AM - Tuesday, 24 January , 2006 08:00:00 Reporter: Peta Donald KAREN PERCY: The planned defection of the Nationals Senator, Julian McGauran, to the Liberal Party is set to bring tensions within the Coalition to boiling point.
With a Cabinet reshuffle on the way, Senator McGauran's application to join the Liberals in Victoria could jeopardise a Nationals position in the ministry.
So it's little wonder that his former Nationals colleagues are calling him a deserter.
They're also asking the Victorian Liberals to punish him by rejecting his application.
Some are pointing the finger at the Treasurer, Peter Costello, for orchestrating the move.
We'll hear from him in a moment.
But first this report from Peta Donald in Canberra.
PETA DONALD: In National Party circles, Julian McGauran is a persona non grata - accused of betrayal.
The Nationals leader in Victoria, Peter Ryan, wants the Liberal Party in his state to reject Senator McGauran's application to join.
PETER RYAN: Well I would like to think that the attempt that he's making to join the Liberal Party will fail. I'm always heartened to hear the Prime Minister talk about notions of loyalty and the importance of that issue in the sense of the way one conducts oneself in life at large but also in politics. And this of course in political terms is the ultimate act of treachery.
PETA DONALD: Senior Nationals have told AM the Treasurer Peter Costello encouraged Senator McGauran to come across to the Liberals - something Mr Costello's office denies. But a spokesman does say the Treasurer believes Senator McGauran would be a good addition to the Liberal team in Victoria. Costello supporter Victorian Liberal Senator Mitch Fifield is among those welcoming Senator McGauran with open arms.
MITCH FIFIELD: Julian would be very welcome by the Victorian members of the Federal Parliamentary party. We're about maximising the number of MPs in the Senate, and Julian's making a great contribution there and he'll continue to do so.
PETA DONALD: Senior Liberal Senator Nick Minchin also speaks glowingly of Senator McGauran.
NICK MINCHIN: Julian is a very valued member of what is a coalition Senate team, and which party he sits in is a matter for him and the Victorian division of the Liberal Party.
PETA DONALD: But there's a warning for the Victorian division of the Liberals from the former Premier Jeff Kennett. He says Julian McGauran has bitten the hand that's fed him, and when it comes to preselection next time around, Liberal Party members won't forget it.
JEFF KENNETT: Julian has been given opportunities for many years now by family and the National Party - I think this is a gross act of disloyalty.
PETA DONALD: And do you believe that many in the Liberals in Victoria will share your view? Do you think there'll be those who believe his membership should not be accepted and he shouldn't represent the Liberal Party in the Senate?
JEFF KENNETT: That's up to those who continue to serve. The bigger question is would Julian ever receive the support of the Liberal Party for the next Senate election at which he is by rotation due to stand. And I would find it very hard to believe that the Liberal Party would prefer Julian over a range of other candidates who have been Liberals for years and have a great deal to offer to the Senate.
KAREN PERCY: Former Victorian Liberal Premier Jeff Kennett, ending Peta Donald's report.
Australian National Party senator Julian McGauran left the party in order to join the Australian Liberal Party. McGauran has made comments to the effect of stating that the Liberals have the best chance of representing regional Australia.

The Prime Minister John Howard has said that McGauran was not "poached", over suspicions in relation to an upcoming frontbench reshuffle, and the Federal Treasurer Peter Costello welcomed McGauran's defection, with suspicion he may have orchestrated the move in order to bolster his leadership prospects. 

Many Nationals felt hurt; Victorian Nationals leader Peter Ryan called his move the "ultimate act of treachery".

His House of Representatives brother Peter McGauran remains in the National Party.