Chris Gatenby and Isaac Levido: Previewing election year in Australia

Chris Gatenby has previously worked for Policy Exchange and is a Conservative Party activist. He is currently Vice President of Australian Liberals Abroad UK and writes in a personal capacity. Isaac Levido is an Australian who has recently moved to London from Washington DC, where he worked with Republican Senate campaigns before advising on Congressional and electoral politics at the Australian Embassy.

The passing of 2012 ushers in the most welcome of junctures for long-suffering Australian conservatives: a federal election year. Prime Minister Julia Gillard’s minority Labor Government has been in an election losing position since early 2011 and, according to the Newspoll published by The Australian, ended 2012 in the same place they started it. They face an intimidating eight point (54%-46%) two-party preferred deficit to the Liberal/National Opposition led by Tony Abbott. If this outcome were translated into votes Abbott would be elected Prime Minister in a landslide.

The PM formed a minority government in 2010 by securing the support of just one Green MP and three Independents. This razor-thin majority means the Government needs to gain seats to have any certainty of remaining in power; a massive task for Gillard given the polling headwinds Labor faces. 

Speculation abounds about election timing but in all likelihood it will be held sometime between August and October. While a poll could technically be called by Gillard any day, the earliest possible date for a joint House and half-Senate election (the normal format) is 3 August, the latest being by 30 November. A good summary of the mechanics of the whole thing is available here.

We suspect both sides of politics, not least the Australian public, will be glad to leave 2012 behind them. It was a year dominated by a series of distracting scandals and acrimonious personal attacks. In a word: forgettable.

Gillard weathered an extraordinary (and continued faux) leadership challenge in March from the former Prime Minister she deposed, Kevin Rudd, only to be dogged throughout the remainder of the year by Labor MP Craig Thompson’s alleged use of a union credit card pay for escort services and accusations the Prime Minister herself was complicit in setting up an illegal union slush fund on behalf of her then boyfriend when practicing law some two decades ago. Not to mention the ongoing sexual harassment saga engulfing former Speaker Peter Slipper, which was brought to the world’s attention following Gillard’s fierce attack on Abbott as a ‘misogynist’ in Parliament. What was originally a political liability for Labor now seems to have implications for Abbott and his party, too.

The bitterness appears to have taken an electoral toll and both parties now have very unpopular leaders. According to Newspoll, Gillard and Abbott hold the dismal job satisfaction ratings of 35% and 28% respectively. Despite the Opposition’s strong advantage in headline polling noted above, Gillard leads Abbott as preferred Prime Minister 43%-34%. Clearly there is some way to travel to rebuild public confidence in national leadership.

But a new year brings a fresh start and an opportunity for the Liberal-National Coalition to focus on the serious issues facing the nation. And now, as the perils of the world economy begin to close in on a country that for a time seemed almost immune to the global downturn, the Opposition has been handed a sizeable stick to beat away at the Government’s credibility.

From the 2010 election campaign onwards, the central plank in Labor’s economic platform has been a commitment to return the federal budget to surplus by the 2012-13 fiscal year. Despite presiding over a $22 billion blowout in the deficit in 2011-12 (from a forecast $22.6 billion at budget delivery to $44.7 billion by the end the year), Gillard and her Treasurer Wayne Swan, doggedly stuck to their commitment and Swan slashed his way to a forecast $1.5 billion surplus in May last year. However, five days before Christmas the Treasurer casually announced that, thanks to lower than forecast tax revenue, it was now “…unlikely that there will be a surplus in 2012-13”. After inheriting a surplus of $20 billion and no net debt in 2007, this will be Labor’s fifth straight deficit, having not delivered a surplus budget in government since 1989.

Labor’s surplus pledge was key to burnishing their economic management credentials and the abandonment of it is a serious political liability the Opposition will rightly take them to task on. Expect Abbott to hammer the issue home with similar vigor to his relentless prosecution of Gillard’s broken pledge during the 2010 campaign that there would “…be no carbon tax under the government I lead”.

Gillard’s about-face on the carbon tax went to the core issue of trust in the Government and directly touched cost of living concerns in voters’ minds; the dropping of surplus target is a timely reminder of Labor’s lack of credibility on the economy. This will especially be the case if Gillard and Swan’s abandonment of their by-hook-or-by-crook surplus strategy gives way to an enthusiastic dive back into deficit in a pre-election spending spree.

At the same time, Labor’s budget failure will increase pressure on the Opposition to outline details of their fiscal plan and a broader policy offering. This will be a welcome opportunity to present an optimistic and responsible picture of where an Abbott Government would take the country. The Coalition will be tested to prove their plans for tax and spending hold up in the pursuit of a balanced budget. Hopefully they won’t face any nasty surprises should they be successfully elected - when Abbott’s mentor John Howard came to power in 1996, he and then Treasurer Peter Costello faced an unexpected almost $8 billion budget black hole, forcing them to reverse core election promises to deliver necessary spending cuts.

Whilst Australian politics remains dormant for the summer break, the close of 2012 saw the contours of the pre-election debate begin to take shape. Both major parties have so far committed to the introduction of a National Disability Insurance Scheme (NDIS) and Labor has pledged to implement an, as yet unfunded, root-and-branch reform of the Australian education system. Abbott has committed to repeal the carbon tax, boosting highway funding and has flagged a million new jobs over the first five years of his premiership if given the reins.

So we look forward the battle being joined in earnest and - along the road to what we dearly hope will be a return to a Liberal-National Federal Government - we’ll do our best to give ConservativeHome readers an insightful window into the people, process and policies of this Australian election year.

Stay tuned.