Found a really really old workshop locally.
The guy clamped the pulley in the lathe and kept tapping it till it spun true.
He said he could open it out to 1" but the washer inside 70mm down was an issue making it hard to cut the keyway.
He said he could cut the pulley in half do the machining and then sleeve it back together.

The phone rang it was MTD Australia saying their representive has sent me an email. The email had the part number for later model pulley which is 1" and the original engineering drawings for the pulley showing 1" and the pulley is in stock. Wow its ordered and be here in a couple of days.

Thanks for everyone's patience and advice Thanks

Last edited by rudes; 30/08/16 05:14 AM.