Parliament returns tomorrow, yet in recent weeks, the government has been provided with two golden opportunities to turn around its miserable prospects by framing the impending election around economic reform.
In January, the Productivity Commission released its Efficiency and Competitiveness Report outlining major structural flaws in the management of Australians’ super. This was followed by the long-awaited release of the report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
An overhaul of the banking and superannuation ecosystems is undoubtedly required but one must question whether the wounded minority government has the political capital or indeed will to prosecute the argument.
Labor has already accepted unconditionally all 76 recommendations of the Royal Commission. Treasurer Josh Frydenberg has baulked at a crackdown on mortgage brokers, opening another attack line for the opposition which has already hammered the government for voting against establishing a royal commission on 26 occasions.
Upon reflection, making the case for necessary economic reform was once benchmark of Coalition political effectiveness. Now it has been placed in the ‘too hard’ basket in Cabinet discussions and leaves the Coalition economically directionless as it approaches the May federal election.
The ascension of Scott Morrison promised to satisfy all elements of the Liberal party room and present a united front come the 2019 Federal Election. Morrison has so far fared no better than his predecessor, sitting awkwardly between the continuously warring moderates and conservatives.
Morrison must first do away with the perception that he is prime minister by accident only.
His Tourism Australia background, along with his policy floundering and hesitation, do nothing to shift Morrison’s image from a Steven Bradbury-esque political opportunist to the conviction politician that he can become. Australian voters are sceptical of the baseball cap wearing, Cronulla Sharks-loving Prime Minister. Moderate and conservative Liberals don’t know whether he is an ally or an enemy.
Nobody knows quite what values the current Morrison regime represents because they haven’t told us.
Perception is everything in politics. Take energy policy for example. There is nothing more pertinent and embarrassing to highlight this absence of vision than the fact that almost half a year since the National Energy Guarantee failed to pass the Party Room, the Coalition still does not have a Federal energy policy. This vacuum allows Labor free rein to bash Morrison and Energy Minister Angus Taylor over the head about being ‘climate change deniers’.
Liberal MPs and supporters are craving a policy platform to go hell-for-leather with into the May election. The problem is they haven’t been given one.
Long gone are the days of the visionary duumvirates of Hawke-Keating and Howard-Costello. Not since the introduction of the GST almost two decades ago has a fundamentally reformist economic policy been successfully introduced.
It only takes a look down the other side of the aisle to see the reasons behind the looming electoral landslide that the Coalition faces in May. Where the government continues to shoot itself in the foot, Labor presented itself ready-to-govern at its December national conference.
Surprising as it may sound, the Liberals could do worse than taking a leaf out of the book of Bill Shorten and Daniel Andrews. Despite the unquestionable damage their policies would inflict on the feeble economic outlook for Australia, they have the apparent courage and conviction to advocate and prosecute major economic reforms.
Labor’s plan would cause damage to Australia’s economic performance at a time where global headwinds are on shaky ground. Under the stewardship of Shorten and Shadow Treasurer Chris Bowen, Labor proposes sweeping generational changes to investment taxation rules in Australia, including reforms to negative gearing, capital gains tax and dividend imputation credits. These policies will have a disastrous effect on private investment levels, asset prices and retirement balances and are the cornerstone of Labor’s growth crushing tax-and-spend agenda.
There are signs that the Government is gaining the political ascendency regarding franking credits. However, despite Treasurer Josh Frydenberg and Victorian MP Tim Wilson’s best efforts, it is evident that the Coalition has not yet been able to effectively communicate the devastating effect of Labor’s wider economic agenda.
The Coalition’s strategy has been to poke holes in Labor’s economic plan by espousing doomsday predictions about the effect changes to investment taxes and deductions will have on asset prices. Senior ministers have embraced the Abbott playbook of bashing Labor at all costs rather than outlining how Australia can thrive in an increasingly volatile global economy. The sheer negativity and pessimism from this electoral strategy is further fatiguing voters whom are weary after over five years of Coalition government.
Many political pundits have consigned the Scott Morrison stewardship to the dustbin of history only short months after it began. In unprecedented fashion, Labor’s frank outlining of its policies makes it now look more competent at managing the economy than the Coalition.
With seemingly nothing to lose, the PM must change tack and come up with some economically reformist policies himself, rather than reverting to a strategy of simply attacking Shorten and Labor. Advocating for the recommendations of the Banking Royal Commission and the Productivity Commission are a start and should be followed by announcing significant economic reforms ahead of the next election.
The Coalition must stop acting like an opposition and propose forward-looking policies to take to the election. There would be no shame losing the election fighting for retirees and small business-owners rather than limping towards it wrecked by internal division. It might even turn an electoral obliteration into a fighting chance for the Government.
Tom Waite is Bachelor of Commerce student in finance and Management at the University of Melbourne and a member of the Melbourne University Liberal Club.
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