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Assume the brace position

Prepare for Labor

14 May 2022

9:00 AM

14 May 2022

9:00 AM

If you read the mainstream press a lot – not that I’m recommending that – you might believe that Labor is hoping to win the election using a small-target strategy in which the policies being proposed are not too different from current government settings. It’s a common refrain.

But as they say, the devil is always in the detail. And, in this case, it’s often more important what isn’t said by Albo and his shadow ministers (maybe I should reverse that order) than what is said.

There is an important, forgotten element in the suite of policies that Labor is taking to the electorate and that is the ongoing compromises needed to keep the Right and the Left (and the various sub-factions) of the party from declaring civil war. While it’s easy to dismiss Albo’s external political appeal, he has demonstrated real political skills calming down the party, particularly the parliamentary wing, and maintaining a degree of stability.

After the Right’s Bill Shorten surprisingly lost the 2019 election, it could have been on for one and all. The Left, including Albo, never liked Shorten but tolerated him because they thought he was going to become prime minister. A new settlement was required, including new policy positions.

Even though the Left was in favour of many of the tax proposals Shorten had run with – think here removing cash refunds for franking credits, limiting negative gearing, lifting capital gains tax, higher taxes on trusts – it was widely acknowledged that the path to election would involve ditching them. Over time, this is what Albo achieved – there is really nothing remaining of the Shorten tax agenda in 2022. This left Albo with the task of finalising new policies that both the Left and Right could sign off on. That the Morrison government had abandoned any sense of fiscal responsibility was a plus – gone are the days (at least for the moment) of having to answer that pesky question: how are you going to pay for it?

In order to simplify the process, the factions were initially given certain portfolios – climate and education, for instance, were bagged by the Left. Defence and treasury went to the Right. Even so, the final policy positions were negotiated between the Left and Right so that the outcome looks like a small target – very little different from the Coalition’s policies, nothing too radical – but is actually the result of this compromise.

The importance of this insight is that were Labor to win office, particularly in its own right rather than as lead in a minority government, the actual policies enacted may look quite different from those presented to voters prior to the election.

There is also the point that the very vagueness of many of Labor’s policy documents leaves a great deal of wriggle room in practice. In other words, we don’t really know what to expect from a Labor government in terms of policy because of the skimpiness of the proposals being made public.

Take, for instance, industrial relations. Based on a few pages and using the theme of insecure work, Labor is in fact (potentially) proposing to make a number of radical changes to the regulation of industrial relations. The numbers are completely dodgy – all self-employed people are in insecure work, evidently – but that doesn’t really matter.

Labor is intent on killing off the gig economy to the greatest extent it can, ensuring labour hire firms have no place in the labour market and thwarting any further growth in casual employment. The fact that there are plenty of participants in the gig economy who are very happy with their arrangements, with gigs often undertaken in addition to day jobs, is neither here nor there for Labor.

Similarly, labour hire firms fulfil a useful role in providing short-term workers for companies as well as facilitating recruitment, training and induction. They don’t do a big job in the labour market – around three to five per cent of employed persons work for labour hire firms – but it is useful. They are important in parts of mining, particularly in Queensland.

But what gets Labor’s goat – or, in reality, the trade unions’ goat – is that labour hire workers are not very inclined to join unions. Ditto gig workers.

In addition to attempting to mandate higher wages – that always works well – Labor in government will alter the laws to impose a series of new restrictions on employers that are in keeping with the trade unions’ agenda. In all likelihood, the new Senate will simply wave through these legislative amendments.

Another area where the dulcet tones of Labor’s policy disguise quite radical measures is climate. Mind you, the government can largely blame itself for the loss of competitive political advantage in this area – as in the 2019 campaign – by signing on to the net zero emissions by 2050 pledge.

Labor’s line is that, given that both parties are heading to the same end point, it is simply quibbling with details to think there are any real difference in the climate policies of the two parties.

The reality is that there are important, impactful differences between the policies of the two parties that are likely to have consequences in the near term. The Coalition is sticking with the 2030 target of lower emissions of between 26 and 28 per cent (from a 2005 base) whereas Labor has opted for 43 per cent – not significantly different from its target taken to the 2019 election. (Confusingly, the Coalition claims it will achieve 35 per cent.)

One of the means whereby Labor will achieve its higher target is the Safety Net Mechanism to force Australia’s 215 biggest emitters to reduce their emissions or purchase (expensive) carbon credits.

But instead of providing clear guidance as to the rules that will apply across-the-board to these big emitters – mines, electricity plants, smelters, waste management facilities – Labor is proposing individual backroom negotiations with the Clean Energy Regulator. This is the antithesis of good policy but is one reason why the managers of these big emitters have been very quiet publicly during the course of the election campaign.

The bottom line is that Labor is happy with the description ‘small target’ in relation to its pitch to win government at this election. When in government, Labor is hoping to implement a range of radical policies – and well beyond IR and climate, including defence and border protection – of which the voters will have been largely unaware.

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