Baumann stands aside after admitting secret developer donations - ABC Online

The Hunter is already facing a flurry of by-elections after the resignations of Andrew Cornwell and Tim Owen, the members for Charlestown and Newcastle, as well as the city's mayor, developer Jeff McCloy.

Craig Baumann had been briefly mentioned earlier in proceedings, but ended up being one of the last to appear on the final day of the ICAC inquiry that has already claimed so many political scalps.

The inquiry's terms of reference were officially widened to include whether Mr Baumann and his accountant made false declarations to conceal donations from Mr McCloy and another developer, Hilton Grugeon.

The Port Stephens MP admitted that during his first election campaign in 2007 he failed to declare donations from the pair totalling $79,000 and created sham invoices.

ABC reporter, Sarah Gerathy, says developer donations weren't yet banned, but both the businessmen stood to make a lot of money from a favourable decision on a land release at Wallalong.

At the time Mr Baumann was a Port Stephens councillor.

"He denied that he'd actually made any favourable decisions because of the donations," Sarah says.

Mr Baumann said outside the hearing he did not believe he'd done anything wrong and would not be stepping aside.

However, shortly afterwards he announced he would be moving to the parliamentary cross benches.

In a brief recall to the inquiry, Jeff McCloy denied that he'd been trying to buy Craig Baumann's favour.

The ICAC also heard that Mr Baumann's accountant gave $100,000 to his 2011 campaign as payment for a house built for him by the politician's company, which meant tax wasn't paid on the amount.

The inquiry into business donations and political favours has cut a swathe through the Hunter's Liberal MPs.

"It's huge," Sarah says.

"In the Hunter the only Liberal MP who's been left unscathed is Robin Parker.

"Huge levels of uncertainty, huge levels of disappointment and shock."

The by-elections for Newcastle and Charlestown will be held on October 25.

Sarah Gerathy spoke to Carol Duncan on 1233 ABC Newcastle Afternoons.