'We got it wrong': Albanese sets up fight over Labor's tax-and-spend agenda

Labor leader Anthony Albanese has vowed to rid the party of its "moral shadows" and failed policies in a pledge to regain the trust of ordinary workers, setting up a fight over the tax-and-spend agenda taken to this year's election.

Mr Albanese promised a "new policy agenda" to reconnect with voters who spurned the party in May, while telling progressive allies he would have to jettison policies that were not essential to a new message on economic growth.

Anthony Albanese said he was "not interested in excuses" for the election result.Credit: Alex Ellinghausen

The message signals a fundamental shift towards economic policies to help Australians on low incomes rather than crowding the party platform with "grievances" to help special interest groups.

"The message to us is that too many people were confused or even frightened by our policies or didn't trust us to implement them," Mr Albanese said, one day after the release of a scathing review of the party's performance at the election.

"We failed to present a clear and concise narrative which explained an optimistic sense of what our country could become.

"I am going to change that. I am going to change the culture of our party and ensure we are worthy of the people's respect and trust."

Speaking of Labor's historic mission to break the bonds that keep people tied to a lower class, Mr Albanese said he was "not interested in excuses" for the election result.

"We got it wrong. Not everything was wrong of course, but enough was. We lost an election, which, given the utter chaos that was there on the other side, we should have won.

"So our agenda must change. If you do the same thing, you should expect the same result.

"I am going create a new policy agenda to modernise our country for the benefit of all its people."

While Bill Shorten has declared he will stay in politics for the next 20 years, Mr Albanese marked a shift in message from the past six years by saying he would abandon the former leader's use of the phrase "the top end of town" to describe wealthier Australians because it was divisive.

The speech sets out four stages to decide a new policy platform for the next election after the party failed to secure a mandate for a $56 billion plan to change franking credits and a $32 billion policy to scale back negative gearing.

Illustration: Matt Golding Credit:

The debate about the election review, handed down on Thursday, will be followed by a series of speeches to set out a broad vision by May, after which the party will revise its platform at a national conference in Canberra in December 2020. This suggests detailed policy changes will wait until 2021 or closer to the next election, due before the middle of 2022.

Mr Albanese cited his move to expel union leader John Setka from the party as a sign of his willingness to take on those whose personal behaviour tarnished the Labor brand, while saying he was "calling time" on the culture of the NSW branch after a donations scandal there.

"The moral shadows cast over the Labor party by [Setka] and some in the NSW party office are being removed by a strong and self-administered dose of sunlight," he said. "We need to win back the Australian peoples' trust and respect because we want them to embrace the positive plans we will lay out for the future of our country."

On policy, Mr Albanese moved to reset expectations by warning that spending plans for health and education might have to be scaled back in line with changes to tax policies on franking credits and negative gearing. 

"Specific policies we'll work on and we obviously will work on the funding envelope that will be available," he said. "If you don't have the same level of revenue, you can't have the same level of expenditure - it's just a fact."

In a warning to interest groups that pressure Labor to adopt their agenda, Mr Albanese agreed with a key finding of the election review that too many supporters "banked the win" without fighting hard enough to ensure a victory.

Labor frontbencher Michelle Rowland, who holds a marginal seat in western Sydney, described the Labor election review as a "very confronting document".

"Labor didn't embark on this to make people feel good. It's to learn lessons and to be honest about mistakes that everyone made," she said.

The Labor communications spokesperson said she was most confronted to learn about the lack of a campaign strategy.

"When you're an MP or a candidate, I think you make assumptions that these things are being taken care of because it's a basic element of campaigning."

With Judith Ireland