Three weeks to go to the New South Wales election, and it’s been a shocking week for Peter Debnam’s opposition. Yesterday’s Australian described Debnam as “desperate” and getting “deeper into a quagmire”.

Today’s SMH is almost as bad, “with candidates in key marginal seats reporting they are mostly having to raise money without help from head office.”

Labor will still be concerned on a few counts: the worry that it has peaked too soon; the risk of overconfidence leading to a protest vote for the opposition; maybe the possibility that the polls are really recording the electorate’s enthusiasm for Kevin Rudd which won’t necessarily flow through to the state ALP on election day. All the same, one would much rather be Morris Iemma at this point than his opponent.

The betting market reflects that. On Sportingbet, Labor has been backed in from 6-1 on a week ago to 10-1 on. Remarkably enough, 18 months ago it was possible to get 6-4 against Labor – at which point (disclosure!) I put on $200.

Sportingbet is also offering odds on a selection of 14 individual seats. Unfortunately only about half of them are marginal, and they exclude some of the most interesting, such as Monaro, Wollondilly, Terrigal and Menai.

Nonetheless, there are some interesting trends. In Tweed, the government’s most marginal seat (4.0%), Labor member Neville Newell is a narrow favourite, paying $1.85 against $1.90 for his Nationals opponent.

In Penrith, another must-win seat for the opposition on 6.6%, Labor are now strong favourites, paying just $1.60. And in Murray-Darling, where Labor needs a swing in its favour to hold the seat, the punters are backing it to do just that.

No-one knows how good a guide these odds are to the result. At the last federal election, when Centrebet took bets an a range of individual seats, their predictive power was not particularly good.

In last year’s US elections, however, the final odds on individual Senate races gave the right result every time – even though the overall market predicted, wrongly, that the Republicans would retain control.

Adding up separate contests isn’t always going to be the best guide to the total result. If I back four odds-on favourites at the races, that doesn’t mean I’m odds on to get the quadrella.

However horse races are (more or less) independent events in a way that elections are not, so the seat-by-seat odds are probably worth keeping an eye on.

Peter Fray

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