Craig Thomson’s arrest on 150 fraud charges will cause reputational damage to the Gillard government but is extremely unlikely to topple the 43rd parliament prematurely.

As Crikey noted last October following the last New South Wales Police raid, absent of a Thomson resignation there are at least five flaming hoops that would need to be jumped through — including a charge, a conviction and an unsuccessful appeal (or appeals) and a byelection before July for the independent Dobell MP to be forced off Capital Hill.

The much more likely impact is that preselected Liberal candidate Karen McNamara will more easily rein in Thomson’s 5.1% margin and snag Dobell — as expected — on September 14.

Under the constitution, an MP must leave Parliament if they are convicted of a crime that carries a penalty of over a year. But there is zero chance a Thomson trial, conviction and various appeals will be completed before mid-year — the last point the Coalition could legitimately argue that the government should call an early byelection that must be held, like a general election, between 33 and 58 days after writs are issued. The process can take three months from go to whoa.

On the floor of the House, where Labor has 70 MPs, it needs five of seven crossbenchers to pass legislation or four to defeat a motion with Anna Burke to break a tie. Thomson will rightly ignore Coalition demands that Labor offset his vote, with Tony Windsor, Rob Oakeshott, and Adam Bandt all but guaranteed to remain in the government column. As we wrote last year, assuming Peter Slipper continues to vote with the government, Gillard would still hold a 76-74 advantage in the House before the exclusion of the Speaker, or 75-74 with Burke in the chair.

If Slipper votes with the Coalition in a motion of no-confidence we’re getting closer to a new poll, although all indications are he won’t act to bring down the government. Andrew Wilkie has already said he probably won’t back any no-confidence motion unless it relates to a proven instance of sleaze.

Thomson is protected under the Parliamentary Privileges Act from appearing in court if the hearing is scheduled five days either side of a parliamentary sitting day or a meeting of a parliamentary committee — he’s currently on the House economics committee.

Thomson’s lawyer, former Australian Workers Union official Chris McArdle, told Sky News yesterday his client would plead not guilty to all charges “because he hadn’t done anything”. He says any money spent by Thomson during his five-year term as Health Services Union national secretary between 2002 and 2007 was done so “lawfully and in accordance with the rules of the union” and reiterated his client’s claim he had been setup by union rivals.

NSW Police appear to have tipped off a Channel Seven camera crew to the impending raid and humiliating “perp walk”, currently being beamed around the nation. McArdle says Seven cameramen were stationed outside Thomson’s Central Coast electorate office since 7am — suggesting the force’s savvy media unit was getting busy on the secret texts.

McArdle also questioned the amount of muscle present — five officers; two from Victoria and three from NSW — who walked Thomson to a nearby unmarked station wagon. The NSW fraud officers including Colin Dyson were acting on behalf of Victorian fraud squad detectives who commandeered boxes and handwriting samples from Thomson’s house last year and have been busy combing through the records of the former national office. Their burly presence was tailor-made for a media feast.

“What were the other three doing then? Handing out press releases?” McArdle told Sky. The unit was certainly on the front foot: at 1.22pm yesterday afternoon, NSW police posted on its website a release eagerly informing the public an arrest warrant had been issued for a “48-year-old man” for “fraud against the Health Services Union”.

Thomson appeared in a Wyong court yesterday and will appear in the Melbourne Magistrates’ Court on Monday. But McArdle says Thomson won’t be “extradited” but simply travel to Victoria to appear, precluding any Mrs Petrov-style forced embarkations. He told the ABC his client has effectively been charged with “buying an ice cream” and told Sky that he’d spent $300 on ancillary expenses.

The VicPol-auspiced swoop will no doubt raise questions as to whether its separate probes of the Victorian No. 3 and No. 1 branches, previously controlled by Kathy and Jeff Jackson respectively, are close to completion, and if so, whether anyone else will face charges.

Here’s what Crikey wrote last October on the extreme unlikelihood of Thomson’s predicament leading to an early poll. With Julia Gillard anointing September 14 election day, an unlikely by-election would have to be called by July 10 at the very latest if it were to occur before writs are issued on August 12. And even then the opposition would still lack the numbers in the House …

  1. The constitution mandates an MP is banned if they are convicted of a crime that carries a penalty of over a year, regardless of how much time they are actually sentenced to. So, for example, if Thomson was ever convicted of fraud or theft under the Victorian Crimes Act he would be banned from federal Parliament because that crime is “punishable” by up to 10 years in prison. But an early exit from parliament would require a subsequent trial and all appeals would have to be exhausted.
  2. The other option is bankruptcy stemming from Fair Work Australia’s civil claims — that could (although probably won’t) attract penalties of up to $450,000. But as McArdle and industrial relations academic Andrew Stewart explained last year, those could well fail on a two-year statute of limitations provision, pending the outcome of an appeal in the Toyota Materials Case currently before the Federal Court.
  3. Assuming one or both of those bans eventuated, a byelection in Dobell would then need to be won by the Liberals’ Karen McNamara (held by Thomson by 5.1%).