One Nation party leader Pauline Hanson, centre left, and candidate David Farley, centre right, embrace after the party’s victory in the Farrer by-election on Saturday © Jesse Thompson/Getty Images

Pauline Hanson’s One Nation, the Australian far-right political party, has won a seat in the lower house of parliament for the first time, shocking the traditional conservative establishment as the anti-immigration group seeks to become a potential third force in politics.

David Farley, the party’s candidate, won a by-election in the rural seat of Farrer in New South Wales with almost 40 per cent of the primary vote in Saturday’s election.

The seat was vacated when Sussan Ley quit politics after she was ousted as leader of the centre-right Liberal Party in February. The seat had been held by the Liberals, Australia’s main opposition party, or its National Party coalition partner since 1949.

Raissa Butkowski, the Liberal candidate for Farrer, came third with just 12 per cent.

Experts said the historic result for One Nation reflected voter anger with the Liberals over the treatment of Ley, who was leader for just nine months but was popular in the district, which she represented for almost 25 years.

The result also owed to the perception that the party has been in chaos since Labor Prime Minister Anthony Albanese won a second term last year.

Angus Taylor, a former McKinsey consultant who took over as Liberal leader, said the party had “hard lessons to learn”.

“This was a rage against the status quo,” said one MP, speaking to the FT on condition of anonymity. A Liberal politician noted that as Labor had not fielded a candidate in Farrer, voter anger towards the political establishment was felt by the Coalition candidates. 

Zareh Ghazarian, a lecturer in politics at Monash University, said One Nation had presented a more capable face than the traditional rightwing parties by focusing on issues such as housing affordability. “This is a real disaster for the Liberal Party,” he said.

Hanson, a senator for Queensland and vocal critic of Australia’s immigration policies, founded One Nation in the 1990s.

She was convicted of electoral fraud in 2003 and sentenced to three years in prison, but the ruling was later overturned. She has remained a controversial figure in Australian politics, including two instances in which she dressed in a burka in parliament.

The by-election result will not change the balance of power in the lower house of parliament, which is controlled by Albanese’s Labor.

But it marked the first victory for a One Nation candidate in the chamber and pointed to a party that was becoming better organised and resourced as it seeks to transition from a fringe force into one able to attract more mainstream support. Mining billionaire Gina Rinehart donated a plane to One Nation this year.

The party already has one MP in the 150-seat lower house after Barnaby Joyce, a former deputy prime minister and leader of the Nationals, defected to One Nation in December. It also holds four of the 76 senate seats.

Mark Kenny, director of the Australian Studies Institute at the Australian National University, noted that the collapse of support for the Liberal-National coalition mirrored last week’s UK local elections, where Nigel Farage’s anti-immigration Reform UK ate into the Conservative Party vote share.

But he added that in Australia, the centre-right was also coming under pressure from inner-city “Teal” independent politicians, as well as now losing rural seats to One Nation.

“It’s a worst-case scenario,” he said.

A further test for the Liberals will come in elections in Victoria, the country’s second most populous state, due by the end of the year.

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