Key policies for Australia’s new conservative government

Steady flow of refugee boats from Indonesia a hot political issue

Key policies of Australia's new conservative prime minister Tony Abbott, who has swept into office in national elections to end six years of centre-left Labor Party rule, include the following:

Foreign relations

The election is unlikely to have any major foreign policy implications. The new Liberal-National Party coalition government is a strong supporter of a long-standing military alliance with the US, and supports the rotation of US marines through northern Australia.

It also strongly supports closer ties with China, which is Australia's top trading partner, and wants to push ahead with negotiations for a free trade deal with China.


Mr Abbott, however, has promised to cut 4.5 billion Australian dollars (€3.14 billion) from Australia’s foreign aid programme over four years.


Australia’s $1.5 trillion economy is in transition as the investment phase of a big mining boom comes to an end. The economy has marked up 22 years of continuous growth, with gross domestic product (GDP) rising 2.6 per cent in the year to the end of June.

Unemployment is at 5.7 per cent, and interest rates are at a record low 2.5 per cent. Both the central bank and the government would like to see a lower Australian dollar, to help ailing manufacturers and exports.

Mr Abbott has promised stronger control on government finances to guard Australia’s AAA credit rating. He said his government would ensure a budget surplus of about 1 per cent of GDP within a decade and plans to cut 12,000 public service jobs to help control spending.

He has also promised to cut company tax by 1.5 percentage points to 28.5 percent from July 1, 2015, at a cost of A$5 billion in its first two years. But the biggest 3,000 companies will be hit with a 1.5 per cent levy, to help fund a paid parental leave scheme.

Asylum seekers

The steady flow of refugee boats from Indonesia is a hot political issue, particularly in a clutch of marginal seats. About 400 boats have arrived in the past 12 months, and 45,000 asylum seekers have arrived since Labor won office in late 2007.

Mr Abbott has promised to stop the boats, and to use the navy to turn back boats to Indonesian waters. However, there are few details on how that will be carried out.

He also wants to expand the number of asylum seekers who can be processed outside of Australia on the remote Pacific island nation of Nauru.

Maternity leave

Mr Abbott’s landmark election policy is a promise to give women up to six months’ leave, on full pay, upon the birth of a baby. The scheme would start on July 1st, 2015, and is caped at A$75,000. It will be partly funded by a 1.5 per cent levy on companies with income above A$5 million.

Business thinks the scheme is too generous. The Greens, who may hold the balance of power in the upper house Senate, will move to lower the maximum payment to A$50,000.


Mr Abbott has promised to scrap a controversial 30 per cent profits tax imposed on major coal and iron ore mines.

Former prime minister Julia Gillard introduced the tax, which began in July 2012, after negotiations with global miners Rio Tinto, BHP Billiton and Xstrata, now Glencore Xstrata.

However, the tax take has fallen short of forecast and is expected to raise only about A$3.0 billion in its first four years, down from initial estimates of A$13.4 billion.

Carbon price, energy

Mr Abbott has promised to abolish an unpopular carbon tax, currently set at A$24.15 a tonne and imposed on Australia’s top 300 polluters.

Mr Abbott has also committed to cut Australia’s carbon emissions by 5 per cent of year 2000 levels by 2020, through a direct action policy.

The former Labor government had set a 20 per cent renewable energy target, set at 41,000 gigawatts, by 2020. But falling electricity demand might see Mr Abbott’s government review the target to 20 per cent of real demand by 2020, which would see the target drop to about 27,000 gigawatt hours.


Mr Abbott has promised to suspend work on a A$38 billion national high-speed broadband network, delivered to households via fibre-optic cables with broadband speeds of 100 megabits per second.

The new government wants to complete the broadband network at a lower cost, of about A$29.5 billion, but with slower speeds of 25 megabits per second. It will use fibre optic cables to suburban hubs, but then rely on existing copper wires to deliver the network the final metres to each house.