Gillard | How far will she stick her neck out to save her Government?

Julia Gillard backs MP Craig Thomson over Labor gift declaration

• UPDATED Ben Packham
• From: The Australian
• August 17, 2011 4:03PM

Federal Labor MP for Dobell Craig Thomson near his Tuggerah electorate

office on NSW Central Coast this week.

Picture: Gary Graham Source: The Daily Telegraph

Julia Gillard has restated her confidence in Labor backbencher Craig Thomson, forgiving him for the late declaration to parliament of a financial gift from the ALP to settle his legal bills.

But the MP for Dobell, whose former union credit card was allegedly used to procure the services of prostitutes, is still to declare his interest in a local community group allegedly set up with union funds.

The former Health Services Union secretary updated the register of members' interests last night, well after the allowable 28-day time limit, admitting the ALP's NSW branch had paid a “sum of money” to to his lawyers on his behalf.

The payment follows an aborted defamation claim by Mr Thomson against Fairfax media.

The declaration does not disclose the sum involved, reported to be $90,000.

He is yet to declare on the register of interests his position as an authorised public officer for the Coastal Voice Community Group, an incorporated entity used by Mr Thomson as a campaign vehicle to win Dobell in 2007.

Labor is desperate to avoid a by-election in Mr Thomson's seat, fearing it could bring down its fragile minority government.

Bankrupts are disqualified from sitting in parliament under the Constitution.

“I have complete confidence in the member for Dobell,” the Prime Minister said today.

“There is more than one member of this parliament that has declared things late. Of course people should abide by the rules.”

The Daily Telegraph reported today that the ALP gave Mr Thomson $40,000 to settle his legal bills and about $50,000 in the form of a personal loan.

It's understood the register of interests was amended following inquiries from the newspaper.

Mr Thomson recently dropped his defamation case against Fairfax over allegations his union credit card was used to procure the services of prostitutes.

He claimed the credit card was used by someone else.

In a letter to House of Representatives deputy clerk David Elder, Mr Thomson said the money went to his legal counsel, defamation specialists Kalantzis Lawyers.

“In May 2011 the Australian Labor Party (New South Wales Branch) paid a sum of money in settlement of a legal matter to which I was party,” he said.

“While I was not the recipient of the payment, for the avoidance of doubt I am updating my register of interests.”

Liberal senator Ronaldson said Mr Thomson had “lived the high life” on union funds, and the Labor Party had closed ranks to protect him from bankruptcy and disqualification as an MP.

“We know that the only thing standing between Craig Thomson and bankruptcy is the Australian Labor Party with loans and payments being made,” he told the Senate.

“And we know the only thing standing between Craig Thomson and Section 44 of the Constitution is the payments of the Australian Labor Party, because if he were made bankrupt, he would no longer be entitled to be a member of this Australian parliament.”

Opposition legal affairs spokesman Senator George Brandis said Mr Thomson must answer a series of questions about his conduct, and Ms Gillard must say whether she was satisfied with his responses.

“Given that Thomson's mobile phone was used to contact the service provider, and that his driver's licence was produced to verify payment, how did his credit card, driver's licence and mobile phone find their way into the possession of another person?” Senator Brandis said.“Why was their loss or misappropriation not reported?”