

else, I think, where he laid

down series of traps for his

opponents by using very

overwhelming language on the

trading scheme, the most moral

and het Cal challenge of our

time. The difficulty with

putting oun moral landmines is

they are impervious to change.

So if you need to at some stage

turn around and walk through

that mine field you blow your

own legs off. You're right and

I think Kevin Rudd like often

Opposition Leaders do when they

are within reach of victory as

Kevin Rudd was towards the end

of 2007 probably turned up his

rhetoric in his enthusiasm to a

degree that was later very much

to damage him but I think that

in this remarkable drop off of

support, public support for

Kevin Rudd, what we've seen is

I think a very crippling case

of buyer's remorse. An

electorate that took him at his

word and agreed with him on his

nomination of what the

important issues were were, I

think it's fair to say,

flabbergast ed by his seeming

retreat from those very seemingly firmly held

positions. The question now, I

suppose, is whether Julia

Gillard is in a position to

reconstruct that public trust

and to reestablish the idea

that there are some issues and

some principles on which this

Government will not compromise

because experience over the

past month has told us that

there are quite a few issues

that we thought the Government

felt deeply on that have turned

out to be rather changeable.

Ironically, of course, the

reestablishment of a new narrative for this Government

is going to involve immediate

changes of direction on some of

those issues. Julia Gillard, as

we've already discussed, is

absolutely integral to some of

that decision making on some of

those really hot issues. The

question now whether she can

rescue the situation is very

much dependent on her ability

to set a new tone, I think. Yeah, it's certainly

true that when this was all

unfolding last night I got some

messages from the Liberal Party

saying they didn't know whether

this was going to be such a

great thing for them because

now of course there is a stark

contrast between Julia Gillard

and Kevin Rudd. Julia Gillard extremely powerful performer

and no doubt will enjoy a

honeymoon period with the media

and with everybody else being

the first female prime minister

in Australia. The question that

arises next is what does she

do? There was a lot of

speculation in the ranks last

night as to when you would call

the election. They do think

something has to be said about

that sooner rather than later

but of course views in politics

are changeable and many

facetted but - That's true

because I think it would be

polite to bring the Australian

public in on the question of its leadership at some point

and it's fine for caucus to

make a decision about who the

Prime Minister is but I think

that Julia Gillard would

probably be of the mind that

consulting the general

electorate sooner rather than

later would probably be a

reasonable idea. That was a

strong view that was coming

through last night, that

essentially she would seek a

mandate from the people

reasonably swiftly and may go

to the polls quite quickly and

one of the things to remember too when we get into an election the conversation

changes. So although the Government is doing badly in

the polls at the moment, but

don't forget, as I was reminded

by one of the people who's supporting Kevin Rudd in there

this morning, that in fact the

last Newspoll showed that they

had an election-winning lead,

although the primary vote was

catastrophic, that they still

thought the Prime Minister

could get over the line. But

when an election comes the

conversation changes, it will

be much broader, there will be

a lot more heat put back on

Tony Abbott and he will need to

articulate something beyond

Opposition. He would need to

start articulating what he would Leica Falcon in an alternate government.

Emma. Thanks, Chris. Chris

Uhlmann and Anabel Crabb there

waiting for some result in this

leadership ballot. While we're

waiting we'll look back at

Julia Gillard, the challenger

and the woman poised to become

Australia's first female prime

minister. She was born in Wales

and as a young child her family

emigrated to Australia and

settled in Adelaide. As a

university student she led the Australian union of students

and went on to a distinguished

legal career working closely

with the unions on industrial

relations issues. Like Kevin

Rudd there was a stint in State

politics as a chief of staff

before she stepped into the

federal arena as the federal

member for Lalor in 1998. She's

a proven parliamentary reporm

former and those union links

have remained strong and will

most likely be the catalyst for

seeing her take the prime

ministership. Her rise in

government may have been rapid

but Julia Gillard's early political career wasn't as

easy. The young lawyer and

party activist sought

preselection for Labor 3 times

and failed. After her third

attempt she worked for then Victorian Opposition Leader

John Brumby and finally in 1998 won a seat in Federal

Parliament. I'm not naive, you

know, I'm not, you know, I'm

not Doris Day who's just

somehow para chuted into

Canberra. I had to fight hard

to get preselected, I had to

play a factional game to do

that, I had to count numbers, I

had to make deals. In her

maiden speech she praised the

growing influence of women in

politics and has since risen to

become the most powerful woman

in Australia. In Opposition she

quickly rose through

portfolios, immigration, indigenous affairs and then

health where she went head to

head with Tony Abbott. Do you

like each other, do you

think? I think I'm a much more

normal person than Tony

Abbott. In late 2006 Julia

Gillard formed an unlikely partnership with Kevin Rudd and

the so-called marriage of convenience toppled Kim Beazley

to install a new generation of

leadership to Federal Labor.

Australian voters liked the

pairing and in 2007 Labor swept

to power. In Government, she

took on a heavy workload as

Minister for Employment and

Workplace Relations she rolled

back Work Choices. As Minister

for Education she went head to

head with teachers over NAPLAN

testing and won. She also

presided over the Government 's

school building program amid

Opposition claims it was poorly

managed. But the leadership

question never went away. Can I

just get a hug from the future

prime minister? First of all

PM, now let's - Oh, stop

it. Cheap shot. More chance of me becoming the full-forward

for the Dogs than there is of

any change in the Labor

Party. She's a fantastic Deputy

Prime Minister and she's going

to make a fantastic prime

minister as well, one day. That

day may have arrived. A look

back there at the woman most

likely and we'll go back to the

court yard within Parliament

House where Chris Uhlmann an

Anabel Crabb are waiting for

some result in this leadership

spill. Yes, Emma and that image

of her becoming the

full-forward for the Dogs is

resonating loudly. We're coming

to the finals in the not too

distant future so maybe she has

a position there. Let's look

back over the career of Kevin

Rudd, the brief and spectacular career of Kevin Rudd as prime

minister. One of the things

that people quite often talk

about is his awkwardness in

public speaking, in the

convoluted language. What have

you made of him as a

communicator? Well, I said

during the 2007 election

campaign that if that campaign

demonstrated anything it was

that political oratory was dead

in the country and John Howard and Kevin Rudd were helping the

police with their inquiries. I

think Kevin Rudd has been an

extremely cautious speaker, his

caution is usually mill Tating

against the risk of saying

anything interetion. He is a

great - Except for detail ed specificity. He is one of the

Nu Breed of politicians that's

evolved to fit the 24-hour news

cycle in a way. It's very

tough, I think, these days to

be a leader and to be called on

constantly to hold forth on

every issue. You develop rather

quickly and Julia Gillard has

developed this knack too, an

ability to speak for lengthy

periods without actually vouch

safing any information. Kevin Rudd's communication style has

been widely lampooned and he

can at times put you in mind of

a sort of sophisticated human

noid Rudd Bott. Last night he

was in full robot mode last

night as he chopped the air

that nothing was going to

induce him to give tum prime

ministership. This will be

remembered as a period of very

unusual prime ministerial communications, I think, and

one of the difficulties is that

Kevin Rudd as Prime Minister

has always seemed to have an

incredible number of projects

on the go and as a result a

seemingly short attention span.

Add to that his celebrated need

for no more than 3 hours sleep

a night and I think you start

to see just how crowded a prime

ministerial life is and I think

that one of the great short comings of the Rudd prime

ministership is the lack of

opportunity, so important to

political leaders, I think, for

intraspex on a daily basis, for

reflection and careful charting

of the ways ahead. Interestingly in that

too, his office began to

reflect him. From very early on

his chief of staff Alistair

Jordan, has been with him since

he was 22 and he's now only 30.

That office has been running at

campaign speed since 2007,

since the time Kevin Rudd took

over from Kim Beazley they've

within running at this enormous

pace, where people are getting

up at 4:30 in the morning and

they're staying in the office until midnight and that's

expect of them. That stress and

strain on the office has tolled

over the time. There's been an enormous attrition of staff in

his office. We endlessly hear problems about the way that

staff is treated and a lot of

people have left feeling very

bitter about the way that they

have been treated in that

office. There is a sense among

some that Kevin Rudd chews

people up and spits them out.

But I think it is easy in these

times to focus on the negatives

of the man but he also has great strengths and great

positives otherwise he never would have become prime

minister. One of them is that

enormous energy and he has a

great intellect but perhaps the

problem is there's a difference

between intellect and wisdom

and he doesn't seem to have

learned an enormous amount

through his time as being Prime

Minister. Emma. Thanks, Chris.

Labor MPs are still locked in

this meeting where they're

going to make this momentous

decision on the leadership of their party and the Government

and the ballot this morning has

caught many Labor MPs by

surprise of course. It only

became apparent late last night

that they would be turning up

this morning for the last

sitting day of the session to

vote in a leadership ballot.

Here's what some of them have

had to say as they've

arrived. The challenges that

face the Government are deep

and it's necessary to have both

a fresh pair of hands, fresh

eyes and a different approach

to the management of government. I think that he's

been fantastic in so many things that he's done since he's been Prime Minister. The

welcome to country, the

apology, all those ground

breaking thing, paid parental

leave. I think that people, you

know, we always said that, you

know, it's about keeping your

nerve and showing a bit of

courage under fire. Obviously

some people haven't been able

to but as far as I'm concerned

the Prime Minister's got my

full support. Time and time again we've been sent out to

defend decisions in which we

had no say and which have been

damaging to our personal

standing. You can't go and say

that climate change is the

great moral challenge of our

time or that taxpayer-funded

government advertising is a

cancer on democracy and then

backflip on these things

without damage to your

credibility. So I'll be voting

for change. I hope that the

result of this vote will be

less rosy talk about a big

Australia and more action to

protect the environment and

protect the Australian way of

life. Labor MPs there arriving

at Parliament this morning and

now they're locked in a

leadership ballot caucus

meeting here at Parliament

House. For a different

perspective on what we're going

through this morning here in

Parliament House we'll shortly

be joined by the ABC's Barrie

Cassidy, the host of 'Insiders'. He's in our

Melbourne studio and Barrie,

how do you see this morning unfolding? Well, I don't think

lit be anything like the Tony

Abbott leadership ballot that

dragged on for ages and nobody

had any idea of the outcome. I

think this should be over

fairly quickly and I'd imagine

that the votes will be Graham

Richardson was saying something

like 75 votes for Julia Gillard

which would mean something in

the high 30s for Labor, it

might be a bit less than that

for Julia Gillard but on both

sides there isn't seem to be

any doubt going in about how

the number would fall. Do you

see any likelihood at all that

Kevin Rudd may just step aside

when he sees these numbers in

the caucus meeting? No, that's

just against the grain of Kevin

Rudd's personality. I think

what will be really interesting

and the thing to watch about

Kevin Rudd how he behaves after

the ballot. There are a couple

of ominous signs last night in

his news comments. He raised a couple of thing. He talked

about climate change. I think

the implication was hang on a

second, Julia Gillard was as

much a part of that as I was.

That will be interesting to watch, particularly if Julia

Gillard moves as you think she

would to try and fill that

vacuum. But the second area I

thought was interesting where

he said quted look, I was

resisting a move to go to the

right on asylum seekers". Now

there has been a lot of

pressure on Kevin Rudd on this

issue from very nervous backbenchers particularly in

Queensland but in parts of NSW

and after the result of Penrith in western Sydney saying look,

we're not getting a lot of it

in the media but we're getting

it from everybody and they're

really worried about it. I

think what he was implying

there is that Julia Gillard

might succumb to that pressure

where he would not. That's

going to make it very difficult

for her to move on that issue

if that is her inclination. He

also said last night in that

press conference, Barrie, that

he'd been elected by

Australians, not by the

factional chiefs of the ALP. Do

you think that Julia Gillard

may face an accusation that she

is a factional puppet similarly

to Kristina Keneally in

NSW? That's one aspect to it.

Look, it's understandable for people to have that response

straight away because when they

go to elections they don't

really think that they're

voting necessarily for the

candidate in their electorate,

they think they're making a choice between Rudd and Howard

as it was at the last election

and they voted in Kevin Rudd.

When strictly speaking the

electorate of Griffiths voted

in Kevin Rudd and then the

Labor Party decides who will

lead it and that's what they're

doing right now. Look, when Bob

Hawke was prime minister he was

cut down by Paul Keating. There

was some concern in the community how could this happen

because we voted for Bob hawk.

They got over it and voted for Paul Keating at the next

election. On the factions I do

take Anabel Crabb's point that

chaos reigns and it does seem

as if the factions are not in

control. But what I take out of

what has happened over the last

24 hours is in fact the Kevin

Rudd experiment is over. This

idea that you can run the

Government and run the party

out of Kevin Rudd's office is

over and the factions and the

trade unions are actually back in control. They're now

actually starting to call the

shots again. Why else would you have a situation where some of

the faction leaders knew what

was going on last night and the

most senior ministers in the

land had no idea. That may well

be situation normal for many in

the ALP, Barrie. Barrie Cassidy

there the host of ABC's

'Insiders'. And we're going

back now to the court yard

where Chris Uhlmann and Anabel

Crabb are waiting for a result. We're actually standing

at the north-east corner of

Parliament House facing down

Commonwealth Avenue for those

who know Canberra and behind us

the doors that you can see

around about 2 metres behind

that are the doors to the

Government party room. There is

word coming from there at the

moment that Kevin Rudd may not

be standing. So it may well be

that he has been told by his

minders that it will look very

bad to see such a large defeat because what will happen at the

end, of course, what usually

happens at the end of this is

that the returning officer will

come out and read out the

numbers on the ballot paper and

if there is a huge distance

between Julia Gillard and Kevin

Rudd that would be the final humiliation for the Prime

Minister to be utterly rejected

by his party room. We had been

hearing quite recently that his

numbers might be as low as 30,

possibly even lower. That is

obviously a fairly resounding

thumping and not something that any self-respecting prime

minister likes to have happen

to them. These are

extraordinary circumstances in

every way and you should

always, I think, be guided by

the principle that anything can

change up until the last

minute. But I think what we may

be seeing here is a

consolidation of Julia

Gillard's support. Everyone, as

I said, in politics love aswiner, everyone wants to be

on the winning team and if by

the time people come to put up

theirlands in a ballot that

means a huge majority for Julia

Gillard and a derisory show of

support for Kevin Rudd then I

think even Kevin Rudd with his

trademark determination and

ability on show so richly on

show last night might be given pause for thought in that circumstance. I think one of

the things that there's a

problem in public life, and

it's certainly a problem for

journalists, is we tend to

treat people in the end as objects rather than human

beings and I do think there is

a sense within the party that

they do not want to see one of

their leaders humiliated even

though there are those in the

party who really have no time

for him at all. One of the

things I have to say that has

become evident in the last

little while is the murmur ings

out of caucus, out of cabinet

from some of the ministers have

become ever so visceral about

the Prime Minister as they express their disquiet about

the way he's been governing.

And most of them talk about

wanting to return to a proper

form of cabinet government.

That they do believe some of

the mistakes that were made

could have been avert fd there

had been discussion around the

cabinet table. If, for example,

the RSPT had been discussed with even one of the members

from Western Australia, not

forgetting, of course, Stephen

Smith is a very canny political

player from there and of course

Gary Gray had also been a

mining executive. Emma. Anabel

Crabb waiting outside the

caucus room there in

parliamentary court yard.

Throngs of journalists have gathered outside the

Government's caucus room within Parliament House in the

corridor there eagerly awaiting

the first news of what's

happened inside. It's

traditional for the whip to

emerge after the decision has

been made to inform journalists

of the outcome. Hayden Cooper

is there and joins us now. Can

you hear me? Ki. What word are

you hearing down there? Well, a

few rumours around, as you've

mentioned, I'm sure, that the

Prime Minister may have pulled

out of the ballot leaving the

job to Julia Gillard but it's

just whispers at this end so a

large group of journalists

gathered waiting for the

announcement. There's no word

yet on how far away that is.

But it's been half an hour or

so so most are expecting the appearance of the party whip

fairly soon. The media, of

course, have been herded 30

metres down the corridor so as

not to get in the way of the

MPs as they were arriving and

leaving. Julia Gillard arrived

with Wayne Swan saying very

little. They didn't answer

questions on the way in, of

course, so Emma, now we

wait. And who else did you see

go in? Did anybody say anything

as they went inside,

Hayden? Look, a few said a few

words. Some are openly

declaring their hand, others

weren't too interested in

talking to the media on the way

in. We didn't see Kevin Rudd

arrive, he took a different

path, avoiding some of the

cameras. But most came through

the media scrum and ignored the

questions studiously and gave

really not much indication of

how they think it will go. And

we're seeing pictures of them.

They're looking fairly solemn

and there's been some word that

this is quite traumatic for

many of them. Were you getting

that sense? Indeed and I think

there's an announcement coming out. We'll just cross to that

now, thanks, Hayden. The

returning officer of the

Federal parliamentary Labor

Party is to report to you that

a special meeting of the party

was held this morning at which

the position involved leader

and deputy leader were declared

vacant. The new leader of the Federal Parliamentary Labor

Party elected unopposeside

Julia Gillard. The new deputy

leader of the Federal

Parliamentary Labor Party

elected unopposeside Wayne

Swan. The next Labor prime

minister and the first female

prime minister of this country

will be Julia Gillard and Wayne

Swan will be the next deputy

prime minister of Australia.

Thank you. Did Mr Rudd

speak? Each of the people

elected as well as Prime

Minister Rudd spoke to the

caucus. I don't wish to canvass

what they said, I will leave it

for those members to report as

they feel fit to do so. The

meeting was conducted in a very

orderly manner, it was - yes, I

can say it was a very gracious

speech by the Prime Minister

and also by the new leader and

deputy leader. It was no ballot

because there was only one

nomination for both positions.

Was there any display of

emotion from the Prime

Minister? This has been a

difficult time for the Prime

Minister, it's been a difficult

time for the party. I will

leave it to the Prime Minister,

Mr Rudd, to make further

comment s. I don't wish to

comment other than to say that

he led us to victory in 2007, a

victory that was achieved when

many people thought that, you

know, we would be still

spending more years in

Opposition. That is a great

achievement. He did that with

Julia Gillard as the deputy

leader. We now have a new team

and I'm looking forward and

looking confidently forward to

the next election and I think

Julia Gillard will be elected

at that election as prime

minister and Wayne Swan as

deputy prime minister. Thank

you, ladies and gentlemen. Is

that a transition that will

happen straight away. Thank

you, ladies and gentlemen. It's not for me to

comment on those matters. Thank

you. Thank you. Look, they are

matters for the executive to

sort out. They're not matters

for me as returning officer of

the party. Thank you, thank

you, ladies and gentlemen. I

think Anthony Albanese will be

out to speak to you pretty

soon. And there it is, an

outcome to an extraordinary,

even seismic change this

morning. Julia Gillard is the

nation's new Prime Minister,

the nation's first female Prime

Minister. Wayne Swan has been

elected as her deputy. And

there was confirmation there

too that Kevin Rudd elected not

to stand in the end in this

leadership ballot. We'll go

down to Chris Uhlmann and Anabel Crabb for further

analysis of this result. Yes,

Emma, it is an extraordinary

result and of course Kevin Rudd

does remain Prime Minister for

a little while yet until that

commission is handed over to

Julia Gillard and that will be another extraordinary sight

because we'll see the first

female Governor-General

swearing in the first female

Prime Minister. And in is a

situation that's largely been

brought about, ironically, by

the officers of Kevin Rudd

himself. He was the one who

appointed that Governor-General

and he's the one that teamed up

with Julia Gillard and made her

the deputy Prime Minister. She

has been until recently. The

thing with the ladies is you

give them an inch, they take a

mile. At 2 pm this afternoon another great match up that

will be Julia Gillard facing

tabs across the despatch box.

They share a fair bit of

history and have an enormous

regard for each other. It's one

of those thing, an odd friendship in public life that

is perhaps going to be a little

bit strained now but she told

me a story once that there's an

old hotel in Canberra now pulled down where they both

used to lodge when they were in

Canberra and the staff in there

loved nothing more than to put

them in rooms side by side so

at night when she was fumbling

for her keys outside her motel

room she'd see this figure

wadling towards her, it would

be Tony Abbott and he holds her

in quite high regard. You can

expect in about 4.5 seconds for

the Labor Party to exhume that

footage from about I think a

year ago where the Tony Abbott

in the course of describing the

immediate past prime minister,

Kevin Rudd as a toxic bore,

said that he thought that Julia

Gillard would make a very good

prime minister. I'm assuming

that that will be front and

centre in some Labor campaign

ads. Look, there is no doubt

there has been something of a

spark between these two. They

have bounced off each other

intellectually and they have

confronted each other over the

despatch box most memorably in

the health portfolio when Tony

Abbott was John Howard's final

health minister and Julia

Gillard was shadowing him in

that portfolio. I've often

thought that Tony Abbott was as

an adversary something of the

making of Julia Gillard as the powerful political operator we

see her today. She rarely puts

a foot wrong in public, she is

very cool and under control. I

think that her fronting in the past an opponent like Tony

Abbott has made her a sharper

practitioner. Now we see this extraordinary result today

giving us a heads up challenge

between Tony Abbott and Julia

Gillard. One of the weirdest

things, I think, about the last - Among many weird things. Consummate weirdness

rules here, I think we can

accept that in Parliament House

at the moment, but one of the

strangest things about politics

in the last couple of years is

to some extent the team that's

out of the spotlight has been

profiting. Kevin Rudd and his

team did well for 1.5 years while the Liberal Party lurched

from leader to leader

auditioning new and interesting

leaders every day it seemed,

and as soon as Tony Abbott

became the leader of the

Liberal Party the spotlight -

and united his party the

spotlight went back to the

Government and I think what

Tony Abbott needs to do now is

try to establish himself as a

contender in his own right

rather than being the

Opposition Leader that remains

silent and allows the

Government to make all the

mistakes. I can't help but

think that only a year ago the

story we were talking about was

Godwin Gretch at the same time

that kneecaped another leader

Malcolm Turnbull. Now it

appears emissions trading has

got one more leader and that's

Kevin Rudd. Emma. Thanks,

Chris. Indeed the last sitting

day before the winter break is

going to get a reputation.

Chris Uhlmann and Anabel Crabb

there with their assessment of

the situation this morning.

Jewel y Gillard has been

elected unopposed as the nation's next prime minister

and for his assessment of

what's happened this morning,

I'm joined by the chief

political correspondent Mark

Simkin. Emma, it's important, I

suppose, not to lose sight we

are seeing history here today.

The first female Prime Minister

of Australia and it's of course

been a very long time since a

party turned on a first term

prime minister. Just a few

moments ago Kevin Rudd walked

past us here surrounded by his

supporters walking alongside

him, the Labor Party's key

factional chief and party elder

John Faulkner. Kevin Rudd was

smiling but once he gets back

to the office those smiles may

well fade. I suppose the key

question now what happens next

for Julia Gillard, the most

immediate question, does she

jet off to Toronto tomorrow to

represent Australia at the G20

summit? Unlikely, she's got a

fair few things to sort out.

The potential for a reshuffle obviously, there will need to

be some movement on the front

bench of Labor. Will there be

movement in key policy areas

and of course some in the party

are urging her to do that.

Ironically key members of the

right of the party are urging

this Victorian left MP to move

to the right on issues such as

asylum seekers, to try and sort

out the mining tax, to try and

recalibrate the timetable for

the emissions trading scheme.

So all of those issues have to

be bedded down and of course

one thing that is weighing very

heavily on Labor MPs as well,

what happens for the election?

According to the Liberal Party

they have polling that shows

that Julia Gillard would, in

their words, smash Tony Abbott.

So there is obviously a

temptation for Labor to go to

the polls sooner rather than

later but of course what the

polls don't reflect is whether

all this bloodshed, all this

instability, will actually do

further damage to the Labor

brand and to Julia Gillard's

brand as well. So the other

argument from key supporters of

Julia Gillard well if she

doesn't go straight away then

she should wait as long as

possible. And Mark, do you - I

put this question earlier to

Barrie Cassidy about the

factional ties that Julia Gillard has, do you believe

that she will be open to the

accusation that she's a

factional puppet? Well there

will be people in the party who

are going to be very unhappy

about this. There's no doubt

about that. I mean Julia

Gillard has shown herself to be

very adept at playing factional

games, clearly a lot more adept

than Kevin Rudd of course.

There are some key questions

though that will depend, I

think, largely on those policy

decisions. If she does start

taking the party to the right

on key issues then those

criticisms will be levelled at

her and there are those in the

party today who are saying

look, I'm going to vote for

Julia Gillard but I'm doing it

reluctantly because I don't

think it needed to come to

this, I don't think Kevin Rudd

would have lost the election.

So there are going to be some

divisions and difficulties in

the party. As the Coalition has

shown those divisions can be

healed pretty quickly. You can

imagine the Coalition, the

Liberal Party making the most

of her ties to those factions

and the way that this has

unfolded this morning. Do you

think that Tony Abbott is going

to find her a genuinely tougher

opponent? Yes, I think he will.

As I mentioned that Liberal

Party polling does show she

will be very difficult. He has

struggled to get a handle on

her. It recalibrates the whole

debate about can he be Tony

Abbott's pugilistic aggressive

self up against Julia Gillard.

They have a long history. They

have some degree of friendship

so it will be an absolutely

intriguing political contest,

one that will we see them go

head to head in really for the

first time since she took over

the prime ministership in

question time this afternoon. Do you see any

downsides for her in going to

an election early and

perhapsing to one? It depends

on whether they can get the

ducks in a row on policy, of

course. That's the key

question. There will be some

pressure within the party to go

early but having said that it

depends, as I say, on whether -

there is a perception that there is instability in the

party, division in the party,

whether she can rise above that

and whether she can therefore

rebrand herself, I suppose.

Now, Emma, we just have members

of the party are breaking from

the party room. One of the NSW

MPs, Belinda Neale is joining

us now. Good morning. Good

morning, can you talk us

through what happened inside

that party room? Well,

obviously it was a special

meeting for the only purpose

was to determine the

leadership. Kevin addressed the

meeting, spoke very graciously,

spoke very much about his pride

in meet - leading the Labor

Party and the achievements but

in the interests of ensuring

that the Labor Party could do

the best it could in explaining

to the community its message

and the next election of course

that he would stand down to

make way for Julia Gillard. An

historic day as a woman is

there some pride that we now

have a female prime minister or

a disappointment that Labor has

made history by removing a

first time prime minister? Of

course there is a lot of

excitement in the new leader

the first woman PM but at the

same time but also recognition

of what he has achieved. Those

things don't happen lightly and

in the end we're all human and

of course it was a difficult

time for the Prime Minister so

our hearts all go out to him

but of course there's excitement we have a new

leader. She's very forceful and

clearly she's going to do a lot

to help the Labor Party explain their plans for the future

after the coming election. You

mentioned that Kevin Rudd has

achieved a lot, why did it come

to this then? Well it's always

very difficult to say, of

course, but I think despite the

fact that we've achieved so

much, despite the fact that we

have - that the Government has

led Australia through the worst

economic crisis really for some

70 years and we have the

strongest economy in the world,

that we seem to be having

difficulty explaining to the

Australian community what

direction we were heading and

this was causing some

uncertainty. I think it gives

us an opportunity with Julia

Gillard as PM to explain

ourselves, put a clear path on

issues like climate change and

really set the agenda again and

restore the trusts that have

seemed to have leaked away. You

mentioned climate change, do

you see the party changing

policy on issues like asylum

seekers, like the timetable for

an emissions trading scheme? I

don't think there's going to be

any rush to change policy but I

think there's going to be for

the future a clear agenda for

climate change and I believe

that the Government before the

election will spell out what

that path will be. Were the

problems of Kevin Rudd then

ones of policy or ones of

personality? Well it's always

very hard to say. In tend, and

not only do you have to have

the policy bussio have to explain them to the Australian

community in a way that reassures the community, makes

it clear that you know where

you're going and I think

unfortunately a situation

developed where the Australian

people weren't clear about the

direction of the Government and

in the end ultimately, I suppose, that's the responsibility of the

leader. What does it say though

about the Labor Party that you

have a prime minister who's a

first term prime minister, he's

led you out of the wilderness,

he is still well ahead on the

2-party prefer