Gaps in Turnbull’s Coalition and credibility
Flying over the vast, featureless Nullarbor Plain emphasises the huge distance between the east and west coasts of the continent. Malcolm Turnbull crossed it earlier in the week. His visit to Perth was to lend a hand to the embattled Liberal premier Colin Barnett, who faces his moment of truth at the ballot box in two weeks.
Judging by the reception he got from the local media, Turnbull failed to close the distance between his government and the sandgropers. Perth’s major newspaper described the flying visit as a “damp squib”. But whatever his problems in failing to address the apparent discrepancies in the GST carve-up, they pale into insignificance when it comes to the vast divides in his Coalition government.
Put simply, many on the backbench are fed up with the slack Turnbull cuts to outspoken right-wingers such as the Nationals’ George Christensen. If Christensen can get prime ministerial intervention to assuage sugar producers’ grievances in his North Queensland electorate by threatening to quit and rob the government of its parliamentary majority, then maybe they should follow suit.
The member for Bennelong, John Alexander, doesn’t go quite that far. But he says five years of being a team player and keeping his gripes in-house have got him nowhere. His burning issue is housing affordability. On the eve of the last election, figures came out showing his electorate has the fastest-growing house prices in the country. According to Alexander, prices rose 74 per cent over the previous three years. The government’s failure to address the crisis is particularly galling.
Alexander has taken his crusade to the media. “The traditional economic basis is three to five years of average wages buys an average home,” he told the ABC last year. “In Sydney, it’s 12.2 years of average wages to buy an average home.” With some passion, he says: “We’re a long way from housing to be accessible [for an average] wage-earner.” He feels no one in government is taking him seriously. One senior government figure couldn’t wait to “piss him out of the room. It sure pissed me off.”
Alexander sees hyperpartisan politics blocking the development of evidence-based solutions. The all-party parliamentary inquiry he headed came up with the facts. The treasurer even acknowledged excesses in the negative gearing and capital gains tax concessions only to back off and demonise any change as a dangerous Labor prescription.
The cover Scott Morrison and Turnbull are using, for now, is housing supply. It’s a neat deflection. It lays the blame with the states. New South Wales Liberal premier Gladys Berejiklian is happy to play along on the supply argument, except she says taxes should also be part of the debate. Curiously, the new premier moved the state’s previous housing minister, Rob Stokes, out of the portfolio to education. Stokes, a planning expert, upset his Canberra colleagues last year by calling for changes to negative gearing, the tax breaks used by many investors to cover their losses on the way to accruing more property assets. When he took his new job looking after schools, Stokes observed: “I’m no expert on matters of education.”
Alexander fears heavily geared investors – as well as people such as the nurses, teachers and firefighters that Morrison likes to talk about – are dangerously exposed to interest rate rises that will inevitably lead to a property crash. He has no doubt investors are driving would-be home owners out of the market. He dismisses claims that a Liberal government should continue with the current arrangements because they are protecting the interests of the party’s natural constituents. “The best way to protect investors,” he says, “is to avoid having a crash.”
To that end, the MP is putting pressure on Morrison to revisit his previous views in the run-up to the May budget. There are signs the treasurer is that way inclined. On this, the government was all over the shop in parliament a week ago. Turnbull appeared to overrule Morrison again. But Alexander says moderating the capital gains tax discount is still being considered. “Listen to the words very carefully when our prime minister says, ‘We have no plans,’ ” he says. “Are we working on plans? Yes we are.”
Alexander is not alone on the backbench in believing voters are deserting the major parties in droves. People are fed up with the dumb partisanship that sees anything the other side says as ipso facto bad. Clinging to power rather than delivering good policy is seen as politically self-serving. The response to the Australian Bankers Association’s decision to appoint former Labor premier Anna Bligh as its chief executive, on a salary believed to be upward of half a million dollars, is a case in point. Morrison’s senior adviser, Sasha Grebe, had put his hand up only to be gazumped by, horror of horrors, a Labor identity.
It was seen as a vote of no-confidence in Turnbull winning the next election. The treasurer was so miffed he hinted he wouldn’t deal with Bligh. He, like other Liberals, regarded the appointment as a kick in the teeth from a sector the government has taken a lot of water for in protecting it from a royal commission.
Calls for revenge went out. Christensen, helpfully, threatened to cross the floor and vote for a parliamentary banking inquiry. Brisbane Liberal Luke Howarth called for the banks to be left out of the big business tax cut. His reasoning undermined the argument stubbornly pursued by the treasurer and prime minister that the corporate tax cut is good for the nation. He told Nine News that excluding the big banks would win over the senate crossbench and dilute Labor’s claim that Turnbull stands for the big end of town. “Let’s take away the issue,” he said, “and get the rest of the country with lower tax rates.”
For his part, Bill Shorten dismissed any idea that a senior Labor figure such as Bligh arguing against a royal commission is damaging for him. He says that nothing less than a royal commission will satisfy him or the Labor Party. And, for good measure: “I run the Labor Party, not Anna Bligh.”
Shorten is just as belligerent on energy policy. And with good reason. The Essential poll has found a staggering distance between public opinion and the government on climate change and renewable energy. More than 70 per cent believe the Liberals aren’t doing enough on energy policy and that includes 62 per cent of Coalition voters. Sixty per cent accept humans are causing the problem. Sixty-five per cent support Labor’s target of 50 per cent renewable energy by 2030, including 55 per cent of Coalition voters. And in a poll taken five months after Turnbull relentlessly blamed South Australia’s renewable energy reliance for its statewide blackout, 58 per cent of Liberal and National voters agreed renewable energy was the solution to future needs.
On Thursday, in a major speech on energy policy, Shorten identified 400 weather records that have been broken in Australia in the past month as more than enough proof that climate change is a reality we must face. He accepted the prime minister’s January challenge, in which Turnbull said the “battlelines are drawn” on energy policy. Labor is determined this time not to allow the argument to be simply about costs.
Shorten has marshalled impressive evidence to bolster his claim that Labor’s plan is “cleaner, cheaper, more reliable power”. His hosts for the speech at Bloomberg needed little persuading. The head of Bloomberg New Energy Finance, Kobad Bhavnagri, said new coal was in fact the most expensive form of energy in the future. Trying to make it “clean coal” through carbon capture and storage is prohibitively expensive. No wonder the coal lobby has already spent $21 million on misleading propaganda and political donations. Bhavnagri said no one in the energy sector was seriously looking at investing in coal. Only the coalminers. The miners are desperately trying to get the government to reverse 20 years of policy, re-enter the energy business and stump up billions that the private sector won’t.
Turnbull says he is technology neutral – a good first step if it also means he will accept evidence that carbon capture and storage is an expensive pipedream. The technology is so unlikely that the first Coalition government budget in 2014 gave up on it – Joe Hockey slashed $460 million from carbon capture and storage research. But no one believes the denialists on Turnbull’s right flank, who are also the most fervent coal evangelists, will suddenly begin to accept evidence-based policy formulation. They would rather blow up the government.
The ultra-conservatives have a champion to replace Turnbull if he gets too serious about climate change. Andrew Bolt on his TV show all but anointed Immigration Minister Peter Dutton. Dutton responded with some well-rehearsed lines on what he would have to offer. Along the way, he fired a missile at Turnbull’s credibility over the refugee deal with Washington. He contradicted the prime minister by calling it a “people swap” and confirmed that Australia taking refugees from Costa Rica was a quid pro quo. Of course it was, but Turnbull is still denying it.
For the prime minister, crossing the Nullarbor is a hundred-metre dash compared with bridging his growing credibility gap.
This article was first published in the print edition of The Saturday Paper on Feb 25, 2017 as "Boundless plains to spar". Subscribe here.