Australian Election: Stormy Waters Ahead
Australia’s conservative government claimed a narrow victory in a week after the July 2 national election.
But Prime Minister Malcolm Turnbull’s coalition government and the opposition Labor party recorded their lowest votes in decades as Australians turned to minor parties and independents, in the longest election in the country’s history.
A big winner was One Nation’s Pauline Hanson, returning from the political wilderness after almost 20 years. Her party has won three seats in the upper house of parliament, the Senate.
Hanson in strongly anti-immigration and against multiculturalism. Her critics call her racist, which she denies.
Without control of the Senate, Turnbull will have to strike deals with Hanson, other minor parties and independents. He also has a wafer- thin majority in the lower house, the House of Representatives.
The 76-seat Senate will have up to 20 independents or minor party members.
And for effective government, Turnbull will also have to deal with independents and minor party members in the lower house, where the government is decided.
The National Party, the rural-based conservatives who form the minor partner in the coalition government, has also increased its strength in comparison to Turnbull’s Liberal Party, giving it more cabinet ministers and a greater say in policy and legislation.
Turnbull's gamble in calling the election backfired badly, with a swing to the center-left Labor opposition and a rise in the popularity of minor parties and independents.
Turnbull's narrow margin of victory over Labor leaves him likely to be forced to rely on independents, who won five seats in the lower house, to ensure the passage of legislation. That raises questions about how effective his government will be in the long term.
Standard and Poor's cut Australia's credit rating outlook to negative from stable last month, threatening a downgrade of its coveted triple A status, over a potential budget impasse.
"We really want to see them start achieving some of their forecasts," S&P official Anthony Walker told a briefing, adding that the cost of refinancing Australia's debt is up to three times more than its foreign currency earnings.
But many analysts expect the government to be forced to another election before its three-year term.
“We don’t yet know what that will mean for the nation, beyond deep uncertainty” wrote journalist Emma Reynolds in The Australian newspaper.