Jim Chalmers knows the government is under the pump and he says Labor must up its game to battle inflation, the unintended consequences of its May budget and keep voters’ trust through a painful period of interest rate rises.
uncertain
Labor → know → rises
While the federal government is not yet in panic mode – and it would still beat the fractured right-wing if an election were held today – Labor MPs returning to Canberra this week described a level of voter frustration they have rarely encountered during Anthony Albanese’s prime ministership.
asserted
they → beat → ministership
The economic circumstances have shifted sharply against a government that had hoped to make its second term a story of fairness, reform and rising living standards.
asserted
term → shift → fairness
Donald Trump’s war in the Middle East has compounded Australia’s entrenched inflation problem.
asserted
war → compound → problem
As ministers were putting finishing touches on its equity-focused budget, inflation was firing up again unexpectedly, putting a premium on fiscal restraint and growth.
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inflation → put → restraint
Ministers and MPs say the caucus is more unsettled and irritable than at any point since Labor came to power, despite a thumping election win just last year and a remarkable period of stability by the standards of contemporary politics here and abroad.
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Labor → say → politics
Some in Labor want a strategic reset on its economic settings rather than a fresh political sales job.
asserted
Some → want → job
They worry Albanese has lost his public authority.
asserted
Albanese → worry → authority
Many others lament a breakdown in relations between the caucus and Chalmers, who they say has alienated many by being too sensitive to feedback.
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they → lament → feedback
“I do get the government is under political pressure right now on a whole range of fronts and I do take responsibility for my share of that,” Chalmers told this masthead on Friday when contacted for this story.
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Chalmers → get → story
“I like and respect my colleagues and I take the concerns they raise with me directly or express in other ways really seriously.
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they → like → ways
I’ve always operated on the basis that nobody is above or beyond criticism and everybody can do better, me included.”
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me → operate → criticism
Albanese did little to quiet speculation about tensions at the heart of the government on Tuesday when he suggested at the Australian Chamber of Commerce and Industry’s annual dinner that he had personally intervened to reverse an Australian Taxation Office ban on credit card payments.
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he → do → payments
“Andrew did text me last Thursday morning, and by Friday morning we had an announcement,” Albanese said of ACCI chief executive Andrew McKellar.
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Albanese → text → McKellar
“That was an example of a relationship that takes time to develop.
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that → take → time
That trust, where you can have a discussion and say ‘it is in hand, I agree with what you are saying, and I will get it done’.”
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it → have → what
There was no mention of Chalmers, who announced the backflip alone last week.
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who → be → backflip
Albanese’s allies dismissed the comments as him simply flattering his audience.
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him → dismiss → audience
Regardless of intent, the optics were unmistakable: the treasurer had presided over another unpopular decision and the prime minister was taking credit for putting it right.
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minister → preside → it
Those close to Chalmers say he was “stung”.
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he → say → Chalmers
The moment was not unlike previous flare-ups, but poor polls and economic gloom have made the Albanese-Chalmers dynamic more salient.
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dynamic → make → ups
The Coalition picked up on tensions after a meeting with Angus Taylor and Albanese in August.
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Coalition → pick → August
The prime minister was grappling with another unintended consequence of Labor’s fiscal blueprint from May.
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minister → grapple → May
The so-called widow’s tax, as critics had labelled it, threatened to strip bereaved partners and divorcees of tax concessions.
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critics → call → concessions
A minor flaw had become emblematic of a budget that needed several carve-outs, which eroded goodwill for the brave attempt to reduce property speculation and concessions to wealthier Australians.
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which → become → Australians
Chalmers had said publicly he was in no rush to patch up the widow’s tax.
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he → say → tax
But after Taylor went public asking for a quicker change in return for supporting Labor’s NDIS reforms, Labor’s position switched.
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position → go → reforms
Sources familiar with the conversation on the Coalition side say the two leaders discussed repealing the widow’s tax and that Albanese indirectly reflected on Chalmers’ strategy during the exchange.
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Albanese → say → exchange
Taylor and his office declined to confirm.
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Taylor → decline → ?
Labor denied that Albanese said any such thing and it believes the Coalition is spreading untruths.
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Coalition → deny → untruths
But whispers about the Albanese meeting spread through the opposition.
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whispers → spread → opposition
According to Labor sources fed up with news stories about budget barnacles, Albanese had also been critical in private conversations with Labor colleagues about the widow’s tax and another trusts proposal that had given rise to a misleading scare campaign on death duties.
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that → accord → duties
If Albanese and his allies have tried to shift blame onto Chalmers, this stands in contrast with a pre-budget story in this masthead in which Albanese loyalists, including Katy Gallagher, gave credit to Albanese for driving the reforms, angering the ambitious treasurer who had dragged Albanese to overhauling the stage three tax cuts last term.
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who → try → cuts
It has fuelled open debate among MPs and commentators about whether the treasurer’s standing is now so tarnished that Chalmers – once viewed as Albanese’s obvious successor – could be on the chopping block come the next cabinet reshuffle, though such a move is viewed as highly unlikely.
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move → fuel → reshuffle
“Caucus is pretty shitty,” one minister says.
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minister → say → ?
“Some are keen for promotion and getting antsy.
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Some → get → promotion
Some are wetting the bed because they haven’t been here very long and don’t know what it’s like to have a rough period.
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it → wet → period
“But I have been surprised at how many are a bit over the backflips and feel that we need a better message on the economy.
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we → surprise → economy
A wide range of Labor’s caucus and cabinet gave input for this story.
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range → give → story
A broad summary of their view is that the critique of Labor’s economic strategy is partly driven by ideological opponents in the media, “midterm blues”, internal jockeying to one day replace Albanese, and that it is partly justified.
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it → drive → Albanese
…and 62 more, not listed.
The Aporia
