Can cash splash in 2022 Federal Budget win Scott Morrison the election?

The Coalition has slashed petrol prices and splashed on cash bonuses and tax offset. Now he’ll be hoping it’s enough to secure him a fourth term.

Nothing quite focuses the mind of a Prime Minister and his Treasurer as the looming prospect of political death.

It was Samuel Johnson who once wrote, “Depend upon it, sir, when a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully.”

And that fear has prompted the Morrison Government to embrace one of the weapons that John Howard embraced in political desperation: petrol tax relief.

This budget will slash petrol excise by 22 cents a litre from midnight on budget night, but don’t expect it to flow through overnight. It will cost $3 billion in revenue foregone.

It might take a few days but relief for motorists is on the way. Labor has confirmed it will support the measure.

To be fair, it’s a measure embraced across the globe in recent weeks, including in New Zealand where motorists will be offered a 25 cent cut for three months and in the United Kingdom.

Prime Minister Scott Morrison will be hoping his petrol price cut will help secure him a fourth term. Picture: Martin Ollman/Getty Images

The Prime Minister may not hold a hose as he famously quipped during the bushfires, but he’s happy to spray cheaper petrol around if it will secure him a fourth term.

The petrol excise cut in tonight’s budget is different to John Howard’s approach however for three reasons.

First, it’s “targeted” and “temporary.” In 2001, John Howard abolished the indexation of fuel excise as compensation for the GST.

The original move was neither temporary or targeted and it cost the budget an absolute bomb before Joe Hockey and Tony Abbott reversed the decision over a decade later.

Secondly, the fuel excise cut doesn’t involve indexation at all. Instead, it’s a short, sharp injection of relief.

That’s good news for now, but bad news for motorists and whoever wins the election later.

In fact, whether by accident or design it’s handing an exploding cigar to whoever wins the election because they will need to put petrol prices back up.

The third reason it is different is the timing. John Howard cut petrol indexation in March, 2001 but didn’t head to the polls until November.

Australians will start seeing fuel prices fall within the next fortnight. Picture: Keryn Stevens

For good measure, Prime Minister Scott Morrison is throwing in an immediate one-off $250 cash bonus for six million pensioners and welfare recipients.

There’s also a $1500 tax cut for 10 million working Australians earning under $126,000. For that you will need to wait until you lodge your tax return.

Mind you, he’s also axing that tax cut for low and middle income earners (LMITO) in 2022, as expected.

Known as the “Lamington” tax cut, was always temporary and has already been extended twice as a result of the pandemic.

The Lamington will rise from $1080 to up to $1500 and you will get the extra money when you file your tax returns in July.

It’s not a cash bonus as some media are describing it but a one-off cost-of-living tax cut of $420.

But like the pensioner bonus and the petrol excise cut, it’s all about the election.

It’s a big job to convince voters to give one party a decade of power, although it is perversely the revolving door of Prime Minister’s that has served to give the government a perpetually fresh look as a new bloke came sailing through the front door.

It’s tough, tougher than the “miracle” he sought at the 2019 election. But it’s not impossible.

Time is running out for the Prime Minister to turn things around. His options have narrowed to an election on May 7, May 14 and May 21.

He starts the election race as the underdog, behind in the polls and with Labor retaining a two-party preferred lead of 55-45.

The Coalition holds 76 seats and it needs to hold its own seats and gain some seats to balance out any Labor wins if it is to retain government.

Labor starts the campaign on 69 seats and needs to win a net seven seats to elect a Speaker and form a government. That’s a tougher task than it looks.

The Coalition approaches the election as the underdog. Picture: Getty Images

Mr Morrison outlined his pitch to Coalition MPs today suggesting that governments are a bit like dentists.

“We’re not going to be loved,’’ he said.

“We’re out here to do a job for our nation, and it’s an incredible responsibility.”

The core question he argued was competency.

Nobody “cares if he or she is my friend or not,” he said. You simply want to know if someone has “got that drill in their mouth” that they “know what they’re doing”.

The Labor Party will be running a campaign that the Prime Minister does not know what he’s doing, citing the examples of his bushfire holiday to Hawaii, the furore over abuse allegations at Parliament House and the vaccine rollout.

Expect the election to be called shortly.

The big question is whether voters will take the budget cash splash and calmly and methodically vote for the other mob anyway.

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