Prime Minister Kevin Rudd says the Australian Federal Police will investigate whether someone impersonated a public servant and made up a fake email that is at the centre of the OzCar scandal engulfing the Government.

Mr Rudd said Opposition Leader Malcolm Turnbull had claimed to be in possession of documentary evidence that indicated the Prime Minister's office had lobbied on behalf of Ipswich car dealer John Grant.

Mr Turnbull had now changed his tune and Mr Rudd said his integrity was at stake.

"Today Mr Turnbull is in full retreat on this claim," Mr Rudd told reporters in Canberra.

"How easy it is in the business of national politics simply to throw mud at people and then, having thrown the mud, to run away.

"Mr Turnbull's done that today."

The Opposition Leader said today that he wasn't in possession of a purported email sent by Mr Rudd's senior adviser Andrew Charlton to Treasury official Godwin Grech, who runs the $2 billion OzCar scheme.

Mr Turnbull also insisted the email "was not composed by anyone in the Opposition''.

http://www.smh.com.au/national/pm-announces-email-inquiry-20090620-crrw.html

Opposition Leader Malcolm Turnbull has 24 hours to produce the alleged email at the centre of the OzCar affair or resign, Prime Minister Kevin Rudd says.

"Mr Turnbull and the Liberals have been boasting for a long time now that they are in possession of this information. Well the time has come to produce this information to the parliament for authentication," Mr Rudd said on Sunday.

"If when parliament resumes in 24 hours, Mr Turnbull fails to produce this email, this email upon which his entire case against the government is based, for authentication he has no alternative but to stand in the parliament, apologise, and to resign."

http://www.smh.com.au/national/rudd-gives-turnbull-24-hours-to-produce-email-evidence-20090621-cs89.html

from Crikey

Utegate cage match: Malcolm on the back foot

Canberra correspondent Bernard Keane writes:

Malcolm Turnbull has stumbled into a fight to the death unprepared and, it seems, outgunned.

The Opposition had Wayne Swan right where it wanted him. It appears Swan wanted John Grant's concerns taken care of to the extent Treasury could. In that, Swan is no more guilty of impropriety than any other minister of recent years, but his denial of it in Parliament was a bad look and establish a case to be answered. This should not be lost sight of amid the dramatic developments today about the email.

But, cavalierly and apparently without thought as to the longer-term repercussions, Turnbull casually targeted the Prime Minister as well. While there is much about Turnbull to admire, his tendency to half-smart politics may yet be a fatal flaw. This was an overplaying of a strong hand, and it was all Rudd needed. Since Friday evening, when he came into a press conference to declare that no email had been found and he had requested the ANAO to investigate, he has masterfully redirected all the attention that should be focussed on Swan back onto Turnbull.

It's a lesson that, if Malcolm Turnbull was able to take on Kerry Packer in his pomp and win, Kevin Rudd is no slouch at deathmatches either and knows more about politics than his opponent, who has only been around for four years.

The Opposition is now trying to back away from the Charlton-Godwin email at a rate of knots. Backbencher Stuart Robert this morning remarkably said ""we've never actually made reference to it at all." Eric Abetz discussed it in Hansard on Friday, and in any event seemed to have it two weeks ago when he initially grilled Grech at Senate Estimates about contact with the PMO. The Opposition is correct to say that it is a distraction, but it's an effective distraction because they have made so much of it.

And then there are the implications of the Opposition's claims. For the Opposition's claims to be true, the Prime Minister, the Treasurer, their offices, senior officers in PM&C and Treasury and/or workers at the companies that provide those departments' IT services must have engaged in the biggest cover-up in Australian political history. If true, all would have to go, and possibly, in the case of the public servants concerned, their Department heads as well.

And all over a simple email asking that a car dealer be contacted.

As for Wayne Swan, he appears to have misled Parliament, albeit on a matter of trivia. What Swan did was unexceptionable by current ministerial standards. A Government backbencher asked for assistance for a motor dealer and he got it. The only surprising aspect of it is that Swan's office actually took seriously Kay Hull's similar request for help and actually did something about. That didn't happened much under the Howard Government.

But there is a prima facie case against Swan, who has to produce evidence other dealers got similar treatment to Grant. If he can't, he'll have to hope the news cycle moves on quickly enough for him to survive. And if he does, he will have Turnbull's sloppy work to thank.

The Herald has also learned that Godwin Grech, the official at the centre of the OzCar affair, is now suspected of being a "Treasury mole" who has been involved in leaking material to the Opposition over the past 18 months that has been used to embarrass the Government.

The Australian Federal Police, already investigating Mr Grech over the fake email, is understood to have widened that probe into other leaks concerning the ill-fated FuelWatch scheme and behind-the-scenes concerns over the Government's bank deposit guarantee.

Mr Turnbull refused to comment on the claims, saying he did not reveal his sources.

As he dusted himself off yesterday and sought to renew the attack on the Government over the OzCar affair, Mr Turnbull faced a mini-revolt in the party room over a shadow cabinet decision to oppose a bill that would free asylum seekers from having to pay for the cost of their detention.

http://www.smh.com.au/national/libs-ready-to-defy-turnbull-20090624-cvi7.html