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26/04/2018
Few would imagine that Prime Minister Malcolm Turnbull, having recently lost his 31st consecutive Newspoll, would be in a hurry to rush to the polls.
Indeed, in current circumstances, the Prime Minister would almost certainly be keen on a four-year term, an idea considered in CEDA’s 2018 Economic and Political Overview. Unfortunately for the PM, he has a maximum three-year term and time is ticking.
While a general election could be held as late as the second half of next year, you can be certain that, inside the Prime Minister’s office, the ruler has already been run over a number of possible election dates.
Although election timing is broadly a matter of prime ministerial discretion, Mr Turnbull would be very conscious that he is significantly constrained in his choice of election date. Some of those constraints are constitutional, while others are a function of convention or convenience.
Essentially, the Prime Minister has four options for the timing of the next federal election.
Indeed, in current circumstances, the Prime Minister would almost certainly be keen on a four-year term, an idea considered in CEDA’s 2018 Economic and Political Overview. Unfortunately for the PM, he has a maximum three-year term and time is ticking.
While a general election could be held as late as the second half of next year, you can be certain that, inside the Prime Minister’s office, the ruler has already been run over a number of possible election dates.
Although election timing is broadly a matter of prime ministerial discretion, Mr Turnbull would be very conscious that he is significantly constrained in his choice of election date. Some of those constraints are constitutional, while others are a function of convention or convenience.
Essentially, the Prime Minister has four options for the timing of the next federal election.
Option 1: An early election (August to October 2018)
The Constitution does not require a House of Representatives election to be held until the second half of next year. It does, however, require a half-Senate election to be held between 4 August 2018 and 18 May 2019.
The Prime Minister could technically hold a half-Senate election sooner and a House election later. This would not be unprecedented. In fact, it was briefly fashionable in the 1960s and early 1970s. These days, though, it would be considered unusual and unduly expensive. Therefore, a combined election is likely by 18 May 2019.
When the Prime Minister first glanced at a calendar, he would have quickly become aware that most of the space available for a federal election campaign before May 2019 is already politically spoken for.
Victoria will enter full campaign mode at the end of October ahead of its election on 24 November. Then, soon after the Christmas/January electoral “no-go zone”, the NSW Government and Opposition will hit the hustings for their state election on 23 March 2019.
Overlapping state and federal campaigns are not impossible but are generally avoided, partly because they reduce party fundraising opportunities and partly because they amplify the cross-pollination of state and federal issues, adding unpredictability and noise to media coverage and political “messaging”. There are also technical legislative rules making it complicated for Commonwealth and state elections – and possibly even campaigns – to be held simultaneously.
Trying to steer clear of state campaigns would therefore leave very little room for a federal election anytime between mid-October 2018 and May 2019. There is a clear window, however, between August and October this year (bearing in mind the custom of avoiding footy Grand Finals in late September).
Over the summer, many observers had predicted the Prime Minister would opt for an August-September election. The Government had finished 2017 with strong parliamentary performances, wins in the New England and Bennelong byelections and the resignation of “Shanghai Sam” Dastyari. Labor politicians appeared set to face ongoing citizenship issues in early 2018. Some commentators even tentatively suggested the political worm had turned.
Unfortunately for the Prime Minister, Barnaby Joyce put paid to any such momentum and Tony Abbott has ensured any remaining momentum was “dead, buried and cremated”.
As such, Mr Turnbull told a business summit last month that an election would be held in the first half of 2019. Such pronouncements are not set in stone, of course, as those who recall Julia Gillard’s commitment to an election on 14 September 2013 would attest. And, if a shift in circumstances lends itself to an election this year, the August to October window would come back into play.
Short of an unforeseen swing in support towards the Government, the main shift in circumstances that could precipitate an early election would be the Prime Minister’s sense that he was losing support in his own party room. He may then choose to visit the Governor-General and seek to submit himself to the judgement of electors, rather than be removed as leader, which – incredibly – has been the fate of each of the three most recent prime ministers.
If the Government was minded to go to an election in August-October, it would be counting on the personal tax cuts it has telegraphed will be in the May budget providing it with an electoral boost. It would hope to frame a campaign around a narrative of tax cuts under the Coalition versus higher taxes under Labor.
Prospect: Less likely now than it appeared late last year – but remains an option if polls improve for the Government or if the Prime Minister feels the need to jump before he is pushed.
The Prime Minister could technically hold a half-Senate election sooner and a House election later. This would not be unprecedented. In fact, it was briefly fashionable in the 1960s and early 1970s. These days, though, it would be considered unusual and unduly expensive. Therefore, a combined election is likely by 18 May 2019.
When the Prime Minister first glanced at a calendar, he would have quickly become aware that most of the space available for a federal election campaign before May 2019 is already politically spoken for.
Victoria will enter full campaign mode at the end of October ahead of its election on 24 November. Then, soon after the Christmas/January electoral “no-go zone”, the NSW Government and Opposition will hit the hustings for their state election on 23 March 2019.
Overlapping state and federal campaigns are not impossible but are generally avoided, partly because they reduce party fundraising opportunities and partly because they amplify the cross-pollination of state and federal issues, adding unpredictability and noise to media coverage and political “messaging”. There are also technical legislative rules making it complicated for Commonwealth and state elections – and possibly even campaigns – to be held simultaneously.
Trying to steer clear of state campaigns would therefore leave very little room for a federal election anytime between mid-October 2018 and May 2019. There is a clear window, however, between August and October this year (bearing in mind the custom of avoiding footy Grand Finals in late September).
Over the summer, many observers had predicted the Prime Minister would opt for an August-September election. The Government had finished 2017 with strong parliamentary performances, wins in the New England and Bennelong byelections and the resignation of “Shanghai Sam” Dastyari. Labor politicians appeared set to face ongoing citizenship issues in early 2018. Some commentators even tentatively suggested the political worm had turned.
Unfortunately for the Prime Minister, Barnaby Joyce put paid to any such momentum and Tony Abbott has ensured any remaining momentum was “dead, buried and cremated”.
As such, Mr Turnbull told a business summit last month that an election would be held in the first half of 2019. Such pronouncements are not set in stone, of course, as those who recall Julia Gillard’s commitment to an election on 14 September 2013 would attest. And, if a shift in circumstances lends itself to an election this year, the August to October window would come back into play.
Short of an unforeseen swing in support towards the Government, the main shift in circumstances that could precipitate an early election would be the Prime Minister’s sense that he was losing support in his own party room. He may then choose to visit the Governor-General and seek to submit himself to the judgement of electors, rather than be removed as leader, which – incredibly – has been the fate of each of the three most recent prime ministers.
If the Government was minded to go to an election in August-October, it would be counting on the personal tax cuts it has telegraphed will be in the May budget providing it with an electoral boost. It would hope to frame a campaign around a narrative of tax cuts under the Coalition versus higher taxes under Labor.
Prospect: Less likely now than it appeared late last year – but remains an option if polls improve for the Government or if the Prime Minister feels the need to jump before he is pushed.
Option 2: Overlapping state and federal election campaigns (November-December 2018 or March-April 2019)
If the Prime Minister chooses to hold on beyond mid-October, he runs into the campaign periods for fixed-date elections in Victoria and NSW.
As noted, this is awkward – and generally seen as undesirable – but cynics may suggest there could be some strategic advantage to be gained from the conflation of federal and state issues, especially for an unpopular federal government.
The fact that the Prime Minister weighed into the African crime issue in Victoria earlier this year suggests he wouldn't necessarily mind the bleeding of certain state issues into a federal campaign. This issue, together with recent Ombudsman findings around the misuse of electorate officers by some Victorian Labor Government MPs and the fire services disputes that keep flaring up, present political opportunities for the Turnbull Government.
The Liberals currently hold four federal seats in Victoria by 3.2 per cent or less, though this will be affected by the pending electoral re-distribution. Holding all four will be important if the Coalition is to retain government.
The general predominance of federal over state politics means that, notwithstanding duelling campaigns, the PM could still largely set the daily news agenda, though there would be an element of uncertainty that would make his media team nervous.
If this option were under consideration in the PM’s office, it would quickly be deduced that running a federal campaign alongside the Victorian campaign would be a better bet than alongside the NSW campaign. The latter creates a risk of a double backlash vote against the two Coalition Governments.
Certainly, a federal election immediately before the NSW election would be undesirable. It would create a risk that any voters who may have their metaphorical baseball bats ready for the two-term state Coalition Government could take out their frustrations first on the federal Coalition Government.
There is also virtually no chance of a federal election being held at the start of 2019 before the NSW campaign gets underway. A federal election any earlier than March would not only be unusual; it would be unprecedented. There has never – in the history of federation – been a federal election in January or February. Even the least astute prime minister has deduced that Australians do not want their summer beach time interrupted by an election campaign.
So would the PM really consider overlapping federal and state campaigns to muddy the political waters? In truth, probably not. The convention of avoiding simultaneous campaigns, together with the reasons that it would be a bad idea, are likely to outweigh any perceived benefit.
Prospect: Unlikely. An election that overlaps with the Victorian campaign may be more politically advantageous but an election that overlaps with the NSW campaign would buy the PM more time.
As noted, this is awkward – and generally seen as undesirable – but cynics may suggest there could be some strategic advantage to be gained from the conflation of federal and state issues, especially for an unpopular federal government.
The fact that the Prime Minister weighed into the African crime issue in Victoria earlier this year suggests he wouldn't necessarily mind the bleeding of certain state issues into a federal campaign. This issue, together with recent Ombudsman findings around the misuse of electorate officers by some Victorian Labor Government MPs and the fire services disputes that keep flaring up, present political opportunities for the Turnbull Government.
The Liberals currently hold four federal seats in Victoria by 3.2 per cent or less, though this will be affected by the pending electoral re-distribution. Holding all four will be important if the Coalition is to retain government.
The general predominance of federal over state politics means that, notwithstanding duelling campaigns, the PM could still largely set the daily news agenda, though there would be an element of uncertainty that would make his media team nervous.
If this option were under consideration in the PM’s office, it would quickly be deduced that running a federal campaign alongside the Victorian campaign would be a better bet than alongside the NSW campaign. The latter creates a risk of a double backlash vote against the two Coalition Governments.
Certainly, a federal election immediately before the NSW election would be undesirable. It would create a risk that any voters who may have their metaphorical baseball bats ready for the two-term state Coalition Government could take out their frustrations first on the federal Coalition Government.
There is also virtually no chance of a federal election being held at the start of 2019 before the NSW campaign gets underway. A federal election any earlier than March would not only be unusual; it would be unprecedented. There has never – in the history of federation – been a federal election in January or February. Even the least astute prime minister has deduced that Australians do not want their summer beach time interrupted by an election campaign.
So would the PM really consider overlapping federal and state campaigns to muddy the political waters? In truth, probably not. The convention of avoiding simultaneous campaigns, together with the reasons that it would be a bad idea, are likely to outweigh any perceived benefit.
Prospect: Unlikely. An election that overlaps with the Victorian campaign may be more politically advantageous but an election that overlaps with the NSW campaign would buy the PM more time.
Option three: The last-chance saloon (May 2019)
A third option open to the PM is to give NSW voters the opportunity to take out any frustrations with the state Coalition Government on 23 March 2019, draw breath and then brace themselves for a federal campaign starting three weeks later.
The last possible date a simultaneous House and half-Senate election could be held is 18 May 2019 and it would be preceded by a minimum campaign period of 33 days.
An election in May 2019 would involve a campaign that runs over Easter and Anzac Day but this is far from prohibitive. It also would potentially require the passage of interim supply bills to keep the government funded until a new Parliament (and possibly government) could pass a budget.
This option would risk causing election fatigue in the nation's most populous state, potentially making it harder to interest voters (and party donors), but it would give the Prime Minister a year from now to turn around his political fortunes. It also corresponds with his stated intention to hold an election in the first half of next year.
So long as the Prime Minister believes he can maintain party room support for his leadership for another 12 months, this is likely to be his preference.
Prospect: Currently the most likely option, especially if polling fails to improve over coming months.
The last possible date a simultaneous House and half-Senate election could be held is 18 May 2019 and it would be preceded by a minimum campaign period of 33 days.
An election in May 2019 would involve a campaign that runs over Easter and Anzac Day but this is far from prohibitive. It also would potentially require the passage of interim supply bills to keep the government funded until a new Parliament (and possibly government) could pass a budget.
This option would risk causing election fatigue in the nation's most populous state, potentially making it harder to interest voters (and party donors), but it would give the Prime Minister a year from now to turn around his political fortunes. It also corresponds with his stated intention to hold an election in the first half of next year.
So long as the Prime Minister believes he can maintain party room support for his leadership for another 12 months, this is likely to be his preference.
Prospect: Currently the most likely option, especially if polling fails to improve over coming months.
Option four: The tricky option (separate House and half-Senate elections)
There is a fourth option. It’s somewhat quirky – and therefore unlikely – but it might just be to the Prime Minister’s taste, especially if he wants to hold out as long as possible.
The PM could decide to hold a half-Senate election anytime from August this year, potentially alongside some other vote, such as a referendum or plebiscite. A House-only election could then follow in the second half of 2019.
This option appeared to be in play at various stages last year, with a referendum on the cards on indigenous recognition. The outright rejection of that proposal seemed to take it off the table.
Nevertheless, there have been a number of potential referendum or plebiscite topics floated, including in response to the section 44 citizenship problem and the periodic push for a republic.
Indeed, it is the sort of creative use of constitutional processes for which the PM has a knack, something he demonstrated when he advised the Governor-General to prorogue the Parliament in 2016.
The Government could argue that holding a half-Senate election alongside a referendum or a plebiscite would efficiently meet the constitutional requirement for a half-Senate election while providing the space for a campaign to focus on the referendum/plebiscite topic. This would not be the case if a referendum or plebiscite were held alongside an election that could change the Government, with the associated intensity of campaigning.
The main attraction of this option to the PM is that it would allow him up to 18 months to turn around his current polling numbers. It would also provide a little time for party coffers to recover from the Victorian and NSW elections.
It is worth noting that a referendum would require the passage of legislation on the relevant question and at least two months before the referendum itself could be held. There is not yet a subject with sufficient impetus behind it for this to occur.
An accompanying referendum or plebiscite is not necessary to hold a half-Senate election but it would provide a justification for doing so that goes beyond the PM’s own self-preservation.
Prospect: Unlikely but worth bearing in mind. Keep an eye on any early movement towards a referendum (or plebiscite) that may hint at this option being pursued.
The PM could decide to hold a half-Senate election anytime from August this year, potentially alongside some other vote, such as a referendum or plebiscite. A House-only election could then follow in the second half of 2019.
This option appeared to be in play at various stages last year, with a referendum on the cards on indigenous recognition. The outright rejection of that proposal seemed to take it off the table.
Nevertheless, there have been a number of potential referendum or plebiscite topics floated, including in response to the section 44 citizenship problem and the periodic push for a republic.
Indeed, it is the sort of creative use of constitutional processes for which the PM has a knack, something he demonstrated when he advised the Governor-General to prorogue the Parliament in 2016.
The Government could argue that holding a half-Senate election alongside a referendum or a plebiscite would efficiently meet the constitutional requirement for a half-Senate election while providing the space for a campaign to focus on the referendum/plebiscite topic. This would not be the case if a referendum or plebiscite were held alongside an election that could change the Government, with the associated intensity of campaigning.
The main attraction of this option to the PM is that it would allow him up to 18 months to turn around his current polling numbers. It would also provide a little time for party coffers to recover from the Victorian and NSW elections.
It is worth noting that a referendum would require the passage of legislation on the relevant question and at least two months before the referendum itself could be held. There is not yet a subject with sufficient impetus behind it for this to occur.
An accompanying referendum or plebiscite is not necessary to hold a half-Senate election but it would provide a justification for doing so that goes beyond the PM’s own self-preservation.
Prospect: Unlikely but worth bearing in mind. Keep an eye on any early movement towards a referendum (or plebiscite) that may hint at this option being pursued.
Conclusion
It is often observed that the absence of fixed terms for the Commonwealth Parliament creates economic uncertainty, as businesses wait to find out which major party will have the opportunity to enact its policies after an election. Investment decisions are sometimes paused where their viability could be affected by changes to taxation treatment, industry subsidies or the like.
As we approach the end of the second year of the Federal Government’s current term, businesses and individuals considering upcoming investment decisions may be contemplating the risks associated with policy areas where the major parties differ. These include energy policy, superannuation and taxation (notably capital gains tax and negative gearing).
For those who are looking for a timeline for these decisions, there remain a number of options in play – but the smart money would probably be on a federal election in May 2019.
As we approach the end of the second year of the Federal Government’s current term, businesses and individuals considering upcoming investment decisions may be contemplating the risks associated with policy areas where the major parties differ. These include energy policy, superannuation and taxation (notably capital gains tax and negative gearing).
For those who are looking for a timeline for these decisions, there remain a number of options in play – but the smart money would probably be on a federal election in May 2019.