Super caps to fragile votes could be a touch audacious

“Not surprisingly, with so much on its plate, the government can afford to treat the Aston byelection as something of a sideshow. It sees it as secondary to getting on with its three ‘Rs’ of ‘relief, repair and restraint’.”

On the very day the speaker announced the surprise date for the byelection in the Melbourne seat of Aston – April 1 – the treasurer startled others with a shock announcement of his own.

On Monday, Jim Chalmers began “a conversation” about the burgeoning cost of billions of dollars’ worth of tax concessions for superannuation. Within 30 years, they would top the amount forked out for the aged pension. He said he was not convinced “that’s a sustainable way to get to our destination – good retirement incomes for more Australians, now and into the future”.

It was a shock because Anthony Albanese had ruled out touching tax concessions after the 2019 election loss. Virtually on the eve of the May election, he assured voters “we have no intention of making any super changes”. This week, at the National Press Club, he updated his language and brought himself more into line with the treasurer’s pre-election formula.

In March last year, Chalmers began talking about superannuation, saying “Australians shouldn’t expect major changes … if government changes hands”. It may all revolve around a definition of “major changes”. Not surprisingly, the opposition leapt at the opening the treasurer was providing. Shadow Treasurer Angus Taylor completely ignored questions of equity or cost. He accused the government of a serious broken promise.

Taylor told Sky News: “It is clear the prime minister said one thing before the election and he’s saying something quite different now.”

Chalmers says his kite-flying doesn’t “necessarily” mean we will see adjustments to super arrangements in the upcoming budget, to be delivered on May 9. He certainly intends to push legislation for a definition of superannuation, so future governments can’t subvert its primary purpose. That definition would be: “to preserve savings to deliver income for a dignified retirement alongside government support in an equitable and sustainable way”.

This looks like the treasurer setting the scene for a crackdown on excessively high super balances, which the assistant treasurer, Stephen Jones, points out “don’t seem to have any bearing or relationship with retirement income” but are rather acting like a tax shelter for wealthier Australians.

Chalmers is attracted to capping balances in accounts that can receive the generous tax concessions. The industry itself has suggested $5 million. The Grattan Institute thinks that is still too generous and proposes a cap of $3 million on accounts. That’s a long way from the average balance for most people, which Chalmers identifies at $150,000.

The treasurer says fewer than 1 per cent of people in the system have balances higher than $3 million. The average among that group is $5.8 million. But the lion’s share of the $50 billion the tax concessions cost annually goes to this group.

Chalmers told RN Breakfast the government has to work out “where we get the most value for money when it comes to some of these tax concessions”. He says it hasn’t “come to a view on a proposal”.

What will spur him to come to a view more quickly are the competing challenges of budget repair – easy to say but hard to do without decisions that inevitably cause pain for someone. Chalmers must “make room” in the budget to deliver the Fair Work Commission’s wage rises for aged-care workers, to strengthen Medicare and to fund the ambitious national security agenda Albanese committed to this week.

Confronting the broken-promise charge this week, the prime minister ran for the hills. “We haven’t made any announcements at all,” he said in Port Hedland on Tuesday, continuing: “the long-term issue of superannuation is something we need to deal with. My government makes no apologies for pointing out what the future looks like.”

Not surprisingly, with so much on its plate, the government can afford to treat the Aston byelection as something of a sideshow. It sees it as secondary to getting on with its three “Rs” of “relief, repair and restraint”. Albanese and Chalmers are not allowing considerations such as the profile of the seat to distract it. Aston has a significant number of wealthier, self-employed tradies and contractors, who could be susceptible to a scare that says the treasurer is coming after them.

Labor is bracing for the Liberal Party to rummage through its store of old slogans, such as “Labor will tax you to death”, or to adopt the line, “Labor is coming after your nest egg”. Perhaps the treasurer’s timing is also a sign the government doesn’t give itself much chance of winning anyhow. One hundred years of byelection history would suggest they are certainly the underdog. It is that long since a government took a seat off an opposition at such a contest.

Aston is, however, no sideshow for

Peter Dutton. It is a moment of truth for his leadership. As one Melbourne MP puts it: “If the Liberals lost Aston, it would be shocking news for the party leader.” It would amplify doubts about his electoral appeal, already harboured in sections of the parliamentary party. According to some Liberals, his deputy, Sussan Ley, is ready and willing to step up.

The speaker’s poll date is the earliest possible under the relevant act. He caught the Liberals and the Greens by surprise. The Greens are yet to select a candidate. The Liberals, amid much internal displeasure, ditched a planned plebiscite of local preselectors and replaced it with a hurriedly convened administrative committee process on Tuesday night.

State party president Greg Mirabella wrote to party members, explaining that “every day we do not have a candidate we are losing votes”. Never mind that last Friday Dutton bagged the Labor Party for not being democratic in its preselection of candidate Mary Doyle. He said the Liberals wouldn’t make the same mistake. He was wrong on both counts. Doyle was Labor’s uncontested candidate and the Liberals rode roughshod over their grassroots members.

In a byelection these issues assume much greater significance than at a general poll. At least the Victorians did not embarrass Dutton by ignoring his pleas for a female candidate. Three presented their credentials, with barrister and City of Melbourne councillor Roshena Campbell winning on the night.

According to a party source,

Campbell ticked two boxes the Liberals needed to address after last year’s election defeat: she is a woman with an ethnically diverse background.

Campbell is also well connected to the Melbourne media. Her husband, James Campbell, is the national weekend political editor for News Corp papers and websites. Roshena says she will immediately move into the outer Melbourne seat from the family terrace in Fitzroy. By polling day, she says the voters will have a local promising to

“fight for them”.

Dutton says the reason for the April 1 poll date is clear: Albanese wants it held before the May budget, where he says the government will break its promise of no new taxes.

Dutton says he intends to visit the seat “many, many times” during the campaign. He brings the baggage of being a high-profile member of the Morrison government, who was particularly outspoken on the threat posed by “Communist China”. The electorate’s biggest single ethnic minority is 22,422 Chinese–australian voters, according to the Australian Bureau of Statistics’

2021 census results. Last May, they were a significant factor in the Liberals losing support in electorates with a similar or greater number of these voters. What sort of message the Liberals will be urging voters to send the government is yet to crystallise. Sure, all sides agree that cost of living and interest rates are the key issues but, apart from blaming Labor, the Liberals haven’t come up with any solutions and in fact have voted against relief packages.

Labor will be hoping the Greens do as well as they did last May. The preference flow from the party’s 11,855 votes helped Labor come within 2.8 per cent of winning.

Greens leader Adam Bandt has joined Dutton in attacking the government over cost of living. One solution he offered at the weekend, that the treasurer use powers in legislation to override the Reserve Bank, is dangerous populism.

Economist Stephen Koukoulas says such a move would court disaster, similar to what the conservative government of Liz Truss suffered last year when markets severely marked down its mini-budget, causing the pound to collapse and interest rates to skyrocket.

Bandt wants to turn the byelection into a protest against both the major parties. He highlights their support for new coal and gas and for the stage three tax cuts “benefiting billionaires”. It’s hard to see these issues cutting through too much in Aston, though. The seat is no Kooyong or Mackellar.

Climate 200 founder Simon Holmes à Court has been unable to find a community candidate exercised by the issue in the same way as in the teal seats last year.

For Labor candidate Mary Doyle, big positives are the findings of the three opinion polls published this week showing Labor’s honeymoon is far from over and Albanese is substantially more popular than Dutton, who continues to flatline.

Polling analyst Kevin Bonham says, looking at the raw figures in all the polls, “Anthony Albanese will be hoping his honeymoon remains this much over forever.”

“It is indicative of how backwards we have become that some in the Coalition are still promoting a new coal-fired power plant for north Queensland, even though there is no net demand for power in the region, even though major international banks won’t fund it, even though equity investors are equally reluctant…”

Last week I visited one of our local nurseries with my wife, Jessica. The manager’s cottage had two small signs displayed in his window: “Climate Change Action Now” and “Fossil Fools”. They seemed like an omen of the Albanese government’s safeguards legislation and the response of the Greens.

The government struggled last year to get parliamentary approval for its target to achieve emissions reductions of 43 per cent by 2030, en route to net zero by 2050. It now needs the policy framework to achieve that 2030 target.

Of course, Peter Dutton’s opposition is totally opposed, consistent with its overarching strategy of “nope” on just about anything that the prime minister wants to do, even where he has a clear election mandate.

The opposition’s position is just blatant hypocrisy given that they initially proposed the safeguards approach. This hypocrisy is compounded by their constant bleating about prospective increases in electricity and gas prices and Anthony Albanese’s failure to deliver promised cuts in household power bills, when the former minister for Energy and Emissions Reduction, Angus Taylor, withheld advice about rising power prices until after the election. I must admit that I am finding it totally frustrating just watching Dutton and his team in parliament.

The Greens seemed to initially make their support for the safeguards conditional on the Albanese government also committing to