19 July 2016

After counting votes for two weeks, Australia finally has a new government

Written by: Nic Jarvis, Head of Public Affairs at Edelman

Government Affairs, News, Public Affairs

At Government House in Canberra today, the Governor-General of Australia Sir Peter Cosgrove swore in the new ministry led by Prime Minister Malcolm Turnbull. After the Coalition’s near death experience on July 2, there was an air of self-congratulations by new and current ministers who will serve in the Federal Government. It was as if the election hadn’t really been as bad as it was for the Coalition as the new ministry gathered on the front steps for the obligatory group photograph. Maybe it was just relief at getting over the line! But as one senior press gallery journalist pointed out yesterday, a win is a win.

Despite pressure to cave in to the conservative right of the Liberal Party and re-install former Prime Minister Tony Abbott to a Cabinet position, Turnbull ignored this and carefully re-shaped his team exactly as he wanted to, leaving the ministry largely intact while rewarding junior Coalition partner the National Party with two additional portfolios and elevating younger MP’s to junior posts. Two junior ministers who lost their seats were replaced with new talent.

Of note, Turnbull shifted his former Minister for Industry and Innovation Christopher Pyne to a newly-created portfolio of Defence Industry to oversee implementation of the Government’s Defence White Paper (and nearly $200 billion in expenditure on new frigates, submarines and patrol vessels). The Government sees the revival of naval shipbuilding in Australia as a key plank in its industrial and manufacturing policy to counter the decline in the mining and resources industry now taking place. Despite promising much of the huge submarine contract to South Australia (where Pyne’s seat is located) the voters of the State actually voted against the Coalition in large numbers – no gratitude there!

Other key economic portfolios and ministers were left as they are with Scott Morrison retaining Treasury, Matthias Cormann keeping Finance and Kelly O’Dwyer as Revenue and Financial Services although she lost the Small Business portfolio to the National Party’s Michael McCormack. This was something of an odd move, given most small businesses are located in urban areas while the Nationals represent the rural constituency.

The talented duo of Julie Bishop and Steve Ciobo retain their respective Foreign Affairs and Trade portfolios, both significant as Australia assesses the future of trade negotiations with a post-Brexit UK and Europe and uncertainty over the future of the Trans-Pacific Partnership that is supported by President Obama but opposed by Trump and getting mixed signals from Clinton.

Another change is Greg Hunt leaving Environment to head up Industry, Innovation and Science while talented Queenslander Matt Canavan gets Northern Australia and Resources. Conservatives Peter Dutton and Alex Hawke control Immigration and Border Protection. Environment and Energy are combined under Josh Frydenberg.

While the Government is now back to work, counting continues for the Senate, Australia’s upper house, with predictions there could be as many as 13 independent or non-party aligned Senators. This process won’t finish until sometime in August. The outcome is a potential political nightmare for any government trying to get its budget and legislation passed. We can be sure that the negotiations are just beginning. The jury on Malcolm Turnbull himself is still out and his performance over the next few months will be closely scrutinised. He has no obvious successor, but it won’t stop the quiet undercurrent about his leadership from continuing, as it has for some time.

One thing the major and minor political parties have agreed to do post-election is to review Australia’s Dickensian ballot counting system. Everyone agrees in a new world of innovation, it shouldn’t take nearly two months to find out the final composition of the country’s Parliament.

A full list of the new Cabinet can be found here.

Nic Jarvis – Head of Public Affairs, Edelman Australia

nic.jarvis@edelman.com

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