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Journalists claim Treasurer insisted on challenging Prime Minister.

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This transcript has been prepared by a source external to the Parliamentary Library.


It may not have been checked against the broadcast or in an y other way. Freedom from error, omissions or misunderstandings cannot be guaranteed.


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Wednesday 15 August 2007

Journalists claim Treasurer insisted on challenging Prime Minister


TONY EASTLEY: There's yet another dramatic chapter this morning to add to the long running leadership saga between John Howard and Peter Costello. As the Treasurer celebrated his 50th birthday last night, details were emerging of comments made by Mr Costello to senior journalists at a dinner two years ago.  


Those three journalists at the dinner, including one from the ABC's 7.30 Report have revealed details of a long conversation they had with the Treasurer, where he insisted he would challenge John Howard for the top job. 


Mr Costello has denied he ever made the comments and his colleague, Foreign Minister, Alexander Downer has weighed in saying it's ludicrous to believe journalists over Mr Costello. 


From Canberra, Gillian Bradford reports. 


PETER COSTELLO: Great evening, thank you very much. 


GILLIAN BRADFORD: Not many people can pull James Packer, the Reserve Bank Governor and the Prime Minister to their birthday party, but they were just a few of the well heeled crowd who helped Peter Costello celebrate his 50th last night. 


(sound of festivities) 


But while the Treasurer and his friends were in a birthday bubble - outside the 7.30 Report was going to air with yet another story to inflame the leadership tensions. 


The 7.30 Report 's Michael Brissenden said he was at a dinner two years ago with two other journalists where the Treasurer said he would challenge the Prime Minister if he didn't stand aside by last April. 


Brissenden made notes that Mr Costello said he was prepared to go to the backbench and would carp at Mr Howard until he destroyed his leadership. 


Shortly after that dinner, Mr Costello asked the journalists not to report the comments - but they only have now because yesterday for the first time - Mr Costello explicitly denied ever making them, effectively calling them liars. 


JOURNALIST: Did you say that? 


PETER COSTELLO: No. Look, this is two years ago, so what, this great revelation has remained secret in this journalist's hands for two years? 


GILLIAN BRADFORD: But Michael Brissenden, the Bulletin 's Paul Daley and The Age 's Tony Wright all have the same recollection of that evening. And their point now is that some key questions still remain. They say at the time Mr Costello said he was preparing to challenge because John Howard would lose this election. That comment is of course gold for an opposition already depicting the Prime Minister as tired, mean and tricky. 


So how will the Government deal with this next round in the leadership saga? When he arrived at the Treasurer's party last night, the Prime Minister seemed quite effusive in his praise for Mr Costello - even hinting there were bigger things to come. 


JOHN HOWARD: Been a great Treasurer and he's got an enormous amount more to offer the people of Australian in public life. 


GILLIAN BRADFORD: No time is a good time for leadership tensions, but as the days tick closer to the election, this just becomes more unhelpful for the Liberals. 


Peter Costello's supporters insist the time for a challenge has passed, even though they think a lot of the Government's current woes could have been avoided with a smooth transition last year.  


Backbenchers Peter Slipper and Bruce Baird are among the Peter Costello fan club. 


PETER SLIPPER: He's been a fantastic Treasurer, probably the greatest we've seen in Australian history, so I wish him all the best. 


BRUCE BAIRD: And he will be a great Prime Minister. 


GILLIAN BRADFORD: While the Government might try to dismiss this story as ancient history, Peter Costello will now be relentlessly prodded about this dinner. The journalists - all three of them - are sticking by their story 


Alexander Downer is dismissive. 


ALEXANDER DOWNER: What's on the front page of the newspaper tomorrow will be wrapping up fish and chips tomorrow night. I mean, you know, get real. At the end of the day, journalists claim something was said two years ago, the Treasurer, who's a man of decency and integrity, has denied it. And his denial is… I think is somewhat supported by the facts, actually, that John Howard, two years later, is still the Prime Minister. 


TONY EASTLEY: The Foreign Minister Alexander Downer on Lateline last night. That report form Gillian Bradford. And the Treasurer declined our offer for an interview on AM this morning. A spokesman says the denials Mr Costello made yesterday contradicting the three journalists still stands.