Paterson's quiet grip on power

Saturday 31 October 2026

Sumeyya Ilanbey and Myriam Robin

Australian Financial Review

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The 38-year-old powerbroker and his wife are key confidantes to Victorian Opposition Leader Jess Wilson as she targets only the second state Liberal victory this century.

“They say your worst day in government is better than your best day in opposition,” James Paterson says with a touch of disdain. “It’s not true at all.”

The Liberal senator from Victoria has just been asked why he’s so cheery when his party is in the doldrums, One Nation is on the march and the prospect of a federal Coalition government is looking ever more distant.

The truth, he says, is that life has not changed that much for him in opposition. After all, he was never a minister, and never needed the office to effect change.

“I don’t know why we give people that advice,” he says of the aforementioned and widely held belief that achieving government is all that matters in politics.

“It’s just madness. If you think the purpose of politics is to have staff and cars and power … well, that’s not my view. That’s not the purpose of politics.”

Many Liberals these days seem depressed, weighed down by their party’s polling failures and brutal internal politics. But Paterson seems … fine. He’s just getting on with it, and as others have remarked, some of his best days in politics have been in opposition.

The 38-year-old father of two has plenty to do. There’s the business of changing the nation. And the business of changing the Liberal Party. On both, he has reason to be sanguine.

In February, he helped negotiate the compact between Opposition Leader Angus Taylor and Liberal MP Andrew Hastie that turfed Sussan Ley from the party’s leadership.

In June, he was named federal political leader of the year by the McKinnon Institute, with the not-for-profit organising citing the “discipline and rigour he brings to the role of opposition”.

The following month, he delivered a speech to the Ramsay Centre that was widely lauded as a blueprint for the Liberal Party’s future.

As Taylor’s opposition defence spokesman, he is shaping the Coalition’s position on the policy issue that interests him the most. And as a powerbroker, well, these are salad days.

Paterson is closely associated with Victorian Opposition Leader Jess Wilson, a longtime friend who appears set to secure what would be only the Liberals’ second election victory in the state this century.

Her closest sounding board, insiders say, is either Paterson or his wife, Lydia, who is Wilson’s deputy chief of staff.

Wilson’s husband, Aaron Lane, was a close colleague of Paterson’s at the Institute of Public Affairs. The Patersons are godparents to the Wilson’s child, and Wilson and Lane are godparents to theirs.

When Wilson hits the campaign trail, James Paterson will be there on the bus, making sure it goes to plan.

Wilson’s ascension has augmented Paterson’s clout. But there are other factors too, many related to Paterson himself and the unusual eloquence and clarity he brings to his public utterances.

That quality, and his lengthy alliance with then-opposition leader Peter Dutton, saw him appointed campaign spokesman during the last Liberal federal election campaign, a role in which he avoided scandal even as it erupted all around him (the campaign as a whole would be an abject failure).

“James is a trusted confidant – someone who is calm, wise, and someone you can always go to for advice,” Wilson tells AFR Weekend.

“One of the things I really appreciate about James is he will always give you frank and fearless advice, but respect the decision you make, and then back you in regardless of where he started.”

Organisation for Economic Co-operation and Development chief and former Liberal finance minister Mathias Cormann describes Paterson as one of the “most serious and hardworking” people in parliament.

“In my role at the OECD, I don’t take sides in domestic politics anywhere. But I can say that democracies are better served when people of genuine policy substance from across the political spectrum go into public life, and James is a person of genuine policy substance,” says Cormann.

Former Liberal senator and party elder Nick Minchin, who conducted a review of the disastrous 2025 federal election campaign, says Paterson is “a conviction politician”, one whom he says bore no blame for the loss.

Former Labor parliamentarian Anthony Byrne, who worked closely with Paterson on the powerful parliamentary joint committee on intelligence and security, believes the Liberal is “a genuine talent”.

“He follows in the ilk of Liberals like Nick Minchin,” says Byrne.

“He’s not extravagant, or in your face … He’s a young man who has matured well before his years and I think he’s respected across our side. He could be a Labor or a Liberal person – like Minchin. He was a conservative, but people could deal with him.”

Survival tends to imbue even the most partisan factional spear-carrier with the sheen of an elder statesman. For several elections, Victoria has been a killing field for Liberals, felling everyone from party leaders such as Josh Frydenberg to rising stars like Keith Wolahan.

Paterson, safe in the Senate, benefits from being one of the few left standing.

Technically, he’s hardly the state’s most senior federal Liberal (which would be deputy leader Jane Hume). But he holds more factional clout than those who are.

That’s a function of friends in cabinet, caucusing with the conservatives, now totally ascendent, and reaching out across the factional aisles.

aterson joined the Liberal Party at just 17, after the 2004 federal election, much to the chagrin of his left-wing parents working at a university.

He met Lydia, now his wife, at the Melbourne University Liberal Club soon after. He completed commerce and arts degrees.

A few years later, he did the numbers for Wilson when she became president of the Young Liberal Movement.

The Victorian Liberal Party plays things pretty loose when it comes to formal factions. Its alliances tend to be based more on personalities than ideologies. That doesn’t make the party any less cut-throat.

Paterson, who describes himself as a “classical liberal”, was for many years a willing participant in the bloodletting, according to those who knew him at the time.

After university, Paterson worked briefly for then-Victorian senator Mitch Fifield and then, more prominently, for the Institute of Public Affairs.

His preselection, at the age of just 28, to fill the casual Senate vacancy left by the retirement of Michael Ronaldson was described at the time as “surprising”, and against the party’s intention of getting more women into politics (an impression not helped by his triumphing over now-Senator Jane Hume and Victorian MP Amanda Millar).

Asked how his preselection came about, Paterson says that Ronaldson’s retirement was unexpected.

“People weren’t really preparing for it … Lydia and I were married, but we didn’t have kids yet. We didn’t have a mortgage. I could afford to drop everything, and [so] threw myself into the preselection,” he tells AFR Weekend.

“I knew it was a bit audacious to think at 28 that I was ready to serve. But I also thought I’d regret it if I didn’t have a go. So I threw my hat in the ring, and they chose me,” he says.

Early headlines focused on Paterson’s youth and his tweets, some of which were highly critical of Turnbull (whom he described as “an ineffective leader not popular with his colleagues”).

While Paterson would naturally disavow this view when discovered (“history has clearly proven me wrong,” he would go on to tell the Herald Sun), one wonders whether that played on Turnbull’s mind when, as a novice senator, Paterson got in his way.

In 2017, Turnbull and his foreign minister, Julie Bishop, had intended to ask parliament to ratify a long-signed extradition treaty with China. In his memoir, Turnbull described his belief that it would help save Australians then held in Chinese custody from the death penalty.

“While we had obvious concerns about the Chinese criminal justice system, we were satisfied there were enough protections in the extradition treaty and our own legislation to ensure that the treaty could not be used for political cases,” Turnbull wrote.

Paterson did not see it like that. He was worried about China’s near-total conviction rate, and also the treaty’s impact on Australia’s Chinese population.

“I found it offended my Liberal principles that we would send anyone to face that justice system, whether they were an Australian citizen or not, but anyone under our jurisdiction,” says Paterson.

“Even if no one was ever actually extradited, just the threat would strike real fear into their hearts and potentially coerce them into acting against our national interests … So I just thought this is a crazy idea.”

Paterson became the first politician to speak against it in caucus’ backbench committee. He was soon supported by fellow backbenchers Andrew Hastie and Tim Wilson. Their arguments won the day, and the government withdrew the bill upon seeing it would fail.

“I don’t think Malcolm appreciated it,” Paterson recalls now. “Well, I know he didn’t. He called and gave me a free character assessment.”

The tussle over the extradition treaty, Paterson now says, marked the start of an abiding parliamentary specialisation in defence matters, made more pointed when he became the chairman of the Parliamentary Joint Committee on Intelligence and Security.

The interest is deep-rooted with Paterson, who was politically formed not in the long calm that followed the fall of the Berlin Wall but a bit later, in the chaos and unrest of the war on terror, an era that helped define his Liberal world view.

A son of academics, as a seven-year-old he spent some months in the United States. He adored his time there.

After the planes struck the World Trade Centre towers several years later in 2001, he watched, flabbergasted, as public commentary swiftly turned to blaming the United States, claiming it had provoked the attack through its foreign policy decisions.

Paterson thought of the kids at the primary school he had attended, many of whose parents worked at the Pentagon, which had been a target. “I just had a very instinctive reaction against that line,” he says.

He has a similar explanation for his resistance to attempts to normalise relations with China years later. He had a classmate whose family fled the Tiananmen Square massacre. “I had an affinity and interest in the Australian Chinese community,” he says.

Paterson would also play a role in what he calls “bottom-up” parliamentary initiatives such as the Foreign Influence Transparency Scheme. He was one of several parliamentarians banned from China for these agitations.

He also became part of a motley group of parliamentarians who dubbed themselves “The Wolverines”, after the teenagers depicted in 1984 action film Red Dawn who single-handedly resisted a Soviet Invasion of the United States.

Critics, of which there were many, viewed the reference as juvenile. Paterson says the Wolverines moniker was an “in joke” coined by the late Labor senator Kimberley Kitching. He never resiled from it.

“We were deliberately trying to be a bit notorious … we were a ginger group on the backbench of both our parties trying to change policy. I thought it was a bit tongue-in-cheek. It’s self-deprecating,” he says.

Still, Paterson acknowledges, “it’s not the kind of language we use now. This is an even more serious time than it was then.”

Fellow Wolverine and Liberal MP Andrew Hastie says that once Paterson started to grapple with the seriousness of the big geopolitical and national security issues facing the nation, it sharpened his focus and matured him as a politician.

Few within Australia’s defence establishment disagree.

Former ASIS director Paul Symon, who dealt with Paterson on the Parliamentary Joint Committee on Intelligence and Security, says the senator demonstrates “a seriousness about national security issues which is welcomed and appreciated by those of us who have dedicated our working lives to these unique, gnarly and ever-evolving challenges”.

Former Australian Signals Directorate chief Rachel Noble says Paterson would turn up having done the homework, deeply curious and capable of using the power of the Senate to advance and understand the issues.

He led the committee, says Noble, during a period when China’s economic coercion was blatant and incredibly difficult to deal with.

“I stay out of the political machinations – I don’t know what was influential with the political class. But James was in a powerful and important position during that period … and he used it,” she says.

Another retired senior defence source says debate about defence matters can be “fairly shallow”. He credits Paterson with a willingness to argue things from first principles and, in so doing, bring people along.

As opposition defence spokesman, this source argues, Paterson is in “a critical position”.

“The stuff that matters in this space won’t happen tomorrow … but it’s not 25 years away either. There’s a healthily sceptical public and a more threatening world out there, and we need strategic warriors who can lead us through it,” the source says.

It’s a telling description for a man who, as an impetuous 28-year-old junior senator, once called for the sale of Jackson Pollock’s artwork Blue Poles to reduce government debt.

Labor senator Raff Ciccone, chairman of the Parliamentary Joint Committee on Intelligence and Security, says he has known Paterson since his university days and that “people generally have a positive attitude towards him”.

“He’s a hard worker, smart, very diligent, someone who’s formidable,” says Ciccone. “He has wide respect across the political spectrum.”

Wilson says carving out a real speciality in national security has shaped the kind of parliamentarian Paterson is today.

“He has travelled the world, been a leader as part of delegations representing our country, and with that comes enormous responsibility that I know he takes seriously,” says the Victorian Liberal leader.

While Paterson has been embraced by the defence establishment, many others wonder whether he’s wasted there.

The thinking of several Liberal parliamentarians is that the party needs good communicators such as Paterson attacking the government on its economic record, not in a niche role of little interest to voters.

Paterson, who initially thought his career would be economically focused, does not see it that way.

“I genuinely believe what is at stake is whether or not we hand a sovereign liberal democracy to our children and grandchildren that we inherited from previous generations at a great sacrifice. I think we can’t take them for granted,” he says.

“Lots of areas of public policy are important, and you don’t want to get any of it wrong. But if you get your tax policy a bit wrong, or your health policy a bit wrong, or your education policy a bit wrong, that’s not great.

“You get your defence and national security policy wrong, and that could be the end of it.”

The defence portfolio was Paterson’s reward for calming leadership tensions between Angus Taylor and Andrew Hastie.

In February, Paterson was photographed as part of a Melbourne peace delegation between the two sides, all of whom were in Melbourne for the funeral of Liberal MP Katie Allen. Their truce had the effect of ending Sussan Ley’s leadership.

“Sussan’s leadership was not going well, and it was likely to come to an end,” Paterson recalls of that period. “I was very concerned that if and when that happened, the right would be divided.

“I thought it would be a disaster for us as a party if we had a civil war on the right.

“So the role I played was as an honest broker and mediator between Angus and Andrew about reconciling their legitimate ambitions and aspirations because they couldn’t both have it at the same time.”

Despite backing Taylor for the role and forcing Hastie to temper his leadership ambitions, Paterson remains close to both.

“To his credit, he told me to my face what he thought,” says Hastie.

“I respect someone who speaks their mind, but there wasn’t a hope that was going to win his vote. I think it was fairly obvious that he was backing Angus at the time, and that’s preserved our relationship.”

It was not the first time Paterson played a role in leadership tensions. In 2018, he helped Dutton’s unsuccessful challenge against Malcolm Turnbull, a shambolic and chaotic affair in which several female parliamentarians complained of being bullied and harassed over their vote.

Paterson came under criticism for his role, and he later expressed his regret for how it had all played out.

Journalist Niki Savva wrote a book touching on the events in which Paterson admitted to underestimating the cost of the transaction. He told her that not having been there to witness it first-hand in 2015 when Turnbull knifed Tony Abbott had influenced his pre-coup assessment.

“It was a very eye-opening experience for me,” Paterson now says. “I was still a little bit naive.

“I came to the view that we were heading in a very bad direction, and we needed a change of direction …

“But it was much more brutal than I thought it was going to be, and it did strain relationships more than I thought it would. So it was an eye-opening experience.”

Observers argue Paterson has rarely conducted himself in such a cavalier manner since. Compare the spills. Paterson’s first was messy and chaotic; the latest was orderly and efficient.

Paterson remains close to both conservative factions, although the impact of the most recent spill is hardly positive: Taylor has not yet arrested the Liberal Party’s slide to electoral oblivion.

Paterson had a position in Ley’s shadow cabinet, but got one he preferred under Taylor. He is a critical rampart to Taylor’s future – but if Paterson were to move, it would spell the end of Taylor’s leadership.

And under a Hastie regime, should it come to that, he would probably prosper too.

It’s a powerful position to be in, all the more so as a 38-year-old senator from the weakest division of the Liberal Party.

“I wouldn’t say he’s a pack animal,” says Hastie, reflecting on Paterson’s place in the party.

“He’s not the sort of guy who gets around parliament with their faction or their team behind them.

“He’s more a strategic counsellor. And because he’s been in the parliament for 10 years now, he’s been through a couple of leadership changes.

“He’s been through some policy debates. He’s rarely made a mistake and people hold him in high regard for that,” says Hastie.

A Liberal figure who has known Paterson for almost two decades, says the senator, like many in the party, has grown tired of the factional infighting that has beset the Victorian division for decades.

This person says Paterson leads a “sensible, pragmatic grouping” in Victoria – a bulwark between the conservatives and the moderates.

“The great thing about James is he gets people to follow him because they think it’s in the party’s interest and the national interest – and it is, but it’s also in his interest, so, in that regard, he is very clever,” the person says.

When former Liberal premier Ted Baillieu and Paterson first met, the young man was “aligned to people whose cause was to bury me”, the former Victorian premier now recalls. Though the two are now friendly.

“He’s been wise about the way he has done things,” says Baillieu.

“He hasn’t been a controlling influence. He is someone who has attracted respect and that’s grown his influence. He’s not running around rushing, demanding people do this or that.

“His overtly intelligent approach to people and issues wins favour, and that’s the most solid sort of favour.”

Much in politics can turn on chance. In 2021, Jess Wilson was working at the Business Council of Australia when Kew parliamentarian Tim Smith ran his jaguar through a fence while drunk.

The incident ended his political career. The very next month, Wilson was preselected for his safe seat.

Paterson encouraged Wilson to run for parliament. Then, he encouraged her to run for leader, despite her being in her very first term.

Her elevation has been inspired: for the first time in a decade, the Liberals are spending more time fighting the Labor Party than they are each other.

Paterson’s rapport with Wilson, the result of a longstanding friendship, prompts some measure of angst within the Victorian party.

Some say his influence with her is overstated. Others argue she has regrettably taken his advice against pursuing genuinely populist policies, ones that would cut through with voters and temper the appeal of One Nation.

Should the Liberal opposition fail to secure power in its own right in November’s state election, some will no doubt blame Paterson for this.

Some already blame him for the federal election loss last year that came after a period in which he was the Liberal Party’s cabinet secretary and thus involved in its (lack of) policy co-ordination.

“The Liberal Party has lost a lot of talent and, among those who are left, he’s right up there. He’s a good communicator, intelligent, competent,” says one internal rival.

“But there are question marks that remain based on the outcome of the 2025 election and the key roles he had as spokesman and shadow cabinet secretary, and the strong backing he gave Dutton and Taylor … and that’s not going well either.”

Minchin, who wrote the official election review for the Liberal Party, disputes this view. He says the final report he wrote with former NSW Liberal MP Pru Goward “in no way implicated James – he, like many others, found that campaign extremely frustrating”.

Paterson says he has already accepted his share of responsibility for the loss. “I did so immediately after the election on the [ABC’s] 7.30, and every time I’ve been asked,” he says.

The 2025 federal election loss is what precipitated One Nation’s current polling surge. Unlike some, Paterson does not believe the party needs to radically alter in response.

In his closely read Ramsay Postgraduate Scholars speech, he lashed populism as a “package deal” that tied and utilised understandable resentments to achieve the wholesale trashing of institutions vital to Western political and economic progress.

The speech did not mention One Nation, although it was a clear rebuke of it.

Speaking to AFR Weekend, Paterson says the minor party’s polling is unsustainable.

“We’ve already seen their numbers come down. The trajectory is quite clear,” he says.

“I think that while people have legitimate anger and frustration, and they want to voice that in the political system, I don’t think these people are capable of governing.

“Certainly, they’re incapable of governing well in the national interest. And if they ever got the opportunity to do so, well, I think they’d be exposed very quickly,” he says.

Paterson is “concerned” about where the Liberal Party is at federally. In the most recent Australian Financial Review/Redbridge/Accent Research survey, the federal Coalition had a primary vote of 21 per cent, behind One Nation (29) and Labor (28). However, he says, “being freaked out doesn’t help us fix it”, nor is it a productive use of their time.

Instead, Paterson is on the campaign trail, where Wilson is carving out a growing two-party lead.

The Victorian Liberal leader sees Paterson as a close confidant on political strategy; someone who can explain to her what a disastrous election campaign looks like and the mistakes she needs to avoid.

“The federal Coalition has never won an election from opposition without first winning an election in Victoria,” says Paterson. “Obviously, it’s not sufficient on its own … but it has been a precondition for us winning federally.

“This is a traditionally progressive state. So if you can win here, you should be able to win nationally.

“States like Queensland and WA are always more likely to be in our column. But if even Victorians are voting Liberal, well, we’re in a good position,” he says.

And if, even now, the Liberals lose? It would be devastating enough, one would think, to entirely halt Paterson’s relentless rise.

“It doesn’t bear thinking about,” he says when prompted to consider it.

“It will not be good.” He pauses, then repeats. “It will not be good.”

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