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GRACosway Political Week in Review
8 July 2016
Current State of Play

It has been almost a week since voters had their say at polling booths around the nation and while the final election result remains unclear, Prime Minister Malcolm Turnbull says he is still “very confident” the Coalition will form a majority government. Based on results provided by the ABC, the Coalition has so far secured 73 seats to Labor’s 66, with 5 going to the crossbench and 6 still in doubt; 76 seats are required to form a majority government and avoid entering into an agreement with one or more independents or minor parties to form a minority government. At the time of this newsletter, the election outcome hinges on the seats of Capricornia, Forde, Flynn and Herbert in Queensland; Cowan in Western Australia; and Hindmarsh in South Australia. Labor leads in 5 of the uncertain seats, while the Coalition is ahead in 1 but with the trend in postal vote counting significantly favouring the Coalition. The Australian Electoral Commission (AEC) is in the process of counting around 1.5 million postal votes in addition to those from absent, interstate and overseas voters.
Prime Minister Malcolm Turnbull and Opposition Leader Bill Shorten wasted no time in preparing for the possibility of a hung parliament this week, with both leaders seeking to shore up support from members of the crossbench soon after Saturday’s poll. Independents Cathy McGowan and Andrew Wilkie have both ruled out doing deals with either major party in the event of a hung parliament, with Mr Wilkie saying the Prime Minister does not have a mandate to implement the policies he took to the election. Ms McGowan has also dismissed suggestions she may be offered the role of Speaker. Senator Nick Xenophon, who met the Prime Minister on Wednesday to discuss the future of the Whyalla steelworks, has however indicated the Nick Xenophon Team (NXT) was open to a formal minority government agreement with either major party if it advanced the Party’s agenda, while Katter’s Australian Party (KAP) Leader Bob Katter declared on Thursday that he will support a Coalition Government on issues of confidence and supply but reserves his position on all other issues.
Mr Shorten embarked on a tour of new Labor seats on Monday, visiting the western Sydney electorate of Lindsay – claimed by the Party’s Emma Husar at the weekend – to thank voters for backing Labor. Mr Shorten also called on Prime Minister Turnbull to resign, accusing him of introducing “farcical” Senate reforms which expedited Pauline Hanson’s return to politics, and dubbing Mr Turnbull the “David Cameron of the southern hemisphere”. Mr Shorten confirmed he had spoken to some of the independent crossbenchers but ruled out a deal with the Greens. The Opposition Leader continued to thank voters throughout the week, visiting the electorate of Longman in Queensland – where Labor unexpectedly overcame Assistant Innovation Minister Wyatt Roy at the weekend – and Tasmania, where his Party nabbed three lower house seats from the Coalition.
In his first press conference since election night, the Prime Minister told reporters on Tuesday that the Coalition was focusing on talks with crossbenchers from more conservative backgrounds, such as Ms McGowan and Mr Katter, but remained confident of forming a majority government. Mr Turnbull said he took “full responsibility” for the Coalition’s election campaign and conceded there was more work to be done in earning voters’ trust on his Party’s health policies. Opposition Leader Bill Shorten said the Prime Minister led a “divided government” and was considering a “snap election” to resolve the situation, which would return voters to the polls. In response, Coalition frontbencher Senator Mitch Fifield said the Opposition Leader should “take a rest”, and emphasised the Coalition’s focus is on forming majority government.
Unrest among Coalition MPs about the election result has prompted a call for unity from former Prime Minister John Howard, who urged members to “remember the character of their Party” as a “broad church”. Meanwhile, South Australian Liberal Party Senator Cory Bernardi announced he will instigate a new conservative cross-party political movement – the Australian Conservatives – to unite those who support traditionally conservative ideas, such as small government and lower taxes. Senator Bernardi confirmed however, that he did not intend to establish his own political party.
Based on the uncertainty around the Federal Election result, ratings agency Standard and Poor’s (S&P) changed Australia’s AAA credit rating outlook from “stable” to “negative” on Thursday. S&P stated that “fiscal consolidation may be further postponed” if neither of the major parties are able to form a majority in either house of Parliament, and said that ongoing budget deficits may persist without “more forceful fiscal policy decisions”. Treasurer Scott Morrison said the S&P announcement underscored the importance of further budget savings and warned against Labor’s plan for a short-term increase to the Budget deficit. 
Election Result Highlights 
  • The seat of Gilmore on the south coast of NSW was secured in the Coalition’s favour on Thursday after previously being labelled too close to call – Liberal Party incumbent Ann Sudmalis currently has 50.7 per cent of the two party preferred (2PP) vote.
  • The Chisholm electorate in Melbourne’s east has also been categorised as a Liberal win, with Julia Banks achieving 51.3% of the 2PP vote.
  • The rural South Australian seat of Grey looked at risk of falling to the NXT earlier in the week, with the Party’s candidate Andrea Broadfoot securing 28.1 per cent of the primary vote – Liberal incumbent Rowan Ramsey subsequently pulled away with a strong postal vote securing 52 per cent of the 2PP vote at last count.
  • The AEC confirmed there was a “mix-up” in the West Australian electorate of Pearce where 105 voters were given Victorian Senate ballot papers and which have now been determined as informal.
  • The Labor caucus is meeting in Canberra today, where it is expected Bill Shorten will be re-nominated Labor Leader. Additional nominees have a week to declare their interest in the leadership.
  • Cabinet Secretary Arthur Sinodinos has conceded the Coalition underestimated the extent of community sentiment about Medicare during the election campaign and will aim to be “the best friend Medicare ever had”.
  • Re-elected Greens MP for Melbourne Adam Bandt said the Parliament may have an opportunity to legislate same-sex marriage without a plebiscite if Coalition MPs are given a free vote.
  • Current and former Australian politicians responded to the release of Britain’s Chilcot Inquiry into the Iraq War on Thursday, with Tasmanian Independent Andrew Wilkie calling for an Australian inquiry into the matter and saying political leaders have “blood on their hands”. 
Terms of Senators in the New Parliament

In the Upper House, questions have begun arising about how the duration of Senate terms will be decided following the July 2 double dissolution election.
The Australian Senate comprises 76 senators: 12 from each of the six states and two each from the mainland territories. Senators elected by the states normally serve a six-year term, with a half-Senate election of Territory Senators occurring every three years to maintain the balance of the Senate. In the instance of a double dissolution election however, all 76 Senate seats are subject to re-election at the same time.
Under the Constitution, the Senate as a whole is given the power to decide how it will be divided following a double dissolution and must determine which Senators will serve three years and which will serve six via one of two methods: the ‘countback’ method or the traditional ‘order elected’ method. The countback method favours those candidates – usually larger parties – which secure a larger proportion of the 2PP vote, while the order elected method benefits candidates that secure a larger proportion of the first preference vote.
The Commonwealth Electoral Act was amended in 1984 to introduce the countback method, which was considered a better fit for the proportional voting system used in the Upper House. The Senate, however, chose not to use the countback method following the 1987 double dissolution election and reverted to the order elected method using its power to override the electoral legislation granted under the Constitution.
The order elected method has been used at each of the six double dissolution elections held and provides that the longer six-year terms are given to the first six Senators in each state that achieve the 7.69 per cent quota required for election in a double dissolution. Notably, during the 2010 Gillard Minority Government, the Senate voted in favour of using the countback method for all future double dissolutions; the Parliament is not bound to follow this course of action.
Victorian Senator-elect Derryn Hinch has already objected to potentially being relegated to a three-year term in the Senate and has indicated the possibility of seeking a High Court challenge should this occur.

Policy Wrap Up

NSW Premier Mike Baird announced that greyhound racing will be banned in the State as of 1 July 2017, following the final report of a Special Commission of Inquiry led by former High Court Judge Michael McHugh. Premier Baird labelled the report “chilling” and said the decision to shut down the greyhound racing industry was “not taken lightly” but is “the right thing to do”. The NSW Government will present an industry shutdown plan in the second half of 2016 after consulting with industry and animal welfare stakeholders. NSW will be the first Australian jurisdiction to ban the practice. In response to Premier Baird’s announcement, ACT Chief Minister Andrew Barr concurred and said there is "no future for the industry" in the territory and would consider the findings of the Report before announcing a timeline for the ACT to follow suit. See Premier Baird’s media release: Greyhound racing to be shut down in NSW.

The South Australian Budget was handed down on Thursday, featuring a $254 million surplus for 2016-17 and a focus on jobs creation, health and education measures. Treasurer Tom Koutsantonis said the Budget brings South Australia “back in the black” while also providing a buffer against economic uncertainty and responses to the State’s high unemployment rate. Key measures include a $50 million investment to extend Adelaide’s tramline and $250 million for building and upgrades to science, technology, engineering and mathematics (STEM) facilities in public schools. See GRACosway’s briefing note on the SA Budget here.

No parliaments are scheduled to sit next week.


State Developments

Two new wind farms will be built in regional Victoria after Minister for Energy, Environment and Climate Change Lily D’Ambrosio announced State Government support for the projects with ACCIONA Energy and Windlab. The Government expects the wind farms will create $220 million worth of new investment and hundreds of jobs, while powering around 80,000 homes. The wind farms will be located in Mt Gellibrand and Kiata and are part of the State Government’s focus on large-scale renewable energy. See media release: Two new wind farms for Victoria.
The West Australian Minister for Energy Mike Nahan announced that regulatory compliance and enforcement of WA’s energy markets has been transferred from the Independent Market Operator to the Economic Regulation Authority. It is expected the Independent Market Operator will be abolished by the end of 2016. See media release: Local regulator to monitor WA energy markets.
The NSW Government has announced the sale of Delta Electricity’s Brown Mountain Power Station and Cochrane Dam to Cochrane Dam Pty Ltd, a wholly owned subsidiary of Hydro Power Pty Ltd, for gross proceeds of $4.5 million. According to NSW Treasurer Gladys Berejiklian, the sale is part of the State Government’s broader strategy to reduce debt by divesting power assets. See media release: Sale of Mountain Brown Hydro Power Station.
In Queensland, Natural Resources and Mining Minister Anthony Lynham said “something has to be done” about the State’s Land Court, which is becoming “untenable” as major projects are being held up by appeals. Minister Lynham also foreshadowed the State Government’s plan to reform farmland laws in a bid to clarify land that is available to resources companies and that which is “too valuable to mine” by using a “more efficient court process” to maximise productivity. See coverage by The Courier Mail here (subscription service).

State Developments
Transport for NSW (TfNSW) has announced a feasibility study to construct ferry wharves at La Perouse and Kurnell. The wharves would be used to operate a ferry service across Botany Bay and connect south east Sydney and the Sutherland Shire. The Government has invited the NSW community to provide feedback on the proposal. See media release: Government calls for community feedback on La Perouse to Kurnell Ferry Wharves study.
NSW Transport Minister Andrew Constance has announced that paper tickets will no longer be sold or accepted on public transport in Greater Sydney from 1 August 2016. In order to facilitate the transition, the NSW Government aims to have single-use Opal cards available on all transport modes by the 1 August deadline. The Government will undertake an information campaign to encourage those commuters not using Opal to make the change. See media release: The last paper tickets to be wrapped up on August 1.
Victorian Transport Minister Jacinta Allan has announced that Japanese company NTT Data has won the contract for the continued operation of public transport system myki, valued at $700 million over seven years. Minister Allan said the new contract will see the introduction of innovative new features, including the ability to use the system with either a credit card or smart phone. See media release: Stronger Myki contract paves the way for improvements.


State Developments

The Queensland Government has launched the Queensland Alcohol and Other Drugs Action Plan 2015-17, which aims to address harm caused by binge-drinking and other drugs by outlining 54 prevention and treatment initiatives to reduce alcohol-fuelled violence. The plan will work in unison with the Government’s recently-introduced legislation to reduce alcohol service hours and ban the sale of high-alcohol content drinks after midnight. See media release: Binge drinking and drug use targeted in new action plan.
Victorian Minister for Health Jill Hennessy has released the Government’s new End-of-Life and Palliative Care Framework. The Government will supply $7.2 million in funding to provide the infrastructure needed to enable more Victorians with terminal illnesses to die at home. The funding will also support the expansion of specialist palliative care expertise, training for GPs and additional respite services.  See media release:  More Victorians to have their end-of-life wishes respected.
NSW Minister for Health Jillian Skinner has announced the State’s first Health and Arts Framework, which seeks to integrate arts into the NSW health care system. The Framework builds on the health art initiatives already underway in hospitals and health facilities and will ensure the arts sector continues to play a role in the look and feel of hospitals. See media release: NSW leads the way in Health and Arts collaboration.

About GRACosway
GRACosway is Australia's leading public affairs and corporate and financial communications counsel, and has been assisting organisations understand and navigate elections at federal and state levels for over 20 years. The firm provides a full suite of integrated services to a range of domestic and international clients across all industry sectors, including public policy, communications, regulatory, issues management and media relations advice. From offices in Sydney, Melbourne, Brisbane, Adelaide, Canberra and Perth (GRA Everingham), GRACosway’s clients benefit from the combined experience, expertise and strategic perspective of our team of professionals in addressing complex and commercially sensitive projects. For more information, visit
GRACosway is a Member of the Clemenger Group. 
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