Grattan on Friday: Nationals force reluctant Turnbull to dress in Shorten’s banking clothes


Michelle Grattan, University of Canberra

Only a few months ago Bill Shorten would have thought that if he won the election he’d be delivering same-sex marriage and a royal commission into the banks early in his government.

Now Malcolm Turnbull is bringing us both – in each case, his hand forced by a (different) group of rebel backbenchers.

The marriage bill, which will go through the House of Representatives next week, has some disgruntled conservatives arcing up after the Senate rejected their amendments, but Turnbull will mark it down as one of the achievements of his prime ministership.

It’s another matter with the banking royal commission. Seldom is a government’s impotence and frustration as much on display as it was when Turnbull finally capitulated and announced on Thursday that the government would establish the inquiry it has so long resisted and denounced.

For quite a time political hardheads had been arguing the government should accept the inevitable and “own” an inquiry. Well, now it does – and what a reluctant owner it is, miserable and bitter.

Turnbull and Treasurer Scott Morrison lamented that setting up the royal commission, which covers superannuation and insurance providers as well as banking, was “regrettable but necessary”, driven by the political circumstances in which they found themselves.

In the end, there wasn’t a choice.

The bad result for the Liberal National Party in Saturday’s Queensland election strengthened the hand and determination of the rebel federal Nationals, intent on pushing Barry O’Sullivan’s private senator’s bill for parliament to set up a commission of inquiry.

Two lower house Nationals, George Christensen and Llew O’Brien, were willing to cross the floor to give the bill the numbers there. In the background Nationals leader Barnaby Joyce, on the New England campaign trail, was not resisting the flow. Joyce judged that if the issue reached the Nationals’ partyroom, the commission would get support.

The Nationals also knew an inquiry had strong public backing, a point underlined by an Essential poll this week showing 64% wanted a royal commission. That included 62% of Coalition voters.

The banks themselves came to accept that opposition had become too costly. In their Thursday letter to the government (flagged late Wednesday) advocating “a properly constituted inquiry”, the chairmen and chief executives of the four major banks said it was “in the national interest for the political uncertainty to end.

“It is hurting confidence in our financial services system, including in offshore markets, and has diminished trust and respect for our sector and people,” they wrote.

As Australian Bankers’ Association chief executive Anna Bligh, a former Queensland Labor premier, put it bluntly, it was too a big a risk to have a inquiry where the terms of reference and choice of commissioner were in “the hands of minor parties and fringe elements of the parliament”.

On Tuesday and Wednesday, O’Sullivan, Turnbull and senior ministers sparred over the issue. O’Sullivan, a tough ex-cop from Queensland, says the government didn’t try to get him to drop his bill. Rather, it was attempting to “manage time”. He knew it was working on something, though he didn’t know what.

The ministers wanted to find out when his bill would be ready for the Senate. Some say O’Sullivan put it on pause. He denies this, saying his negotiations with the Greens and others and the preparation and printing processes pushed it back to early Thursday, which helped the government.

Cabinet met first thing that morning – Turnbull’s announcement was at a 9am news conference. The bill had done its job without having to make an actual appearance in parliament.

The government’s perennial arguments – until Thursday – against a royal commission have included that it would undermine international investor confidence in Australia’s banks and that an inevitably prolonged inquiry would have delayed the reforms the government has introduced or proposed.

The first proposition will be tested now that the inquiry is to proceed. It is doubtful, however, that overseas investors are as easily frightened as the government has been suggesting. They’re surely sophisticated enough to understand the fundamentals of our banking system, and those are sound.

The government has maintained its measures are adequate to address the issues but O’Sullivan and other proponents of an inquiry insisted they would not deal with the dimension of “culture”. The banks’ “profit before people” attitude, as Nationals senator John Williams puts it.

A circuit-breaker is needed to restore public confidence in banks. But the material to emerge during the inquiry may lower that confidence further before there is any sign of its restoration.

The royal commission will be led by a former or serving judicial figure and will be asked to deliver a final report by February 1, 2019, with an interim report before that. The terms of reference will be tight: “it’s not going to be an inquiry into capitalism”, Turnbull said.

The Nationals’ brutal power play may deepen tensions between Liberals and the junior Coalition partner. Not that the Nationals care that much.

Christensen didn’t hesitate to rub salt into Turnbull’s open wound. “I just don’t understand why it took a number of National Party backbenchers to drag the prime minister kicking and screaming to this decision,” he said, in a cutting but pertinent observation.

O’Sullivan was more diplomatic, speaking of Turnbull “making his own journey”. A journey, it might be said, under armed escort.

Meanwhile, the Nationals were relishing shades of the 1937 royal commission into the banking system. As a Senate report of a few years ago recounted:
“At the 1935 election the Country Party (and the Labor Party) had promised an inquiry and when the conservative government led by Joseph Lyons was forced to form a coalition with the Country Party, he agreed to establish an inquiry”.

If it had responded much earlier to the pressure for an inquiry the government could have hoped to reap credit for appreciating the depth of public complaints and concerns.

As it is, with its grudging decision through gritted teeth, it doesn’t seem to be looking for plaudits.

But the political reality is that by establishing the royal commission it has neutralised one of Shorten’s issues.

The ConversationFor all that, it could be a Shorten government that deals with the commission’s ultimate recommendations. By the time the final report rolls round, an election will be imminent, assuming the royal commission runs on time and the government runs full term.

https://www.podbean.com/media/player/hdjfk-7dce11?from=site&skin=1&share=1&fonts=Helvetica&auto=0&download=0

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

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Queensland Liberals and Nationals have long had an uneasy cohabitation, and now should consider divorce


Gregory Melleuish, University of Wollongong

There can be no doubt that in matters political Queensland is different from the rest of Australia.

It is the only state that has a single house of parliament. It is the only state that has a single council for its capital city. It is the only state in which the Country (and later National) Party has been the dominant force on the non-Labor side of politics and, for a time in the 1980s, held government in its own right.

The rhythm of Queensland politics has been for one party to hold power for long stretches of time. Labor was in government from 1932 to 1957, losing government that year as the Labor Party split. The Country Party held power, first in coalition with the Liberals and then in its own right, from 1957 to 1989. Subsequently, Labor was in office, except for a short time in 1996, from 1989 to 2012.

Queensland voters, at least in recent times, also seem to be more volatile in their voting habits, perhaps more resembling Canada than other parts of Australia. In Sydney, for example, there are electorates that are so rusted on to a political party that electing a member from another party is unthinkable.


Read more: Queensland result, while decided on state issues, adds to Turnbull’s burdens


This does not appear to be the case in Queensland, including Brisbane. In 2012, the Liberal National Party (LNP), led by Campbell Newman, won a stunning victory, claiming 44 seats with swings as high as 21%. In other states, many of these seats would be rusted-on Labor.

Given Queensland’s electoral history, one would have expected that the 2012 election would be the prelude to an extended term of LNP government. Yet, in 2015, the LNP lost 34 seats and government. As an example, the seat of Ipswich, which had swung some 20% to the LNP in 2012, had almost an exact same swing to Labor in 2015.

Perhaps the most extraordinary thing about the 2017 election has been the way in which Brisbane has become almost exclusively Labor. The LNP holds fewer than half-a-dozen seats. While this may be in part a consequence of how One Nation allocated its preferences, this only confirms the weakness of the LNP in Brisbane.

The birth of the LNP

The Queensland LNP came into being in 2008 with the marriage of the Queensland divisions of the National Party and the Liberal Party. This was at a time when the non-Labor side of politics had, except for a short period mentioned above, been out of power for nearly 20 years.

Although the Nationals were clearly the senior partner, the president of the new party acquired full voting rights with the federal Liberals. Even more curious is the fact that those from the “Liberal” side of the party have tended to dominate the leadership.

In other states, where the Liberals are the senior party, as at the Commonwealth level, the two parties have favoured coalition rather than amalgamation (cohabitation rather than marriage).

That the Nationals and the Liberals should have come together at all seems in some ways astonishing, given the cavalier way in which Joh Bjelke-Petersen treated the Liberals back in the 1980s.

In days gone by, the Queensland Liberals were quite unlike other Liberal parties in Australia. Being always the junior member of the partnership meant that the party was much more of a “liberal” party, based in urban Brisbane.

Populism and conservatism were the property of the National Party. It is worth recalling that it was the Liberal Party that disendorsed Pauline Hanson as a candidate in the 1996 election.

It may have made good sense in electoral terms for the National Party and the Liberal Party to amalgamate in 2008. It appears to have delivered in 2012. But it has failed to deliver a second time. I think that there are some good reasons for this.


Read more: Queensland election: One Nation dominates Twitter debate in the final weeks


The amalgamation followed the logic that a unified anti-Labor Party would be more likely to defeat Labor. However, this decision was made at a time when a political reconfiguration was occurring in which the old right-left, business-unions divisions were becoming less important.

In its place has been the emergence of a new politics based around more symbolic matters and in which progressives increasingly find themselves at odds with conservatives on a whole range of matters, from the environment to same-sex marriage.

The LNP tethered together progressives and conservatives. In Newman it had a leader who was a good liberal reformer, rather reminiscent of Nick Greiner in New South Wales. Perhaps Newman should have studied what happened to Greiner, who barely scraped back into power in the 1991 NSW election.

Moreover, populism has never really gone away in Queensland. Labor Premier Peter Beattie had a touch of Joh about him.

Uneasy bedfellows

What I am suggesting is that the creation of the LNP was backward- rather than forward-looking. In a state in which populism is an established tradition, it was always going to be difficult to get the conservative and progressive horses to run together in the same direction.

Bob Katter and Hanson have been beneficiaries of the inability of the LNP to express its inner populism. Remember that John Howard neutralised Hanson by stealing her thunder. Cohabitation was a hindrance to liberals and conservatives alike.

The ConversationBut the primary beneficiary of this state of affairs has been the Labor Party. I think it can be argued that the too rigid nature of the LNP has led to a fracturing of the non-Labor side of politics. If the Liberals and Nationals had simply continued to cohabit they may have been able to have the flexibility required for electoral success.

Gregory Melleuish, Professor, School of Humanities and Social Inquiry, University of Wollongong

This article was originally published on The Conversation. Read the original article.

Government questions whether Dastyari fit to be a senator, in new row over Chinese donor


Michelle Grattan, University of Canberra

Opposition Leader Bill Shorten is again under pressure over the behaviour of high-profile Labor senator Sam Dastyari, who warned a political donor with Chinese Communist Party links that his phone was likely tapped.

Fairfax Media on Wednesday reported that before Dastyari and Huang Xiangmo spoke, the senator “gave Mr Huang counter-surveillance advice, saying they should leave their phones inside and go outside to speak”.

The story said the meeting last year was at Huang’s home in Sydney and occurred some weeks after Dastyari had to quit the frontbench amid controversy over his dealings with Huang, who is a Chinese citizen and an Australian permanent resident, and his contradiction of Labor policy on the South China sea.

It also happened after ASIO briefed political figures including from Labor about Huang’s opaque links to the Chinese government, the Fairfax report said.

The new controversy about Dastyari comes amid deepening security concerns about increasing Chinese interference in Australia.

The government questioned whether Dastyari should remain in the Senate, with Prime Minister Malcolm Turnbull saying Dastyari “has very, very grave questions to answer”.

“This is a very, very serious issue of national security.” Dastyari “should really be considering his position in the Senate”, Turnbull said.

Shorten indicated he had given Dastyari a warning but did not suggest he would take any more action against him.

“I have made it clear to senator Dastyari that this is not the first time his judgement has been called into question, but I certainly expect it to be the last,” Shorten said.

Dastyari’s demotion was followed by partial rehabilitation when he became deputy Labor whip in the Senate.

Turnbull asked rhetorically: “Whose side is he on?”

“Here he is, an Australian senator who has gone to a meeting with a foreign national, with close links to a foreign government and advises that foreign national, Mr Huang, to put their phones inside to avoid the possibility of surveillance,” Turnbull said.

“Why is he trying to alert Mr Huang that perhaps Australian security agencies may have an interest in him?”

Foreign Minister Julie Bishop said if the allegations were accurate, “they will show that senator Dastyari was acting against Australia’s national interest, against Australia’s national security concerns”.

This would make his position in the Senate “untenable”, she said.

Turnbull also challenged Shorten, asking why he told Dastyari “directly or indirectly, about possible interest from security services, in Mr Huang”.

Dastyari argues that his remark about the likely phone tapping was passing on press gallery gossip.

He said he had never been briefed by any security agency, or received any classified information about any matter.

“I’ve never passed on any protected security information – I’ve never been in possession of any,” he said.

He quoted a comment he had made to the ABC’s Four Corners some months ago, when he said: “After the events of last year, I spoke to Mr Huang to tell him that I did not think it was appropriate that we have future contact. I thought it was a matter of common courtesy to say this face to face. Neither my office or I have spoken to Mr Huang since.”

He said this information has been publicly available since June.

Shorten said he had not passed on any information from a security briefing to Dastyari. “However I do not believe the senator is the subject of any national security investigation.”

Dastyari had never made a secret of the fact that this meeting took place, Shorten said. “He has again confirmed that he did not pass on any classified information, because he didn’t have any.”

Peter Jennings, head of the Australian Strategic Policy Institute, said the incident was “as serious as it gets” and called for a public investigation.

He said that if, when he was a public servant, he had had a conversation with a foreign national warning them their phone was likely tapped, “it would have been a career-ending moment for me – probably leading to legal action”.

Jennings said over the past two to three years, “we’ve had a number of examples of Chinese involvement at senior political levels that are deeply questionable in terms of appropriateness. For the health of our democracy we have to get to the bottom of these issues.”

UPDATE

Late on Wednesday, in another damaging blow to Dastyari, audio was leaked of his remarks in June last year supporting the Chinese over the South China Sea, in flat contradiction of ALP policy.

Although a report of part of his comments had previously come out via the Chinese media, the audio, following hard on the heels of the revelation of his phone tapping warning to Huang, will be extremely damaging to him and put Shorten further on the spot.

The comments were made at a Sydney news conference for the domestic Chinese media, with Huang standing beside Dastyari.

Later, Dastyari was quoted as having said: “The South China Sea is China’s own affair, Australia should remain neutral and respect China on this matter”.

The audio indicates how deliberate his comments were and gives more precision and detail of what he said.

Dastyari says in the tape: “The Chinese integrity of its borders is a matter for China.

“And the role Australia should be playing as a friend is to know that with the several thousand years of history, thousands of years of history, where it is and isn’t our place to be involved.

“And as a supporter of China and a friend of China the Australian Labor Party needs to play an important role in maintaining that relationship and the best way of maintaining is knowing when it is and isn’t our place to be involved.”

In response to the audio, Dastyari said in a statement: “In September last year, I resigned from the ALP frontbench, over comments I made at a June 17 press conference which were wrong and not consistent with ALP policy.

“I have acknowledged this a number of times previously. I should not have made these comments at the press conference. I have acknowledged this, and I paid a price for this error.

“I expect Turnbull and the Liberals to smear me, but for he and his colleagues to suggest that I am not a true or loyal Australian is incredibly hurtful – and hurtful to all overseas-born Australians. I might’ve been born overseas, but I’m as Australian as he is.”

The ConversationHe said his last contact with Huang was 14 months ago. “I haven’t spoken to him since.”

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

Turnbull talks with rebel National on banks


Michelle Grattan, University of Canberra

Malcolm Turnbull and senator Barry O’Sullivan have discussed the rebel National’s private senator’s bill for a commission of inquiry into the banks and other financial institutions.

As the stand-off continues over an inquiry, Turnbull on Tuesday publicly reaffirmed that “we are not going to establish a royal commission”.

But behind the scenes Turnbull appears to be seeking some resolution of the impasse, which could lead to his hand being forced.

It is believed he is due to have a further discussion with O’Sullivan after the bill is printed.

O’Sullivan refused to confirm Tuesday’s meeting.

The bill is now considered to have the numbers to pass not just in the Senate but in the House of Representatives as well. Two lower house Nationals, George Christensen and Llew O’Brien, are supporters, although O’Brien has cast his backing in terms of being “quite likely” to vote for it.

Nationals leader Barnaby Joyce, who is fighting a byelection in New England to get back into parliament, has indicated he is very willing to have the bank inquiry issue considered by the Nationals’ partyroom, and has signalled he is relaxed about the outcome. The O’Sullivan bill will be discussed there on Monday.

If the Nationals as a party moved to support an inquiry, Turnbull would be deeply embarrassed.

O’Sullivan was inundated with suggestions for fine-tuning after circulating his draft bill, and it has taken some time for these to be dealt with and a final version to be sent to the parliamentary draftsman.

Turnbull, campaigning in Bennelong for the byelection in that seat, said the government had been concentrating on “positive steps, real reforms right now”.

“We have put more money into the regulators to give them stronger teeth and more effective powers. And of course we are setting up the one-stop shop, the Australian Financial Complaints Authority, which will mean that people will have one place to go to for help and assistance with complaints and concerns with their financial service providers.

“We are constantly working to ensure that the cultural change in the banks occurs and we are getting strong support for that,” he said.

“Our focus is on results. It is on action. That is why we have not supported a royal commission.”

Turnbull argues that a royal commission would take a very long time and delay getting results.

But O’Sullivan has maintained that what is fundamental is achieving cultural change and this won’t happen without a bright light being shone on the way banks and other institution have operated.

The commission proposed in the O’Sullivan bill is one that would be set up by parliament and report back to parliament. A royal commission is set up by the executive and reports to the executive.

The ConversationEssential Media, in a poll published on Tuesday, reported 64% supported holding a royal commission into banking and the financial services industry and 12% opposed. Support among Labor voters was 72% – among Coalition voters it was 62%.

https://www.podbean.com/media/player/nqtdd-7bf599?from=site&skin=1&share=1&fonts=Helvetica&auto=0&download=0

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

Turnbull backed against the wall by rebel Nationals on bank inquiry


Michelle Grattan, University of Canberra

Prime Minister Malcolm Turnbull and Treasurer Scott Morrison appear to have become hostages to rebel Nationals determined at all costs to secure a commission of inquiry into the banks.

On Monday a second federal National, Llew O’Brien, from Queensland flagged he is likely to cross the floor in the House of Representatives to support the private member’s bill sponsored by Queensland Nationals senator Barry O’Sullivan to set up a commission of inquiry that would investigate a broad range of financial institutions.

O’Brien, who has inserted an extra term of reference to protect people with mental health issues from discrimination, said “I like what I see” in the proposed bill. But he added that he would respect his party’s process. The bill is due to go to the Nationals’ partyroom on Monday.

The bill, which has the numbers to get through the Senate, is supported in the lower house by Queensland MP George Christensen, who after Saturday’s Queensland election apologised to One Nation voters for “we in the LNP” letting them down.

Backed by Christensen and O’Brien, together with Labor and crossbenchers, the bill would have the required 76 votes to enable its consideration by the lower house – although when it can get to be debated there is not clear.

In a discussion last week – later leaked – cabinet considered whether the government should adopt a pragmatic position and give in to calls for a royal commission. But Turnbull and Morrison have refused to do so.

Now the cabinet looks like it will have to decide whether to own the process of an inquiry or have it forced on it.

If Monday’s Nationals’ party meeting endorsed the bill, that would escalate the situation dangerously for the government, unless it had softened its opposition to an inquiry. It would amount to the minor Coalition partner formally rejecting a government position.

Cabinet would have to back down, or find some other way through.

As the crisis over the banking probe deepens for the government, there is currently no-one with the authority or availability within the Nationals to manage the situation.

Barnaby Joyce remains leader but he’s absorbed in Saturday’s New England byelection, which is his path back into parliament. Senator Nigel Scullion is parliamentary leader but has little clout to curb the determined rebels.

With the commission push gaining momentum there is also less desire from some senior Nationals to fight it. Joyce is said to be relaxed about having a banking inquiry, which would be popular among voters and could be chalked up as a win for the Nationals.

The election loss in Queensland has strengthened the federal Nationals’ determination to pursue brand differentiation.

O’Sullivan has repeatedly referenced the example of Liberal Dean Smith’s use of a private member’s bill to pursue the cause of same-sex marriage, arguing he is following Smith’s pathway.

But there are still divided opinions within the parliamentary party about the bank probe. Resources Minister Matt Canavan, a member of cabinet, on Monday reaffirmed his opposition to a royal commission.

Joyce is likely to attend Monday’s party meeting although he will not be formally back in parliament by then.

Nationals are not clear whether they will elect their new deputy on Monday to replace Fiona Nash, who was ruled ineligible by the High Court because she had been a dual British citizen when she nominated. There is some speculation that this might be delayed to give aspirants time to lobby.

If there is no deputy leader chosen on Monday, it would mean that the minor party would be literally leaderless on the government frontbench in the House of Representatives. Infrastructure Minister Darren Chester would be the most senior National sitting behind Turnbull in Question Time.

Christensen on Monday launched a website with a petition seeking signatures for a banking inquiry.

“Misconduct is not in the ‘past’,” he says on the site. “It is not being fixed by the industry to a standard acceptable to the community. Although positive steps are being made by government reforms, gaps still exist.

“Enough is enough … unless the government acts to establish a royal commission, I will be acting before the end of this year to vote for a commission of inquiry into the banks.” The site also invites people “bitten by the banks” to “tell your story”.

The ConversationA commission of inquiry differs from a royal commission in being set up by and reporting to parliament, rather than being established by and reporting to the executive.

https://www.podbean.com/media/player/nqtdd-7bf599?from=site&skin=1&share=1&fonts=Helvetica&auto=0&download=0

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

Grattan on Friday: Discovery of the cabinet leaker would present bigger problem than the leak


Michelle Grattan, University of Canberra

What on earth was Julie Bishop thinking when she declared she’d support a “formal investigation” into this week’s damaging cabinet leak?

Bishop was defending herself as the questions swirled about who might be the leaker, saying it wasn’t her. But to have one of the most senior ministers – she’s deputy Liberal leader too – talking about a probe into cabinet members just underlines the serious breakdown not just in the government’s discipline but in its common sense as well.

The leaked story was by the Daily Telegraph’s Sharri Markson, reporting that a “despondent”: cabinet had discussed, in the context of the backbench revolt on banking, whether the government should capitulate and hold a royal commission.

Treasurer Scott Morrison said no; Peter Dutton, one of the conservatives who has had Malcolm Turnbull’s back, was reported to be “opposed in principle” but open to the idea on pragmatic grounds. But Turnbull remains against changing policy and has said this publicly.

For Bishop the affair is a rerun of an old movie. After a leak from the Abbott cabinet, Bishop denied being the source, saying that if the prime minister found the culprit he would “take some action”.

In retrospect, if not always at the time, it seems obvious the 2015 leaks were mostly inspired by those wanting a coup.

This time, the “who” and the “why” aren’t clear. There is no evidence of any organised push against Turnbull, like there was against Abbott, although leadership speculation has become media grist.

The leaks, of which there have been several, may be driven by the general angst around or reflect jostling by various players in uncertain times.

We’ve seen publicly the respective positioning by Morrison and Dutton on the marriage legislation, with Morrison putting himself at the forefront of the “safeguards” brigade and Dutton – on this issues as on others – looking for a compromise way through.

Anyway, there won’t be an investigation. The Australian Federal Police almost never finds the source of leaks to the media, but imagine if it had an unexpected success! That indeed would present a problem.

Bill Shorten described the situation as the government eating itself. Alternatively, think of an army in untidy retreat, sloshing through heavy mud, when it becomes every soldier for himself.

We’re back to the Gillard days or, for those with a sense of history, to the Liberal party of the late 1960s, as it lost its way in the post-Menzies years.

Despite cabinet’s now well-canvassed discussion, the government is still faced with the push from the Nationals’ rebels for parliament to set up a commission of inquiry (only marginally different from a royal commission) into the banks.

Turnbull has tried to minimise the scope for the rebels and Labor to make trouble by cancelling next week’s House of Representatives sitting, but the action just exposed his weakness.

The rebels are unbowed with Nationals senator Barry O’Sullivan on Thursday circulating his private senator’s bill for “a commission of inquiry into banking, insurance, superannuation, financial and related services”.

O’Sullivan confirms he is determined. “I’m not someone who blinks”, he said. He dismissed suggestions his absent leader, Barnaby Joyce, was trying to dissuade him. He’d spoken to Joyce early on – Joyce just “asked me to keep him posted”.

It should be remembered the Nationals generally have no problem in cracking down on the banks. In fact, if a proposal for a royal commission were put to the Nationals’ party room, it would likely get up. Nationals assistant minister Keith Pitt was blunt on Thursday: “Clearly the government’s position is not for a royal commission, however we do have a number of members in the Nats who think it’s something that they want”.

Amid the tumult, former prime minister John Howard has used the occasion of Friday’s tenth anniversary of being turfed out of office to buy into the contemporary debates on banking and taxation.

The latter debate was reignited after Turnbull held out the prospect of personal income tax relief in a major address on Monday, albeit devoid of detail. On Thursday Finance Minister Mathias Cormann was dealing with scepticism about its affordability, arguing “we have effectively already assumed future further tax cuts in our budget projections”.

Howard claimed a banking commission would be “rank socialism” – to which O’Sullivan says, “I don’t understand what he means”.

As for tax, Howard, who nearly lost office in his (successful) pursuit of a GST, told Sky it would benefit the government “if it were to embrace very significant further tax reform”. This should include the GST, which couldn’t be left “where it is indefinitely”.

The best of luck with that. Turnbull is tossing tax into the mix to try to show voters he has some sugar in his back pocket to put on their tables. But sweeping reform would see losers as well as winners. For a government perennially behind in the polls, with the slenderest majority before it fell into its current minority position, a major tax overhaul including the GST would take more bravery than presently in sight.

The tenth anniversary of the Howard government’s defeat is also the anniversary of the loss of his own seat of Bennelong. Now the Liberals are again fighting to hold Bennelong, after John Alexander became a victim of the citizenship crisis.

It is too early to get a real sense of how that December 16 byelection will go. On a 9.7 % margin, Alexander has a big buffer, as he faces Labor’s Kristina Keneally.

But this week the Liberal campaign, already looking lack lustre, was snagged by an embarrassing 1990s video of Alexander telling a crude Irish joke and another about “a black guy in Chicago” describing a rape.

Alexander wasn’t the only government byelection candidate who became an embarrassment. There was Joyce’s jaunt from his New England campaign to Canberra for “AgDay”, described as the “brainchild” of his good friend Gina Rinehart, who presented him with a $40,000 cheque, reward for being a “champion of our industry”. He only belatedly declined the money.

The ConversationIt was another example of the poor judgement that infects this government.

https://www.podbean.com/media/player/k3zus-7afe23?from=site&skin=1&share=1&fonts=Helvetica&auto=0&download=0

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

Income tax relief on Turnbull’s agenda


Michelle Grattan, University of Canberra

Malcolm Turnbull has raised the prospect of personal income tax relief to help middle-income earners, saying he is “actively working” on it.

As the government is still trying without success to get the remaining part of its company tax plan through parliament, which would deliver lower tax to big companies, Turnbull has moved to hold out the prospect of relief for individuals.

Speaking to the Business Council of Australia on Monday night, he noted the government had already lifted the second-highest income tax bracket threshold from A$80,000 to A$87,000, keeping some half-a-million people from moving into a higher bracket. It had also spared people facing a permanent top marginal rate of 49.5% by not making the temporary deficit levy permanent.

“You know our plans on corporate tax,” he said. “In the personal income tax space, I am actively working with the treasurer and all my cabinet colleagues to ease the burden on middle-income Australians, while also meeting our commitment to return the budget to surplus.”

He said his commitment to all Australians was: “Whether you are starting out in your first job, a worker providing for their family, or a business hiring staff, our goal is always to leave more money in your pocket, not in ours.

“Higher taxes penalise people who are trying to get ahead. But when you reward hard work and enterprise, you encourage hard work and enterprise.

“It’s pretty simple – more investment, more jobs. That’s the key.”

He recalled that his earliest foray into the personal income tax debate in 2005 as a fairly new MP was not uniformly welcomed. He did not spell out that then-treasurer Peter Costello was furious.

But the concerns that underpinned a report he released then still existed: “The tax system remains complex and compliance is a burden, our marginal tax rates are high, bracket creep is a constant challenge that needs to be addressed”.

Turnbull said that “just because we’re in challenging fiscal times doesn’t mean we should raise the white flag on making the tax system work better”.

A Treasury analysis showed Australia risked being left behind by the rest of the world in the competitiveness of its business tax, he said, citing in particular the US and the UK.

The Conversation“If we don’t reduce our corporate rate to 25% as planned – in our Enterprise Tax Plan – over the coming decade, the only advanced nations that will exceed Australia’s tax rate are Japan and Malta.”

https://www.podbean.com/media/player/nqtdd-7bf599?from=site&skin=1&share=1&fonts=Helvetica&auto=0&download=0

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

When you’re on the defensive, stepping backwards can send a bad signal


Michelle Grattan, University of Canberra

Malcolm Turnbull’s tactic of cancelling the House of Representatives’ sitting next week – because his numbers are depleted and the government is nervous – is a short-sighted decision that smacks of lack of nerve.

Undoubtedly it would have been a rough week in the lower house. But refusing to face it looks panicky, just when Turnbull is trying to convince people that he and the government are in control.

The government is desperate to keep the lower house agenda narrow and as tightly managed as its unfortunate circumstances permit. It declares the rest of the parliamentary year will be confined to legislating for same-sex marriage and considering which citizenship cases should be referred to the High Court.

Monday’s cancellation wasn’t Turnbull’s only ploy to avoid being embarrassed in the lower house’s final sitting days of 2017. When he recently met Bill Shorten to discuss citizenship disclosure, he tried to win agreement to confine the coming period to non-controversial legislation. Labor naturally wouldn’t play ball.

The cancellation has nothing logically to do with the timetable for the same-sex marriage bill. Consideration of that legislation was always to continue in the Senate next week, moving to the House of Representatives for debate the week after. Meanwhile, the lower house next week would have dealt with other legislation.

Nor is Leader of the House Christopher Pyne convincing when he claims this is just a routine change, and that there was no need for the lower house to meet next week because there was nothing urgent for it to do.

In truth, the government fears what trouble Labor games and rebels in its own ranks might cause, and is desperate to limit the time available to them. The latter, spearheaded by Nationals Barry O’Sullivan in the Senate and George Christensen in the lower house, are planning to try to force the issue of a commission of inquiry into the banks and other financial institutions.

O’Sullivan is preparing a bill for the banking commission and claims up to four lower house members could cross the floor. The O’Sullivan commission would report to the parliament; it would be distinct from a royal commission, which only the government can set up.

This bill was never going to get to the lower house next week; it’s not even clear whether it will be debated there when the lower house does sit the week starting December 4. But Christensen says he will vote for a commission or the like “in whatever guise it comes up and I definitely expect it’s going to come up”. Something will certainly “come up” if Labor can make it do so.

One big question is why the government has let this bank issue fester. It has been very critical of the banks, slapped a hefty tax on them, and moved to impose a tough regimen on their executives. But it has fought trenchantly against the royal commission that Labor advocates.

Given the strength of anti-bank feeling in the community, and within some of its own ranks – based on the banks’ bad behaviour – the government should have long ago cut its losses and set up a broad-ranging inquiry.

An important aspect of the rebel Nationals’ push is that they are referencing the precedent of the Liberals rebels’ success on same-sex marriage.

O’Sullivan told the ABC the government’s facilitating Liberal backbencher Dean Smith’s private member’s bill (now a crossbench bill) provided “a new pathway for backbenchers to be able to pursue matters of importance to them, and I’m just simply following along in his footsteps”.

The Nationals remain deeply out of sorts about the marriage debate sucking oxygen, as they see it, from other issues for months.

Beyond that, the rebels have taken from the marriage story the lesson that what’s good for the goose should be good for the gander. If a group of Liberal rebels – the “famous five” who put same sex-marriage back on the government agenda – can break ranks and end up getting what they want, why not a group of Nationals, with their issues?

And the win – and praise – scored by the Liberal rebels has meant the Nationals leadership and whips have reduced authority to keep their own rebels in line.

On Monday night Labor was seeking crossbench support for a proposed joint letter to put pressure on Turnbull to reverse his decision to cancel next week’s lower house sittings, but there’s no chance of his doing that.

Turnbull had raised the possibility of deferring the start of the House sitting at his meeting with Shorten. Shorten gave it short shrift at the time, and said so publicly, but Turnbull has rashly chosen to have the last word.

The ConversationTurnbull told a business audience on Monday night: “In times of uncertainty, the nation needs calm and measured leadership, a steady hand at the helm”. His earlier action suggested a touch of the tremble.

https://www.podbean.com/media/player/nqtdd-7bf599?from=site&skin=1&share=1&fonts=Helvetica&auto=0&download=0

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

Newspoll 55-45 to Labor as Turnbull’s better PM lead falls to 2. Qld and Alabama polling


Adrian Beaumont, University of Melbourne

This week’s Newspoll, conducted 9-12 November from a sample of 1630, gave Labor a 55-45 lead, a one point gain for Labor since last fortnight, and their largest Newspoll lead since February. Primary votes were 38% Labor (up 1), 34% Coalition (down 1), 10% One Nation (up 1) and 9% Greens (down 1). This is Turnbull’s 23rd consecutive Newspoll loss as PM, 7 short of Abbott.

29% were satisfied with Turnbull’s performance (down 2), and 58% were dissatisfied (down 1), for a net approval of -29. Shorten’s net approval was up five points to -19. The biggest story in the personal ratings was Turnbull’s lead as better PM over Shorten narrowing from 41-33 to 36-34, by far Turnbull’s lowest Newspoll lead over Shorten since he ousted Abbott to become PM.

This result will increase leadership speculation, and hard right commentators will say the Coalition should return to a proper conservative leader. However, while this is Turnbull’s worst better PM rating, Shorten often led Abbott while Abbott was PM. The better PM measure favours incumbents more than would be expected given voting intentions.

Newspoll asked a best Liberal leader question with three options: Turnbull, Julie Bishop and Peter Dutton. Bishop led Turnbull 40-27, with 11% for Dutton. Among Coalition voters, Turnbull was ahead 42-39 with 7% for Dutton. Dutton won 24% with One Nation voters.

If we count Labor/Greens as left, and Coalition/One Nation as right, there has been little change between the total left and right votes in the last six Newspolls. The total left vote has been 47% in all six, and the total right 44-45%. One Nation’s preference flow to the Coalition is likely to be stronger than the 50% at the 2016 election, which Newspoll uses, so Labor’s two party lead is probably overstated.

The fall in Turnbull’s better PM lead is likely due to the citizenship debacle, with voters thinking he has lost control of the situation. By 45-42, voters favoured changing the Constitution to allow dual citizens to run for Parliament.

The Bennelong by-election will be held on 16 December. Former NSW Premier Kristina Kenneally today announced she would contest the by-election for Labor. Kenneally has a high public profile. While Labor was smashed at the 2011 NSW election, the damage was done long before Kenneally became Premier, and she has not been blamed for that loss. Kenneally appears to be a very good choice for Labor.

With Essential and YouGov below confirming the trend in Newspoll, Kevin Bonham’s poll aggregate is now at 54.2% two party to Labor, a 1.0 point gain for Labor since last week, and Labor’s best for this term.

Lambie’s probable disqualification will un-un-elect McKim

Two weeks ago, I wrote that Tasmanian Liberal Senator Stephen Parry’s disqualification would see One Nation’s Kate McCulloch defeat Green Nick McKim for the 12th and final seat, reversing the 2016 election result.

Jacqui Lambie has revealed she has a Scottish father, and has resigned from the Senate. If both Parry and Lambie are disqualified, the Senate recount reverts to electing McKim instead of McCulloch. So it now appears that the High Court will not have to rule on whether an elected Senator who has done nothing wrong himself can be unelected.

SSM plebiscite polling

The result of the same sex marriage plebiscite will be declared at 10am Melbourne time tomorrow. In Newspoll, 79% said they had voted, up 3 since last fortnight. Of these 79%, Yes led 63-37 (62-35 from the 76% who had voted last fortnight).

In Essential, 45% thought the postal survey a bad process that should not be used in the future, 27% a good process that should be used in the future, and 19% a good process that should not be used.

If Yes wins, 58% in YouGov thought the government should pass a law legalising same sex marriage straight away, 18% ignore the result, and 14% wait before passing a law. By 46-42, voters thought MPs who personally oppose same sex marriage should vote for the bill.

Essential 54-46 to Labor

This week’s Essential, conducted over the last two weeks from a sample of 1820, gave Labor a 54-46 lead, a one point gain for Labor since last week. Primary votes were 38% Labor, 36% Coalition, 9% Greens, 8% One Nation and 3% Nick Xenophon Team. Additional questions use one week’s sample.

Turnbull’s net approval was down 11 points to -12 since October, and Shorten’s net approval was down six points to -13. Unlike Newspoll, Turnbull maintained a 40-28 lead as better PM (42-28 in October).

By 44-40, voters thought Turnbull’s proposal to resolve the dual citizenship crisis did not go far enough. By 49-30, they thought disqualified MPs should repay public funding of their election campaigns. By 44-31, voters disapproved of privatising the NBN when completed.

YouGov primary votes: 34% Labor, 31% Coalition, 11% Greens, 11% One Nation

This week’s YouGov poll, conducted 9-12 November from a sample of 1034, gave Labor a 52-48 lead by respondent preferences, a 3 point gain for Labor since last fortnight. Primary votes were 34% Labor (up 1), 31% Coalition (down 5), 11% Greens (up 1) and 11% One Nation (up 2). By previous election preferences, this poll would be about 55-45 to Labor.

Hanson had a 48-45 unfavourable rating (50-42 in early September). Greens leader Richard di Natale had a 33-29 unfavourable rating (39-26). Nick Xenophon had a 53-28 favourable rating (52-28). Abbott had a 56-36 unfavourable rating (57-34).

By 61-16, voters thought a full audit into all parliamentarians regarding dual citizenship a good idea. By 63-26, they thought it unacceptable to legally avoid paying tax. By 55-27, voters said they would not take part in a tax avoidance scheme, which is probably not an honest assessment.

Qld ReachTEL poll of One Nation voters, and more Galaxy seat polls

A ReachTEL poll of over 3400 voters was conducted for the Sunday Mail. From the Poll Bludger’s write-up and comments, it appears this poll was of just One Nation voters, not all voters. Sky News reported this poll as 52-48 to the LNP, but they appear to have extrapolated One Nation preferences in this poll (74.5% to LNP), and applied those preferences to other polls.

If 3 in 4 One Nation preferences are going to the LNP, Labor has shot itself in the foot by changing the electoral system from optional preferential to compulsory preferential voting last year. Labor can hope that this poll had self-selection issues, with hard right One Nation supporters more likely to participate than those who are simply disillusioned with both major parties.

In deputy Premier Jackie Trad’s South Brisbane, the Greens had a 51-49 lead over Trad according to a Galaxy poll taken last week. However, this poll assumes that LNP voters will assign their own preferences, rather than follow their party’s How-to-Vote card. In practice, over half of major party voters follow the card. With the LNP putting the Greens behind Labor on all its cards, Trad should retain South Brisbane easily.

In Burdekin, the LNP had a 51-49 lead over Labor, a 2 point swing to the LNP since the 2015 election.

Following Moore’s alleged sex encounter with 14-y/o, Alabama Senate race tightens

The Alabama Senate by-election will be held on 12 December. Last Thursday, the Washington Post reported that extreme right Alabama Senate candidate Roy Moore had had a sexual encounter with a 14 year-old girl when he was 32.

The three polls taken since this revelation are between a 4-point lead for Democrat Doug Jones, and a 10-point lead for Moore, averaging at Moore by 2 points. There have been 12-point shifts in Jones’ favour from the previous editions of both JMC and Emerson, and a 5-point shift in Opinion Savvy.

The ConversationWhat happens next depends on whether voters quickly get over the scandal, or whether it festers, and continues to damage Moore. If the former happens, Moore should win comfortably, but the latter outcome would give Jones a real chance. An example of a scandal that festered in Australia was Bronwyn Bishop’s Choppergate affair.

Adrian Beaumont, Honorary Associate, School of Mathematics and Statistics, University of Melbourne

This article was originally published on The Conversation. Read the original article.

Labor increases Newspoll lead to 55-45% as Shorten moves within striking distance as better PM


Michelle Grattan, University of Canberra

Newspoll has delivered a sweeping new setback to Malcolm Turnbull, with a big cut in his “better prime minister” rating and Labor increasing its two-party lead to a massive 55-45%.

The blow comes as the government and opposition prepare for a byelection in the Sydney seat of Bennelong, expected to be on December 16, following Saturday’s resignation of Liberal backbencher John Alexander, who said he was a likely British citizen.

The Coalition will be particularly panicked by the fall in Turnbull’s rating as better prime minister, from 41% to 36%. Bill Shorten’s rating rose one point to 34%. Turnbull’s two-point lead over Shorten is the narrowest margin there has been between them.

The government has always looked to this measure to argue Turnbull’s strength against Shorten, even in the face of the bad two-party results.

In the 23rd consecutive Newspoll in which the Coalition has trailed, the ALP increased its two-party vote from 54-46% a fortnight ago, and its primary vote from 37% to 38%. The Coalition’s primary vote went down one point to 34%. The escalating citizenship crisis has dominated the two weeks.

Turnbull’s net satisfaction worsened slightly from minus 28 to minus 29, while Shorten’s improved from minus 24 to minus 19. Pauline Hanson’s One Nation rose one point to 10%; the Greens fell one point to 9%.

Bennelong, once held by John Howard, is on a margin of a little under 10%, making it safe in normal times but potentially vulnerable in the present chaotic climate.

Alexander said that although he had not received formal confirmation from the British that he was a UK citizen via his father, “the probability of evidence is that I most likely am”. He will recontest the seat.

With Barnaby Joyce and Alexander both out of parliament the government will be operating from a minority position when the House of Representatives returns on November 27. It has 74 of the 148 occupied seats, 73 on the floor when the Speaker, who only has a casting vote, is excluded.

Though the government is not at risk of a no-confidence motion, thanks to having sufficient crossbench support, Labor will make the lower house as difficult as possible.

Turnbull said the byelection date was “a matter for the Speaker” but the government wanted it “as soon as possible”. Labor started campaigning in the seat on Sunday.

Both sides became more shrill at the weekend in their claims about the alleged dual citizens among the ranks of their opponents.

The government is threatening to refer at least two ALP MPs, Justine Keay and Susan Lamb, to the High Court, and perhaps more. It could not do this on its own, with its present numbers.

In response, the opposition has issued a “hit list” of Liberals, including Julia Banks, Nola Marino, Alex Hawke, Tony Pasin and Ann Sudmalis.

A Labor source said that if Malcolm Turnbull “wants to fire this missile, we’ve got the ammo to go nuclear”. Turnbull was “locking and loading the gun at his own MPs”.

Several Labor MPs moved to renounce their dual citizenship before their nominations but did not get their confirmations until afterwards. The ALP claims they should not be referred to the court, because they took reasonable steps but given the High Court’s black-letter approach in its recent decisions, it is not clear how it would treat such cases.

Turnbull, who is trying to manage the unfolding crisis from a distance during his Asia trip, said: “Bill Shorten has got to stop running a protection racket for his own dual citizens”.

Turnbull said Labor had welcomed the court’s literalism. But “the worm has turned and now we see one Labor MP after another who could not pass that literal test.

“Now, if Labor says they’ve got counter-arguments, terrific. Let them make them in the court.

“There is no question that Labor has a number of members who not only were, but knew they were … foreign citizens at the time they nominated for parliament. That makes them ineligible.”

The manager of opposition business in the House of Representatives, Tony Burke, said the difference between the Labor and Liberal MPs was that “Those who are in the spotlight for the Labor party took reasonable steps before the nomination date. Those who are in the focus from the Liberal party took no steps at all before the nomination date.”

Burke on Sunday was campaigning in Bennelong, where Labor is homing in on the seat’s ethnic component.

Following the Queensland Liberal National Party preferencing One Nation in many seats for the November 25 state election, Burke said a petition was being launched “to demand that Malcolm Turnbull end the preference deals with One Nation”.

Labor will also make the government’s proposed toughening of the citizenship law an issue in Bennelong.

“A prime minister with any authority would be able to stop a preference deal with One Nation. John Howard would have been able to stop a preference deal with One Nation,” Burke said.

The Conversation“But Malcolm Turnbull, a prime minister with no authority and a government with no majority, has failed to stand up for the people who live here. Make no mistake, when you attack multicultural Australia, which is exactly what One Nation is all about, you attack the community that lives here in Bennelong.”

https://www.podbean.com/media/player/k3zus-7afe23?from=site&skin=1&share=1&fonts=Helvetica&auto=0&download=0

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.