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McLachlan Claims Howard-Costello Leadership Deal In 1994; Costello Concurs; Howard Demurs

Leadership tensions in the Liberal Party rose on July 10, 2006, with claims by former Defence Minister Ian McLachlan that John Howard and Peter Costello struck a leadership deal in 1994.

McLachlan, the Defence Minister in the first Howard government (1996-98), claimed that Howard offered to stand down as Prime Minister after one and a half terms, if he was able to assume the leadership of the party unopposed in 1995.

McLachlan claimed to have carried around in his wallet for years a piece of paper containing his contemporaneous notes on the deal.

The deal arose out of the collapse of Alexander Downer’s leadership of the Liberal Party in the second half of 1994. Downer and Costello took over the leadership in 1994, defeating John Hewson.

Costello confirmed the McLachlan claims. “His account is entirely accurate,” Costello said.

Costello said the three men met on December 5, 1994 and Howard offered to stand aside after a term and a half, provided he got the leadership unopposed. “He volunteered that commitment and I took him at his word,” Costello said.

Howard disagreed, claiming that the meeting “did not involve the conclusion of a deal”. He said discussions about the Liberal leadership “went on for weeks and weeks after that discussion”.

  • Listen to Peter Costello discuss the claims of a 1994 leadership deal (5m)
  • Listen to John Howard deny there was a deal over the leadership (2m – transcript below)

Transcript of Prime Minister John Howard’s Opera House doorstop on the Liberal leadership.

JOURNALIST: Prime Minister, how do you answer claims that you have been dishonourable over Mr Costello?

HOWARD: The situation is very simple, there was no deal made. There were lots of discussions at that time, including one in which Mr McLachlan was present, that did not involve the conclusion of a deal. Perhaps the best evidence of that is that the discussions about the leadership of the Liberal Party went on for weeks and weeks after that particular discussion took place in December of 1994. Could I just make one other point, I think everybody should just take a bit of a reality check. The leadership of the Liberal Party is determined by the more than 100 men and women who make up the Parliamentary Liberal Party. The leadership of the Liberal Party is not determined by John Howard or Peter Costello or indeed any other individual. The leadership of the Liberal Party is in the hands of the men and women who comprise the Federal Parliamentary Liberal Party and beyond that I don’t have anything further to say.

JOURNALIST: But at the time Prime Minister, at the time it was a clear choice between Peter Costello and yourself…

HOWARD: Look I am not going to go any further into it, I’ve made my position clear about that discussion and both Mr Costello and I on a number of occasions over the years have denied the existence of a deal. Frankly, I don’t have anything further to say.

JOURNALIST: So you weren’t mean and tricky?

HOWARD: It’s a beautiful day, let us all be charitable and let us all rejoice in such a beautiful day.

JOURNALIST: Are you a united party or are there angry backbenchers?

HOWARD: I think any political party that’s been in power for a long time has a variety of views about the future, but as I say this is a matter that is in the hands of the men and women of the Parliamentary Liberal Party. My advice to them is to focus on the interests of the Australian people because that’s what they’re interested and concerned about.

JOURNALIST: Mr McLachlan clearly sees it as a deal Prime Minister and this morning Alex Somlyay, who saw those notes, also sees it as a deal.

HOWARD: Well I have told you my recollection of the meeting and I can do no more or less than that.

JOURNALIST: So Prime Minister is Mr McLachlan lying or exaggerating?

HOWARD: No, I’m not passing any aspersions on anybody’s character. I am telling you what the meeting represented to me and I am also reminding you that there were many discussions about the future leadership of the party at that time that went on for weeks after that particular meeting which suggests that nothing could have been concluded at that meeting and those are matters on the public record.

JOURNALIST: So it wasn’t a deal, it was a discussion. Is that what you’re saying?

HOWARD: I’ve already answered the question.

JOURNALIST: Have you spoken to Mr Costello?


JOURNALIST: With so many discussions could it be that maybe there was a bit of a deal that you might have not remembered?

HOWARD: Look, I have answered the question. I think we’re sort of going around and round in circles.

JOURNALIST: What do you think of headlines like this though? Is it hard to wake up to that headline?

HOWARD: It’s a free country.

JOURNALIST: So Prime Minister, if it wasn’t a deal what was it?

HOWARD: I’ve already answered that question.

JOURNALIST: Mr Howard, Grahame Morris has suggested you’ll turn your mind to retirement in around November or later this year, how likely is that?

HOWARD: Oh I am not going to comment on that commentary. That was his own comment.

JOURNALIST: He’s been a close adviser of yours.

HOWARD: He’s a good friend of mine Grahame Morris and I respect him a lot. I like him, he’s been a mate of mine for years, but he’s a free thinker and he makes up his own mind and forms his own views and he articulates them very well, but I’m not going to respond to that particular view.

JOURNALIST: Is he way off the mark?

HOWARD: I am not going to offer a comment on that. I’m really not.

JOURNALIST: What about your own view? Are you looking at retirement at any time in the future?

HOWARD: Oh come on.

JOURNALIST: In light of the last 24 hours, have you had any personal discussions with Mrs Howard as to your future?

HOWARD: Oh look, I talk to my wife about lots of things all the time. She’s a very intelligent and supportive person.

JOURNALIST: And the leadership issue?

HOWARD: Look, I certainly don’t intend to get into the substance of what I talk to my wife about. Really, this is becoming beyond a joke.

JOURNALIST: Why did he bring this issue up now?

HOWARD: I don’t know.

JOURNALIST: Are you surprised that a former ally and colleague has said this about you?

HOWARD: Nothing ever surprises me in politics. And I wish him well, he’s a nice man and he was a good Defence Minister. And he was also a very good cricketer.

JOURNALIST: On another issue, in Queensland, the breast cancer issue at the ABC. Do you think the staff should moved?

HOWARD: Well that really is a matter for the experts. I wouldn’t want to interfere in the ABC’s affairs. That really is a matter for the ABC. And, I mean, I sympathise very, very much for the staff who have contracted breast cancer, I do. But the question of whether it’s some problem with the working environment is really a matter for the experts and a matter for ABC management in discussion with the Queensland Health Department to decide. I think it’s quite inappropriate for me to inject an uninformed, lay view into something which really has to be determined according to the available evidence.

JOURNALIST: Kevin Rudd has said that it’s likely it’s like a slum compared to the other ABC offices around the country.

HOWARD: Well I don’t know that that is directly relevant to the issue. It sounds like Mr Rudd feeling he has to say something about everything rather than offering an informed view.

JOURNALIST: Prime Minister, a question about the nominations today. Why is it important, that’s what we’re here for anyway, why is it important that we nominate, that the Australian public get out there and actually take part in this, rather than waiting for somebody else?

HOWARD: Well I think it’s part of the spirit of this country that everybody gets involved. We’re a very community minded group of people and I’ve never thought that choosing something like the Australian of the Year, or the Young Australian of the Year, or the Local Hero should be done at any kind of elite or removed level. I think it should always be done in a spontaneous community way and that’s why I think it’s very important that we have this kind of process for dealing with it.

JOURNALIST: Prime Minister, aren’t the voters entitled to know whether you’re going to stick around until the next election?

HOWARD: Well at the time of the last election, the words I used about my future were exactly the same as the words that I continue to use. So I have in no way misled the Australian public. I openly said at the time of the last election that I would remain the leader of the Liberal Party for so long as the Party wanted that and it was in the Party’s best interests. That was the condition on which I was elected and that remains my position.

Thank you.

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Malcolm Farnsworth
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