Mining magnate Clive Palmer has called on Queensland Premier Annastacia Palaszczuk to remove herself from the election race, saying her lack of support for federal Adani funding is "disastrous" for the state.
Ms Palaszczuk says she only learned last week that her partner Shaun Drabsch was helping PricewaterhouseCoopers with Adani's application for a possible $1 billion loan from the Northern Australian Infrastructure Facility, to build a rail line to get coal to the coast for export.
She says she will veto any such loan so she cannot be accused of a conflict of interest.
However Mr Palmer, who is chair of Waratah Coal, says this decision is unacceptable, and called on her to resign.
"What Queensland Premier would refuse billions of dollars of investment and activities in their state, by placing their own personal life above that of serving the community?" Mr Palmer said in a statement.
"She is not a fit and proper person to govern the state of Queensland, and I call on her to resign as Premier for denying investment and growth in Queensland."
However the premier's decision has attracted support from the opposing end of the political spectrum, with former veteran LNP MP Vaughan Johnson blaming Canberra for using it to launch a smear campaign against her.
"We've seen now a bucket of mud that's been thrown from Canberra that's lobbed right in the face of the election campaign in Queensland - the fingerprints of Canberra are all over this exercise," he told the ABC on Tuesday.
"I'm an LNP member and I'm loyal to the operation, but there's one thing I am not loyal to - mudslinging. Let's keep this a clean, fair dinkum state election."
Federal Resources and Northern Australian Minister Matt Canavan on Monday denied he or his colleagues were planning to use the involvement of the premier's partner in the loan application to smear her.
"None of us had any information about this matter," he told ABC radio.
"This has been a smear from herself as a smokescreen to try and hide the fact that the Labor Party in Queensland are massively divided on this particular issue."
State LNP leader Tim Nicholls also denies knowing about it.
