ALP’s services focus stakes out different ground to handout-happy Coalition

Despite talk of Labor’s small target strategy and an “election about nothing”, the opposition goes into the election with a markedly different approach to government than the Coalition. And that was reinforced last night by Anthony Albanese in his budget reply speech.

The election has devolved into a contest over how to use Australia’s permanently bigger government and years of budget deficits. The Coalition’s budget pitch is handouts, pork-barrelling in the regions and help for small business. Labor’s focus is more on government services.

That’s services in the broad sense, including services provided by the private sector but which are funded by government — in effect, childcare and aged care.

Aged care was front and centre last night, with a $2.5 billion commitment to more nurses and aged care staff as well as stronger regulation of the sector. That’s separate from the so-far-uncosted commitment to fund whatever increase in aged care wages the Fair Work Commission decides on in the current work value case.

Albanese led off his first budget reply in 2020 with a commitment to a big expansion in childcare subsidies, which the government has, in the interval, mostly matched. But he still mentioned childcare last night. He deliberately placed both aged care and childcare into the longstanding narrative that Labor delivers the big social capital reforms: Medicare, superannuation, NDIS.

While the government’s budget focus of handouts was dictated mainly by its polling panic and cost-of-living pressures — and there’s nothing “small government” about a party that commits to permanent increase in government spending as the Coalition has — the contrast between handouts and more government services fits the broad ideological narratives both sides like to claim for themselves. Morrison might have only used “can-do capitalism” once and then realised what a dumb idea it was, but there’s something of that spirit in the idea of throwing taxpayers’ money back at them to help with the bills.

The political problem is that this is a sugar hit. As Albanese pointed out last night, the government is offering one-off payments and short-term excise cuts. The contrast, he could have added, was with an opposition that wanted to build and improve permanent social services.

The history of Labor’s big social capital reforms is of initial opposition from the Coalition — often for many years — but a reluctance on the part of conservatives to wear the political cost of reversing them. John Howard eventually abandoned his ambition to “gut” Medicare; the Liberals continue to despise superannuation but their attacks on it always blow up in their faces, and they know the political cost of any fundamental change like ending rises in compulsory super. And the budget papers now have what they call a “maturing” NDIS reaching its full extent as a major Commonwealth program in coming years.

On aged care, don’t be surprised if this process is accelerated dramatically and the Coalition caves in on aged care funding ahead of the election campaign. Why? The government has significantly expanded aged care funding since the royal commission report early last year — but mostly through more spending in home care. It has also been trying — though not particularly hard — to pass the foundational legislation for a number of reforms that will implement the royal commission recommendations.

But that’s been forgotten in the focus on the aged care workforce pay rise, which the Coalition has allowed to become totemic of its attitude to the sector, along with the bumbling, disgraceful performance of Richard Colbeck. Labor has seized on the issue as a point of difference. The government might be criticising Labor now, but the political logic suggests there’s little to be gained from continuing to hold out.

Whether it makes much difference remains to be seen. Bill Shorten began the 2019 election with a big, headline-grabbing commitment to cancer funding, meant to illustrate that there would be benefits to all the tax rorts Labor said it would close. It did Labor no good at all in the face of scare campaigns from Morrison and the media.