Liberals win as Xenophon’s SA Best stumbles in South Australia

New South Australian Premier Steve Marshall.

South Australians headed to the polls on March 17 to decide whether they would return the incumbent Labor Party to power after 16 years or hand government to Steve Marshall’s Liberals, with Nick Xenophon’s SA Best as a significant political force.

The results saw the Liberals win, overcoming their recent history of factionalism and disunity marked by ongoing leadership battles. Optional above the line preferential voting was introduced this election, but a redistribution of seats proved more detrimental to Labor.

The Liberals’ primary vote fell by more than 7%. Labor gained a 1.5% swing, but needed 3% to retain power. Ousted Premier Jay Weatherill stood down as Labor leader, with former health minister Peter Malinauskas and former Treasurer Tom Koutsantonis, both from the SDA-aligned Labor right, vying for the job.

The Greens’ overall vote dropped slightly, but Tammy Franks was returned to the Legislative Council.

SA Best fell far short of expectations in an election where it was targeted by both major parties, the Greens, SA Unions and the SA Hotel Association. Where once polling had predicted 32% of the primary vote and Xenophon as a potential Premier, SA Best’s inability to position itself as a credible alternative ultimately saw it stumble at the finish line. SA Best achieved less than half the predicted percentage, with Xenophon failing to win the seat of Hartley. 

Neoliberal policies

Despite decades of successive Liberal and Labor neoliberal governments contributing to ongoing privatisation, casualisation, stagnating wages and lack of job growth, the major parties consolidated their position as the main players in the election. The focus of the election was largely on job insecurity and energy policy, particularly electricity prices.

The recent decline of manufacturing jobs in South Australia, which consistently has some of the highest unemployment statistics in the country, is in stark contrast to its image as a middle class, progressive, festival state. Recent figures in the ABS Household Income and Wealth Survey (2015–16) showed three out of five South Australian households made less than $80 a week more than the minimum wage for a full-time worker, earning $787 per week or less per household.

The Liberals’ pitch for jobs and growth centred on eliminating payroll tax for small business, cutting land tax and regulations to stimulate growth, as well as talks with the federal government on defence jobs and apprenticeship funding. Labor’s plan for job creation centred on a $2 billion infrastructure plan, which included tram extensions, level crossing upgrades and a new deep sea port.

Both parties promised to address rising electricity prices, with South Australia’s power prices now the highest in the nation, thanks in no small part to the privatisation of the Electricity Trust of South Australia by the Liberals in 1999. Energy reliability was also central, with South Australia’s energy supply drawing media attention after power outages and a statewide blackout.

Renewable energy

South Australia leads the nation in renewable energy, having installed more large-scale renewable capacity than any other state in the past 15 years. There are plans in place for Australia’s first solar thermal power plant with storage and the world’s biggest battery.

In the campaign, Labor announced it would raise the state renewable energy target (RET) to 75% by 2025, coupled with a storage target of 25%. The Greens have a policy of 100% renewables by 2025, SA Best said it would maintain the current 50% target, and the Liberals pledged to scrap the target altogether.

The Liberals vowed to end Labour’s “experiments” and instead proposed a second interconnector that would make it possible to import energy from the eastern states’ grid as well as export green energy. Its commitment to scrap the 75% RET raises questions about South Australia’s recent investment momentum towards renewable energy, put in place by Labor.

Existing projects in the pipeline would contribute more than 4500 jobs and $8 billion in investment in the state, with up to 4848MW of new generation capacity. Most of these projects are already signed and committed and Marshall has stated he will honour these arrangements. 

While the Liberals have announced a moratorium on fracking in the south-east of the state, one of Marshall’s first policy announcements was to scrap the Tesla Plan, a private initiative touted as the world’s biggest “virtual power plant”, which would install solar and storage systems for 50,000 public housing and low-income households at no cost.

Instead the new Liberal government plans to offer those already with solar rooftop systems $2500 for battery storage installation in a $100 million subsidy to 40,000 homes. In effect, it is taking solar and storage systems from lower income households and giving it to middle income households, which can already afford solar.  

Of particular interest is how Marshall will juggle South Australia’s energy policy direction and the scrapping of the state RET in favour of Prime Minister Malcolm Turnbull’s latest National Energy Guarantee (NEG) plan. The NEG has been criticised for its woefully low emissions targets.

SA Solar Citizens campaigner Daniel Spencer said the NEG would “throw renewable energy off a cliff” and SA Conservation Council chief executive Craig Wilkins said it is “worse than doing nothing”. He said it will “stop reinvestments in renewable energy infrastructure and increase the price of energy” and “the only people who would benefit are those working within the fossil fuel industry”.   

Deregulation and privatisation

In Marshall’s seat of Dunstan, plans for a $279 million EastLink Norwood tram line proposed by Labor, now seem uncertain after Marshall’s re-election, as he had previously opposed the plan.

Moreover, his plan for delivering “more jobs, lower costs and better services” appears to include reducing the size of the public sector, decentralising the health system, deregulating shopping hours and replacing the TAFE board.

This is the crux of the Liberals’ ideological approach to politics, the cornerstone of which consists of deregulation and privatisation. Workers’ rights, public health and education are firmly in its sights and big business and private capital will be its beneficiaries.

However, the Liberals will face a contentious Upper House when trying to pass key pieces of legislation, which could make their efforts to implement their reform plan difficult. 

The Liberal victory points to a sharp move further to the right and a hostile political terrain. It remains to be seen whether the Liberals are able to stall previous momentum towards renewable energy. The local environment movement, along with the community, will need to be prepared to defend these gains.

Plans for local defence jobs and traineeship creation talks with the federal government are concerning, given Prime Minister Malcolm Turnbull’s recent $3.8 billion loan fund announcement to boost sales of Australian arms.

Turnbull hopes the plan will see Australia become one of the world’s top 10 exporters of weapons within the next ten years and defence industry minister Christopher Pyne credits the scheme with the potential to create “tens of thousands” of local jobs.

South Australia’s public sector will also need defending from impending restructuring that signals cuts and job losses in the name of efficiency and growth.

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