Scott Morrison’s pitch for a post-budget bounce
The budget-selling roadshow has been in top gear for almost two weeks but early signs are the spruikers are finding it hard to be heard above the noise of the carnival. And that is despite every effort to be in tune with the vaudeville act of its main competitor next door.
Government backbenchers are hoping the wisdom that used to work will work again. As one Liberal veteran put it, “When in trouble, veer left”. Treasurer Scott Morrison is urging everyone to hold their nerve and allow Australians to absorb the beauty of his re-choreographed act.
On Monday night, Sky News showed the treasurer in action at the Central Coast Leagues Club in Gosford. It was a dramatic window into just how hard he is finding it to win over the crowd. The housing affordability package left one woman cold. The excuse to leave negative gearing and capital gains tax discounts untouched to look after “mum and dad investors” was dismissed as “ludicrous”. She reminded the treasurer that, mum and dad or not, “They’re all investors”. At the other end of the spectrum, the very guiding principle of the budget was seen by one gentleman as a sellout to the left.
Peter Lewis of Essential released detailed analysis of his post-budget polling this week. Writing in Guardian Australia, he explained the government’s failure to get an instant boost out of the budget in terms of where the perceived winners and losers were. Despite a concerted and somewhat successful attempt to move onto Labor’s turf in health, education and disability, most voters saw the biggest winners were still high-income earners and big corporations.
That’s a resounding endorsement for Bill Shorten’s doubling down on corporate tax cuts. It shows his calls for the 2 per cent deficit levy on incomes above $180,000 to stay are resonating and his refusal to endorse a half per cent rise in the Medicare levy for everybody earning below $87,000 is too.
Shorten summed it up when he batted away questions of his leadership performance by explaining Labor’s ascendancy in terms of him being more in touch. “I don’t need a poll to tell me that they don’t like the idea that millionaires should pay less tax under Malcolm Turnbull and that 10 million Australians should pay more income tax.”
In the Essential poll, only 18 per cent of people thought the budget would be good for them. Fifty-one per cent thought it would be good for people who are well off. In none of the other polls – Fairfax Ipsos, Newspoll and ReachTEL – did a majority think the budget was fair. Fairer than previous Coalition efforts, sure; but still perceived to be wanting.
Focus group research for Labor in Perth and western Sydney found an explanation for why the overwhelmingly popular bank tax was not an immediate vote winner. People were not convinced by the government’s arguments that the banks won’t pass on the cost in higher fees and charges. At Gosford, there were groans when the treasurer ran the line.
Morrison’s budget and its sales pitch still looks like it is coming from a government at war with its own past convictions. There is something dissonant about a Liberal treasurer talking about the banks “fleecing their customers”, as he did on Insiders. He is, after all, a treasurer who still argues against the need to hold a royal commission into the economic power of the banks and their use or abuse of it.
The ironies don’t end there. As the banks ramped up their resistance to the $6 billion hit to their bottom line, former treasury secretary Ken Henry, now National Australia Bank’s chairman, called for an inquiry into the tax. A parliamentary inquiry, he hastened to clarify. Malcolm Turnbull lashed out at the highly qualified Henry, accusing him of being a self-serving “big bank boss”. Worse, he was Labor-leaning with a record of flawed policies in treasury. Henry has, perhaps unwittingly, given more credibility to Labor’s call for a royal commission.
If anyone had any doubts that this particular push is impressing voters, they would only have to see how Morrison and Turnbull keep ratcheting up their bank-bashing. The prime minister and his treasurer are even doing what looks like a most un-Liberal thing by interfering in how the banks run their businesses, who they can hire and how much they can pay them. Not without reason, mind you, but Labor’s Ben Chifley, who lost an election wanting to nationalise the banks 70 years ago, would be cheering. Makes you wonder why Turnbull doesn’t just bite the bullet and call a commission of inquiry.
Shorten welcomes the fact that the government is now fighting on his turf. The wisdom is that the more health and education is in the headlines the better it is for Labor. Peter Lewis says the Liberals are now set to play away games probably to the next election. While some Liberals congratulate themselves on leaving Shorten naked – in their view, they have pinched all his clothes – the Labor leader sees the budget as a capitulation to the agenda he has been pushing for three years. He is more than happy to lose in the charisma stakes if he continues to command the sort of support Labor has drawn since the election.
Polling analyst Andrew Catsaras says all the polls since the budget show statistically there hasn’t been any shift. “Nothing has happened,” he says. But that “nothing” explains why Turnbull had to do something to regain Australians’ trust and confidence. There have been 27 polls since the election. They are not predictive of the next election but they are indicative of what is happening. In none of them has Labor trailed. Its lead has ranged from five to 10 points. The polling average this week was a seven-point lead, the same as the previous 17 polls this year. So far, nothing Turnbull has done – boosting hydro, scrapping 457 visas, his crackdown on citizenship, building submarines, you name it – is having an impact.
This cannot be all government self-harm, although the ideological straitjacket forced on Turnbull from day one is a major contributor. The more Turnbull vacated the middle ground, the faster Shorten ran to fill it. The curious findings since the budget of significant support for many of its key measures but no shift in voter sentiment is explained by Catsaras as “too late”. Turnbull missed his chance when he seized the leadership. People don’t think his left turn is credible, in the sense that his party will not allow him to carry through even if he really wants to.
Giving weight to these doubts is the continuing presence of Tony Abbott in the parliament. As one Turnbull ally laments, “If Abbott wasn’t there it wouldn’t be as big a problem.”
The ex-prime minister is apparently trying his hardest to be on his best behaviour. His former chief of staff, now a prolific commentator, Peta Credlin, says he doesn’t want to be accused of “fuelling anti-Malcolm sentiment”.
But he can’t help himself. Last week Abbott explained his half-hearted applause for Morrison’s budget as what it deserved. This week, he went on Radio 2GB in the slot the treasurer used to have to accuse the PM and Morrison of putting their survival ahead of everything else. “Frankly,” he said, “the only way to govern is with both eyes fairly and squarely on the national interest.” He also proclaimed, “governments can’t govern with one eye on the opinion polls”.
Credlin was even more excoriating. In The Australian, she wrote: “If we want a return to good government in this country our obsession with the polls must end.” She described the budget as an ignoble surrender of principles that has played into Labor’s hands. She doesn’t share the dismissive view of Shorten found in much of the commentariat. She credits him with “political savvy” that “vastly exceeds that of his opponents” and homed in on his income tax play-offs. She said they paint the Liberals wanting to tax workers more and millionaires less.
On the day the latest ABS figures showed wage growth continuing at record lows, Shorten’s treasury spokesman, Chris Bowen, amped up the attack. At the National Press Club he said not only are wages growing more slowly than the cost of living but many workers will receive pay cuts on July 1 “unprecedented in post-World War II Australia”. The same day, the deficit levy comes off big earners. In a nutshell, he explained Labor’s policy to taper the Medicare levy increase: “This is not the time to be increasing the burden of tax on people earning $30,000, $40,000 and $50,000.”
Bowen dismissed as a ruse the linking of the Medicare levy increase with the need to fund the NDIS. He said the government was lying when it said Labor left it short. He was asked why the opposition was then agreeing to some rise in the levy. “Because the budget is in need of repair,” he said. “It all goes into consolidated revenue. It always does.” It could now be a test of the Liberals’ commitment to the disability scheme if the senate insists on trimming its revenue plans.
Will the spruikers keep their caravan veering left or will they jump off? Whatever they do, they will need to find the political savvy that Credlin says they lack.
This article was first published in the print edition of The Saturday Paper on May 20, 2017 as "The greatest show on worth". Subscribe here.