The uncertainty over whether Julia Gillard will still be Prime Minister come September’s federal election is adding further caution to an already conservative business environment, according to Clayton Utz partner Karen Evans-Cullen.
Evans-Cullen, from the law firm’s Corporate Advisory / M&A Group, has told Michael Bleby at BRW that businesses are more likely to be putting deals on hold because of the instability in the federal Labor party.
Momentum has been growing among federal Labor MPs for ousting Gillard and returning Kevin Rudd to the leadership. Concern over Gillard’s judgement was fuelled by a bruising clash with media companies over new press regulation proposals in the past week. The crisis has been building as MPs prepare to return to their electorates for an extended break from Parliament before returning for the federal Budget in early May.
Widespread reports of a potential leadership spill in the current Parliamentary session had been unhelpful to investors, Evans-Cullen said.
“The way they came out with it and said ‘it’s this or nothing in the next two weeks’ does cause people in the business community a lot of concern,” Evans-Cullen said. “That’s what happened with the mining tax. There is concern those things can come out of left field with the government at the moment because of the difficulties and pressures in the party.”
(One senior minister today denied Rudd had anywhere near the support required to remove Gillard.)
The firm September election date meant the caution could be short-lived, Evans-Cullen added. “It’s only a short-term thing now. Hopefully it will be solved in six months’ time.”
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