Controversial MP Peter Slipper stepped aside as Speaker over the weekend after allegations of sexual harassment against a male staffer and claims he misused Cabcharges appeared in News Limited papers.

The government’s majority has been shrunk to just one vote, with Deputy Speaker Labor MP Anna Burke set to step into the Speaker’s chair. It comes at a crucial time for the government, with the federal budget just around the corner and Labor MP Craig Thomson being investigated for misuse of Health Services Union funds.

James Ashby filed federal court documents against Slipper, claiming that he sent inappropriate”unwelcome sexual advances” and made “unwelcome sexual comments” via text message.

The Daily Telegraph published an extract of text messages at the heart of the allegations, including:

Thursday, January 5: Ashby was getting ready for work, when Slipper says: “You’re a strange one”. The following conversation then took place in words to the effect of: Slipper: “You’re a weird because you shower with the door shut”.
Ashby: “What’s weird about that?”
Slipper: “You’re a prude”.
Ashby: “You can call me what you like, I’m happy to war the tag of prude. I don’t know what you private schoolboys got up to in your day, but I’ve never found it normal to shower with the door open. My dad’s never done it, I’ve never done it, my mates don’t do it, that’s not weird”.
Slipper: “But you even go to the toilet with the door shut”.
Ashby: “It’s not weird and it’s normal”.
Slipper: “You should try showering with the door open”
Ashby: “It’s never gonna happen”
Slipper: “What have you got to hide? What are you doing in there?”
Ashby: “I’m not doing anything in there, it’s just not normal to shower with the door open”.

Sexual harassment allegations are a civil matter — and traditionally MPs have maintained their positions while facing civil matters — but claims of misuse of government travel funds are a criminal allegation.

These include: that Slipper spent $3000 of public money to help support his friend Jillian Law run for Tasmanian state parliament (she lost), a short taxi-ride in Melbourne at 4.19am, flights to Melbourne to interview an advisor and a taxi ride in Darwin claimed by Slipper — although he was in Canberra at the time. Another Slipper advisor, Tim Knapp, is currently being questioned by Australian Federal Police over two matters including the illegal use of a Commonwealth fuel card in Slipper’s name.

Slipper denied both the allegations of sexual harassment and the misuse of government funds. “Any allegation of criminal behaviour is grave and should be dealt with in a manner that shows appropriate regard to the integrity of our democratic institutions and to precedent,” he said. ”In relation to the civil matter there will be an appropriate process that will resolve the matter in due course.”

This is a dangerous position for Prime Minister Julia Gillard, writes Geoff Kitney in The Australian Financial Review:

“The breakdown of the relationship between Gillard and independent MP Andrew Wilkie over gambling reform means he is more likely to vote against the government. This puts the Gillard government in a much more precarious position.

It brings uncertainty back to the centre of the political contest. It increases the prospect of an early election. An accident now could be fatal — an accident such as the Craig Thomson affair suddenly turning bad and Thomson being forced to quit. This puts back at centre stage of federal politics the ugly Thomson saga, the last thing Labor needs.

Abbott called Slipper and Gillard’s deal to make Slipper Speaker — although he was not a member of the government — “a squalid and tawdry attempt to shore up her numbers, a squalid and tawdry deal which has now ended in tears.”

After Slipper stood aside as Speaker, Gillard released a statement noting it was “appropriate that Mr Slipper has stood aside as Speaker whilst alleged criminal conduct is investigated … It is also appropriate for all parties to note the processes under way and treat them with respect.”

But the Daily Telegraph is umimpressed by Gillard’s behaviour, according to its editorial:

“The independent MPs who sided with Labor following the 2010 election did so because they thought Julia Gillard’s party would provide more stability.

Our question, and doubtless the question from many Daily Telegraph readers: more stability than what? The San Andreas Fault?”

Gillard’s response says a lot about her leadership, says The Australian‘s editorial:

“But the Prime Minister seems incapable of learning that the only way for her to consolidate power in a precariously balanced parliament is to instinctively show leadership and do what is unambiguously in the public interest. She had a chance to show prime ministerial authority and respect for the institution of parliament, but missed it. Instead, she has been seen once again to appear either as weak and indecisive, or more seized by the imperatives of her political survival than her national duty.”

As Paul Sheehan writes in the Sydney Morning Herald:

“He is taking the Gillard government down a slippery slope to a level of illegitimacy I have not seen before in my years of covering politics. Not even the Whitlam government, and the constitutional coup in 1975 engineered by a reckless Malcolm Fraser, matched the impression of illegitimacy that now hangs over this government.”

Gillard appears disaster-prone, declares Dennis Shanahan in The Australian:

“What can go wrong politically goes wrong; what can backfire politically backfires. Labor is back to living on a knife-edge in even more parlous circumstances.Not all of the problems are of Labor’s making, or the Prime Minister’s, but many are and the end result is a greater uncertainty than there should be about our government and governance.”

Why is this government so dysfunctional? asks Troy Bramston in The Australian:

“Labor and Coalition MPs have known for years about a series of allegations concerning Slipper’s personal peccadillos and claims he rorted his entitlements.

Yet, in a politically craven yet ultimately mind-numbingly stupid move, the government decided to lure Slipper from the opposition benches with the prize of the Speakership. A senior cabinet minister told me at the time this was a highly risky move that would damage the government’s credibility and could come back to haunt them. It has.”