Race issue clouds clarity of contest in troubled world

Australia's political leaders hit the campaign trail yesterday for an October general election, selling rival economic visions…

Australia's political leaders hit the campaign trail yesterday for an October general election, selling rival economic visions to voters in the shadow of world financial turmoil.

The Prime Minister, Mr John Howard, behind in opinion polls, warned Australia's growth may be slowed by the Asian economic crisis and appealed to voters not to flirt with the Labour opposition in the October 3rd poll.

Mr Howard made a flurry of media appearances on the first day of the five-week campaign which he wants to focus on economic issues and the record of his conservative Liberal-National coalition. But the campaign is likely to be dogged by race issues and the wild card of the anti-immigration, protectionist legislator, Ms Pauline Hanson.

Four former prime ministers who have been outspoken in their criticism of Ms Hanson, including Mr Howard's mentor and the former Liberal leader, Mr Malcolm Fraser, published an open letter urging Australia's 12 million voters to shun racist candidates.

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"Racism is unmitigated evil, it is immoral, it does Australia significant harm through Asia and the wider world," said Mr Fraser and the former Labor prime ministers, Mr Gough Whitlam, Mr Bob Hawke and Mr Paul Keating.

Mr Howard sought to highlight the economic achievements of his coalition, citing low interest rates, low inflation and steady growth. "All of that would be threatened by the high-spending policies of a returned Labour government," he said. Mr Howard is asking voters for a mandate for further economic reform. He plans a new value-added tax, A$13 billion (£5.214 billion) in annual tax cuts and the A$45 billion full privatisation of the telecoms giant, Telstra Corp.

The Labour leader, Mr Kim Beazley, pushing his own A$6 billion worth of tax cuts, attacked Mr Howard's planned new tax and the government's failure to tackle unemployment, stuck above eight per cent since Mr Howard ousted Labour in 1996.

"We all know we are going to roll into a period of considerable economic difficulty," Mr Beazley told factory workers in a Sydney industrial suburb. "What we don't want in those circumstances is a risky new tax on jobs."

He also pledged a 100-day plan aimed at boosting jobs growth and lifting social spending, such as health, if he wins.

The main polls show Labour an average of one point in front of the government - 50.5 per cent to 49.5. But book-makers rate Mr Howard, a long-time political survivor, a slight favourite. Labour needs an extra 27 seats in the 148-seat parliament to win.

Mr Howard's support has been eroded by Ms Hanson, who has wooed traditional conservatives with a grab-bag of policies against Asian immigration, Aboriginal rights and economic reform.

She has established her One Nation party as the third political force that could well grab the balance of power in the powerful upper house, and possibly the lower house as well.

The left-wing Australian Democrats, the former third political force, launched a campaign yesterday aimed at denying Ms Hanson the balance of power. The party's new slogan is: "Vote Democrat to stop One Nation dividing Australia."