Coalition clinches majority government — here's what it means for you

Liberal Party supporters welcome the news as Labor leader Bill Shorten concedes defeat. Sydney, Saturday 18 May 2019.
Image: Tracey Nearmy / Stringer/Getty Images

While Prime Minister Scott Morrison enjoyed a cold one at the ‘Shark Park’ rugby league grounds in his electorate of Cook on Sunday, the ABC’s election computers were still working overtime.

By 11.30pm on Saturday night, Morrison’s Liberal-National Coalition had secured enough seats to stop Labor from winning the election, despite opinion polls to the contrary. But the ability to form a majority government was unclear throughout Sunday, with five seats still in doubt.

The ABC’s election mathematicians have officially predicted that the Coalition will claim at least 77 seats, one more than the required 76 to take control of the House of Representatives.

The Tasmanian seat of Bass will be won by Liberal Party candidate Bridget Archer, sending Labor MP Ross Hart packing. Meanwhile, Liberal MP Gladys Liu is predicted to be the winner in the eastern suburbs Melbourne seat of Chisolm, beating off challenger Jennifer Yang despite a 2.9% swing against the government.

The updated prediction from the ABC follows Independent Kerryn Phelps conceding defeat in the blue ribbon Sydney seat formerly occupied by ousted PM Malcolm Turnbull. Liberal candidate Dave Sharma, a former Australian ambassador to Israel, will be the next Member for Wentworth.

With a majority Morrison government now assured, here’s what you can expect.

Tax cuts the priority

The Coalition’s flagship election policy followed the federal government’s budget handed down in April, which put tax cuts at the very centre.

Speaking to media on Sunday, Treasurer Josh Frydenberg said tax cuts would be the next Morrison government’s top parliamentary priority.

“The Labor party have already said they will support that legislation, so it will have bipartisan support, so let’s get this legislation passed so that the Australian people get their tax cuts,” Frydenberg said.

The Coalition intends to legislate tax relief for 10 million Australians with the three-step plan unveiled in the budget, including increasing the top threshold of the 32.5% tax bracket from $120,000 to $200,000 and removing the 37% tax bracket entirely by 2024.

According to its election manifesto, it will also cut tax cuts for small and medium businesses from 27.5 per cent to 25 per cent by 2021-22, having previously lowered the SME tax rate from 30 per cent.

However, the government will need to get its tax cuts passed by the Senate prior to 1 July in order to stick to the plan outlined in the budget. And with just 49.1% of the vote counted in the upper house at the time of writing — and 3 seats still in doubt — we don’t yet know how easy that will be.

Boost for (some) first home buyers

Just a week out from victory, Morrison announced a “leg up” for first home buyers, reducing the minimum deposit required purchase a property from 20% to just 5% and scrapping lenders’ mortgage insurance.

But the scheme will only be for buyers who earn less than $125,000 annually or couples with a combined income of less than $200,000. Some commentators have questioned whether the policy encourages responsible lending.

Your franking credits or negatively-geared investment properties are safe

One of the key planks of the unsuccessful Labor campaign were plans to “reform dividend imputation”, or in other words scrap the current system for refundable franking credits so that “wealthy people who pay no income tax no longer get a cash refund simply for owning shares”. The policy was so central to the party’s platform that Australian comedian Magda Szubanski described Labor’s campaign as having become “Franking-stein’s monster”.

Similarly, Labor planned to end tax concessions such as negative gearing and capital gains tax arrangements which it said were blocking first home buyers out of the market.

But the Coalition put opposition to both of these policies at the centre of its campaign. You can expect the Morrison government to honour its commitment to leave these tax arrangements alone, much to the glee of the financial services and property industries, who have put up serious resistance to Labor’s slated changes.

The question now is whether the Labor opposition will remain committed to the changes or take the election as an opportunity to dump the longstanding but controversial policies.

Climate change will continue to dog the government

Frydenberg said on Sunday the government will remain committed to its election environmental policies, including a $2 billion Climate Solutions Fund to help “farmers, small businesses and Indigenous communities reduce emissions”.

However, even former Liberal prime minister and self-described “climate realist” Tony Abbott reportedly said Labor’s policy to address climate change is “much better” amid a number of prominent critics.

And one of those prominent critics, incoming Independent MP for Warringah Zali Steggall — who knocked Abbott off as local MP on Saturday after a quarter of a century in the role — is likely to be a noisy member of the next federal parliament.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.