Nauru in crisis after parliament sacked

2.30pm

MELBOURNE - Nauruan President Ludwig Scotty has sacked the parliament and declared a state of emergency in a new constitutional crisis for the tiny Pacific island nation.

Speaker Russell Kun told AAP he had been ordered by Mr Scotty to vacate his office immediately.

He said Mr Scotty addressed the nation last night on national television, saying he had no choice but to declare a state of emergency and dissolve parliament because the national budget had lapsed.

Mr Kun said the president's action was unconstitutional, and opposition members of parliament would be seeking an injunction to stop it in the nation's Supreme Court.

"The president has declared a state of emergency on the island because the government budget has not been passed," Mr Kun said.

Mr Kun said Mr Scotty had declared the state of emergency without consulting parliament.

The decision means Mr Scotty has seized absolute power in the tiny nation of 13,000 people.

Mr Kun said two police officers were waiting to escort him from his office in parliament.

He likened the situation to a coup, and said MPs were in shock.

"There's anarchy going on around here," he said.

"There's orders given to police that I vacate my office.

"I'm packing while I'm talking to you.

"It's incredible. It (Nauru) has been singlehandedly taken over by one person," said Mr Kun.

"Whatever happened to the separation of powers?"

Mr Kun said the crisis was sparked by the refusal of a suspended MP, Health Minister Kieren Keke, to leave parliament yesterday.

Mr Kun had declared Dr Keke a stranger in the house and parliament had been unable to operate, he said.

The suspension of Dr Keke meant the 18-member parliament was locked at eight votes all, with the casting vote residing with Mr Kun.

Mr Kun said the national budget had subsequently lapsed at midnight (Nauru time) yesterday.

Mr Kun said Mr Scotty had blamed him for the crisis, but denied any responsibility for the situation.

He said there was power vested with the president under the constitution to declare a state of emergency, but not to dissolve parliament.

But there was no justification to declare a state of emergency in this case, Mr Kun said.

He said it should only apply when the nation's security or economy was threatened.

"Declaring a state of emergency is one thing, that's a power vested in the president under the constitution, but at the same time he made the declaration he's also dissolved the house, which is absurd," he said.

"It's unlawful.

Mr Kun said opposition MPs would be seeking to have Mr Scotty's action overturned in the Supreme Court.

But he feared the chief justice, Barry Connell, may also have been ordered out of his office by Mr Scotty.

"We're going to challenge it, we're going to file an injunction," he said.

"We're not going to whinge about it."

The state of emergency is the latest crisis to hit Nauru, once one of the wealthiest nations on the planet because of royalties from phosphate mining.

But the country is now a financial basket case, with its multimillion dollar portfolio of assets in Australia in receivership after the government failed to keep up payments on a A$230 million ($249.86 million) loan from United States company GE Capital.

Nauru faced another constitutional crisis earlier this year when former president Rene Harris was removed in a vote of no-confidence by parliament while he was out of the country.

One of his former allies is Mr Kun, who was justice minister in his government.

Mr Scotty was elected president on June 22, less than a year after he himself left office because of a no-confidence vote in August last year.

The country's economy has been kept afloat in recent years by aid from Australia, including more than A$30 million paid to detain asylum seekers on Nauru under the Pacific Solution.

- AAP