Challenging Times

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By Strategic Partner John Barker 

The long threatened double dissolution of parliament with a Federal election for both Houses of Parliament on 2 July will become a reality following the Federal budget on 3 May.

The performance of the Federal Government, particularly Prime Minister Malcolm Turnbull has been disappointing. The public expectation following his elevation to Prime Minister is not being fulfilled. For example, the on and off taxation antics of the Federal Government are confusing and have drawn just criticism.

Why would a Government try to flick responsibility for raising taxes for health and education to the States, knowing history indicated there was no hope of success.

While there is an undeniable problem with Government revenues and expenditure there never was an identifiable win for the Government on income tax or GST but there always was an upside for the ALP when health and education are its traditional strengths.

The Opposition Leader and his colleagues have already ramped up a campaign on education funding, expect more in this space.

The decline in Government support in recent polling is solely on the shoulders of the Prime Minister. His charisma and confidence regrettably masks a political naivety for one with such parliamentary experience.

The senate has defeated the re-establishment of the Australian Building and Construction Commission. There was sufficient evidence to support the need for the Commission however a clash of political philosophy ie Union versus business / consumer support led to the Bills defeat.

The Government also moved with success to abolish the Road Safety Remuneration Tribunal which recently set substantial mandatory increases in minimum wages for smaller trucking companies and truck owner/operators.

These small businesses are already under extreme financial pressure. It follows that they need an economic advantage over the larger trucking conglomerates to be able to compete, indeed exist.

This was another union versus small business political confrontation. The ALP’s emphasis on the road safety factor is likely to win grass roots support.

Similarly the Oppositions push for a Royal Commission addressing the banking system will be electorally popular. It is dangerous for the Government to rely on the powers of the ASIC when that body is not sufficiently understood at grass roots level and its performance is not generally well regarded by business.

The latest opinion polls are wake up call to the Government, they must grasp the message and be much smarter. Unless there is a readjustment of policy, internal and external communication, and evident party unity, the Government can lose the next election.

The budget delivery and outcome is eagerly awaited and will significantly influence the Federal election campaigns.

The State Government is grappling with an energy crisis, not entirely of its making. However, the Opposition has succeeded in elevating the issue to crisis status.

It is the Government’s biggest test to date. One it is tackling with the appointment of a Cabinet subcommittee to handle the matter.

There is a lot hanging on this for both sides.

Energy aside the high level of confidence, improving economy, increased exports, booming tourism, the Premier’s recent delegation to Singapore and China, and the $7.6 million recovery package recently announced to assist oyster farmers devastated by the Pacific Oyster Mortality Syndrome, POMS, are very positive and reflects an active Government.

The Governments confident and successful opposition to the recent income taxation debacle also indicates it is prepared to stand up to its Federal colleagues.

The Premier should take credit for his leadership.

2 Comments

  • Mervin says:

    Nice piece as usual John but I think the State Government and the Energy Crisis is a rod of their own making and they do not like to discipline anyone and will probably pay the Hydro Management team their large bonuses for a job well done.

  • John Brooks says:

    Hi John
    Great commentary. From my perspective, you are right on the money regarding the disappointing Federal Government, the only consolation is that I would fear the alternative even more as the Fair Work trucking order would be an indication of what lies ahead for small business especially, if a change of Government was to happen. Without doubt the State Government is doing a stellar job within the limited sphere of available state taxation and commonwealth funding but the obvious lesson is that lazy government just doesn’t cut it any longer. The current energy situation has all the hallmarks of both the current and previous government, their administration and the generator having taken the easy option. For my mind the Hydro does not fall into the category of ‘too big to fail’ so if it needs to be restructured and elements leased off then so be it.

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