Australia Decides: Edition 2

Crisis&Comms Co brings you analysis and insight from week 1 of the 2022 Australian election campaign.

Mr Morrison talking with workers during a 'high-vis" visit

First up, we'll cover off the Key Events of the campaign so far. Then we'll turn to some of the Top Issues on voters' minds during the campaign, including Cost of Living, The Economy, Debt and Deficit, Taxation, Security, Trade, Russia and China.

Key Events

Labor's Medicare rally

Labor

On the first full day of the campaign, while campaigning in the ultra-marginal government-held seat of Bass (0.4%) Mr Albanese was unable to accurately state the unemployment rate nor the RBA's target cash rate. On one view of the footage, Mr Albanese appeared to say 5%, then corrected and said 4%. However he ultimately said he wasn't sure.

The Opposition leader later said he would "fess up", "cop it sweet", and admit a mistake, in order to draw a contrast with the Prime Minister.

The gaffe dominated the following two days of coverage of the Leader of the Opposition and has stolen crucial momentum from the Labor campaign.

Working to 'right' the campaign, Labor has pivoted to announcements on Labor's preferred ground of health policy. Announcements intended for later in the campaign were reportedly moved forward. This included an announcement to reinstate bulk billing for urban and regional psychiatric telehealth consultations; as well as a plan to trial 50 new Medicare Urgent Care Clinics, to channel less serious but urgent cases away from hospital emergency departments. To complement the announcement, the Opposition held a campaign rally in Melbourne.

The Australian Medical Association, the lobby group for medical doctors and particularly general practitioners, has questioned the policy's funding, and how it would be implemented. The AMA also lashed out at the Coalition for doing nothing on GP policy and “betraying” a promise to implement a 10 year primary healthcare plan.

Coalition

Mr Morrison's first day visit to the seat of Gilmore was plagued by the spectre of the 2019/20 bushfires. At the time of the bushfires, residents and fire fighters refused to shake the hand of the Prime Minister; while other locals were harsh in their criticisms of him. Back then Andrew Constance was a New South Wales MP and Minister and said that Mr Morrison received the "welcome he deserved." Mr Constance is now Mr Morrison's candidate for the seat.

The Prime Minister has stated that former

Education Minister Alan Tudge, remains able to return to his ministerial post at any time. He said that Mr Tudge had simply elected to stand aside and that he has not been dismissed nor resigned his commission as a Minister.

Former Tudge media adviser Rachelle Miller, with whom Tudge had a consensual affair, is rumoured to be in negotiation with the Department of Finance for a compensatory settlement of around half a million dollars.

One of the funniest people in Australia, Shaun Micallef sums it up with a clever quip and an economy of language in this tweet.

Katherine Murphy from the Guardian called Mr Tudge Schrodinger's Minister given he appears able to both be a Minister and not be a Minister at the same time.

A visit by the Prime Minister to a Rheem factory in Paramatta, designed to promote the government's pledge to create 1.3 million jobs, did not go completely to plan when it transpired the company planned to cut jobs at the facility and to move some of them to Vietnam.

Teals

Volunteer and supporter numbers are a measure of two things:

(i) They are a direct representation of the community's support for your campaign. At best, major parties can expect the direct support of perhaps a hundred or so regular volunteers in a federal seat.

(ii) Logistical and organisational ability. The more volunteers you have, the more campaigning you can do.

A stand out feature of the successful 2019 campaign of Independent MP, Zali Steggall against former Liberal Prime Minister, the Hon Tony Abbott, was the sheer number of volunteers and supporters on the streets for her every day.

If the pictures below are anything to go by, the Teal campaigns in the leafy Melbourne Eastern suburbs will be triggering alarm bells in Liberal Party HQ.

From left to right, pictured below, are campaign events of Liberal Higgins MP, Katie Allen; Teal Higgins candidate, former ABC journalist, Zoe Daniel; and Teal Kooyong candidate, Dr Monique Ryan.

While Ms Allen had a respectable turn out, the Teal events appeared to garner the support of several hundreds. (Credit @nicholas_reece)

One Nation

The now former LNP Member for Dawson, Mr George Christensen has announced he is returning to politics as a Senate candidate for One Nation in an unwinnable third position on the party's ticket.

Under parliamentary entitlement rules, an MP who "retires involuntarily" - either by losing a party ballot for pre-selection, or at a general election - may receive a "resettlement allowance" currently set at $105,000. By standing and losing for One Nation, Mr Christensen is likely to be deemed to have retired involuntarily and will therefore be eligible for this payment.

Top Issues

Cost of Living

The Budget predicts inflation to peak at 4.25% this year before moving to 3% in 2022-23 and 2.75% in 2023-24. With US inflation now hitting 8.5%, these estimates may turn out to be optimistic.

High inflation means prices rises are occurring in an economy where wages have remained flat for a decade. Voters' are feeling their pay packets being eroded every day and social media sharing of $500 and $600 weekly shops are proliferating, amplifying the issue. This is a heady and dangerous political mix for an incumbent government.

Direct cash handouts and a halving of fuel excise, delivered by the March 29 Federal Budget may have taken some of the electoral sting out of this issue for now. But voters’ cost of living concerns are likely to remain a key point of political debate throughout the campaign.

It is notable that the basket of goods the ABS uses to calculate the official inflation rate includes prices rises for rent and new dwellings, but it does not take into account increases in the cost of existing dwellings. This means that for families managing large mortgages expecting rate rises of up to two hundred basis points in the next two years, real cost of living increases will far outstrip official rates. This is potentially an issue which will benefit the Liberal Party in tight contests for 'aspirational' seats such as those of Western Sydney.

In general the issue favours Labor.

The Economy and COVID-19 Recovery

Considering traditional measures, the Australian economy is in exceptionally good health, despite the COVID-19 pandemic, a trade dispute with China and a volatile international security and trade picture.

The national official unemployment rate fell to 4% in February 2022. This is 1.2% below March 2020, at the Australian onset of the pandemic. According to the Budget, the projected unemployment rate to the September 2022 quarter is 3.75%.

In respect of exports, strong and recently strengthening prices due to global uncertainty have seen major Australian commodities producers continue to return high profits. Australia has been forecast to achieve the milestone of $100 billion of annual coal exports by the end of the current financial year (ending June 30, 2022).

Domestic consumption appears to have helped maintain the Australian economy throughout the COVID-19 crisis. Apart from the state of Victoria, the rest of the country has experienced relatively limited negative economic impacts from the pandemic, following initial lockdowns in 2020.

While the Government has been credited with early spending during the COVID-19 crisis supporting employment and the broader economy , Prime Minister Scott Morrison has nonetheless been characterised as having failed on the key issues of vaccines and rapid antigen testing. As a result, the Government's anticipated electoral advantage from being seen to have effectively managed the pandemic, was eroded.

Becasue of this, the Government has chosent to almost entirely focus its campaign on attacking the Opposition, including around its perceived strengths of economic management, taxation and national security.

Debt and Deficit

the UAP's advertisement on debt

Debt and Deficit was a key issue at the 2013 election, used by the Liberal and National parties to criticise and defeat the then Labor Government. At the time, government debt had grown due to spending during the global financial crisis.

Fast forward to 2022 and the government is no longer talking about debt!

Spending on the Jobkeeper program and other economic support, has Australian national debt now forecast to peak at $1.1 trillion by 2025 (44.9% of GDP).

National debt was around a fifth of this when the LNP came to office in 2013.

Look out for minor parties continuing to campaign on national debt, while Labor Treasury spokesperson, Dr Jim Chalmers says that the government has little to show for a trillion dollars worth of debt.

Taxation

The Government regularly attacks the Labor Opposition on the basis it is a high taxing party. While this is a statistically contestable question, it will remain a key attack point for the Government, perhaps bolstered by memories of the 2019 election when Labor proposed a wide array of taxation changes.

Labor has said to-date that its only intended change to the taxation system is to implement measures which will crack down on taxation avoidance by multinational companies, including the introduction of a “beneficial ownership” register.

At the Budget, the Treasurer extended funding for the Tax Avoidance Taskforce with $652 million in funding through to 2025.

Security, Trade, Russia and China

In the lead-up to the federal election there have been a number of attempts by the Prime Minister and the Defence Minister to criticise the Labor Party by arguing that its leader would be a push over for the Chinese leadership.

Advcance Australia mobile billboard

The pictured mobile billboard authorised by Advance Australia, a Liberal National Party aligned, conservative political action group, underlines the point of attack.

On 16 February the Director-General of ASIO (the Australian Security Intelligence Organisation) took the unusual step of speaking publicly on the importance of national unity on the issue of the China/Australia relationship and the importance of the disputes not being used as a political wedge. It is likely that this intervention directly resulted in a reduction and at least a temporary halt to this rhetoric from the Australian Government.

National security is considered a major advantage for the Liberal and National Parties, with major increases in defence spending announced in the Budget, including an additional expenditure of $38 billion to increase defence personnel to 80,000 and 100,000 by 2040.

There remains substantial time in the context of an election campaign for these issues to re-emerge. It is highly likely that, particularly in the later one or two weeks of the election campaign, that the government will return to a ‘Labor is weak on China” theme.