The politics of not doing Stage 3 (Part 5)
Why adopting an alternative is more politically attractive than you might think
If the government wants to do something other than Stage 3, they need to announce it in the Budget this year.
In this series of posts I will explore the politics of adopting an alternative set of policies (A Better Plan).
This article will look at how adopting A Better Plan will set up Labor’s 2025 campaign by investing in a few signature policies which materially benefit the lives of millions of voters.
A Better Plan
Instead of Stage 3, the Labor government could do the following
A $250 tax cut for everyone in FY23 (paid retrospectively in July 2023)
A $500 income tax cut for everyone (from July 2024)
Even cheaper childcare (less than $20 a day per child for 60%+ of families)
More rent assistance (a 40% increase)
Phase 1 of Medicare Dental (covering 7.7m Australians)
26 weeks of Paid Parental Leave (in July 2024)
This plan would cost less than Stage 3 and allow the government to pay off $4.2 billion of the Coalition’s debt in FY25 (costing details here).
Source: FY25 Costs - My estimate based on existing Treasury and Grattan work
A Better Plan sets up Labor’s 2025 re-election campaign by investing in a few signature policies that materially benefit the lives of voters
To maximise the chances of maintaining a majority in the House and maintaining a progressive Majority in the Senate in 2025, Labor should enact policies which materially benefit people’s lives.
If Labor lets the Stage 3 tax cuts come into effect, will they make their passage the centre-piece of their re-election campaign?
I don’t believe they will.
Firstly, they won’t do it because it could create a bidding war with the Coalition for further tax cuts.
Secondly, they won’t do it because focusing an election campaign on an policy area where voters have consistently preferred your opponent’s policies for the last 30+ years is a massive strategic error.
Source: ANU Australian Election Study 2019
This raises the question
What is the point of spending $20 billion a year if it doesn’t even give you something good to campaign on?
If Labor adopted A Better Plan they would have the backbones of a campaign that can show millions of voters how Labor has materially benefitted their lives.
Assuming some of my other ideas on annual leave and flexible working rights are adopted, Labor would have a strong basis for their campaign.
Labor would be able to campaign on the following messages in 2025
Labor has delivered
Even cheaper childcare (less than $20 a day per child for 60%+ of families)
5 Weeks of Annual Leave
26 Weeks of Paid Parental Leave
Protection of your right to flexible working and to Work From Home (WFH)
A 40% increase in Rent Assistance
The first phase of Medicare Dental (covering 8m Australians)^
These policies plus strong execution across other policy areas and leadership stability will create a strong platform for re-election.
My mental model of the typical voter is that they aren’t aware or have forgotten most things that a government does. If you can have 2-3 things that they can recall that have benefitted their life, you’re in with a pretty good chance of winning their vote.
For instance, if voters are thinking the following thoughts in the booth, I think Labor will be in for a strong result.
“Having an extra week of leave is pretty sick. I like that.
“Working from home is good”
“Albo seems like a nice guy”
“Adding dental to Medicare seems like a pretty good idea”
Framing the contest
Given the timeline it may not be possible to implement the first phase of Medicare Dental prior to the election (or it might be best to push back the start date a couple of months to avoid having teething issues pre-election).
If this is the case, Labor can frame the election as a referendum on whether or not we should roll out Medicare Dental. This will put the Coalition in a difficult position and allow Labor to frame an issue where they are expanding healthcare and helping people with the cost of living as a key issue. Labor’s message can be
“Re-elect us and we will start to roll-out Medicare Dental”.
As discussed in previous posts, Medicare Dental is good politics for Labor because
It will appeal to lower income and outer metro voters who are trending away from Labor
It focuses debate on 'Health' which is an issue where voters have always trusted Labor over the Coalition
It will appeal to voters deciding between Labor and the Greens (useful for close seats such as Griffith, Macnamara, Richmond, Brisbane, Higgins)
Adding ‘Dental to Medicare’ offers a tangible and easily understood way of improving the lives of Australians
Efforts to tar it as ‘too radical’ will be ineffective
Its likely opponents (private health insurance executives) are unpopular and unsympathetic figures
Summary
In summary, adopting A Better Plan will give Labor a few signature and legacy-defining policies that will materially improve voters lives and this will improve the likelihood of success for Labor’s campaign in 2025.