2019 Federal Election Update #2
The final countdown – will it be Winx or Bradbury at the finish line?
As the election campaign enters the crucial final week, Labor remains the frontrunner in a still tight contest. The big unknown now is where an estimated 20% of disengaged and undecided voters finally decide to put their votes in the last days.
The level of public disengagement is remarkable given voters are being offered the most starkly different major party platforms we have seen in years. As a result, Bill Shorten is enjoying Winx-like betting odds and must be strongly favoured to win, yet there is still the sliver of possibility that a Steven Bradbury-style surprise result could eventuate for Scott Morrison.
That’s because there are still a range of wild cards in this election. Preference flows will be vital as both the Coalition and Labor are struggling with low primary votes in the 30s, meaning Greens, Clive Palmer’s UAP and One Nation votes will be crucial in many seats.
The other factor is the surge of so-called “conservative” Independents in former Liberal Party strongholds in Melbourne and Sydney who are tapping into community fears about the extreme effects of climate change. Contests in Wentworth, Warringah and Kooyong are sapping vital energy and resources in Coalition heartland.
Indeed, climate change could be the winning edge for Labor, as it is the only issue that appears to be generating any passion in an otherwise cynical, sullen electorate. As Anthony Albanese noted this week at Newgate’s pre-election client party in Sydney, many young people are on the voting roll for the first time in this election, thanks to the same-sex marriage plebiscite, and in urban seats particularly they may well skew towards Labor.
Labor was out today with its costings, seeking to neutralise the Coalition’s lead on economic management with forecasts of continuing surpluses over the next decade, delivered by $154bn of new tax revenue over a decade. Treasurer Josh Frydenberg has immediately counter-punched this afternoon with claims there were holes in Chris Bowen’s figures. This is going to be an arm wrestle right to the end.
The magic figure to win a majority in the House of Representatives is 76. The Coalition currently holds 75 seats and Labor 69 with seven independents. Under the redistribution, though, the Coalition has lost at least two seats and Labor has picked up one. Insiders believe at this point that Labor appears to be on track to win about 80 seats which would give them a workable majority. However, given the factors noted above, there is distinct risk that Labor could lose some seats on regional issues or tax fears.
Big versus small target campaigns
In a reversal of traditional campaign roles, Labor’s ‘big target’ strategy has opened up a means of Coalition attack on tax and economic management while the Coalition’s small target tactics have left it open to criticism that it lacks vision.
Bill Shorten has been relentlessly disciplined on the campaign trail without sealing the deal with voters. However, the Telegraph’s attack on his backstory about his mother’s blighted law career gave him his first major chance to “show some emotion” in the words of the great Joan Armatrading. Importantly, it also dulled the Coalition’s attacks on tax.
Remarkably, the Coalition under Scott Morrison has remained competitive throughout this campaign, relying on core messages of fiscal conservatism and low taxes, and a negative campaign focused on Bill Shorten. However, the question remains whether that is anywhere sufficient to propel the Coalition back into office, particularly considering its record of leadership turmoil.
The final week
The last week of the campaign will feature the Coalition’s formal launch in Melbourne on Sunday, a final advertising barrage from all the parties, and the release of the Coalition’s policy costings. The Coalition launch is Scott Morrison’s last chance for it to offer something new to voters and capture back political momentum.
North versus south
On election night, all eyes will be on Queensland and Victoria where the most marginal seats are up for grabs. There is a view that regional seats in Queensland are rallying behind pro-coal candidates, with the opposite effect occurring in Victoria, where 3-5 seats are up for grabs on climate change concerns. Insiders say Leichhardt in far north Queensland could, however, buck this trend: its tourism sector depends on the Great Barrier Reef so the anti-Adani vote could conceivably put it in play for Labor on election night.
There will also be strong interest in Senate outcomes, where a range of crossbenchers are seeking to pick up votes by running against Labor’s tax package, setting the scene for a post-election showdown if Bill Shorten wins. It could be 2013 all over again, when Tony Abbott and Joe Hockey’s budget fell foul of a Senate unmoved by claims of a Coalition mandate.
Business waiting for answers
For business there is a range of issues on the horizon including tax, IR and resources. Labor has begun ratcheting up its rhetoric on multi-national tax avoidance, foreshadowing major changes in tax laws allowing any transfer of profits, and voicing concerns about any companies investing in Australia associated with tax havens. There is also an unknown potential impact from new property taxes on Australia’s historic property slump.
The ACTU’s “Change the Rules” campaign raises the issue of who will call the shots on industrial relations policy if Labor wins. Business is also awaiting more detail on Labor’s ambitious renewable energy and emissions targets and what impact will they have on Australia’s coal industry.
Rate cut in the wings?
The other unknown is whether the RBA will post-election follow in New Zealand’s steps and cut interest rates to a near zero emergency rate as economic conditions begin to slow markedly. This puts a question mark over any new government’s Budget settings and impetus for a political response for a new economic stimulus package.
Newgate will issue a final pre-election note next Friday with our guide to seats to watch and our best predictions about the final result.