Peter Dutton’s ‘working-class’ strategy didn’t materialise a win in Dunkley, and Liberal MPs are seeking a new path

The relief among Labor MPs and officials was palpable.

Going into the Dunkley by-election they knew a swing against the government was the one certainty — governments at this point in the election cycle routinely face a voter backlash. But add to that 12 interest rate rises under their watch and a broader cost of living crisis and the conditions were ripe for the Liberals to exploit.

The only real question going in was the extent of that swing and whether it would be enough to deliver a loss to Labor and vindicate Peter Dutton’s articulated strategy of taking the working-class suburbs from the Labor column.

That didn’t materialise — the Labor vote held up, and Anthony Albanese and his treasurer both got the birthday gifts they were hoping for — a Labor win and the status quo.

The result will be pored over, spun, manipulated and trumpeted to tell a range of stories — that is the way with all elections.

But the celebratory speeches at the Liberal Party function did appear incongruous with the stark reality — despite Australians suffering a decline in their material living standards, the government’s primary vote held up. How could that be?

Low expectations for Liberals

Those triumphant speeches among the Liberal leadership — from Sussan Ley to Jane Hume — demonstrate just how low expectations really are inside the Liberal tent.

A loss is celebrated because the loss isn’t as bad as it was last year in the seat of Aston, which had been held by the Liberals until that point.

While some Liberals genuinely believe this is a decent result and that they are on the right trajectory if they continue with their strategy, there are growing concerns inside that the party needs to rethink its suburban working-class seats strategy given it has failed in Dunkley.

Some Liberals are pointing to the strong swings to them in the wealthier parts of the electorate, like Mt Eliza. They say it shows the party must refocus its attention on the Teal seats lost at the last election with similar demographics if it wants to form government again. They fear the strategy of chasing votes in what has traditionally been Labor heartland will fall short as it did in Dunkley.

Let’s not forget, however, that Dunkley isn’t Labor party heartland — the seat has been successfully held by Liberals and was ripe for the picking.

Two of the Liberal MPs who lost their seats to Teal candidates Tim Wilson and Jason Falinski wrote an opinion piece in the AFR on Sunday making the case for the Liberals to stick to their leafy base.

They wrote that like in Aston nearly 12 months ago, “the outer suburbs aren’t sending Liberal MPs to Canberra. An area can’t be the new heartland if your primary vote has a three in front of it.”

“Liberals need to win seats like Dunkley to form government. But it is not their heartland; communities like Curtin, Higgins, Mackellar, Warringah, North Sydney and Wentworth are.”

They pointed to the Mt Eliza swing to make their point.

Redbridge’s Kos Samaras says their analysis is wrong because “Mt Eliza is not Hawthorn”. Samaras says Mt Eliza has an 8.4 per cent rental rate whereas Hawthorn (in the seat of Kooyong) has a 45.6 per cent rent rate and that makes a substantial difference.

Loading…Housing the policy key

Dunkley is exactly the kind of seat the Liberals need to win if they have any hope of finding a pathway back to office, and yet at a time when voters are doing it the toughest they couldn’t pull it off.

The Labor candidate Jodie Belyea retained the seat despite a swing of about 4 per cent to the Liberal Party.

The swing to the Coalition is about the average by-election swing against governments in recent decades.

Labor’s primary vote was flat, up by around 1 per cent, while the Liberal vote grew almost 7 per cent. The Greens’ primary vote fell 4 per cent, and with One Nation and United Australia not running those votes essentially shifted to the Liberals giving them a boost to their primary.

Internally, many believe the Liberals need to start making a more compelling economic case and begin to release some policies.

Menzies MP Keith Wolahan said on our ABC News Dunkley by-election special that the revival of the Liberal Party relies on dealing with the intergenerational home ownership issues. He says any party that can solve that issue will find a pathway to success.

The Liberals say they have been working on policies aimed at transforming the housing market to give young people a chance of owning a home but any new policies here are yet to be seen.

LoadingMore to the story for Labor

While the lessons for the Liberals will be pored over, the government’s retention of the seat can’t be the end of the story for them. A swing against any government must always be treated as a warning shot for any serious politician.

The Dunkley by-election was described by journalists and analysts as a referendum on Labor’s changes to the stage 3 tax cuts. While no by-election is decided on a single issue there is no doubt that the tax cuts were a dominant issue in the campaign.

On that front, Labor’s controversial decision was vindicated. They were able to provide a credible answer to voters who feel squeezed and under the pump financially. Without the tax changes, Labor’s answer to that dominant and persistent question would have been weaker.

Victorian MP and Deputy Prime Minister Richard Marles said that while it would take time to analyse the result, Labor’s revamp of the stage 3 tax cuts contributed to minimising the swing in a seat that was “middle Australia” and where the cost of living was the signature issue.

“You can see from the way in which we campaigned we believe they were a huge positive, and the results that we’re seeing so far would seem to affirm that,” he said.

But his other message was that the work on cost of living relief was not done. Albanese reiterated that when he addressed the media with his new MP on Sunday.

“We’ll continue to look for what measures we can put in place to take pressure off cost of living without putting pressure on inflation,” he said. 

“I’ve already foreshadowed we’ll have more measures in the budget. We work each and every day to do more, that’s the focus of the government.”

Politics is often about maintaining momentum. By holding onto the seat of Dunkley, Labor avoids the trouble that comes with any seat loss including questions about direction and policy settings.

To maintain momentum, Labor must now demonstrate to the voters that it takes seriously their concerns and will not stop until it makes life more affordable for those working their guts out and struggling to keep up.

Patricia Karvelas is the presenter of Q+A, which returns tonight at 9.35pm on ABC TV, RN Breakfast and co-host of the Party Room podcast.