IS THE TIDE SHIFTING AGAINST STATE LABOR

UNCLAS SECTION 01 OF 02 CANBERRA 000896

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: PGOV AS
SUBJECT: IS THE TIDE SHIFTING AGAINST STATE LABOR
GOVERNMENTS?

REF: CANBERRA 864


1. (SBU) SUMMARY: Recent swings against the Australian Labor
Party (ALP) in the Western Australian (WA) and Northern
Territory (NT) state elections may indicate that voters are
tiring of long-serving Labor governments around Australia.
On August 9, in NT, there was a nine percent swing against
the ALP, shocking many observers who had expected the Labor
government to lose only a few seats. While Labor was able to
remain in power in NT, it suffered a seven percent swing
against it in the September 6 WA state elections. Although
there are six seats still undecided, Labor lost its majority
in parliament and may now face a Liberal-National Party
coalition government (see Perth septel). Despite the fact
that the Rudd Government remains very popular in national
opinion polls, these results, particularly in WA, have given
the federal Liberal-National Party Coalition a big
psychological boost. In two federal parliamentary
by-elections on September 6, as expected, the Liberal Party
held Alexander Downer's seat of Mayo in South Australia and
an independent won a New South Wales seat formerly held by
the National Party (reftel).


2. (SBU) If the Liberal and National parties form a
government in WA (the two parties are in coalition federally
but not necessarily in all states),it will end the dominance
of the Labor Party in state and federal government. Some
observers maintain that these state election results are a
warning to Prime Minister Kevin Rudd that voters will punish
governments that do not deliver, and who call early elections
(as WA Labor Premier Alan Carpenter and NT Chief Minister
Paul Henderson both did). Others have suggested the votes
reflect uneasiness about wall-to-wall ALP governments.
Whatever the meaning of these results, it is clear Labor
premiers will now be focusing on their political survival,
which will affect how they view Kevin Rudd's attempts at
"cooperative federalism" with the states. END SUMMARY

NORTHERN TERRITORY AND WESTERN AUSTRALIAN SHOCKS FOR ALP


3. (U) In the August 9 NT state elections, the nine percent
swing against the ALP cost it six seats, leaving it with a
one-seat majority in the 25-seat parliament. Most political
observers had expected the ALP to lose 3-5 seats. Instead,
the ALP received only 43 percent of the primary vote while
the Country Liberal Party won 45.6 percent.


4. (U) In WA, ALP Premier Alan Carpenter called an early
election after the opposition Liberal Party changed leaders.
The move backfired as the voters blamed Carpenter for having
to vote early, and the new Liberal leader was much more
credible than his predecessor. The swing against the ALP was
seven percent, much greater than expected, and the ALP may
not be able to form a government once the counting is
finished (septel). At this point, the conservative National
Party holds the balance of power in the new parliament and
the betting is that it is more likely to form a coalition
with its traditional conservative ally the Liberal Party.

FEDERAL BY-ELECTIONS RESULTS AS PREDICTED


5. (U) In the federal by-elections in the seats of Mayo in
South Australia and Lyne in NSW there were no surprises.
Liberal Party candidate and former Howard staffer Jamie
Briggs beat Green Party and Family First candidates to win
the seat, although the Green candidate ran a strong second
with over 46 percent of the final vote. Extremely popular
Qwith over 46 percent of the final vote. Extremely popular
former state politician Rob Oakeshott, running as an
independent, won the seat of Lyne in coastal NSW. While a
demographic shift meant that Lyne was no longer a safe seat
for the National Party, Oakeshott won going away (see
reftel).

PSYCHOLOGICAL BOOST FOR COALITION


6. (SBU) Last week, high-profile Liberal MP Tony Abbott told
us a Liberal victory in the Western Australian election would
be a "big psychological boost" for the Federal Coalition. He
also said that conventional wisdom was that most governments
get two terms, but that winning a third is a big challenge.
As was the case federally in 2007, voters in the Northern
Territory and Western Australia turned on long-serving
governments. Following the Western Australian election, some
Coalition MPs portrayed the result as a backlash against
Rudd. Editor-at-Large of "The Australian" newspaper Paul
Kelly contended that the "vote in Western Australia
highlights not just state ALP failure but a visceral national

CANBERRA 00000896 002 OF 002


dislike of the coast-to-coast dominance of the Labor Party."

LONG-SERVING GOVERNMENTS


7. (SBU) The ALP has been in power in WA and NT since 2001,
in NSW since 1995, and in Tasmania since 1998. The
Queensland ALP has run the state since 1998, and Labor has
ruled Victoria since 1999, the ACT since 2001 and South
Australia since 2002. Popular premiers Steve Bracks in
Victoria and Peter Beattie in Queensland both resigned last
year, replaced by competent administrators who are not as
popular with the voters.

WARNINGS FOR RUDD


8. (SBU) Melbourne's tabloid the Herald Sun claimed the
Western Australian election reflected on the Rudd government:
"It is clear that the Rudd Government's honeymoon with voters
is over ... As Labor battles a hostile Senate, an emerging
criticism of Mr Rudd is that he is more of a talker than a
doer." The Sydney Morning Herald's political editor, Peter
Hartcher, wrote: "for the Rudd government, which holds power
with a margin of two per cent, the implication is clear. The
state Labor model of the status-quo plus spin - is a bankrupt
one. Solve problems, or we'll be cranky." It is likely
there will be five more long-serving ALP state and territory
governments facing the voters before the next federal poll.
There will almost certainly be swings against the ALP in each
one.

COMMENT: NO NEED FOR RUDD TO PANIC


9. (SBU) The Australian's Paul Kelly likely exaggerates the
impact of "wall-to-wall" ALP governments on voting intention.
The Western Australian ALP government has long been plagued
with incompetence and scandal. The result would have been
similar even if the Coalition were still in power in
Canberra. In state elections, state issues dominate. A big
factor in WA seems to have been the installation of a
credible alternative premier in the Liberal Party's Colin
Barnett. The incompetent, long-serving ALP government in NSW
only survived the 2007 election because of Workchoices, and
the fact that Opposition Leader Peter Debnam was not seen as
a credible alternative by the voters. Rudd continues to
dominate the opinion polls and enjoys strong support for the
big item of his first term - an emissions trading scheme.
The WA result is a reminder to Rudd that voters severely
punish poor performance and scandal, and a reminder to the
Liberal Party that voters are more likely to make a change if
they feel the opposition has a credible leader.


10. (SBU) Ironically, it might even be in Rudd's interest to
play hardball with unpopular state governments, which he is
doing on schools standards and hospitals, for example. While
the state ALP governments may believe they need to
demonstrate their independence from Rudd, they may also feel
they need some of his popularity in order to survive another
election. For the Liberal Party, out of office everywhere in
Australia, a return to government in Western Australia would
be a huge boost, particularly for the Party's ability to
fundraise.

MCCALLUM