Volume 4, Issue 8, (Originally Published on 16 September 2013)
A lacklustre election campaign dominat¬ed by discussion of costings and opinion polls has culminated in Tony Abbott being elected as Australia’s 28th Prime Minister.
Abbott ran a disciplined, well-or¬ganised and largely positive campaign, promising a return to ‘adult’ government that people could depend on. He will be sworn in by Governor-General Quentin Bryce sometime next week.
As the dust settles, there will be little time for Abbott to catch his breath. His Government faces considerable chal¬lenges. The greatest of these is a sluggish economy and the likelihood of rising un¬employment. Last week’s quarterly GDP figures showed an economy growing at 2.6 per cent annually, well below trend.
Contributing to the result was, first, weak consumer confidence. Consumers remain wary to spend despite a string of interest rate cuts by the Reserve Bank. The savings rate – the ratio between savings and income – continued to increase, edging up to 10.8 per cent as households pay down debt.
Business, too, is lacking confidence. The gross operating surpluses of cor¬porations fell by 3.2 per cent in 2012-13, the biggest fall in 50 years. Mining investment continues to peter out amid lower commodity prices.
According to Westpac chief economist Bill Evans “the task of filling the gap created by the slowdown in mining is spectacular”
Abbott will also be under pressure to stem the flow of asylum seeker arriv¬als, this having been one of his central campaign commitments. His policies in this area, such as the reintroduction of temporary protection visas, will not be implemented overnight. There is the risk, however, if numbers do not begin to fall soon that Abbott will be seen as ‘all talk’. The Labor Party will be ruthless in scrutinizing Abbott’s performance.
Finally, Abbott needs to be wary of the ‘do nothing government’ tag. The great challenge of government is that it requires not only sound administration but also effective spruiking of that sound administration. Governments have to give people a sense of what they’re on about, they have to seem purposeful. If not, people tend to conclude that the government is floundering.
In Opposition, Abbott’s purpose was more or less defined by his systemic role – to hold the government to account.
In government, however, it’s all on him. He must craft his own story that the elec¬torate can cling onto. Abbott has already intimated that he wants to be known as an ‘infrastructure Prime Minister’.
As he confronts these challenges, Abbott will be strengthened by a tal¬ented and experienced group of senior ministers. Julie Bishop, Andrew Robb, Joe Hockey, Malcolm Turnbull, George Brandis, Kevin Andrews, Ian Macfar¬lane and many others have ministerial experience. Robb and Turnbull are suc¬cessful businessmen in their own right. Brandis is an SC. Greg Hunt, the incom¬ing Environment Minister, is a former partner at McKinsey. Arthur Sinodinos, who appears likely to take the Finance portfolio, was John Howard’s Chief of Staff for a decade and has held senior positions at both Goldman Sachs and the NAB.
Also in Abbott’s favour is a sizeable majority in the House and a clear man¬date to implement his policy agenda.
Photo saved under * HANDOVER AT THE LODGE: OUTGOING PM KEVIN RUDD SHAKES NEW RESIDENT AND PRIME MINISTER TONY ABBOTT