Federal Politics

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Labor lifts, Abbott shifts, credibility drifts

LABOR'S national secretary, George Wright, says Australian politics has entered the ''post-carbon'' phase. Labor is back in a ''contestable'' position and the disastrous electoral impact of the tax is over.

Tony Abbott wouldn't admit it - but he seems to think so, too. He mentioned the electricity bill increases suffered by his small-business-backdrop-of-the-day on Monday (a Harley-Davidson dealership) but immediately admitted it was not all the carbon tax's fault.

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Surplus promises looking shaky

A High Court challenge to the mining tax adds doubt to budget forecasts. So can either major party keep their promises of a budget surplus?

A ''post carbon'' world presents problems for the Coalition leader. His answer to the tax was to ''axe'' it.

His latest attack is that the government won't deliver its promised budget surplus. Many economists agree. The Coalition leader's answer is that he would deliver a surplus, every year. But no slogan can sum up the complications in that pledge.

Starting from the same point as Labor, he must account for abolishing the carbon and mining taxes, but keep some of the policies they pay for, personal tax cuts (they cost at least $3 billion a year), his $3 billion a year paid parental leave plan, the $3.2 billion Direct Action plan on climate change and other promises besides. But he has opposed cuts to so-called middle-class welfare, and won't introduce new taxes or broaden the GST.

That leaves billions in spending cuts to be announced before the next election. But business groups are warning the economy is slowing and close to the point where big reductions could be dangerous and self-defeating.


Abbott says his all sums will add up because he will increase productivity - which he might - but certainly not in time to have an appreciable impact on the first Hockey budget, within months of the election.

In a pep talk to Labor's national executive last Friday, Wright argued Labor's vote had returned to almost exactly where it was in early 2011, when the government announced the carbon tax deal and Abbott's preferred prime minister ratings had slumped to ''pre-carbon'' levels.

Labor strategists concede the ''trust'' legacy of the broken carbon tax promise remains.

But the carbon tax gift has stopped giving, and Labor is unlikely to offer another.