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. Last Updated: 07/27/2016

Shares Scandal Hits Australian Ministers

CANBERRA -- Australia's conservative government, facing its biggest crisis since its election in March, was forced to defend itself Monday over a ministerial share scandal in the face of a concerted opposition attack.

Prime Minister John Howard rejected allegations that shareholdings of some ministers, key officials and their family breached strict ethical guidelines for his administration.

The shares row Sunday claimed the scalp of Assistant Treasurer Jim Short, who quit after admitting he had breached ministerial ethics rules by keeping bank shares while he was responsible for decisions affecting the banking industry.

It was the first time a minister had been forced out of his job, despite several controversies in recent months.

Howard on Monday defended Treasurer Peter Costello and Costello's parliamentary secretary, Brian Gibson, against opposition claims they had broken the government's code of conduct.

Labour targeted Costello over his wife Tanya's ownership of several hundred shares in Commonwealth Bank of Australia Ltd and retailer Woolworths, saying there was a potential conflict of interest and that Howard's ethical guidelines were unclear.

But Howard rejected the accusations.

"In no way has he breached the [ethics] guidelines," he told Australian Broadcasting Corporation radio, adding that partners of ministers had a right to independent investments and income.

Gibson is under fire for keeping shares in National Australia Bank and Bank of Melbourne after being appointed to his post. He ordered his shares to be sold last week after a row erupted over his holdings.

But Howard said there was no conflict of interest.

"Because he was not assigned specific responsibility for banking legislation, I did not believe that he was in breach of the guidelines," Howard told parliament.

Opposition leader Kim Beazley said Howard had shown a lack of leadership and had failed to control his ministers.

Commentators and newspaper editorials criticized Howard for lack of leadership and failing to enforce his own standards.

"Mr. Howard will find it difficult, if not impossible, to sustain his argument that this is a government that imposes and expects the strictest standards of behavior," The Age newspaper commentator Niki Savva wrote.

The Australian Financial Review newspaper, in its editorial, said: "On this and other matters, Mr. Howard is showing a worrying tendency to allow distasteful problems to drag on instead of acting quickly to put them to rest."

Howard returned the conservative Liberal-National coalition to power in March after 13 years of Labor rule.

His platform included a commitment to strict moral values and higher parliamentary and ministerial standards of conduct.