The New South Wales Liberal Party is confronting a $1.75 million legal settlement less than three months ahead of a pivotal state election, stemming from a long-running internal administrative error that barred numerous candidates from the 2024 local government elections. The financial implications come amid existing pressures on the party’s resources, including membership declines and a fundraising shortfall.
The dispute originated from a failure to lodge nominations for around 120 prospective candidates, which resulted in their exclusion from the ballots in several key local government areas, including Sydney’s Northern Beaches, Lane Cove, Camden, Campbelltown, Cessnock, Wollongong, and the Blue Mountains. This blunder led to a complete absence of Liberal representation in these locations during the election.
Under the proposed settlement, the party’s corporate entity will pay $1.75 million to eligible plaintiffs, with approximately 60 former candidates expected to benefit. Additionally, the NSW Liberals have agreed to waive three years of membership fees for the affected candidates, estimated at $36,000 collectively, and to cover $2,250 in campaign expenses for each candidate should they choose to seek preselection in the 2028 local government elections. This could potentially add another $270,000 in expenses for the party, which has traditionally relied on candidates to fundraise independently.
The financial strain is significant given the branch reported an $825,000 deficit for the 2025 fiscal year, its worst in decades. The settlement amount consumes the majority of the $2.5 million revenue declared to the NSW Electoral Commission. The court has yet to rule on legal costs, which could further increase the party’s financial burden.
The fallout from the nomination failure also saw major leadership changes within the party. State director Richard Shields resigned following the scandal, and the NSW division was placed under federal administration by then-opposition leader Peter Dutton. Former premier Nick Greiner was subsequently appointed to oversee the administration before handing control back to a reduced state executive earlier this year.
The settlement terms, due for final approval at a NSW Supreme Court hearing scheduled for December 11, include a guarantee of preselection for those former candidates who remain fee-paying members, contingent on passing the usual vetting process. Their nomination fees will also be waived in future elections. Lead plaintiff John Moores, a former Cessnock deputy mayor, described the experience as “painful,” emphasizing the dedication these candidates had to their communities and the disruption caused by the administrative oversight. He expressed hope that the settlement will allow parties involved to move forward.
An apology with “suitable wording” is also part of the settlement conditions. Electoral analyst Ben Raue has been engaged to assess candidates’ prospects of electoral success. Compensation is expected to be awarded to those with strong chances, while candidates with what Justice Ian Pikiput described as an “outside chance of winning” will not receive payments. Following deductions for legal and administrative costs, just over $1 million is projected to be shared among the eligible plaintiffs.