This is a very good budget and both the Howard Government in general and Peter Costello in particular deserve credit for it. However, while it will improve the Coalition’s poll ratings in the short term, I do not believe this budget will save the Coalition from defeat come November. Voters quickly forget benefits like these. Herein lies the tragedy of Peter Costello. In my opinion he will have a gloomy election night. For him personally the only consolation will be the fact that he will retain Higgins easily while watching the Howard Government crash around him, with Howard also losing Bennelong. So the reward for Costello’s work will be to be elected leader of the Liberal Party unopposed — which will place his name among those men who have served as Leader of the Opposition. I still think this election will be, in effect, a referendum on Work Choices — though Iraq and climate change will also be issues. The Australian people will vote for the repeal of Work Choices. Before going to the people, Howard will have softened Work Choices with a fairness test, a manoeuvre some of our sillier commentators will liken to the way Howard modified his GST package in the autumn of 2001.
What they overlook is that Howard had a mandate for the GST which he had gained from presenting it to the people at the 1998 general election. In those days he was still known as “Honest John” and, therefore, he could make minor changes to the GST because he had some credibility. Consequently he won public endorsement at the November 2001 general election to keep the GST, free from the rollback promised by a Labor party which then enjoyed very little credibility. Since the Coalition will have a Senate majority until June next year (regardless of the Senate result in November) their re-election in November would leave them free to decide that the fairness test requires too much bureaucracy to be workable. It can easily be repealed and voters will know that. A political leader can implement major change if he is honest with the electorate. Thus the GST and Telstra privatisation were never popular with the general public but they have been accepted as legitimate because Howard had a mandate for them. By contrast, in my opinion, Howard’s deceit over Work Choices ensured it was doomed from the very beginning. Assuming I am correct in these predictions it will do huge damage to John Howard’s current reputation. How, then, could he have saved that reputation? Two things, I suggest. First, he could have used his Senate majority to implement only such measures for which he could reasonably claim an electoral mandate. That is what Bob Menzies used to do. If Howard had done that he would have had no trouble to win this election, given Australia’s strong economy. In that circumstance this budget would have guaranteed another Coalition victory. The other thing Howard could have done was keep his 1994 deal with Peter Costello. He could then have engaged in the orderly transition of Prime Minister so wanted by many in his party. If he had done that then Prime Minister Costello would have suffered the electoral humiliation which Howard has chosen to bring upon himself.