GIFT OR POISON CHALICE?

ON WEDNESDAY night, his 61st birthday, Denis Napthine appeared on television as the Liberal Party's new leader, soon to be premier of Victoria. Compared with the man he just replaced - the fit and strapping Ted Baillieu - he cut a less than inspiring figure. Here was a 61-year-old from the bush looking very much the compromise candidate. On television he appeared like a kindly country uncle come to care for his city nieces and nephews in troubled times.

Napthine is much-liked, especially in rural Victoria, and a man widely respected as a disciplined, hard-working minister. But he is also a largely forgotten and overlooked politician, barely mentioned in the feverish recent chatter about a potential successor to the beleaguered Baillieu. He's a recycled leader, rolled by Robert Doyle more than a decade ago after his personal approval rating sank as low as 8 per cent in opposition.

Victorians watching on Wednesday night had good reason to ask whether Denis Napthine was the best the Liberals could do.

In the aftermath of Victoria's dramatic leadership change this week, the Coalition government is facing some serious questions. It may have switched leaders, but the party's senior ranks are unchanged, the rogue MPs and former advisers - Benambra's Bill Tilley, Frankston's Geoff Shaw and former police adviser Tristan Weston - still have the power to create havoc and chaos. The leadership ambitions of young ministers such as Matthew Guy are likely to percolate and leadership speculation continue. Is the vet from Portland really going to lead the Coalition to the 2014 election and what are his chances of victory if he does?

Ted Baillieu's downfall as premier was a remarkable political event. It was 23 years since John Cain jnr was the last Victorian premier to resign under political duress. Baillieu was just over midway through his first term. Many had noted some improvement in the former premier's performance: some strong speeches, a string of policy announcements. The White Night festival was a success.

"I really thought he'd moved to the next stage in his communications strategy," said former state director and Baillieu ally John Ridley.

Labor, meanwhile, had factored in eight years of the Coalition in power because they knew Victorians rarely threw out one-term governments. They had done little of note in opposition - except the significant achievement of maintaining unity - and yet this week, with the government in crisis, the opposition suddenly found itself in the game and with a real prospect of taking back power in 2014.

It seems there was no one thing that finally broke Ted Baillieu's leadership. Labor's taunts that Baillieu was a "do-nothing premier" were sticking. The member for Hawthorn never really seemed comfortable in public and failed to sell his message. He was managing a declining Victorian economy - which coincidentally slipped into recession this week - and public service cuts were beginning to hurt. Former premier Jeff Kennett had given the government an unsolicited and scathing report card.

A few weeks later, the poisonous police leadership dispute - which has now claimed more scalps in Victorian politics and the public service than anyone cares to remember - hit the government in a swirl of bad headlines and controversy.

Secret tapes obtained by the Herald Sun had revealed Baillieu's chief-of-staff, Tony Nutt, offering to help get disgraced ministerial staffer Tristan Weston a job, and that the Liberal Party had paid him $22,500. Baillieu's decision to refer Nutt's actions to the anti-corruption watchdog - and yet keep him on as chief-of-staff - raised eyebrows. Frankston MP Geoff Shaw's bombshell defection from the party, and his citing "the general loss of confidence Victorians are feeling in the leadership of the government" for it, was the last straw.

But all of this does not fully explain why an elected first term premier lost his job. His enemies cite the polls. But most seasoned political observers hardly considered them devastating.

Indeed, the toughest week of Baillieu's political life began on Monday with a slightly improved position. That poll found Labor would emphatically win back government with a two-party-preferred vote of 53 per cent to the Coalition's 47 per cent, but the poll in November/December had Baillieu in a worse position, 55-45.

Monash University politics expert Paul Strangio writes in The Saturday Age today that the government's standing in the polls was "hardly irretrievable" so far from an election. But, as Strangio says, these are not patient times. These are - as Kevin Rudd found out - the times of "politics on speed", when governments and leaders operate in compressed time cycles.

Modern governments, says Strangio, no longer follow "the familiar trajectory of honeymoon and consolidation and eventual decay, they prematurely age and precipitously unravel".

After this unravelling, the question for the Victorian Liberal Party and the Coalition government is: what next? Strangio says the challenge ahead for the Liberals is great. The party once regarded itself the state's natural ruler, but has struggled electorally now for three decades. The evidence since 2010 suggests, says Strangio, that the Liberal Party has "lost its governing knack".

There are a number of issues the Coalition must confront post-Ted. Putting Napthine's performance aside, the party still has the same leadership team and the same loose cannons to contend with. These, specifically, are: Geoff Shaw, who seems to be enjoying his new-found power as an independent, ex-ministerial staffer Tristan Weston, who senior government sources accuse of running a behind-the-scenes campaign against Police Minister Peter Ryan, and Benambra MP Bill Tilley, who resigned as police parliamentary secretary after an unfavourable Office of Police Integrity report. He, too, has the Nationals leader in his sights.

But the first issue to deal with is the anger over the push against Ted Baillieu. The party's parliamentary leadership is keen to ensure comparisons are not made to Kevin Rudd's political assassination, so events are being carefully portrayed as "Baillieu's decision". But Fairfax Media understands that while no spill was suggested, there was a concerted push against Baillieu on Wednesday that forced him into an untenable position. It's unclear which MPs were pushing the most. But there are many within the party who are furious.

John Ridley, Baillieu's friend and an elder Liberal statesman in Victoria, is one of them. He's angry the former premier was cut off at the knees, just as he was hitting his stride. "Personally I find it very sad that a couple of political pygmies have brought down a man who was not only physically large but a large man in Australian politics because of his principles and capabilities," he said.

Ridley is here clearly talking about Liberals including Shaw, a small businessman and evangelical Christian from Frankston. Like Baillieu, Ridley is very much of Victoria's old school of leafy-streeted, small-l liberalism. There is a hint of "how dare they" snobbery in the commentary of the old guard about the likes of Shaw triggering the fall of Ted from Toorak.

"It is astonishing to me as a former state director that there are apparently people in the Parliament on the Liberal side who are unable to act in the collective best interest and forget that they're only in the Parliament because they had the support of the party and the leader, and suddenly get utterly inflated ideas of their own importance," he said.

The leadership speculation around Planning Minister Matthew Guy - and, to a lesser extent, his ministerial colleagues Michael O'Brien and Mary Wooldridge - gives rise to the prospect that Napthine is a seat-warming premier: the holding-pattern leader to be replaced by Guy or some other new-generation Liberal leader.

Some within the party insist that this week's events were an accelerated version of a longer-term plan by Guy and his supporters to destabilise Baillieu, the end game being the party calling upon the young Planning Minister to step in for the party's sake. The problem, according to this theory, is that events moved too quickly, with Baillieu's shock departure and anointment of Napthine a surprise move that wrong-footed Guy.

Guy and Napthine are close: the Planning Minister once worked for the Premier. And Fairfax Media understands the Premier some years ago offered Guy his lower house seat (premiers usually sit in the lower house and Guy is in the upper house). But the problem with a leadership switch before the 2014 election is that three premiers in one term will smack of Labor's record in NSW.

A senior minister insisted there was "no doubt" Napthine would lead the party to the next election, but acknowledged Guy may well take over at some stage beyond the 2014 poll. Another minister, with a clear depth of feeling, insisted Guy would not be made leader before the next election. "I guarantee that will not happen," he said.

The test for the Coalition will be its loyalty to Napthine in the event of further bad polls. Will they panic? Senior Liberal sources insist they won't and that Napthine is a "genuinely different" person to Baillieu, enough so to be a "circuit breaker".

"This is a sort of rebooting moment," says one. "I think you will find people will pull together. A lot of that [disunity] was driven by frustration with Ted. They will pull together now. It's only 18 months until the election and it's either work together or lose."

Some Liberals worry that the parliamentary party is still stuck in the paradigm that dominated under Jeff Kennett - that success hinges on the leader alone. In order to win in 2014, the MPs and the leadership team need to defend the leader if he is under attack and lift their game generally, goes this train of thought.

This will be particularly important next year. If federal Liberal leader Tony Abbott wins the election, Victorians will be heading into a state election having experienced the first year of a federal Coalition government. Some Liberals believe the sort of cuts Abbott will make will leave his state counterparts vulnerable. Others, such as John Ridley, believe Abbott's promise of funding infrastructure projects such as the controversial east-west road tunnel will help.

In some parts of the party there is a general despair about its state parliamentary representatives in Victoria. Some Liberals freely admit that the Napthine frontbench simply does not have the depth of the former Labor government's leadership team - the likes of Rob Hulls, John Thwaites, John Brumby and Steve Bracks.

This paucity of talent, on the frontbench and backbench, seems to be due to several things. The federal sphere is attracting much of the Liberal Party's best talent from Victoria. In 11 years of opposition, over several elections, the Victorian Liberals missed the chance to revitalise the parliamentary party by pushing underperformers out and recruiting strategically. Many people in the party did not believe Baillieu would win in 2010, so potential candidates who would have made strong MPs simply did not stand.

Unlike the Labor Party, which often installs candidates in seats over the wishes of locals, the Liberal Party's preselection processes are decentralised. The local members vote and choose. Party members may be regretting the preselections of Geoff Shaw, Tristan Weston (who stood for the seat of Macedon in the 2010 election before working in Peter Ryan's office) and Bill Tilley. But this is the broad church that Napthine now has to unite to avoid the humiliation of the "natural party of government" being tossed out after one term.