Australian election looming next year

Press, 30 December 1988, Page 29

Australian election looming next year

DON WOOLFORD

By

NZPA-AAP Canberra Almost everything that occurs in Federal politics in 1989 will have one simple aim, to influence the next election. Bob Hawke, having abandoned his flirtation with retirement, dearly wants to extend his record to a fourth successive term. John Howard knows that the next will be his last chance. The election does not have to be in 1989. Technically, it is not due until late 1990. As a matter of practical politics, it does not have to be called until a half Senate election is required in mid-1990.

But the tactical calculations of all parties are based on the likelihood of its being called next November or December. In a sense, there is no such thing as a non-elec-tion period. By-elections, State elections, the continual public and private polling and the gladiatorial nature of politics, in which machismo often seems more important than policy, ensure that. Only the intensity changes — and 1989 promises to be very intense.

The strategic outlines are already clear. In one important respect, Mr Howard is starting at a disadvantage. He has yet to convince his own party, let alone the electorate at large, that he is capable of leading the coalition back to Government. Mr Hawke does not have that problem. To use the sporting imagery he so likes, he has the runs on the board. In fact, caucus believe he is Labour’s major electoral asset, enabling him to

brush aside the treasurer, Paul Keating’s leadership moves.

But Mr Hawke has a problem too — the economy. In many respects it is more complex and less easily controlled than Mr Howard’s.

In broad outline, the Government strategy is straightforward: convince the unions to keep the lid on wages and provide hefty tax cuts in July.

Mr Hawke and Mr Keating have made it clear that the main beneficiaries of the cuts will be the low and middle income earners.

Their preference is for the full cut to be introduced on July 1, but they have not ruled out the possibility of a phased reduction, with the second instalment most likely on January 1, 1990. While they have given no hint of the size of the cuts, insisting that this will depend on the wages outcome, Government electoral tacticians regard substantial cuts as a political necessity. Enormous political capital has been invested in the promised cuts. If they were so small that the Opposition could picture them as token, disappointed public expectations would rebound on the Government. The Government’s image as a good economic manager, which was used so potently in the 1987 election, would also be damaged. The problem is whether the economy will permit big cuts to be made responsibly. Wage breakouts continue to threaten despite the A.C.T.U.’s commitment to moderation, and demand is still too strong

and is making a mockery of Mr Keating’s budget forecasts for the current account deficit and inflation.

Come next May, when the tax decisions will be made, irreconcilable tensions could exist between the political and economic imperatives. A decision to phase the cuts could be a compromise around such tensions, and a hint that the election will be in early 1990 rather than late 1989. Mr Howard also has to put the figures into his tax policy. So far, he has refused to indicate when he will do that. Most observers believe he will wait until the Government has made its decision, which will leave him vulnerable to charges of turning the election into a tax auction. But while his “lower and flatter” tax policy will be important to his prospects, he does not intend tax to be the overwhelming issue it was in the July, 1987, election. That was part of the point of his Future Directions launch in early December. With its emphasis on traditional family values, it was meant to help him shed his accountant’s image (actually, he is a lawyer) and present him as a more rounded and caring person. But Mr Howard’s enduring problem is his leadership. Despite the Liberals’ stunning by-election successes in 1988, his personal standing in the polls remains low and internal bickering continues to erode his authority.

Some observers remain convinced that the Liberals, terrified of yet another term in Opposition,

will dump him early next year and that the souffle will indeed rise twice — bringing back Andrew Peacock.

But Canberra is always fecund with rumours of coup and conspiracy. Mr Howard is nothing if not tenacious. If he goes, it will be bloodily — and that would hardly help the party w?h an election in the win Moreover, the-initial prv'jsing public reception of Future Directions must have helped his position. So the best bet now is that it will again be Hawke versus Howard. On the old boundaries, Mr Howard needs a uniform swing of just over 3 per cent to win.

But that calculation has been complicated by proposed redistributions in Victoria and Western Australia which are generally thought to favour the Coalition.

The first indication of how the votes may fall will come in the West Australian State election, due to be held this year. But given the skeletons that have come out of the W.A. Incorporated cupboard since the fall of Rothwells, that result may be more important for morale than as a genuine guide to a Federal election.

In the meantime, backbenchers on neither side seem to be bursting with optimism. Listen to some Liberals and you would think Howard has little chance; listen to some Labour M.P.s and you would think the Hawke reign is on the skids. That is not as paradoxical as it sounds. Nervous pessimism is an occupational hazard, particularly among the marginals.