Oz begins to accept its gay past and present

Sydney is recovering from an event which, to the discomfort of some of its more conservative citizens, is now widely regarded as portraying the true character of Australia's largest and oldest city: the annual Sydney Gay and Lesbian Mardi Gras. On Saturday night I joined a crowd of several hundred thousand onlookers, including suburban families and international visitors, to watch a flamboyant two-hour parade along Oxford Street, formerly a district of tough working-class pubs which, over the past decade, has been transformed into one of the world's most concentrated havens of gay culture.

Rain had swamped Sydney all day, leading the Rev Fred Nile, a fundamentalist preacher and founder of the anti-gay Call to Australia Party, to claim victory for divine intervention. The crowd, though smaller than in previous years, was undaunted. At 8.30pm, just as the parade kicked off, the rain stopped and an almighty roar rang through the Sydney night. "A miracle!" shouted one of the Locker Room Boys, a group of well-sculpted men marching in white towels.

A Pope figure threw condoms to the crowd, ahead of marchers depicting the Queen, the Prince of Wales, Frank Thring, the veteran Australian actor who died last year, and elaborately costumed groups from Wagga Wagga, the Sunshine Coast of Queensland, Hawaii, New Zealand, Tasmania and South America. Music pounded, searchlights pierced the clouds and the rain failed to fall on the boas and beehives of the lookalikes from Priscilla, Queen of the Desert and Absolutely Fabulous.

For an event that began 17 years ago as a small demonstration urging an end to discrimination against male homosexuals, the Mardi Gras has come a long way. It claims to be the biggest event of its kind in the world. There were as many bare-breasted lesbians as gay men on Saturday and the gamut of participants had widened to include Vintage Men ("We're gay, we're grey and we're here to stay") and Tranny Pride, representing transsexuals.

That first march in 1978 ended in a riot, when police and gays clashed violently. By last year most of their original political demands had been achieved. The parade's participants had grown to 10,000 and the street crowd to 600,000, far more than those for any sporting grand final, royal visit or Anzac Day. Police and public transport authorities spent months planning strategies for Saturday's event with its organisers.

All this is a far cry from a society once renowned for police and public harassment of homosexuals and better known for its veneration of sporting heroes and tycoons. Robert Hughes, the definitive historian of convict Australia, suggests there was a hotbed of homosexuality during the early colonial era, ascribed largely to hideous prison conditions, a disproportionate number of men to women and the growth of male bonding through "mateship". He believes later repressive attitudes stemmed from a Victorian reaction against this aspect of the convict days.

The other day a Sydney newspaper published a survey indicating that almost 60 per cent of Sydney's 4 million people believe it is right for consenting adults to have a homosexual relationship. So I asked Rob Patmore, president of the Gay and Lesbian Mardi Gras, what had brought about such a revolution in attitudes. British-born Mr Patmore, who emigrated five years ago and is now an executive with one of Sydney's biggest advertising companies, said: "Australia is in the process of becoming a truly multi-cultural nation, in the sense of embracing all cultures, and the gay and lesbian culture has been able to take its place in that. I think something as huge and as public as the Mardi Gras parade would take longer to be accepted in Britain, which is more steeped in tradition."

Maybe so, but as with most things that succeed in Sydney, the potent mix of money and politics has played a big part as well. A report two years ago by the University of New South Wales found that the Mardi Gras parade, and a one-month cultural festival preceding it, injected A$38m (£18m) into Sydney's economy, much of it from spending by visitors from the United States, Britain and other European countries. Since then, politicians of every hue, including Paul Keating, the Prime Minister, have rushed to endorse the event.