This followed failed attempts on Iloilo's part to mediate a solution to the long-running impasse between the military and the government of Prime Minister Laisenia Qarase.

Iloilo claimed to have the "full support" of the security forces and directed the military to take "all reasonable steps" to maintain law and order.

He was in this position under President Ratu Sir Kamisese Mara in 1999 and 2000, when Prime Minister Mahendra Chaudhry's government was overthrown by Fijian nationalists led by George Speight in the Fiji coup of 2000.

Iloilo refused to intervene directly in the disputes among politicians, but quietly reached out to disaffected factions, including the Indo-Fijian community.

The source said that Iloilo had refused repeated requests from the Home Affairs Minister, Josefa Vosanibola, to take disciplinary measures against Bainimarama for publicly opposing the early release of prisoners convicted of coup-related offences, as well as the proposed establishment of a Reconciliation and Unity Commission (called the "Reconciliation Bull" by Bainimarama) with the power (subject to presidential approval) to compensate victims and pardon convicted participants in the coup.

The source said that the President's refusal to act was making the Home Affairs Minister look foolish and incompetent, and suggested that Iloilo was not following the Constitution.

According to an unconfirmed report in the Fiji Times on 25 June, Iloilo and his Vice-President, Ratu Joni Madraiwiwi, had asked Prime Minister Laisenia Qarase to withdraw the government's controversial legislation to establish a Reconciliation and Unity Commission, with the power to compensate victims and pardon perpetrators of the 2000 coup.

He also said "As parliamentarians you must carefully examine your conscience on the deliberation of sensitive issues and not be swayed by divisive racial remarks which have been a common and unfortunate hallmark of debate in our Parliament."

Iloilo recalled warnings from Fiji's first modern statesman, Ratu Sir Lala Sukuna (1888–1958), that the chiefs risked becoming an irrelevance if they did not take their leadership role seriously and prove that they had the qualifications and authority that their ancestors had possessed.

When we are equipped with leadership skills that complement traditional rank, we are appropriately prepared to provide the inspiration, the motivation and guidance expected of us."

The family member said that Iloilo had already hinted of his plans during a speech at the 2005 Fiji Business Excellence Awards in Nadi, in which he said it might be his last official function.

The Great Council of Chiefs met at the Tradewinds Convention Centre in Lami on 8 March and re-elected Iloilo to another five-year term.

This followed failed attempts on Iloilo's part to mediate a solution to the long-running impasse between the military and the government of Prime Minister Laisenia Qarase.