Bill Shorten has said a Labor government would repeal already-legislated tax cuts for companies with an annual turnover between A$10 million and $50 million, but left its position up in the air for those between $2 million-$10 million.
The decision, announced in response to questions at a news conference on Tuesday, does not appear to have gone through shadow cabinet. Nor did Shorten mention it when he addressed caucus on Tuesday morning.
It opened the opposition leader to immediate attack from the government and business.
Finance Minister Mathias Cormann said it was Shorten’s “captain’s call”.
Treasurer Scott Morrison said there were 20,000 businesses between $10-50 million turnover, with an average of 75 employees in those businesses.
“This is terrible news for 1.5 million Australians who work in those businesses that will have to face higher taxes under Labor if Labor is elected,” Morrison said. Shorten had turned former leader Mark Latham’s “ladder of opportunity” into “the snake of envy”, Morrison said.
The Australian Chamber of Commerce and Industry CEO, James Pearson said Labor had sent a “very bad signal to business today”.
The opposition has had a long-standing policy of leaving the cuts in place for the smallest businesses – with turnovers less than $2 million. But by failing to clarify its position for companies up to $10 million, Shorten has left uncertainty for many smallish businesses.
A spokesperson for Shorten said: “We’ve never supported these tax cuts for big businesses – we voted against them and we haven’t changed our position.
“We’ve always supported tax cuts for small businesses.
“As Bill said, we’re considering a threshold of $2 million or $10 million turnover. That will be decided by the shadow cabinet, in the normal way.”
Shorten’s announcement comes days after the speech by frontbencher Anthony Albanese in which he advocated the Labor strike a better relationship with business. The speech was seen as Albanese differentiating himself from Shorten on a number of fronts and positioning on leadership ahead of the Super Saturday byelections.
Asked about the decision apparently not having gone to shadow cabinet, ALP sources argued it had been generally known that a Labor government would not leave in place company tax cuts above the $10 million threshold.
But shadow treasurer, Chris Bowen, asked in May how long Labor was going to wait to give certainty to middle-level companies, said for companies above $2 million turnover “it is right and proper that we take some time to carefully work that through. We will be announcing our position, which will be crystal clear, not only to the voters but to the businesses of Australia,” Bowen said.
Labor earlier committed to repealing the tax cuts for big business, now before the Senate, in the event the government manages to legislate them. There is still no indication it can do so.
Whether a Labor government could get any repeals through would depend on the attitude of the Senate of the day.
Shorten’s announcement also comes as he faces criticism over Labor’s controversial advertisement, running in the byelections, that targets Malcolm Turnbull’s personal wealth and how he would benefit from the tax cuts for large companies.
The opposition is seeking to turn the battle over company tax onto Malcolm Turnbull’s personal wealth, with an attack advertisement declaring the Prime Minister stands to profit if the cuts for big business are passed.
The advertisement, to be used this week in campaigning for the Super Saturday July 28 byelections, says Turnbull “has millions invested in funds which hold shares in dozens of big businesses that would benefit from the tax cuts.”
The inflammatory ad runs as the government is making a last ditch effort against the odds to gather Senate support for the company tax legislation, due to be voted on this week. It also comes after Labor frontbencher Anthony Albanese on Friday distanced himself from Bill Shorten’s assaults on the top end of town.
The advertisement says: “Why is former banker Malcolm Turnbull so keen to give big business a tax cut instead of properly funding our schools and hospitals? Who exactly is he looking after? Malcolm Turnbull – is he just for the top end of town?”.
Labor also issued details of Turnbull’s investments, saying his statement of interests “shows that, through at least 15 of his 39 managed funds, he invests in 18 businesses that have a turnover of more than $50 million and an additional 14 businesses that have a turnover of more than $1 billion per year. Several of these funds have a minimum investment of $1 million.”
The tax cuts for big business are directed to companies with a turnover above $50 million annually.
ReachTEL polling in the Queensland seat of Longman done last Thursday, commissioned by the progressive think tank The Australian Institute and released on Sunday, has the Labor and Liberal National Party candidates 50-50 in the two-party vote.
The ALP’s Susan Lamb is fighting to regain the seat after resigning in the citizenship crisis. Labor’s primary vote was 39.1% and the LNP was polling 34.9%. One Nation was on 14.7%.
In Mayo, the other seat polled, the Centre Alliance’s Rebekha Sharkie, who also resigned over her citizenship, is leading the Liberals’ Georgina Downer 62-38%, widening her margin from her 58-42% lead in earlier polls.
Nationally, a Fairfax Ipsos poll, published in Fairfax Media on Monday, shows Labor leading the Coalition 53%-47% on the two-party vote. Turnbull has a 51%-33% advantage over Shorten as preferred prime minister.
In Longman, only a third of voters supported cutting company tax for large businesses; in Mayo just one quarter did so.
The government has flagged it will put the legislation to the Senate this week – the last before the winter recess – even if it is headed to defeat.
Several crossbenchers are opposed to the cuts, including Pauline Hanson and the Centre Alliance senators. The government has reiterated that it won’t split the bill to have a lower threshold that would exclude the banks.
Turnbull said on Sunday that Australia’s 30% rate for larger companies was the second highest in the OECD. Only Portugal had a somewhat higher rate.
Asked whether the government would walk away from the measure if it failed to get it through this week, Turnbull said: “We are committed to this reform”.
Friday’s Albanese speech has handed ammunition to the government. The broad-ranging address was seen as Albanese positioning himself in the event of Shorten doing badly at the byelections.
On relations with business, Albanese said: “Labor doesn’t have to agree with business on issues such as company tax rates, but we do have to engage constructively with business large and small.”
Questioned on Sunday, Shorten said his office got the speech before delivery and “there was nothing in that speech which caused me any offence at all”. He and Albanese had had “an amicable chat” since the speech.
“Let me make very clear for the record my views on big business. I will work with big business – I just won’t work for big business. I’m not anti big business – I’m just pro worker, I’m pro small business, I’m pro farmer, I’m pro pensioner,” Shorten said.
“It’s just all about priorities, we just happen to believe in the fair go for working and middle class people – Mr Turnbull on the other hand, he just looks after the top end of town and his other mates.”
A nationwide poll of nearly 3000 people commissioned by the Committee for Economic Development of Australia (CEDA), published on Monday in a report “Community pulse 2018: the economic disconnect” found that a majority of people don’t feel they have benefitted personally or don’t know if they have gained from Australia’s sustained economic growth.
It also found nearly eight in ten people believe the gap between the richest and poorest Australians is not acceptable.
Releasing the results, CEDA chief executive Melinda Cilento said: “Only 5% of Australians reported having personally gained a lot from our record run of growth, while 74% felt larger corporations and senior executives have gained a lot.
“A decade of stagnant incomes and cost of living pressures in areas like health and electricity are contributing to this feeling but waning trust in business and politics are also likely factors,” Cilento said.
Labor frontbencher Anthony Albanese has urged Labor to “engage constructively” with business, empower its party branches and make sure it avoids “allowing tactics to marginalise strategy”, in a speech that will be seen in the context of leadership.
Albanese’s Gough Whitlam Oration comes against a background of speculation that Bill Shorten’s leadership could come under pressure if Labor did badly in the Super Saturday byelections on July 28. Albanese is considered the only alternative to Shorten.
The address was carefully crafted to keep away from any direct criticism of Shorten, but it had a clear subtext. In saying what Labor’s approach should be, Albanese was also differentiating himself from Shorten who, for example, has been criticised for being too “tactical”.
Albanese’s tone on business contrasted with some of Shorten’s more strident attacks on the top end of town.
He noted that “successful Labor governments collaborate with unions, the business sector and civil society to achieve positive outcomes in the national interest”.
Criticising Malcolm Turnbull for setting business and unions against each other, he said a better course would be to encourage collaboration and compromise.
“That’s the approach of the best Labor governments. Our job is not to sow discord. It is to bring people together in the service of the national interest,” he said.
“Labor doesn’t have to agree with business on issues such as company tax rates, but we do have to engage constructively with business large and small.
“We respect and celebrate the importance of individual enterprise and the efforts and importance of the business community.”
Referring to his area of infrastructure and transport, he said he had maintained a close working relationship with the sector.
“Working with industry helps us to understand its perspective and also helps business to understand ours,” he said.
Albanese also confronted the issue of “aspiration”, which the government is using to attack Labor, especially on the back of its tax cuts legislation which passed this week. The government is claiming the ALP rejects or doesn’t understanding the aspirations of Australians.
Albanese conceded the importance of aspiration – but sought to cast it differently.
“The key to an effective plan for government is an understanding of the aspirations of our fellow Australians,” he said. “We in Labor must always ask ourselves, ‘what do Australians want out of life and how can we help them achieve it?’”
Malcolm Turnbull or Scott Morrison would say people wanted more money, Albanese said, but “I’ve got a different view. Australians do care about quality of life. But they define quality of life as something more than the value of their share portfolio or how much money they have in the bank”.
They wanted happy and productive lives and to build a society where their children had more opportunities than themselves, he said. “While Australians have personal aspirations, they extend beyond individual needs to family, community, environment and indeed, to encompass a fair nation.”
Albanese said Labor needed to recognise the importance of its branches to understanding what was happening in Australia.
“This is not 1950, when most Australians were members of trade unions. Indeed, many people from working class backgrounds are not members of unions because they were beneficiaries of Gough Whitlam’s education reforms,” he said.
“We cannot afford to ignore this demographic. We need the energy and ideas of our membership.
Labor must empower our membership by giving them more direct say in elections for public office and internal positions.
“Labor must also maintain our internal processes that emphasise policy making from the bottom up.
“Policy ideas that come from branch meetings or workplaces are gold. Sometimes they are ahead of their time. But they are always valuable,” he said, pointing to the push for marriage equality, that came from the community, up through the party and ultimately went through parliament.
Albanese trod carefully on refugee policy. “No mainstream politician believes in open borders, but a policy that uses its prolonged treatment of detained people as an ongoing deterrent to others has a deep flaw at its heart.
“Labor supports offshore detention and regional processing, in order to stop the people smuggling trade. But we call out the government’s failure to settle refugees in third countries, despite the clear offer of assistance from countries including New Zealand.
“You can be tough on people smugglers without being weak on humanity. You can protect our borders without losing our national soul.”
This week’s Newspoll, conducted June 14-17 from a sample of 1,660, gave Labor a 52-48 lead, unchanged since three weeks ago. Primary votes were 38% Coalition (steady), 38% Labor (steady), 10% Greens (up one) and 6% One Nation (down two).
This Newspoll is Malcolm Turnbull’s 34th consecutive loss as prime minister, four ahead of Tony Abbott. According to analyst Kevin Bonham, this is the worst Newspoll losing streak for a government, with Turnbull and the Coalition now one ahead of Julia Gillard’s 33 successive losses as PM.
Prior to July 2015, Newspoll was conducted by landline live phone polling with samples of about 1,100. Since July 2015, Newspoll has been administered by Galaxy Research, using robopolling and online methods with samples of about 1,700. The new Newspoll is much less volatile than the old Newspoll, so trailing parties have far less chance of getting lucky with an outlier 50-50 poll.
In this Newspoll, the total vote for Labor and the Greens was up one to 48%, and the total vote for the Coalition and One Nation was down two to 44%. This matches a late March Newspoll as the highest vote for the left-of-centre parties this term. These changes would normally give Labor a two party gain, but it is likely the previous Newspoll was rounded up to 52%, and that this one has been rounded down.
40% were satisfied with Turnbull’s performance (up one), and 50% were dissatisfied (also up one), for a net approval of -10. Bill Shorten’s net approval was down one point to -22. Turnbull continued to lead Shorten by a large 46-31 as better PM (47-30 previously).
Turnbull’s ratings improvement has been sustained since the budget. It is likely he is benefiting from the tax cuts in the next financial year. Recently, hard-right Coalition MPs have not had as much influence on government policy as they used to, and Turnbull is probably benefiting from this.
While Turnbull’s ratings improved, I believe the greater focus on the government’s tax policies and the publicity regarding Barnaby Joyce are holding back the Coalition’s vote. One Nation probably slumped owing to the split between Pauline Hanson and Brian Burston, who is now a senator for Clive Palmer’s new United Australia Party.
Both Newspoll and Essential’s fieldwork was mostly conducted before the federal Liberal council passed a motion to privatise the ABC on Saturday. This vote is likely to be embarrassing for Turnbull and Coalition ministers.
The Australian has been campaigning against the Australian National University’s refusal to allow a Western civilisation course. Most voters would have heard nothing about this issue. It is not surprising that, when given a question skewed in favour of the Western civilisation course, voters backed it by a 66-19 margin.
Essential: 52-48 to Labor
This week’s Essential poll, conducted June 14-17 from a sample of just over 1,000, gave Labor a 52-48 lead, a two-point gain for the Coalition since last fortnight. Primary votes were 38% Coalition (up two) and 35% Labor (down two). Tables have not yet been published, so The Poll Bludger’s report is the best for domestic issues.
79% supported the first stage of the income tax cuts that are introduced in the next financial year, but only 37% supported the third stage, which is scheduled to be phased in from 2024 – these tax cuts would flatten the tax scales. Support and opposition to the company tax cuts were tied at 39% each.
From Peter Lewis in The Guardian, 35% thought the agreement between US President Donald Trump and North Korean dictator Kim Jong-un would make the world safer, 8% less safe, and 41% thought it would make no difference.
Despite Trump’s presidency, 50% consider it very important for Australia to have a close relationship with the US, followed by the UK at 47% and China at 39%. Russia at 17% and Saudi Arabia at 14% are at the bottom of this table.
By 54-11, voters had a favourable view of New Zealand PM Jacinda Ardern, followed by Canadian PM Justin Trudeau (54-14), German Chancellor Angela Merkel (43-18), French President Emmanuel Macron (42-15) and UK PM Theresa May (42-19). Trump had an unfavourable 64-22 rating, Russian President Vladimir Putin 56-19 unfavourable and Kim Jong-un 68-9.
Two Mayo polls give Rebekha Sharkie 58-42 leads over Georgina Downer
On July 28, Mayo is one of five seats up for federal byelections. The incumbent, Centre Alliance’s Rebekha Sharkie, was forced to resign over the dual citizenship fiasco, but will recontest. The Liberal candidate is Georgina Downer, daughter of Alexander Downer, who held Mayo from 1984 to 2008.
A ReachTEL poll for the left-wing Australia Institute and a Galaxy poll for The Advertiser both gave Sharkie a 58-42 lead over Downer. Primary votes in Galaxy were 44% Sharkie, 37% Downer, 11% Labor and 6% Greens. In ReachTEL, primary votes were 41.4% Sharkie, 35.5% Downer, 11.1% Greens and 8.2% Labor.
These poll results represent a 3% swing to Sharkie in Mayo compared to the 2016 election. The ReachTEL poll was conducted June 5 from a sample of 1,031, and the Galaxy poll June 7 from a sample of 515.
In the Galaxy poll, 62% had a positive view of Sharkie and just 10% a negative view. In contrast, 31% had a positive view of Downer and 41% a negative view.
The Centre Alliance was Nick Xenophon’s former party, and the expectation was that Sharkie would follow Xenophon down. However, it appears that she has built up a strong profile in Mayo that is independent of Xenophon’s appeal. It is likely Sharkie will defy the collapse of her party to retain Mayo.
It could be perceived that Downer thinks she should have the seat because it was her father’s seat. Other weaknesses for Downer are her membership of the hard-right Institute of Public Affairs, and her absence from Mayo for the last 20 years.
The Australia Institute ReachTEL has left-skewed additional questions. Question 2, regarding company tax cuts, gave unpopular examples of large companies — banks, mining companies and supermarkets. It then offered three options for company tax rates (increased, kept the same or decreased), with only one unfavourable to The Australia Institute’s left-wing agenda.
Three weeks ago, The Australian had a right-skewed company tax cut question in Newspoll, but left-wing organisations often do the same thing, though their profile is far lower than Newspoll.
In brief: Darling Range (WA) byelection, Conservatives win in Ontario and Colombia
A byelection for the Western Australian state seat of Darling Range will be held on Saturday. At the March 2017 state election, Labor won Darling Range by 55.8–44.2 against the Liberals, a massive 18.9% swing to Labor from the 2013 election. However, Labor member Barry Urban was forced to resign over allegations of fraudulent behaviour. A ReachTEL poll for The West Australian gave Labor a 54-46 lead in Darling Range.
At the June 7 Ontario provincial election, the Conservatives won 76 of the 124 seats, the left-wing NDP 40, the centre-left Liberals seven and the Greens one. The Liberals had governed Ontario for the last 15 years. The Conservatives won just 40.5% of the popular vote, with 33.6% NDP, 19.6% Liberals and 4.6% Greens. First Past the Post, which is used in all federal and provincial Canadian elections, greatly benefited the Conservatives with the left vote split. You can read more at my personal website.
Bill Shorten has moved to make the ABC an election issue, promising to reverse the Turnbull government’s $83.7 million budget cut and to guarantee funding certainty over the broadcaster’s next budget cycle.
Ahead of appearing on the ABC’s Q&A program, Shorten and frontbench colleagues declared the Coalition had “launched the biggest attack on the ABC in a generation”.
In recent months Communications Minister Mitch Fifield has sent a stream of complaints to the ABC about stories, both online and on air, contesting facts and interpretations. The Prime Minister’s Office has also complained. Government frontbenchers and backbenchers frequently make cracks at or about the ABC, echoing a theme of many conservative commentators.
The ABC is also under constant attack from News Corp, driven by both ideology and commercial interests. The government has an inquiry underway into the ABC’s competitive neutrality, which was part of a deal with Pauline Hanson but also important in the context of News Corp’s argument about the government-funded ABC encroaching on financially strapped commercial media.
When the government made the $84 million budget cut – which took the form of a freeze to indexation – Treasurer Scott Morrison said “everyone has to live within their means”. Managing director Michelle Guthrie said that “the decision will make it very difficult for the ABC to meet its charter requirements and audience expectations.”
In a statement Shorten, communications spokeswoman Michelle Rowland and regional communications spokesman Stephen Jones said Labor’s commitment would ensure the ABC could meet its charter requirements, safeguard jobs, adapt to the digital environment “and maintain content and services that Australians trust and rely on”.
They said the Coalition since 2014 had “overseen $282 million in cuts to the ABC that has seen 800 jobs lost and a drop in Australian content and services”.
“Labor will stand up for the ABC and fight against the conservatives’ ideological war against our public broadcaster,” the statement said.
The promised investment “demonstrates Labor’s commitment to the ABC’s independence and to maintain the ABC as our comprehensive national broadcaster.
“Now, more than ever, Australians need the ABC – our strong, trusted and independent public broadcaster.
“At a time when too many Australians feel disengaged from their democracy and distrustful of their representatives, Labor wants to restore trust and faith in our institutions. Part of restoring trust is is supporting a healthy public interest media sector, and protecting that trusted institution – the ABC”.
Sky News ReachTEL polls, conducted last week in the seats of Longman and Braddon from samples of over 800, gave the LNP a 52-48 lead in Longman and the Liberals a 54-46 lead in Braddon.
These polls represent a three-point swing against Labor in Longman, and a six-point swing in Braddon since the 2016 election. Longman and Braddon are two of the five seats that will be contested at byelections on July 28.
Primary votes in ReachTEL polls do not exclude undecided voters, and thus understate major party vote shares. In Braddon, primary votes provided were 47% Liberals, 33% Labor and 6% Greens. In Longman, primary votes were 38% LNP, 35% Labor, 2% Greens and 14% Others. Strangely, One Nation, which won 9.4% in 2016, does not appear to have been listed.
ReachTEL uses respondent allocated preferences, and this is helping the LNP in Longman. The major party primary votes appear to be about the same as in the 2016 election, but the LNP is benefiting from a stronger flow of preferences.
While the Longman poll is bad for Labor, it is a one-point gain for Labor since a ReachTEL poll for The Australia Institute conducted after the May budget. Individual seat polls have not been accurate in the past. With more than seven weeks left until the election, Labor can reasonably hope to hold Longman.
The March 3 Tasmanian election was a disaster for Labor, and this appears to have flowed into federal Tasmanian polling. Tasmania uses the same electorates for its state elections as the federal Tasmanian electorates. In Braddon, the Liberals won 56% at the state election, to just 27% for Labor and 4% for the Greens.
Analyst Kevin Bonham says that the Tasmanian federal election results have been closer to the state election if the federal election came soon after the state election. In this case, the scheduling of the byelections for July 28 has helped Labor by putting more distance between the state election and the federal byelection for Braddon.
Another problem for Labor in Braddon is that the Liberal candidate is the former MP Brett Whiteley. As Whiteley is well-known in that electorate, Labor’s Justine Keay will not benefit as much from a “sophomore surge” effect.
Sky News also released a national ReachTEL poll, conducted last week from a sample of over 2,000. Labor had a 52-48 lead in this poll, unchanged from early May. Primary votes were 35% Coalition (down one), 34% Labor (down one), 11% Greens (up one) and 9% One Nation (up three).
This poll was probably taken before Pauline Hanson and Brian Burston had a falling-out. Bonham estimated this poll was 53-47 to Labor by 2016 election preferences.
By 49-43, voters supported reducing the company tax rate to 25% for “all” businesses, a similar result to an Ipsos poll in early April (49-40 support). However, a late March ReachTEL that asked about tax cuts for “big” companies had voters opposed 56-29.
Voters were more favourable to the company tax cuts in Braddon (56-38 support) and Longman (58-33 support) than nationally.
By a narrow 47-45 margin, voters nationally opposed refugees on Nauru and Manus Island being allowed to settle in Australia. Opposition was far stronger in Braddon (60-31) and Longman (66-28). By 59-27, voters nationally agreed that there should be a 90-day limit on refugee detention.
National Essential: 54-46 to Labor
This week’s Essential poll, conducted May 31 to June 3 from a sample of 1,025, gave Labor a 54-46 lead, a three-point gain for Labor since last fortnight. Primary votes were 37% Labor (up one), 36% Coalition (down four), 10% Greens (steady) and 8% One Nation (steady).
Essential still uses the 2016 election preference flows, so this poll would be 53-47 by Newspoll’s new methods. Labor’s position in the national polls has improved since late May, when Parliament resumed its sitting.
Turnbull’s net approval was up two points since early May to a net zero. Shorten’s net approval was down nine points to -13. Turnbull led Shorten by 41-27 as better PM (40-26 in May).
37% both approved and disapproved of cutting the “tax rate for businesses from 30% to 25%, estimated to cost $65 billion over the next 10 years”.
50% thought the Newstart payment of $270 per week for a single person with no children was too low, 26% about right and 9% too high. At least 64% agreed with five statements about Newstart that implied it should be increased.
How the Senate has changed since the 2016 election
At the 2016 election, the Coalition won 30 of the 76 senators, Labor 26, the Greens nine, One Nation four, the Nick Xenophon Team (NXT) three and Others four. The four Others were Bob Day, David Leyonhjelm, Derryn Hinch and Jacqui Lambie. 39 votes are required to pass legislation through the Senate.
On a right vs left count, the Coalition, One Nation, Day and Leyonhjelm were right-wing senators, and Labor and the Greens left. If all of the right-wing senators voted for Coalition legislation, they needed three of the five centrists on bills opposed by Labor and the Greens. As the NXT controlled three senators, the Coalition needed to work with them.
Since the election, there have been several changes to party composition.
In April 2017, the High Court disqualified Bob Day, and he was replaced by Lucy Gichuhi, the second candidate on Family First’s South Australian Senate ticket. Gichuhi joined the Liberals in February 2018.
In October 2017, the High Court disqualified One Nation’s Malcolm Roberts, and he was replaced by Fraser Anning, who promptly resigned from One Nation. On Monday, Anning joined Katter’s Australian Party.
In November 2017, Lambie resigned owing to the citizenship fiasco, and she was replaced by Steve Martin. Martin joined the Nationals in May 2018.
In November 2017, NXT Senator Skye Kakoschke-Moore resigned over the citizenship fiasco, and was replaced in February 2018 by Tim Storer, who had been expelled from the NXT.
Last week, One Nation leader Pauline Hanson and Brian Burston had a falling-out after Burston said he would vote for the company tax cuts, in opposition to current One Nation policy.
As a result of these changes, the Coalition has gained one net seat to have 31 senators, Labor and the Greens are unchanged, One Nation is down two to two, the Centre Alliance (formerly NXT) is down one to two, and Others are up two to six. Others now include Bernardi, Anning, Storer and Burston, but not Day or Lambie.
Bernardi, Anning and Burston are right-wing senators. Including One Nation and Leyonhjelm, there are now 37 right senators. If they all vote the same way, the Coalition requires either the two Centre Alliance senators, or Hinch and Storer, to pass legislation opposed by Labor and the Greens.
The changes to the Senate have improved the Coalition’s position, as they now have two options rather than one if Labor and the Greens oppose legislation.
In brief: Spanish conservative government falls, Italian populist government formed, Ontario election June 7
On June 1, the Spanish conservative government lost a confidence vote, and was replaced by a Socialist government. Three months after the March 4 Italian election, a government of two populist parties has been formed. You can read more at my personal website.
Canada’s most populous province of Ontario holds an election on June 7, with polls closing at 11am on Friday Melbourne time. Ontario uses First Past the Post. After 15 years of government by the centre-left Liberals, the Conservatives looked likely to win this election in a landslide.
However, the NDP, the most left-wing major party, surged, and is currently tied with the Conservatives in CBC analyst Éric Grenier’s Poll Tracker, but the Conservatives are shown as winning a majority of seats. The Conservative leader, Doug Ford, has been compared to Donald Trump.
This week’s Newspoll, conducted May 24-27 from a sample of 1,590, gave Labor a 52-48 lead, a one-point gain since last fortnight. Primary votes were 38% Coalition (down one), 38% Labor (steady), 9% Greens (steady) and 8% One Nation (up two).
This is Malcolm Turnbull’s 33rd consecutive Newspoll loss as PM, three more than Tony Abbott. While Turnbull’s last two losses were both by a narrow 51-49 margin, Labor extended its lead in this poll.
The total vote for Labor and the Greens was steady at 47%, while the total vote for the Coalition and One Nation was up one to 46%. One Nation’s two-point gain is probably due to its reversal on the company tax cuts.
By 49-39, voters were dissatisfied with Turnbull’s performance (50-39 last fortnight). Turnbull’s net approval of -10 is a new high for this term. Bill Shorten’s net approval was -21, up one point. Turnbull led Shorten by 47-30 as better PM (46-32 last fortnight); this is Turnbull’s best better PM lead since September 2017.
26% (up three since early April) preferred Anthony Albanese as Labor leader, with 23% for both Shorten (down one) and Tanya Plibersek (steady). Albanese is benefiting from stronger support from Coalition and One Nation voters, who are unlikely to vote Labor. He is in third place with Labor and Greens voters.
By 39-37, voters thought Shorten and Labor would be better at maintaining energy supply and keeping power prices lower than Turnbull and the Coalition.
Last week there was a parliamentary sitting. The Coalition tends to do better when Parliament is not sitting. During parliamentary sittings, there is more focus on the Coalition’s policies, and these policies have been attacked by Labor.
In previous cases where Turnbull’s ratings have spiked, they have fallen back quickly. This time, Turnbull’s net approval increased by one point following a post-budget spike. If these ratings are sustained, they are likely to assist the Coalition.
On May 16, the ABS reported that wages grew at just a 0.5% pace in the March quarter, and 2.1% in the year to March. As I said in my first Newspoll article this year, wage growth is likely to be crucial at the next election.
Newspoll’s skewed company tax cuts question
The full wording of Newspoll’s company tax cut question can be seen here. Rather than asking a simple support/oppose type question, Newspoll asked whether voters wanted the company tax cuts as soon as possible, over the next ten years, or not at all. This is a skewed question, as two of the possible responses were favourable to the tax cuts, with only one unfavourable.
The question also suggested a “when”, not an “if”. That is, voters were asked when the tax cuts should be introduced, rather than if they are a good idea.
In addition, the current debate is not over whether “all” Australian businesses receive a tax cut. Companies with a turnover of up to $50 million received a tax cut in March 2017. The debate is whether larger companies should receive the tax cut. The only pollster that has asked explicitly about big companies, ReachTEL in late March, showed voters were opposed by an emphatic 56-29.
In last week’s Essential, not providing company tax cuts for large business was the most popular option when voters were asked to assess measures to cut government spending (60-22 support).
According to this Newspoll question, 36% wanted company tax cuts as soon as possible, 27% over the next ten years, and 29% not at all. The Australian’s Simon Benson claimed that the 63% who supported the company tax cuts is higher than for the same-sex marriage plebiscite (61.6%) – a very dubious claim.
Essential: 51-49 to Labor
Last week’s Essential poll, conducted May 17-20 from a sample of 1,025, gave Labor a 51-49 lead, a one-point gain for the Coalition since the post-budget Essential. Primary votes were 40% Coalition (up two), 36% Labor (steady), 10% Greens (steady) and 8% One Nation (up one).
With a Coalition primary vote at 40%, this poll would have been a 50-50 tie using Newspoll’s new methods. Essential continues to use the 2016 preference flows for its two party results. This poll was taken before Parliament resumed.
After a detailed question, 45% supported Labor’s tax plan proposal, while 33% supported the government’s. Most voters are not familiar with this much detail on policies. Similarly, voters supported Labor’s plan for the economy by 44-38 after much detail on Labor and Coalition proposals.
32% (up six since March) would trust Labor to manage a fair tax system, while 32% (up four) would trust the Coalition, and 22% (down nine) say there would be no difference between the major parties.
Just 34% correctly named the Queen of Great Britain as Australia’s Head of State, with 30% selecting the Governor-General and 24% the PM. By 48-30, voters would support Australia becoming a republic with its own Head of State (44-29 in January). 65% thought an Australian Head of State should be directly elected, 12% appointed by a two-thirds parliamentary majority, and 9% appointed by the PM.
Tasmanian Senator Steve Martin joins the Nationals
As a result of the citizenship fiasco, Jacqui Lambie resigned from the Senate, and her place was taken by the second candidate on her ticket, Steve Martin. Martin refused to resign, which would have allowed Lambie to retake her seat, and was expelled from the Lambie Network.
On Monday, Martin joined the Nationals. While Lambie was conservative on immigration issues, she was a reliable vote for the left on economic issues. Martin’s replacement of Lambie is a clear loss for the left. The Coalition will have a slightly easier path for its legislation, with 31 seats, up from 30. 39 votes are required for legislation to pass the Senate.
Super Saturday: July 28
Last week, the Speaker of the House announced that the byelections for the five lower house seats of Braddon, Longman, Mayo, Perth and Fremantle would not be held until July 28. Labor’s conference had been scheduled for that weekend, and has had to be postponed.
While Labor is very unhappy with the byelection timing, it may be a favour. The rights of asylum seekers are important to Labor’s left, but not to the general public. Public division within Labor over the treatment of asylum seekers could damage them. Policy on asylum seekers is an issue where the public backs the right.
In brief: Tasmanian polling, Ireland abortion repeal referendum
An early May Tasmanian EMRS poll gave the Liberals 47%, Labor 30% and the Greens 14%. The upper house seat of Prosser held an election on May 5, and the Liberals won it on May 15 after preferences were distributed. You can read more about this at my personal website.
On Friday, Ireland repealed the eighth constitutional amendment by an unexpectedly large 66.4-33.6 margin. The eighth amendment, passed in 1983, had greatly restricted abortion rights. The effect of repeal is that Parliament can legislate on abortion. You can read my preview for The Poll Bludger here, and my results report here.
This week’s Newspoll, conducted May 10-13 from a sample of 1,730, gave Labor a 51-49 lead, unchanged from three weeks ago. Primary votes were 39% Coalition (up one), 38% Labor (up one), 9% Greens (steady) and 6% One Nation (down one).
This Newspoll is Malcolm Turnbull’s 32nd successive loss as PM, two more than Tony Abbott. However, the past two have been narrow losses.
The total vote for Labor and the Greens was up one point to 47%, while the total for the Coalition and One Nation was steady at 45%. The gain for the left would normally result in a gain after preferences, but rounding probably helped the Coalition again.
39% (up three) were satisfied with Turnbull, and 50% (down three) were dissatisfied, for a net approval of -11, Turnbull’s highest net approval since the final pre-election Newspoll in July 2016. Bill Shorten’s net approval was down two points to -22. Turnbull led Shorten as better PM by 46-32; this is Turnbull’s clearest better PM lead since February.
Newspoll asks three questions after every budget: whether the budget was good or bad for the economy, good or bad for you personally, and whether the opposition would have delivered a better budget.
The best news for Labor was on the third question, where it only trailed by seven points, equal to their deficit after the badly perceived 2014 budget. According to The Poll Bludger, Labor trailed by more during all of the Howard government’s budgets.
This budget was seen as good for the economy by 41-26, and good for you personally by 29-27. The Poll Bludger says it is fifth out of 31 budgets covered by Newspoll on personal impact, but only slightly above average on the economy.
Turnbull led Shorten by 48-31 on best to handle the economy (51-31 in December 2017). Treasurer Scott Morrison led his shadow Chris Bowen 38-31 on best economic manager. By 51-28, voters thought Labor should support the government’s seven-year tax cut package.
Turnbull has delivered a well-received budget, while Shorten’s credibility took a hit after four Labor MPs were kicked out over the citizenship fiasco.
Voters were not sympathetic to politicians who held dual citizenships. By 51-38, they thought such politicians should be disqualified from federal parliament (44-43 in August). By 46-44, voters would oppose a referendum to change the Constitution to allow dual citizens to become MPs.
A key question is whether Turnbull’s ratings bounce will be sustained. The PM’s net approval and the government’s two party vote are strongly correlated, so the Coalition should do better if Turnbull’s ratings are good. Past ratings spikes for Turnbull have not been sustained.
While people on low incomes receive a tax cut, it will not be implemented by withholding less tax from pay packets. Instead, people will need to wait until they file their tax returns after July 2019 to receive their lump sum tax offsets. As the next federal election is very likely to be held by May 2019, this appears to be a political mistake.
In last week’s Essential, 39% thought the Australian economy good and 24% poor. While Australia ran large trade surpluses in the first three months of this year, the domestic economy is not looking as good as it did in 2017 – see my personal website for more.
Ipsos: 54-46 to Labor (53-47 respondent allocated)
An Ipsos poll for the Fairfax papers, conducted May 9-12 from a sample of 1,200, gave Labor a 54-46 lead by 2016 election preferences, a two-point gain for Labor since early April. Primary votes were 37% Labor (up three), 36% Coalition (steady), 11% Greens (down one) and 5% One Nation (down three).
Newspoll is no longer using last-election preferences, so it seems better to compare Ipsos’ respondent allocated preferences with Newspoll, not the last election preferences. By respondent allocated preferences, Ipsos was 53-47 to Labor, a three-point gain for Labor.
Ipsos is bouncier than Newspoll, and the Greens’ support is higher. If you compare Ipsos’ respondent allocated two party vote with Newspoll, the difference is diminished.
Turnbull had a 51-39 approval rating (47-43 in April). This is Turnbull’s best rating in Ipsos since April 2016; Ipsos gives Turnbull his strongest ratings of any pollster. Shorten’s net approval was up three points to -12. Turnbull led Shorten by 52-32 (52-31 in April).
By 39-33, voters thought the budget was fair (42-39 after the 2017 budget). By 38-25, voters thought they would be better off, the highest “better off” figure in Nielsen/Ipsos history since 2006. However by 57-37, voters thought the government should have used its extra revenue to pay off debt, rather than cutting taxes.
Queensland Galaxy: 52-48 to federal Coalition, 53-47 to state Labor
A Queensland Galaxy poll, conducted May 9-10 from a sample of 900 for The Courier Mail, gave the federal Coalition a 52-48 lead, unchanged since February, but a 2% swing to Labor since the 2016 election. Primary votes were 40% Coalition (down one), 33% Labor (up one), 10% Greens (steady) and 10% One Nation (up one). Primary vote changes would normally imply a gain for Labor, but this was lost in the rounding.
By 39-33, Queenslanders thought the budget was good for them personally, rather than bad. By 39-28, they thought the budget would be good for Queensland.
The state politics questions gave Queensland Labor a 53-47 lead, a one-point gain for Labor since February. Primary votes were 38% Labor (up one), 35% LNP (down one), 12% One Nation (up two) and 10% Greens (steady).
Premier Annastacia Palaszczuk had a 46-38 approval rating (44-38 previously). Opposition Leader Deb Frecklington had a 31-28 approval rating (29-25). Palaszczuk led Frecklington as better Premier 47-27 (42-31).
Longman ReachTEL: 53-47 to LNP
The Longman byelection is one of five that will be held soon. A ReachTEL poll, conducted May 10 from a sample of 1,280 for the left-wing Australia Institute, gave the LNP a 53-47 lead, about a 4% swing to the LNP since the 2016 election. Primary votes were 36.7% LNP, 32.5% Labor, 15.1% One Nation and 4.9% Greens.
ReachTEL is using respondent allocated preferences. The two party vote in this poll looks reasonable assuming One Nation preferences flow to the LNP.
National polls and the Queensland Galaxy poll show swings to Labor compared with the 2016 election. It would be highly unusual for a seat to swing so strongly to the Coalition when other polling shows a swing to Labor. In the past, seat polls have been far less reliable than national and state-wide polls.
In better byelection news for Labor, the Western Australian Liberals will not contest either Perth or Fremantle. Fremantle has a 7.5% margin with an incumbent recontesting, but Labor only holds Perth by a 3.3% margin with no incumbent.
This week’s Essential, conducted May 10-13 from a sample of 1,033, gave Labor a 52-48 lead, a one-point gain for the Coalition since last week. Primary votes were 38% Coalition (steady), 36% Labor (down one), 10% Greens (steady) and 7% One Nation (up one).
By 44-28, voters approved of the budget overall. 22% thought the tax cuts would make a difference to their household. 39% supported the tax cuts, with 30% wanting more spending on schools and hospitals and 18% preferring a reduction in government debt.
By 44-40, voters disagreed with giving higher income people larger tax cuts. By 79-14, voters agreed that those earning $200,000 should pay a higher tax rate than those earning $41,000.
Labor continues to hold a 51-49% two-party lead in the wake of last week’s budget. However, Malcolm Turnbull’s advantage over Bill Shorten has surged in the Newspoll published in The Australian on Monday.
But the Ipsos poll, in Fairfax papers, has Labor ahead by a much wider 54-46% margin on a two-party basis – a rise of two points for the ALP since the last Ipsos poll in early April, with a corresponding fall for the Coalition.
Post-budget opinion will soon be tested on the ground in five byelections, four of them caused by the citizenship crisis.
The Western Australian Liberals have announced they will not run in the two contests in that state, while Pauline Hanson and opposition leader Bill Shorten are trading public blows over preferences for the Queensland seat of Longman, where One Nation preferences were crucial in Labor’s win last election.
In Newspoll, Turnbull has stretched his previous three-point lead over Bill Shorten as better PM to 14 points. Turnbull jumped eight points to 46%, while Shorten fell three points to 32% in the poll, done Thursday to Sunday.
Last week Shorten was embarrassed over his previous boasts that Labor had a strong citizenship vetting process, after the High Court on Wednesday disqualified Labor senator Katy Gallagher for having dual citizenship when she nominated for the 2016 election. The court decision prompted three Labor MPs and a crossbencher to resign.
Turnbull’s satisfaction rating has risen three points to 39% in Newspoll, while Shorten’s rating went down a point to 33%. The Coalition primary vote was up a point to 39%; Labor also rose a point to 38%, since the last poll, published three weeks ago. One Nation is on 6%, the Greens are 9%.
Newspoll found 41% thought the budget good for the economy; only 26% said it would be bad. People were split on its impact for them personally: 29% said they would be better off, 27% thought it would leave them worse off.
Just over half (51%) backed the government’s tax plan, the first stage of which would give a tax cut to lower and middle income earners.
The Labor primary vote in the Fairfax-Ipsos poll was 37% (up three points). The Coalition was unchanged on 36%.
In the Ipsos poll, taken Thursday to Saturday, 38% believed they would be personally better off as a result of the budget – the highest rating in perceived personal benefit since 2006 – while 25% said they would be worse off. On the measure of fairness, 39% believed the budget was fair, while 33% said it was unfair. Ipsos found 57% would prefer the government to use extra revenue to pay off debt; 37% would prefer it to be used for tax cuts.
Turnbull’s approval rating was 51% (up four points) in the Fairfax-Ipsos poll; his disapproval was 39% (down four points). Shorten was on 39% approval (up a point) and 51% disapproval (down two points) . As preferred prime minister, Turnbull was ahead 52% (unchanged) to Shorten’s 32% (up a point).
The timing of the byelections is yet to be announced – they are expected to be on the same Saturday. Four are in Labor seats; the fifth is in Mayo, held by the Centre Alliance’s Rebekha Sharkie – the Liberals are hoping to wrest the seat back.
Braddon in Tasmania and Longman will be the two government-opposition head-to-head battles.
In Longman, on less than 1% margin, a ReachTEL poll commissioned by the left-leaning think tank The Australia Institute found the government leading the ALP 53-47% in two-party terms. It had One Nation on 15.1%. The poll was done Thursday night, of 1277 people.
As it seeks a strong candidate for Longman, the Liberal National Party is bedevilled by the dual citizenship issue that has caused the byelection in the first place. The LNP is having to ensure, before it does its preselection, that no potential candidate is a dual citizen, which can go to complicated questions of eligibility for foreign citizenship through relatives.
Labor’s Susan Lamb, who won the seat in 2016, also must renounce her dual British citizenship in time for her renomination.
Shorten at the weekend delivered a sharp response to Hanson’s demand that Labor put the Greens last.
Hanson wrote to Shorten that:
With a looming byelection in the seat of Longman and a federal election likely within the next 12 months, One Nation and its supporters are seeking an assurance from you as Leader of the Australian Labor Party that you will guarantee placing the Greens at the bottom of all Labor how-to-vote cards.
Conservative Australians do not support parties who flow their preferences to the Greens and I cannot in good conscience flow One Nation preferences to Labor if their preferences relationship continues with the Greens.
Shorten wrote back:
I know you are under a lot of pressure following your decision to support the Prime Minister’s $80 billion tax handout to multinationals and the big banks. That’s the only explanation I can think of for your letter to me, in which you appear to be attempting to direct the preferences of Longman voters voters to the LNP.
Meanwhile a row has blown up over the preselection dumping of Queensland Liberal Jane Prentice, an assistant minister in the Turnbull government. She was beaten decisively in a rank and file ballot by a Brisbane city councillor, Julian Simmonds, a former staffer of hers. Her defeat has reignited the criticism of the Liberal party for having so few women in its parliamentary ranks.
Asked about Prentice’s loss, Treasurer Scott Morrison told the ABC that politics was “a contestable process”. Prentice had “done a great job and we thank her for her service”.
In Labor’s budget reply speech, Bill Shorten reaffirmed the plan to remove refundability of dividend imputation credits. His pitch was to Australian voters on lower and middle incomes, in which he pledged to look after the country’s ageing population:
We know that giving older Australians the security and dignity they deserve matters more than an $80 billion corporate tax cut.
The issue of whether or not retirees should be able to get a refund in dividend imputation has sparked considerable discussion of retirees’ income and wealth.
The Household, Income and Labour Dynamics in Australia (HILDA) Survey shows that, overall, retired people tend to have lower incomes than the population as a whole, but higher wealth. This is because retirement typically involves ceasing employment and reducing income, while wealth tends to accumulate with age, at least up to the point of retirement, mainly due to paying off the mortgage and accumulating superannuation.
The different mix of income and wealth for retired and non-retired households means it’s not straightforward to compare their economic well-being. For example, the HILDA Survey data show that only 23% of retirees aged 60 and over have above-median incomes (compared with 50% of the population as a whole); but 62% have above-median household wealth.
That said, retirees are generally wealthy if they have both above-median household income and above-median household wealth. With this definition, 20% of retirees aged 60 and over are wealthy. This compares with approximately 28% of the Australian population as a whole.
What does retirement wealth look like?
Among retirees aged 60 and over, wealthy retirees are on average about two years younger than other retirees, having an average age of 71.8. Nearly 97% of wealthy retirees own their home, compared with 76% of other retirees.
These retirees have net wealth in 2014 (when wealth was last measured by the HILDA survey) averaging over A$2.4 million at today’s prices.
While wealthy retirees have high average holdings of superannuation, investment property and other investments, the home is still the most important component of their wealth. The home is also the most important asset for other retirees, but in 2014 it was worth an average of only A$400,000 (at today’s prices) for these retirees, compared with A$800,000 for wealthy retirees.
Wealthy retirees get most of their income from superannuation and other investments, although government benefits (mostly the Age Pension) nonetheless average over A$11,000 per wealthy retired household. For other retirees, the Age Pension is the dominant income source, averaging A$24,000 per household.
The HILDA survey data indicates that both wealthy and other retirees on average pay little income tax – A$4,256 for wealthy retirees and only A$94 for other retirees. Indeed, less than 30% of wealthy retiree households, and only 5% of other retiree households, are estimated to actually pay any income tax.
Moreover, the data show that 42% of wealthy retirees, and 22% of other retirees, have negative income tax because of dividend imputation credits received on their holdings of Australian shares. This does not take into account taxes and imputation credits on dividends received by superannuation funds.
Given the tax-free status of superannuation in people’s “retirement phase” (albeit now only on the first A$1.6 million), it’s likely that more than 42% of wealthy retirees, and more than 22% of other retirees, effectively have negative income taxes.
Whether you consider Labor’s plan good or bad policy, given its exemption of pensioners, it is clear that its impact will be most acutely felt by wealthy retirees.