During the District Court trial of Western Colleries Limited[a] director Tony Lloyd, his defence lawyers argued that Premier Dowding and Acting Energy MinisterJulian Grill had ordered Lloyd to pay off a Rothwells debt using a $15 million cheque. In January 1990, Lloyd was found guilty of acting improperly, making him the first person convicted for an offence relating to WA Inc.[b] This made the Dowding Labor Government even more unpopular,[2][5][4] with opinion polls showing support was as low as 32%.[3] Dowding's popularity was also hurt by his arrogant attitude, which annoyed colleagues.[4]
Additionally, the 1990 Australian federal election was coming up, and the Labor Party wanted to limit the seats lost by the party in Western Australia. Having a state leader less associated with WA Inc would have helped with that.[2][3][6]
Leadership election
State Secretary Stephen Smith, FMWU Secretary Jim McGinty, and seven Labor politicians – Carmen Lawrence, David Parker, Ian Taylor, Kay Hallahan, Keith Wilson, Geoff Gallop and Pam Beggs – met together to discuss Peter Dowding's leadership. They decided that he should be forced out of the leadership.[4] By 7 February 1990, the majority of the 47 members of the Labor caucus had signed a letter calling for Dowding's resignation.[1][2] Minister for Education and Aboriginal Affairs Carmen Lawrence and Minister for Police and Emergency Services, Conservation and Land Management, and Waterways Ian Taylor were seen as most likely to win the leadership, with Lawrence having a slight edge over Taylor.[7]
On 8 February 1990, Dowding returned early from the World Economic Forum in Switzerland in order to shore up his leadership, spending the next several days speaking to party members in an attempt to ensure their support.[4][8] He also held a cabinet meeting on 9 February.[9]
At a caucus meeting on 12 February, Dowding and his deputy, David Parker, resigned from their positions. Lawrence was elected as the leader of the Labor Party, making her the first female premier in Australia.[c] Taylor was elected as the deputy leader of the party, making him the deputy premier of Western Australia.[2][11] Both were elected unopposed.[12] Lawrence was seen as a good candidate as she had little association with WA Inc.[3] Dowding criticised the leadership challenge, saying that the timing was premature and was done to help Labor win the federal election, rather than for what's good for the state.[4]
Aftermath
Parker remained in cabinet, serving as the minister for resources, trade and the arts. He resigned from parliament on 26 April 1990. Dowding was on the backbench until his resignation from parliament on 26 April 1990. Grill was put on the backbench as well.[2][4][12] An opinion poll showed that support for the federal Labor Party in Western Australia increased following the leadership change. The poll also showed that WA Inc would influence the decision of 56% of Labor voters, down from 65% the previous week.[13] At the federal election held in March 1990, the Labor Party only lost one seat in Western Australia.[1]