Dutton has a gas-fired plan to win back government

As Peter Dutton prepared to deliver his budget reply speech on Thursday, there was a warning from regulators that the risk to gas supplies was back in the danger zone. Without greater assurances from exporters, domestic supply was vulnerable in the face of unexpected weather events or outages of coal-fired power plants. Mr Dutton zeros in on gas with two observations. Energy is everything to the economy, and subsidies are not the answer. He put gas at the centre of Coalition energy reform, including a gas reservation policy for the east coast. While putting more detail on his energy plan, the Opposition Leader’s budget reply speech identified more than $50bn in cost savings from government programs but voters will have to wait until later in the election campaign to discover how serious a Coalition government will be in the critical areas of genuine economic reform. In what was in effect a campaign opener, Mr Dutton set out the argument for change and tied it directly back to the big philosophical divide that separates Labor and the conservative forces. Where Jim Chalmers had used this week’s budget to set out Labor’s philosophical ambition for bigger government and greater state involvement, Mr Dutton set out why greater government efficiency and a nurturing of small business and the productive sector matters. “We will spend taxpayers’ money wisely, in a manner which has an economic multiplying effect, generates productivity, and can attract new investment,” Mr Dutton said. “And we will curtail union militancy in workplaces.”

He zeroed in on energy policy and declared that no government can subsidise the economy to success. As a result, he said, the looming election contest was a sliding doors moment that would have long-term consequences for the nation. Without change, the setbacks of government waste and interference would be set in stone. To turn things around, Mr Dutton promised to “rein in key inflationary, ineffectual and imprudent spending measures of the Albanese Labor government”. He would scrap the $20bn Rewiring the Nation Fund, stop the $10bn Housing Australia Future Fund, scrap Labor’s $16bn in production tax credits over the next decade for critical minerals and green hydrogen, and reverse Labor’s increase of 41,000 Canberra-based public servants to save $7bn a year. Promising executive action, Mr Dutton said, if elected, he would introduce four critical pieces of legislation on the first sitting day of parliament: the Energy Price Reduction bill; the Lower Immigration and More Homes for Australians bill; the Keeping Australians Safe bill, and; the Guaranteed Funding for Health, Education and Essential Services bill.

On energy, an east coast gas reservation policy would secure an additional 10 to 20 per cent of the east coast’s demand and drive down new wholesale domestic gas prices from more than $14 per gigajoule to less than $10 per gigajoule. Mr Dutton said Australia would join the other 19 top economies in the world in adopting proven, zero-emissions nuclear power, but he did not elaborate on how much this would cost or how it would be done. Similarly, after a sharp political contest over Labor’s plans to cut the lowest tax rate to deliver a $5-a-week boost to take-home pay, there was nothing in Mr Dutton’s speech about how to defeat the scourge of bracket creep. Instead, Labor’s plan was traded off against a 12-month cut to fuel excise. For small business, the instant asset write-off would be increased to $30,000, and there was the previously announced $20,000-a-year deduction for business-related meal expenses.

On housing, Mr Dutton said a Coalition government would cut the permanent migration program by 25 per cent and ban foreign investors and temporary residents from purchasing existing Australian homes for two years. He committed to increased spending on medicines as well as $500m for women’s heath, and a doubling of subsidised mental health sessions from 10 to 20, with an additional $400m invested in youth mental health services. There would be a renewed focus on law, order and justice, as well as a dedicated anti-Semitism taskforce. This is all policy-light, as was a promise of a “significant funding commitment to defence … commensurate with the challenges of our times”, without detail on what that would be.

Politically and economically, this is a contest opener, not a knockout performance. Mr Dutton must turn his ideological convictions into credible policies. Top of the list must be better detail on energy, tax reform and defence.