Shorten targets Turnbull’s instability
In our highly contested and adversarial political system, the combatants have no illusions about the imperative to begin campaigning for the next election the day after the previous one. Bill Shorten needed no convincing. He had his running shoes on before the Australian Electoral Commission had come anywhere near finalising its glacial vote count. His sweep of electorates Labor had won, ostensibly to say thanks to voters, was as ominous a warning as you can get that he won’t be giving the returned government, with its wafer thin majority, an easy ride.
Last Sunday, Shorten sounded positively statesmanlike when he said he hoped for our nation’s sake that the Coalition runs a good government. He said he had called Malcolm Turnbull to concede and to congratulate him and, more than that: “I pledge and I have indicated to Mr Turnbull that where there is common ground we will work very hard to accomplish it.” After noting that voters don’t much like partisan sledging, he said: “I understand that we need to make this parliament function and we will be up for that.”
Turnbull responded in kind. He said he welcomed Shorten’s remark about seeking common ground. He said it was vital “that this parliament works. It is vital we work together and, as far as we can, find ways upon which we can all agree, consistent with our policies that we have taken to the election.” At face value, it looked as if both leaders were ready to embark on an unprecedented new age approaching “a government of national unity”. It didn’t happen in World War II when the country was under threat of invasion, however, and it’s certainly not going to happen now. Indeed, throughout his post-campaign travels Shorten claimed he, too, had a mandate for his policies and promised he would take them as a guiding principle for how he approaches parliament.
A political hard head, Industry Minister Christopher Pyne was dismissive of Shorten’s “honeyed words”. He, you might remember, played an integral part in the utterly negative and disruptive tactics of the Abbott opposition during the term of the Labor minority government. But Turnbull insiders believe Shorten will have to play it much smarter than Abbott did. Their assessment is Abbott’s negativity and take-no-prisoners style of politics eroded his support in the electorate. That is true, but it was after he had won power and was seen to have broken faith with voters.
It is one thing for a government and its cheer squad in business or the media to bemoan the obstructive senate and its unruly crossbench. But if that senate majority blocks measures that have no broad community support, then the upper house is applauded for doing its job. It is no accident that the “keep the bastards honest” sentiment has seen many people vote differently for the house of representatives and the senate for decades. If a government fails to deliver on its agenda, it cops the blame no matter who or what was the cause of the failure.
Partway through this week, a mightily relieved Malcolm Turnbull proclaimed that this was “the first time since 2004 an Australian government has been returned with a majority”. While 2010 was the closest election result in history, Turnbull’s scrape over the line is reminiscent of the near-death experience of his party’s founder, Sir Robert Menzies, in 1961. Then it was the “magnificent James Killen” who delivered majority government, holding his seat of Moreton on the back of a handful of Communist Party preferences. Menzies went on to become Australia’s longest-serving prime minister. The 15 seats he lost were regained at the next election.
The question exercising the minds of many is whether Turnbull has the skills of a Menzies, to not only survive but then to propel the Coalition to a handsome win next time. Shorten is convinced he does not. He believes Turnbull will lose patience with an unpredictable senate and be stymied by his own party room. The Liberals are making much of the fact that Labor recorded its second-lowest primary vote in history. Much of that went to the Greens, and getting it back won’t be easy. But Shorten’s achievement in bringing Labor so close to government and his ability to communicate with the electorate means his political opponents will continue to underestimate him at their peril.
The opposition leader’s often-repeated claim that Turnbull leads a disunited party was bolstered all week by reports that the prime minister faces severe push-back on foreshadowed superannuation changes. The prime minister and treasurer are steeling themselves for a showdown at Monday’s first post-election party room meeting. The Australian reported that senior ministers including Deputy Liberal Leader Julie Bishop warned that the changes would rile the party’s base and lose votes. But these warnings appear not to have had any real substance in the end. One Turnbull strategist says that, in fact, the Liberals’ vote went up in heartland seats, including Bishop’s.
The Turnbull camp sees the rumblings as a proxy for something else. It looks and smells like a power play to keep Turnbull on the leash. Not hard to guess what the party’s conservatives such as Eric Abetz and their media backers, such as Andrew Bolt, are up to. They seem oblivious to the reality that to deliver their stated holy grail of budget repair the treasurer has little choice but to trim overgenerous tax concessions to the top end.
The treasurer has promised to consult as he prepares legislation to give effect to the changes. Here there is more overt support coming from Labor than from elements of the government backbench. Labor’s superannuation spokesman, Jim Chalmers, is sympathetic; though he, too, would like the retrospective concerns over the $500,000 lifetime cap on after-tax contributions clarified. One suggestion to the treasurer is to drop the idea of backdating it to 2007 and have it start from the night of the budget instead.
But if budget repair is one of the key commitments of the government’s election campaign, as Turnbull said on the day he was able to claim victory, then he is getting little help from some regional Liberals and the Nationals. At their party room meeting to discuss the agreement to go back into Coalition, fresh concerns over the backpackers’ tax were raised. Scott Morrison has bought time, putting the $500 million revenue earner on hold for six months. But Nationals’ senator John “Wacka” Williams says the issue is more urgent than that. He says the issue needs to be settled as far as the nation’s fruitgrowers and farmers are concerned.
And this is where the current crop of Liberals and Nationals could learn from Menzies’ response to his 1961 predicament. During that term he set about to address the fears and concerns the electorate had, and that Labor had played to, by adopting some of the opposition’s policies. In the party room a backbencher was reported objecting: “But prime minister these are Labor policies.” Menzies shot back: “And good policies, too.”
Billions of dollars’ worth of budget repair is available to Turnbull and Morrison if they address negative gearing and capital gains tax concessions. While the government warned that the economy and property market would crash if these measures were adopted, the electorate was unmoved. In fact, the government attack lost steam, especially when leading economists gave it little or no credibility. The scare was left to overt vested interests such as real estate agents and property developers. Shorten and his shadow treasurer, Chris Bowen, are even indicating they would support the Coalition’s adoption of this policy.
A senior Liberal MP is sceptical, pointing out that in the previous parliament Labor in the senate voted against some saving measures that Labor itself had earlier proposed. But with the government on a six-month AAA credit rating deathwatch, Morrison may be desperate enough to compromise come the next budget. By then, circumstances may well and truly have changed. Besides, surely one of the lessons of the election is that voters prefer to see the better heeled lose some of their tax concessions than families on lower incomes having to carry the burden through harsh spending cuts.
But Turnbull may have already denied himself the chance to follow Menzies’ lead. Just before meeting the Nationals for their secret discussions on the new Coalition agreement, he said, “All of our policies which we took to the election we will deliver.” Those policies included the Medicare doctors’ rebate freeze, as well as cuts to bulk billing incentives for blood tests and X-rays and dearer prescription medicines. Just last week, the prime minister accepted that the “Mediscare” worked because many Australians were already experiencing unaffordable and inaccessible healthcare and they blamed the federal government’s cuts for it.
Maybe Turnbull is counting on the senate voting these and other family unfriendly cuts down. It wouldn’t be the first time the red chamber has saved a government from itself. He would then need to be nimble enough to look for other options. Some of those Labor has already identified.
Come to think of it, you don’t have to go all the way back to Menzies. Turnbull and Morrison have already done it with superannuation and tobacco tax. Shorten is sure to give them the opportunity again.
This article was first published in the print edition of The Saturday Paper on Jul 16, 2016 as "Menzies club". Subscribe here.