Jeff Kennett: The Politician Business Loves Most

No one had anything to gain, but 700 members of Club Melbourne turned up to hail Jeff Kennett at a special thank you dinner. Stephen Mayne explains who was at the Grand Hyatt last Wednesday and why.
The old saying that there is nothing as ex as an ex politician doesn’t apply to Jeff Kennett. Last Wednesday night, Crikey spies perched themselves at the top of the escalators of the Grand Hyatt in Melbourne and were stunned at the roll-call of heavy hitters that emerged from the Jeff Kennett tribute dinner.

Unlike the $1000 a fundraiser Steve Bracks held in December, there was no chance of getting the guest list with security guards stationed at the top of the escalators shepherding visitors away from this strictly private function. But no-one can stop you having a drink and watching 700 guests leave.

John Hamilton wrote an excellent piece in the Herald Sun on the dinner and reported that 700 attended with a further 200 on the waiting list.

They ate Yarra Valley king salmon served with grilled mango, lime and garden salad for starters followed by Hopkins River tenderloin medallions in white truffle oil slide down. The wine included Alfred chardonnary and Chateau Tahbilk cabernet sauvignon.

The Prime Minister spoke but old Kennett enemies Michael Kroger and Peter Costello were noticeably absent. As far as the Melbourne business establishment was concerned, it was the biggest turn up at a function since the opening of Crown casino in May 1997.

The dinner was organised by Liberal Party Treasurer and close Kennett mate Ron Walker along with that pillar of the Melbourne establishment Hugh Morgan.

The fact that it was organised by Morgan, a product of the Melbourne establishment, says it all. Morgan survived as CEO of WMC after blowing up $500 million of shareholders’ money in Canada 10 years back, getting savaged by a Canadian judge and then getting done over for claim-jumping on the Ernst Henry copper-gold deposit in Queensland.

Morgan has long been a key financial backer of the Liberal Party through WMC and was appointed to the Reserve Bank board by Treasurer Peter Costello where he got involved in another controversy for knowing before the market about the central bank’s planned sale of most of its gold reserves.

Anyway, Crikey will have plenty more to say about Hugh down the track.

The names that Hugh and Ron managed to pull to thank Jeff and hear the PM speak said it all.

The four page program on each table contained some fitting tributes to Jeff which started by quoting Churchill: “There is no use saying ‘we’re doing our best’. You have to succeed in doing what is necessary.To do what is necessary take courage, leadership and vision.”

It then went on to say: “While Premier Kennett succeeded in doing what was necessary for Victoria he was indeed the right man at the right time. We thank and honor him.”

And honor him they did. Try this for size. The chief executive or chairman of 11 of Australia’s top 20 companies were there.

Steve Bracks lured James and Jodie Packer down from Sydney for his dinner in December but PBL has $1.8 billion at stake in the heavily regulated Victorian casino industry, in which they are the monopoly owner. There were lots of PR flaks and government relations types who were sent along to dutifully fly the flag at the Labor dinner. Jeff didn’t need to stoop to that. It was restricted to genuine heavyweights and friends of Jeff.

Jeff certainly got a more impressive contingent down from Sydney including Qantas chief executive James Strong, tottering AMP and CSR chairman Ian Burgess, AMP chief executive Paul Batchelor, serial director Nick Greiner, News Corp director and PMP Communications chairman Ken Cowley and PMP chief executive Bob Muscat.

While Crikey did not get into the meeting, Kate Askew reported in the Sydney Morning Herald’s CBD gossip column that John Howard was seen deep in conversation with Ian Burgess. Could this have related to whether AMP planned to sue John’s brother Stan for his performance as chairman of GIO. Crikey, Stan really has a few things on his plate at the moment which no ordinary 72 year old would want to deal with.

Burgess was one of the earliest to leave who, along with Telstra finance director Paul Rizzo, was spotted walking up Collins Street as we arrived at about 10.20pm.

It was fascinating watching who was chatting to who as guests descended down the escalator. That was AMP boss Paul “poisoned chalice” Batchelor shaking hands with Geoff Tomlinson, the former National Mutual CEO who was ousted by his French bosses at AXA.

Crikey imagines Thommo would have said something like this: “I know what it’s like taking over a basket case Batch. Good luck, you’ll need it. Hopefully you’ll be able to blame Trumbull and Burgess for the GIO debacle.”

Part of Thommo’s new gig is as a director of Mayne Nickless, a once great company which is going out the back door having slumped from $5.92 to $3.20 this year.

It is amazing to think that the once great Mayne Nick has now fallen out of the top 100 and is capitalised at $1.1 billion. It’s 25 per cent stake in Optus that was distributed to shareholders last year is now worth about $5 billion. Wow.

Mayne Nick chairman Mark Rayner must be asking himself why they didn’t stay in the telecommunications game instead of getting clobbered by labour disputes and low growth in industries such as logistics and healthcare. It is the sort of question former Pacific Dunlop chief executive Phil Brass, who was at the dinner, would ask when he reflects back on the decision by former chairman John Gough and co to dump food and stay in low-growth industries such as textiles, tyres and batteries.

Rayner was at the dinner seated on an exit table. He also chairs NAB which has plunged from a high of $30 to $20 over the past year, partly because of growing fears about the $32 billion legal action by John Maconochie’s Idoport group. See the separate 3,500 word story on this site for the full explanation of this emerging disaster.

Rayner grew up in the Rio Tinto stable but left with a $2 million payout when Leon Davis was appointed to succeed John Ralph as chief executive. Somehow this qualified him to chair NAB, Mayne Nickless and Pasminco in a stark example of “Club Melbourne” at work. He’s the Melbourne equivalent of Ian Burgess in “Club Sydney” and both are looking pretty vulnerable at the moment.

The so-called Murdoch conspiracy against John Howard made the attendance of Rupert’s mum and sister at the dinner very interesting given that the PM spoke. Dame Elisabeth puts Liberal posters on her property during elections and Murdoch’s Herald Sun backed Jeff to the hilt for the seven years he ruled Victoria. But what would John Howard have said to the good Dame and her daughter Janet Calvert Jones at the Jeff dinner.

Crikey’s fertile imagination has come up with this:

JH: Hello Dame Elisabeth, can you tell that rascal of a son of your to lay off me. He’s already worth $27 billion, digital telly in Australia would be just a drop in the ocean.

DEM: Look, Rupert’s been a little rascal for the last 50 years even since he got Sir Keith’s Adelaide News in 1953. There’s nothing I can do about it. His three sisters each got about $1 billion out of it so we think its fair that he keeps the other $24 billion given that he’s created the thing which keeps beating up on you.

Malcolm Colless, the News Ltd lobbyist widely believed to be the man who said over a drink at the Canberra Press Club after the digital decision that News was “going to get little Johnny Howard”, was one of the few dinner guests at Jeff’s function who retired to the bar afterwards for a drink.

Colonial chief executive Peter Smedley was another but apart from that most people had retired by midnight, unlike the Bracks dinner which saw many guests schmoozing with union heavyweights and other powerful figures in the Labor Party until the early hours.

Other interesting groups chatting on the escalotors included Lloyd Williams who said a warm hello to Janet Calvert Jones. Afterall, Janet’s husband and Rupert’s brother-in-law John Calvert Jones was a Crown director for the first couple of years.

Other big names that we spotted leaving included Coles Myer chief executive Dennis Eck, his chairman Stan Wallis, Village Roadshow chief Graham Burke, Jeff’s old broker turned Transurban chairman Laurie Cox, MCG Trust chairman and power industry seller John Wylie, the man behind 3AW John Dahlsen, Tabcorp chairman Michael Robinson, trucker Lindsay Fox, Crown builder Bruno Grollo and the chairman-elect of AXA Australia, Rick Allert.

There were a number of people who walked down both sides of the street by attending both the Bracks and Jeff dinners.

These include MCG Trust chairman John Wylie whose firm CS First Boston earned about $90 million selling $29 billion worth of power assets for Victorians. It would be interesting to know if Bracks has called in Wylie or Dr Peter Troughton to advise him on the various power industry problems in Victoria. Or maybe he should hire Alan Stockdale services from Macquarie Bank. Crikey reckons this would be logical but politics would preclude it.

Laurie Cox was another who turned up to honor Jeff and was also there at the Bracks dinner, perhaps out of concern about his future as chairman of Transurban which has generated tax free profits of about $2 million for Jeff’s former stockbroker.

Another two sides of the street man was networker Graham Samuel who Kennett appointed to head one of his hospital networks and the Docklands Authority. He is a former Victorian Treasurer of the Liberal Party so it will be interesting to see if the Bracks government keeps him on. So far they have barely punted anyone who was closely alligned to the Kennett government as Bracks tries to win the confidence of the business community.

This was the final irony of the Jeff dinner. It came as business confidence in Victoria reached lows not seen for some time after the entire Docklands project, with the exception of the new stadium, fell over amid industrial chaos being wreaked by those very same unions which fund the Labor Party. Adding insult to injury was the decision by Richard Branson to establish his regional headquarters in Brisbane.

Politics is all about perception and that was the game that Jeff played best. No-one would remember that Alcoa, Rio Tinto, Woodside Petroleum, Comalco and much of Shell and BHP Petroleum all relocated away from Melbourne during the Kennett years. But no one talked about this because the unions were kept under control, the budget returned to surplus, the AAA credit rating was recovered, $35 billion in public assets were sold and investment in civic and economic infrastructure was resumed.

This is the legacy which business came to thank Jeff for last Wednesday. Unless Steve Bracks can do something pretty quickly, he will struggle to get 50 business leaders to a tribute dinner after he loses office.

Editor’s note: It is definitely worth comparing this list with the Labor Party fundraiser table seating arrangements which is published elsewhere on this site.