Hour of opportunity is with Scott Morrison — can he step up?

Scott Morrison on the campaign trail in Eden-Monaro. Picture: AAP

On a sunny Melbourne winter day, Peter Costello went to a corner­ store to buy a few staples. Never a big spender, and in order to prove the sky had not fallen in despite Nicholson’s hilarious cartoon­ in The Australian of the sun rising with 10 per cent missing, Costello spent $23.50 on milk, bread, orange juice and a bottle of wine at Goodfellows Continental Deli in East Malvern.

Asked if it felt like grand final day, Costello said: “It does. It feels like a grand final, first day of a Boxing Day Test, election morning all rolled into one, actually.” It was July 1, 2000, almost 20 years ago, when the GST finally hit the cash registers. Although the respite was destined not to last, that day passed smoothly. Costello allowed himself a brief sigh of relief.

It had been bitterly fought over for decades until John Howard bowed to pressure, reversed his pledge to “never ever” introduce it and commissioned his young treas­urer in 1997 to begin the mammoth task of reshaping the tax system with five guiding principles including no increase in the overall tax take, large cuts in personal income tax, introduction of a broadbased consumption tax, replaceme­nt of indirect taxes, and reform of federal-state financial relations.

What followed was almost three years of daily combat, impec­cable planning, fact-based, carefully considered salesmanship, near-death and real-death experienc­es full of heartache and heartburn, followed by a complicated, fraught implementation. Every single day, on top of normal stuff like budgets. Two elections were fought over it: in 1998, where Labor sought to block it, then 2001, when Labor wanted to roll it back.

The grunt work was done by Costello and his tight-knit personal staff — first with Phil Gaetjens, then Mike Callaghan as chief of staff — and a terrific department. The late, great Ted Evans, then head of Treasury, appointed Ken Henry to lead a special tax unit within the department to help formulate the package. A bright young Treasury officer, Nigel Bailey, was the departmental liaison officer working out of Costello’s office. Bailey, Tony Smith, Mitch Fifield and Elizabeth McCabe were the key supports for Costello.

Smith and Fifield looked after the politics, Bailey the tax, and McCabe Costello’s itinerary, appointments and personal matters from banking to dry-cleaning.

As Costello would say, he spent almost every day of those three years sitting a tax exam where the only permissible mark was 100, which he scored every time.

You didn’t even need one hand to count the number of “friends” throughout that process. Journalists decided there could not be a single loser, so relentlessly chased down every possible, implausible victim, from farmers who would suffer more bushfires because they wouldn’t be able to afford to clear their land, to hairy youths who would not be able to afford regular cuts. Support from business was limp. No state or territory leader advocated for the package rel­eased in August 1998, even though they would be the beneficiaries.

Labor salivated, confident the government would fall. It was not alone. Government backbenchers wore out the carpet to Costello’s office as the government plum­meted in the polls.

Back then Smith, now the best Speaker of the parliament, certainly in my career, was one of the best political operatives. In mid-1998, with the Coalition trailing Labor by 10 per cent in the polls, a certain other staffer (okay, it was Brian Loughnane) burst into the office Smith and I shared (I was then Costello’s senior and sole media adviser) to say Costello had to make a move on Howard.

Smith slammed the door shut and talked him down. Imagine even thinking it would be okay to bring down a first-term prime minister. Beyond crazy, right? Apart from the appetite for reform, that’s something else that has changed.

So far, Scott Morrison has not shown he is a seize-the-moment kind of leader. Certainly not like Howard, who before he took on tax had reformed gun laws after the 1996 Port Arthur massacre, which propelled him to enact changes that have delivered incalc­ulable benefits for us all.

It is astonishing as well as disturbing how often the Prime Minister just doesn’t get it, how long it takes him to understand the importance of an issue or grasp the nub of it — like when he was asked about women giving birth by the side of a road and offered up improving the road as his solution. Or when he zipped off to Hawaii rather than hang around to monit­or bushfires because it wasn’t his job to hold a hose. Or when he said he was going to the footy after ­announcing bans on crowds as the coronavirus took off.

Even the incident with Smith during question time last week, where an angry Morrison, who had accused Albanese of overseeing corruption, sought to argue the toss with the Speaker after he had insisted the PM withdraw. No good would have come of it if Morriso­n had not backed down.

The last time a prime minister clashed with the speaker, the speaker, with legs like jelly, left the chair and never resumed it. That was Jim Cope in 1975. Smith is not Jim Cope. He has been in parliament longer, is every bit as tough as Morrison, and respected by all sides. Morrison wisely retreated.

Throughout the pandemic, Morrison has generally acted on the advice of medical experts. In reality, he has remained at the mercy of the premiers. But this once-in-a-century catastro­phe is still his once-in-a-century chance to lead reform and restructuring on a huge scale, with or without the states’ support. It will take ticker and meticulous planning.

Win or lose in Eden-Monaro, he should commission Josh Frydenberg to undertake reform across the spectrum — tax, industrial relations and regulation — announcing the principles next month when they are scheduled to reveal the full extent of the damage, and following with big-bang policy in October’s budget.

Then they need to strap themselves in for an almighty battle until the next election, and possibly the one after. Unlike 20 years ago, if they show they have what it takes to introduce enduring­ reform, they are likely to have many advocates to help achieve it.