Labor leader Bill Shorten on Sunday conceded the 2016 election to Malcolm Turnbull, though it remains uncertain whether the Coalition will form a majority or minority government.
So what’s ahead now for health, infrastructure, the economy, welfare, education and more? The Conversation’s experts respond to what the Coalition’s agenda will mean for key policy areas.
Jeff Borland, Professor of Economics, University of Melbourne
Having gone to the election with the slogan “jobs and growth”, the Coalition should expect its employment creation record to be closely scrutinised.
It won’t be enough if total employment in Australia grows over the next three years. That can happen just due to population growth. Voters will expect Australia’s employment/population rate and aggregate hours of work to rise.
The way for the Coalition to deliver on its promise of new job creation will be by increasing Australia’s rate of economic growth. But economic growth isn’t just determined by government policy. Any global slowdown from Brexit will impact on Australia, and make the Coalition’s task harder.
But when you have also gone to the election saying that your party is best equipped to handle the fallout from Brexit, there may not be much sympathy if the Coalition rolls this out as an excuse.
A policy issue that will come up early in the new government’s term is penalty rates and industrial relations reform. If the Fair Work Commission decides to keep Sunday rates unchanged, the Coalition will come under significant pressure to reform the IR system to make it easier to change modern award provisions.
Programs for the unemployed will continue to be a major policy issue. The government will have to implement its Youth-Jobs PaTH program. A big question will be whether the program can induce a sufficient supply of internships that provide valuable work experience to young jobseekers.
At some point, the government will also need to boost funding to programs that improve outcomes for jobseekers with the highest barriers to obtaining employment.
Finally, the TAFE system will need reform to stop the rorts associated with government funding. Over the medium term, it will also be important to set incentives and funding to get the right balance between participation in TAFE and university.Lukas Coch/AAP
John Wanna, Sir John Bunting Chair of Public Administration, Australian National University
The astonishing result of this election will make taxation reform incredibly difficult over the next term of parliament.
Over the past six years, both the government and opposition have been “small targets” and evasive on tax reform. This election outcome will not make them any more courageous. In fact, both parties will conclude from this campaign that you only get rewarded for negativism and scare campaigning.
The proposed cuts to company taxation will be difficult to pass in a fractured parliament. We may see a slight decrease in company tax for micro small businesses, and there is some prospect of it getting extended to enterprises with a turnover of between A$5 million and $10 million. But there is not much prospect of a tax cut to major companies.
A review of the GST – either broadening its application or increasing the rate – will remain political poison to all parties. Similarly, the new parliament will make changes to negative gearing nigh on impossible.
It will not be a surprise if the Coalition revisited its recent budget proposals to increase taxes on superannuation; this was a searing issue turning upper-income supporters off the Coalition government.
Cuts to income taxes are problematic until the deficit is eliminated, and I do not expect any changes to bracket creep – the invisible instrument that increases tax by stealth.
A tight parliament may agree to increase some of the smaller irritant taxes – such as tobacco tax, excise, or capital gains tax – and may also finds its way to reduce some tax concessions. But these will have to be cobbled together piece by piece.
There’s not much hope for a comprehensive strategic review of taxation going forward that would offer a simpler, more efficient tax mix.
Deborah Ralston, Professor of Finance, Monash University
Among the issues to be addressed by the new parliament will be the Turnbull government’s superannuation policy changes as announced in the 2016-17 budget. Given the similarities between both Coalition and Labor super policies, however, the general direction of super reform is unlikely to change.
There is little practical difference between the Coalition’s A$1.6 million cap on balances in pension phase and Labor’s $75,000 tax-free income cap on benefits, although it could be argued the latter is slightly more generous in years when super returns exceed the long-run average of 6.5%.
Similarly, support for women to increase their super balances through the Low Income Superannuation Offset, and the spouse tax offset, are unlikely to be challenged. Neither is the removal of the work test and ability to make further contributions for those aged 65 to 74 years.
These measures and lowering the floor on a 30% contributions tax to those over $250,000, and limiting annual contributions to $20,000, albeit with a carry-forward provision for those with balances under $500,000, are designed to improve equity, redirect concessions from higher to lower-income earners, and ensure sustainability of the system into the future.
What may be more contentious is the cap on non-concessional contributions of $500,000 over a lifetime as from July 1, 2007, and imposing a 15% earning tax on Transition to Retirement accounts, both existing and future. Both of these measures lack grandfathering or forward notice of change, and therefore – some would argue – are regressive in that consumers cannot adjust their future plans to align with new policies.
Primary care and Medicare
Jim Gillespie, Associate Professor of Health Policy and Deputy Director of the Menzies Centre for Health Policy, University of Sydney
Labor’s “Mediscare” campaign brought swinging voters back to the party; it will be a valuable tool in opposition. The government’s freeze on GP rebates is placing bulk billing of patient visits under pressure. We are going to hear much more on the Coalition threat to universal health coverage.
The government must deal with two major areas of policy reform. The first is the Medicare Benefits Schedule Review, which has been investigating specialists’ procedures and whether they accord with current scientific evidence.
The taskforce’s clinical subcommittees are also scrutinising the amounts paid for each service. Should fees fall where new technologies have cut doctors’ time and costs, for instance?
However, cutting waste and inefficiency is likely to impact on the income of health professionals. The government will therefore need great political skills in the face of powerful professional and commercial interests. A Senate fragmented between new micro-parties will be a playground for lobbyists. It’s also unclear whether Labor will make these reforms difficult.
Primary health care – GP and other community-based services – provides the other reform front. The government recently announced pilots for “health care homes”. These would refocus Australia’s fragmented health system around general practice to better care for people with chronic illnesses such as diabetes and heart disease.
New payment systems would move away from fee-for-service in favour of paying doctors a lump sum to look after patients for an entire year. This should encourage team work and more integrated care.
But if health care homes are to make a difference to people with chronic diseases, the government will need to significantly boost its investment from the A$21.3 million allocated.Dan Peled/AAP
Welfare reform and social policy
Ben Spies-Butcher, Lecturer in Economy and Society, Department of Sociology, Macquarie University
The Coalition’s election pitch had little focus on social policy. Most of Malcolm Turnbull’s discussion of social policy was defensive, assuring voters the Coalition would not privatise Medicare and responding to criticisms of cuts to health and education funding.
The main proposals were focused on savings. The Coalition claimed savings from cuts to Newstart (targeting the Energy Supplement) and the age pension (via unjustifiably high deeming rates on investments). The Newstart commitment in particular is of real concern given many people on the benefit are already living in poverty.
Other savings from the contentious 2014 budget remain on the Coalition’s books, suggesting a degree of austerity is likely over the next three years.
There is also speculation the cuts may go further. Following the 2013 election many were surprised by the harshness of the initial Coalition budget, with measures that were not declared before the election (and some that were explicitly ruled out). The economic fallout from Brexit potentially creates a reason to look for new savings.
However, such a budget now seems unlikely. Labor’s effective defence of Medicare has surely made it difficult for the Coalition to propose even mild cuts to health care. The narrow Coalition win, combined with what appears to be the Coalition’s worst Senate result since the second world war, gives this government far less room to move.
Many of the 2014 budget measures never made it through the parliament. It will still be some time before we know the final outcome of the Senate, but it already appears likely that the Coalition will require the support of most of the crossbench senators where Labor and the Greens oppose a measure. This will cause Turnbull to look to his opponents for support for some of the Coalition’s more progressive budget measures, such as changes to superannuation taxation.
As we saw in the last parliament, disciplining even conservative senators to pass austerity measures can be difficult when there are active campaigns to oppose austerity. That is only more likely if the Coalition regularly requires Nick Xenophon and Pauline Hanson to vote together.
At best, it looks like a parliament of treading water with some mildly progressive reforms passing the Senate. At worst there remains the potential for substantial cuts and growing inequality.
Diana Perche, Lecturer in Politics and Public Policy, Macquarie University
Indigenous-specific issues were hard to find among the key policy announcements of the major parties for most of the election campaign, but the incoming government cannot ignore the pressing issues – particularly high unemployment, incarceration levels, school education outcomes, and health, including mental health and devastatingly high suicide rates.
Strong efforts by Indigenous organisations and the National Congress of First Peoples to raise the profile of Indigenous issues, with the launch of the Redfern Statement, received late acknowledgement from Labor and little attention from the Coalition.
For the mainstream media, Indigenous affairs were reduced to a single issue: the proposed referendum to amend the Constitution to recognise Aboriginal and Torres Strait Islanders. Bill Shorten’s preparedness to consider a treaty prompted a rebuke from Malcolm Turnbull, yet this is a path forward that is important to many Indigenous people across Australia.
Former prime minister Tony Abbott was interventionist, moving Indigenous Affairs into the Department of Prime Minister and Cabinet, slashing funding, and establishing the much-criticised Indigenous Advancement Strategy to rationalise funding of services. Little is likely to change, though Turnbull has expressed an interest in working “with Indigenous people”, with “mutual respect”.
Interestingly, the new parliament will have more Indigenous members than ever before. Linda Burney has been elected the first Indigenous woman member of the House of Representatives; Ken Wyatt was returned in Western Australia; and the Senate will include at least two of the ten Indigenous candidates who stood – Labor senators Patrick Dodson and Malarndirri McCarthy.Mick Tsikas/AAP
Asylum seekers and refugees
Mary Anne Kenny, Associate Professor, School of Law, Murdoch University
The Coalition has said it will continue Operation Sovereign Borders, which includes the interception and turn-back of people seeking to come to Australia by boat.
There is pressing urgency around finding a durable outcome for the some 1,300 refugees and asylum seekers currently in offshore processing centres on Nauru and Manus Island.
For Nauru, a viable third country for resettlement of those found to be refugees has become urgent in the face of continuing and serious deterioration in mental health – most recently manifesting itself in self-immolations and other acts of self-harm.
The PNG Supreme Court has declared that detention of refugees and asylum seekers on Manus Island was unconstitutional – and while the Australian government said this is an issue for its PNG counterpart, some resolution will be needed between both governments by the end of this year.
The UN High Commissioner for Refugees has called for the immediate movement of all people from both centres to more humane conditions.
Transfers back to Nauru of 267 asylum seekers who had been brought to Australia for medical treatment seemed to be put on hold after a Somali woman set herself on fire in May 2016. Coalition policy is that these 267 asylum seekers can expect to be returned to Nauru.
There has been a concerted effort in 2016 to remove children out of Australian immigration detention centres, many of whom have been detained for many years. A renewed focus on this issue will come when the government-appointed Child Protection Panel hands down its report and recommendations in mid-2016.
The Coalition will continue with its new system of processing of 25,000 asylum seekers in Australia who arrived by boat in 2012-13 which limits their access to merits review. Those found to be refugees will only be eligible for temporary protection visas.
The Coalition will increase the refugee and humanitarian intake from the current 13,750 places raise the intake to 18,750 places in 2018-2019. The Coalition has also committed to taking an additional 12,000 refugees from conflicts in Syria and Iraq.AAP/Eoin Blackwell
Early education and care
Susan Irvine, Associate Professor, School of Early Childhood, Queensland University of Technology
If only our politicians could learn to play nicely; to talk, listen and work together for the public good. If this were the case, there may be an upside to the prospect of a minority government, with the possibility of more informed debate and better early childhood education and care (ECEC) policy in Australia.
The Coalition has on the table a major reform of childcare assistance. The “Jobs for Families” package represents A$3 billion new money to make ECEC more affordable. The reform has many positive elements but places too much emphasis on childcare to support workforce participation and not enough on children’s early learning outcomes.
Tackling affordability will enable more children to participate in ECEC. However, access is linked to parent workforce participation rather than promoting early learning. Low-income families who fail the work activity test will have their current funded hours cut in half to around one day per week.
Presently reliant on the Senate passing regressive cuts to family payments, families may be waiting some time for any fee relief. There is also no ongoing commitment to fund preschool education prior to school.
There is little on offer for the professionals providing these services. At a time when many educators are moving to other education contexts in search of better pay and conditions, there is no plan to grow and sustain a qualified and professional early years workforce.
Affordable and accessible ECEC is well placed to deliver a range of educational, social and economic benefits to the community. However, the Coalition’s reform package makes it harder not easier for children experiencing disadvantage to participate in early learning programs; this cost will be born by these children, their families and the entire community.
Glenn Savage, Senior Lecturer in Education Policy and ARC DECRA Fellow (2016-19), Melbourne Graduate School of Education, University of Melbourne
In the lead-up to the election, the Coalition was hamstrung by a bizarre range of contradictory policy positions on the role of the federal government in schooling and the vexed issue of school funding.
The election result gives the government a chance to start afresh and move beyond the politics of distraction that have dominated its approach in recent years. But this is easier said than done.
In the short term, Education Minister Simon Birmingham has a tough road ahead to convince states and territories to accept the Coalition’s “less cash, more caveats” funding approach as part of its Quality Schools, Quality Outcomes policy.
Its A$1.2 billion commitment is not only significantly less than the $4.5 billion promised by Labor as part of the Gonski reform model, but the policy also imposes a complex range of new conditions on what states and territories can do with the money.
In the longer term, the Coalition needs to find ways to work more collaboratively with states and territories to strengthen Australian schooling at the national level, rather than pursuing its current trajectory towards greater federal overreach.
This includes investing in quality teaching, building on the critical importance of the early years, nourishing the capacities of school leaders, strengthening curriculum reform, and investing in high-quality educational research.AAP/Paul Miller
Emmaline Bexley, Senior Lecturer in Higher Education, University of Melbourne
It seems clear that the higher education reforms put forward with the 2014 budget, while still sitting “on the table”, are extremely unlikely to go ahead.
The pointy end of neoliberalism is never kind to farmers and those from the bush, and is the source of many of the marital difficulties between the Liberals and Nationals. It would be a strange turn of events if the Coalition could convince crossbenchers Bob Katter and Cathy McGowan to support further fee deregulation – not to mention dealing with the bizarre Senate presently forming.
For the government, this is quite a blow. The discussion paper for higher education released in this year’s budget was a free-for-all shopping list raising every imaginable possibility for the sector.
It included most of the contentious issues from the 2014 budget (HECS repayments for the dead, Commonwealth-supported places for private providers, the 20% funding reduction, and various fiddlings with the HECS threshold), as well as a proposal of “flagship courses” that would allow institutions to levy domestic fees for boutique undergraduate degrees.
The responses to the paper are not due to report until three weeks after the election. The early onset of election shenanigans likely guarantees far fewer responses than the discussion paper would have received with nothing else going on.
The idea, clearly, was that should the Coalition win, it would have a free rein to do pretty much anything, being able to say: “But we asked you if you minded before the election!” The composition of the new parliament puts the handcuffs on all of that.
Science and research funding
Merlin Crossley, Deputy Vice-Chancellor, Education, and Professor of Molecular Biology, UNSW Australia
Scientists in Britain shuddered at the Brexit poll outcome and Australian scientists will be nervous about a fragile government taking office here.
The momentum of the innovation tide, which began so well when Malcolm Turnbull replaced Tony Abbott, seemed to gradually dissipate. Many will worry the new government will be so fixated on maintaining power and accommodating special requests from the Senate that bold investment or major reforms to research funding are unlikely to be on the agenda.
The Coalition was very quiet on science funding during the campaign, merely reiterating its dedication to the welcome sugar hit provided by the National Innovation and Science Agenda and confirming it would implement the recommendations of last year’s Watt review.
The Watt review’s 28 recommendations will streamline the distribution of funding for research support and will enhance interactions between researchers and industry, and are thus welcome. But, on their own, they won’t make Australia much more successful or prosperous.
So, are there any significant opportunities?
There may be some portfolio changes. In particular, the fact Assistant Innovation Minister Wyatt Roy lost his seat may mean someone else may be elevated to this position. Or, possibly, the current assistant science minister, Karen Andrews, who was formerly a highly respected engineer, may assume responsibility for innovation.
Is there anything to hope for? Even hung parliaments sometimes deliver in unexpectedly positive ways.
There is a renewed focus on health, and one can expect the Coalition to be prominent in its support for medical research. As the research that the Medical Research Future Fund supports begins to dividends, one must hope that this investment serves as an example of what committing to science can produce.
A lot will depend on how the fund is administered. One hopes the definition of medical research will be sufficiently broad to include other areas of science that are integral to progress on complex health problems.
Finally, one may hope the parliament’s fragility and the avowed commitments made by some of the crossbenchers – including the Greens – and by Labor’s Kim Carr will prevent any significant cuts to Australian science and, most importantly, stay the tragic erosion of world-renowned institutions such as CSIRO – and, one hopes, also important science communication channels such as the ABC.Lukas Coch/AAP
Environment and climate change
Robyn Eckersley, Professor of Political Science, School of Social and Political Sciences, University of Melbourne
The Coalition offered no new climate policies during the election campaign, and it did its best to keep climate change out of the limelight.
Given the significant swing away from the Coalition, it is unlikely that Malcolm Turnbull will have the political capital to override the climate sceptics in his party and produce more credible climate and energy policies in the near term. The Abbott government’s Direct Action policies can be expected to continue.
Yet reform is desperately needed. Under the Paris agreement, the Coalition pledged to reduce emissions by 26-28% below 2005 levels by 2030. This pledge is among the weakest in the developed world. The Coalition will not be able to meet it without significant additional funding to the Emissions Reduction Fund, which is not fiscally sustainable, or much tougher baselines under the safeguard mechanism’s baseline and credit trading scheme, which would undermine its rhetoric against a price on carbon.
The Coalition has promised a review of its climate policies in 2017, ahead of the UN global stocktake of national pledges under the Paris agreement in 2018. In anticipation of this review, the government will come under increasing pressure to produce much tougher climate action. Polling during the campaign showed a very clear majority of voters are concerned about climate change and want stronger action.
The Senate will be a hurdle for the Coalition. Labor, the Greens and the Nick Xenophon Team will form a much larger rump than the Coalition. Pauline Hanson (a climate sceptic) and Derryn Hinch (who has not declared his views) will be only two of a myriad of possible new smaller parties and independents who will make up the crossbench.
Nicole Gurran, Professor of Urban and Regional Planning, University of Sydney
The Coalition seemed badly out of touch on housing affordability in the election lead-up. A scare campaign around Labor’s proposed changes to negative gearing, spearheaded by the “fake” property investor tradie, seemed callously indifferent to the concerns of struggling renters and those locked out of home ownership.
Instead, the Coalition promised no change to the status quo. Negative gearing and capital gains tax discounts will be retained, benefiting property investors but offering nothing for aspiring first-home buyers.
A Smart Cities Plan, released by the Coalition in the lead up to the election, does refer to “affordable housing”. But it offers little detail and no direct funding for its delivery. The inference is that new infrastructure in key locations such as western Sydney will drive increased housing supply, and that these new homes will somehow be more “affordable”.
There’s no additional funding for social housing supply, but a A$250 million energy efficient fund is earmarked to support the sector. The government did establish an Affordable Housing Working Group in January this year to identify ways to boost the supply of affordable rental housing through “innovative financing”. Although nothing along these lines made the Coalition’s election policies, progressing this work would signal more serious intention to boost affordable housing supply.
The Coalition’s policy of bringing back the Australian Building and Construction Commission (ABCC) was a trigger for the double dissolution. Whether or not the legislation passes in the new Senate, resurrecting the construction watchdog won’t deliver tangible benefits for renters or home-buyers.
In short, there’s not much good news yet for the social housing sector or for low- and moderate-income earners struggling in the precarious private rental market. Gen Ys hoping to break into the housing market will need to heed Malcolm Turnbull’s pre-election advice and hit up their parents for help.AAP/Mick Tsikas
Infrastructure and transport
Jago Dodson, Professor of Urban Policy and Director, Centre for Urban Research, RMIT University
The campaign was significant for urbanists: it was the first election in decades in which each major party had a detailed policy vision for cities and urban infrastructure.
The Liberals promised a mix of infrastructure projects, including extending the Gold Coast light rail and supporting the Sydney and Melbourne metro tunnels, as well as various urban road projects such as WestConnex in Sydney.
In urban policy, the Liberals offered a Smart Cities fund to invest in economically innovative urban and suburban redevelopment projects via City Deal financial packages, including one such deal specifically targeting western Sydney.
With a Liberal government we’ll likely see the rollout of its already-released Smart Cities policy including new financing arrangements for urban infrastructure combined with sub-metropolitan spatial planning via City Deals. There are still many aspects of this policy to be clarified, such as the extent of government funding that will be contributed to the City Deals.
Overall the 2016 election bodes well for cities, though there are some risks with the Liberals’ policy. The government will fund the misguided WestConnex project in Sydney, which will reduce the funds available for public transport. And the City Deals scheme hasn’t yet taken shape, but it is important that this funds public transport given the dearth of such infrastructure in Australia’s suburbs and the need for suburban place-making through concentrated rail-based hubs.
The Liberals’ policy leaves some major urban projects in doubt, such as Brisbane’s Cross River Rail. In addition to the physical investment under the Liberals’ schemes, new institutional arrangements will likely be needed to provide the co-ordination and program management these presume. What these will look like is not yet known.
The need to radically reduce Australia’s dependence on fossil-fuelled urban transport systems is largely overlooked by the Liberals’ urban platform, as are the pressing issues of achieving social equity and environmental sustainability in our cities.
National Broadband Network
Thas Ampalavanapillai Nirmalathas, Director – Melbourne Networked Society Institute, Professor of Electrical and Electronic Engineering, Co-Founder/Academic Director – Melbourne Accelerator Program, University of Melbourne
Australia’s internet connectivity received a slightly favourable shift in the recent Akamai ratings – moving up to 48th based on the average speed of connection, and up to 56th based on average peak speed of connection. This may be partly attributable to the increase in the National Broadband Network (NBN) deployment rates.
As of June 23, NBN Co has passed 2.7 million subscribers. NBN Co has more than doubled its fixed-line connectivity compared to its deployment update in June 2015. It also gained an instant ~400,000 subscribers via the activation of its Sky Muster 1 Satellite service.
NBN policy is unlikely to change with the return of the Turnbull Coalition government, and NBN Co will need to build up its momentum in rapidly converting the planned 875,000 subscribers.
NBN Co and the government maintain that it may be possible to offer comparable services to fibre to the node (FTTN) using the latest copper technology options, but these have so far have only been realised under laboratory conditions. NBN Co launching its second Sky Muster Satellite later this year will significantly expand its satellite broadband offerings.
NBN Co faces a major challenge in how to finance the rest of the deployment given the end of government investment. This has left it scrambling to find alternative funding sources to keep the deployment on track. It remains unclear whether the government will reconsider alternative mechanisms to deal with the capped funding.
The government also needs to direct its attention to customer experience to ensure that broadband market design under the NBN policy is working well to lift and enhance competition and that customers are getting equitable access to broadband regardless of their location.AAP/Lukas Coch
Joanna Mendelssohn, Associate Professor of Art and Design, UNSW Australia
Small parties and independents in general, and Nick Xenophon in particular, will have a significant influence in the new parliament. Both Cathy McGowan and Andrew Wilkie are very aware of the regional concerns of their communities and the value of the arts to well-being, so regional arts in particular should fare fairly well.
The Nick Xenophon Team (NXT) hasn’t produced any policies that relate to the arts. But shortly before the election, a voter in Mayo wrote to Nick Xenophon raising concerns about the current state of arts funding. His electorate officer sent this reply:
The Nick Xenophon Team will be calling for:
- Australia Council funding to be returned to the pre-2015 budget level;
- The Catalyst funding decisions to be subject to greater scrutiny and to be more transparent
The NXT recognises the dire situation of the South Australian arts sector given the state and federal cuts it has suffered recently.
My best guess for future arts funding is that we will see a quiet unpicking of the fiasco of the Brandis years – but this may take some time and will depend on the state of the economy.
There is a parallel here with the Howard era. After a total slash and burn of the arts when John Howard was first elected in 1996, the arts budget gradually drifted upwards, aided by arts-loving philanthropists who understood the art of lobbying.
Malcolm Turnbull certainly appreciates the value of the finished product in the arts – the fine paintings, sculpture and photography; the polished performances of actors, singers and musicians – but he has yet to make the link between this and funding the hard slog of creation and education.
Authors: Jeff Borland, Professor of Economics, University of Melbourne