Strategic Political Counsel

Pre-Election Brief

Prepared June 30, 2016

Introduction

This Brief contains an overview of marginal seats in both the House of Representatives and the Senate, and also provides information about who the current seat is held by, including the incumbent member, the main contestant, and most importantly, the margin by which the seat is currently held. Additionally, this brief includes opinion polls for both the primary and 2PP vote of both upper and lower houses.

Executive Summary

With the election only a few days away, our research indicates the following;

Strategic Political Counsel’s Election Forecast:

House of Representatives

1. Labor’s primary vote has dipped across the country, but they are still favoured to pick up a number of marginal seats. 2. The will win a workable majority of 82-83 seats in the House of Representatives. 3. Deputy Prime Minister will retain New England. 4. The Nationals are a strong chance to win the seat of Murray. 5. will retain Cowper. 6. will not retain Solomon. 7. will lose Mayo to Nick Xenophon Team candidate . 8. will retain Sturt, defeating the Nick Xenophon Team candidate by a comfortable margin. 9. Cathy McGowan will retain Indi.

Senate

1. The Coalition will win 31-32 Senate seats. 2. The Nick Xenophon Team will win between 25% - 30% of the senate vote in South and win 4 Senate seats, with the possibility of a 5th in or . 3. Jacquie Lambie will be re-elected. 4. The Nationals have an opportunity to pick up a seat either in WA or . 5. Derryn Hinch will not win a Senate seat. 6. is unlikely to win a Senate seat.

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Political Environment

• The election has been called for 02 July 2016. • To form government, a party must win 76 seats at an election. • The Coalition currently hold 90 seats, with the ALP holding 55. • The remaining 5 seats are held by The Greens, The Palmer United Party, or Independents. • Since December 2015, the polls have dipped for the Coalition, while Labor have lifted slightly. • Polling for minor parties is relatively high, between 10-15%.

Coalition

• The Coalition has run an unremarkable campaign, which has seen the polls level out as we approach election day. Prime Minister is still the preferred Prime Minister, holding a strong lead over opposition leader .

ALP

• The ALP has run into campaign problems over the last two weeks, mainly in regards to costings. The result of the Brexit referendum in the UK, and the uncertainty that comes with it, has not assisted their cause. The feeling in the electorate is that communities do not want another change in government.

Boundary Changes

The re-distribution of electorate boundaries has resulted in the ALP notionally picking up two seats overall. In NSW, the Coalition held seats of Barton, Patterson and Dobell have all become notional Labor seats, while the division of Charlton (a Labor controlled seat) has been abolished. In Western Australia, a new seat has been created (Burt) which is a notional Liberal seat. This means that Coalition notionally hold 88 seats, with Labor holding 57.

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Key Marginal Seats

The following seats have been identified by Electoral Commission as marginal, or identified by Strategic Political Counsel as marginal due to outside circumstances.

NEW SOUTH WALES SEAT PARTY Margin Sportsbet Incumbent Contestant Odds Barton Liberal -4.39 ALP: 1.05 Nickolas Varvaris LIB: 8.50 Patterson Liberal -0.27 ALP: 1.15 Karen Howard LIB: 5.00 (Won preselection) Dobell Liberal -0.18 ALP: 1.30 Karen McNamara Emma McBride LIB: 3.30 Parramatta Australian 1.32 ALP: 1.10 Michael Beckwith Labor Party LIB: 6.00 Richmond Australian 1.58 ALP: 1.15 Matther Fraser Labor Party LIB: 5.00 (Nationals) Kingsford Australian 2.74 ALP: 1.05 Michael Feneley Smith Labor Party LIB: 8.50 Banks Liberal 2.8 LIB: 1.20 David Coleman Chris Gambian ALP: 4.20 Eden- Liberal 2.91 ALP: 1.35 Mike Kelly Monaro LIB: 3.00 Greenway Australian 2.98 ALP: 1.35 Yyvone Keane Labor Party LIB: 3.00 Lindsay Liberal 2.99 LIB: 1.27 Fiona Scott Emma Huar ALP: 3.50 Robertson Liberal 3.09 LIB: 1.25 Anne Charlton ALP: 3.75 Page The Nationals 3.1 ALP: 1.45 Janelle Saffin NAT: 2.60 Reid Liberal 3.33 LIB: 1.15 Angelo Tsirekas ALP: 5.00 MacArthur Liberal 3.39 ALP: 1.65 Russell Matheson Michael Freelander LIB: 2.15 Gilmore Liberal 3.78 LIB: 1.35 Ann Sudmalis Fiona Phillips ALP: 3.00 Macquarie Liberal 4.48 LIB: 1.52 Susan Templeton ALP: 2.40 Hunter Australian 5.68 ALP: 1.01 N/A Labor Party LIB: 16.00 New The Nationals 19.6 ALP: 1.30 Barnaby Joyce Tony Windsor England IND: 3.30 (Independent)

Notes

New South Wales is predicted to have the largest number of seats changing hands. The re-distribution in NSW turns two existing Coalition seats (Barton and Patterson) into notional ALP seats. Other seats tipped to fall to Labor include Eden-Monaro and Paterson. 43 Phillip St, Sydney NSW 02 8272 0616 4

Tony Windsor is contesting the seat of New England, which has turned a very safe Coalition seat into a marginal seat, with polling in March showing that the contest was 50/50. While many expect Barnaby Joyce to retain the seat, it will be at a much smaller margin.

PREDCTION: • Barnaby Joyce to retain New England • Peter Hendy to retain Eden Monaro

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QUEENSLAND

SEAT PARTY Margin Sportsbet Incumbent Contestant Odds Fairfax Palmer United 0.03 LNP: 1.01 – • Scott Anderson Party ALP: 16.00 Not Contesting (ALP) • Ted O’Brien (LNP) Petrie Liberal National 0.53 ALP: 1.38 Jacqui Pederson Party LNP: 3.00 Capricornia Liberal National 0.77 ALP: 1.60 Leisa Neaton Party LNP: 2.25 Lilley Australian Labor 1.32 ALP: 1.05 Wayne Swan David Kingston Party LNP: 8.50 Moreton Australian Labor 1.55 ALP: 1.03 Nic Monsour Party LNP: 5.00 Kennedy Katter's 2.19 KAP: 1.05 • Norm Jacobsen Australian Party LNP: 8.50 (ALP) • Jonathan Pavetto (LNP) Griffith Australian Labor 3.01 ALP: 1.15 Fiona Ward Party LNP: 5.00 Bonner Liberal National 3.69 LNP: 1.12 Laura Fraser Hardy Party ALP: 4.00 Oxley Australian Labor 3.77 ALP: 1.05 (Won Bibe Roadley Party LNP: : 8.50 Preselection) Liberal National 4.28 LNP: 1.40 Trevor Evans Pat O’Neill Party ALP: 2.75 (Won Preselection) Forde Liberal National 4.38 LNP: 1.40 Des Hardman Party ALP: 2.50 Rankin Australian Labor 4.78 ALP: 1.01 Freya Ostapovitch Party LNP: 16.00 Blair Australian Labor 5.26 ALP: 1.08 Teresa Harding Party LNP: 6.00 Leichhardt Liberal National 5.68 LNP: 1.06 Sharron Howes Party ALP: 9.00 Herbert Liberal National 6.17 LNP: 1.15 Ewen Jones Cathy O’Toole Party ALP: 5.00 Flynn Liberal National 6.53 LNP: 1.20 Ken O'Dowd Zac Beers Party ALP: 3.00 Dickson Liberal National 6.72 LNP: 1.10 Linda Lavarch Party ALP: 6.00 Longman Liberal National 6.92 ALP: 1.15 Wyatt Roy Susan Lamb Party LNP: 5.00

Notes

Fairfax will not be contested by Clive Palmer and is tipped to return to the Liberal National Party.

Capricornia is traditionally a safe Labor seat, and is thought to be at significant risk given the swing against the government. The electorate of Petrie is also at risk.

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VICTORIA

SEAT PARTY Margin Sportsbet Incumbent Contestant Odds McEwen Australian Labor 0.15 ALP: 1.08 Rob Mitchell Chris Jermyn Party LIB: 7.00 Indi Independent 0.25 IND: 1.15 Cathy • Matt Corboy NAT: 6.00 McGowan (Nat) LIB: 11.00 • Sophie Mirabella (Lib) Bendigo Australian Labor 1.26 ALP: 1.10 Megan Purcell Party LIB: 6.00 Chisolm Australian Labor 1.6 ALP: 1.36 Stefanie Perri Julia Banks Party LIB: 3.00 (Won preselection) Bruce Australian Labor 1.8 ALP: 1.10 (Won Helen Kroger Party LIB: 6.00 preselection) Jagajaga Australian Labor 3.13 ALP: 1.05 Jenny Macklin David Mulholland Party LIB: 8.50 Deakin Liberal 3.18 LIB: 1.20 Tony Clark ALP: 4.20 Australian Labor 3.56 ALP: 1.25 Michael Danby Owen Guest Ports Party LIB: 4.00 Isaacs Australian Labor 3.86 ALP: 1.01 Garry Spencer Party LIB: 16.00 Corangamite Liberal 3.94 LIB: 1.05 Sarah ALP: 8.50 Henderson La Trobe Liberal 4.01 LIB: 1.17 Simon Curtis ALP: 4.50 Ballarat Australian Labor 4.89 ALP: 1.01 Catherine King • Paul Tatchell Party LIB: 12.00 (Nat) • Sarah Wade (Lib) Melbourne The Greens 5.27 GRN: 1.05 • Sophie Ismail ALP: 9.00 (ALP) • Philip Liu (Lib) Dunkley Liberal 5.57 LIB: 1.17 ALP: 3.50 (Won Preselection) Mallee The Nationals 6.21 NAT: 1.01 Andrew Broad Lydia Senior ALP: 21.00 Batman Australian Labor 10.6 ALP: 1.80 • George Souris Party GRN: 1.95 (Lib) LIB: 34.00 • Alex Bhathal (Greens)

Notes

The seat of Batman was considered a very strong chance to fall to The Greens, however the recent announcement that the Liberal Party will preference the Greens last has made this unlikely.

The seat of Indi will be retained by Cathy McGowan

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SOUTH AUSTRALIA

SEAT PARTY Margin Sportsbet Incumbent Contestant Odds Hindmarsh Liberal 1.89 LIB: 1.75 Matt Williams • Steve ALP: 3.00 Georganas NXT: 5.00 (ALP) • Daniel Kirk (NXT) Wakefield Australian Labor 3.4 ALP: 1.15 • Kathleen Party NXT: 5.00 Bourne LIB: 16.00 (Lib) • Richard Inwood (NXT) Australian Labor 3.95 ALP: 1.30 Kate Ellis • David Party LIB: 3.30 Colovic NXT: 11.00 (Lib) • Joe Hill (NXT) Makin Australian Labor 5.06 ALP: 1.15 • Graha Party NXT: 5.00 Reynolds LIB: 16.00 (Lib) • Craig Bossie (NXT) Mayo Liberal 12.5 NXT: 1.50 Jamie Briggs • Rebekha LIB: 2.50 Sharkie (NXT) • Glen Dalimore (ALP)

Notes

South Australia will be a point of interest this election, due to the presence and power of Nick Xenophon and the Nick Xenophon Team in both the House of Representatives and the Senate. In the Lower House, the NXT will threaten the Liberal seat of Mayo, currently held by former minister Jamie Briggs. Labor polled just 21% of the primary vote in Mayo in 2013, giving NXT the opportunity to poll second to Briggs and leapfrog on the back of voter preferences. At this stage, each party is running an open ticket in Mayo. Should this happen on election day, it is likely that the majority of ALP voters would preference the NXT before the incumbent Liberal Party.

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WESTERN AUSTRALIA

SEAT PARTY Margin Sportsbet Incumbent Contestant Odds O'Connor Liberal 0.95 LIB: 1.10 Rick Wilson Jon Ford NAT: 6.00 ALP: 21.00 Perth Australian Labor 2.18 ALP: 1.10 Tim Jeremy Quinn Party LIB: 6.00 Hammond (won preselection) Brand Australian Labor 3.71 ALP: 1.05 Madeleine Craig Buchanan Party LIB: 8.50 King (won preselection) Cowan Liberal 4.52 ALP: 1.85 Luke LIB: 1.85 Simpkins Fremantle Australian Labor 5.4 ALP: 1.03 Pierette Kelly Party GRN: 7.00 (won LIB: 34.00 preselection) Hasluck Liberal 6.02 LIB: 1.27 Bill Leadbetter ALP: 3.50 Burt N/A 6.1 ALP: 1.44 N/A • Matt Keogh LIB: 2.70 (ALP) • Matt O’Sullivan (Lib)

Notes The new electorate of Burt has been created in WA with a notional Liberal margin of 6.1%. This margin is likely inflated as the boundary includes part of the Canning electorate previously held by the late Don Randall who was a very popular local member. Many polls show a 50/50 split and both parties are directing a huge amount of resources into the contest.

The ALP should easily retain each of Perth, Brand and Fremantle. The Liberals are not directing many resources to these seats.

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TASMANIA

SEAT PARTY Margin Sportsbet Incumbent Contestant Odds Lyons Liberal 1.22 ALP: 1.35 Eric Hutchinson Brian Mitchell LIB: 3.00 Braddon Liberal 2.56 LIB: 1.45 Brett Whiteley ALP: 2.35 Bass Liberal 4.04 LIB: 1.35 Andrew Nikolic Ross Hart ALP: 3.00 Franklin Australian Labor 5.09 ALP: 1.01 Julie Collins Amanda-Sue Party LIB: 16.00 Markham

NORTHERN TERRITORY

SEAT PARTY Margin Sportsbet Incumbent Contestant Odds Lingiari Australian Labor 0.88 ALP: 1.22 Warren Tina MacFarlane Party LIB: 4.00 Snowdon (CLP) Solomon Country Liberals 1.4 ALP: 1.27 Natasha Griggs (CLP) (NT) LIB: 3.50

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Polling

The opinion polls have shown the coalition in steady decline since November/December of 2015, with most polling showing Labor trending slightly upwards in the same period. A decline in Coalition votes has led to an increase in “other” votes, indicating that disaffected coalition voters are turning to minor parties instead of the ALP. In the final weeks of an election campaign, this “other vote” has surged to upwards of 15% in some polls, while both Coalition and ALP votes have levelled out.

Primary Vote Essential Poll (as of 29 June 2016)

50%

45%

40% 35% 30%

25% 20% 15%

10% 5% 0%

LNP ALP Green Other

Morgan Poll (as of 29 June 2016)

60%

50%

40%

30%

20%

10%

0%

LNP ALP Green Other

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Newspoll (as of 29 June 2016)

50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0%

LNP ALP Greens Other

Two Party Preferred Newspoll (as of 29 June 2016)

60%

55%

50%

45%

40%

LNP ALP

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Morgan Poll (as of 29 June 2016) 70.00%

60.00%

50.00%

40.00%

30.00%

20.00%

10.00%

0.00%

LNP ALP

Gaming Markets

The betting agencies have the coalition heavily favored to win the election. The ALP have drifted out to $7.00, after being as short as $4.00 before the election began. SportsBet is the only agency offering odds on a hung parliament, with the short odds favoring the No Hung Parliament outcome.

Agency Coalition Win ALP Win Hung Parliament SportsBet $1.10 $7.00 $1.15 – NO $5.00 - YES Bet365 $1.11 $6.50 N/A UniBet $1.11 $6.50 N/A William Hill $1.10 $7.00 N/A

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Senate

The recently passed senate reforms and the fact that all Senate spots are up for re- election have ensured that the Senate election will be as compelling and important as the lower house election. To win a Senate place in the coming election, a candidate will need to secure 7.7% of the vote in their state (as opposed to 14.2% in a regular senate election).

This gives the opportunity for several minor parties to secure the last senate seat in each state, as they will only need 7.7% of the vote. At this point it seems likely that if a candidate gets 4% of the vote in any state, they will likely win the final senate seat.

The most prominent minor party in the senate is likely to be the Nick Xenophon Team. In the 2013 Senate election, Nick Xenophon received 24.89% of the Senate votes in South Australia, ahead of both the ALP and the Greens and only 2.57% behind the Liberal Party. If the NXT were to poll in that fashion this time around, they would secure 3 Senate seats. If that vote can be pushed to 26.9%, the NXT will have half a quota of votes left over in the race to elect a fourth member. We predict that the NXT will gather between 25% – 30% of the Senate vote in SA. The NXT success will likely mean that will lose his senate seat.

Jacqui Lambie is widely tipped to retain her seat in the senate, needing only roughly 25,000 votes to get a full quota and 12,500 votes to get a half quota. The Liberal Democrats are may retain their senate position, particularly since they only need 3.9% to fill the half quota needed for a chance of gaining the final senate spot.

A usual senate election will see the successful candidate assume their office for 6 years, with every three years being a half senate election. As this election will see all senators being re-elected, some will be sitting for 3 years only. While there is no official method for choosing which senators sit which terms, Strategic Political Counsel understands that the first 6 senators elected in each state will serve 6 year terms, with the final 6 elected serving 3 year terms. This means that many of the minor party senators will be up for re-election at the next Federal election.

Likely Senate Makeup

Party Likely Senate Seats Coalition 31-32 27-29 The Greens 8-10 Nick Xenophon Team 3-5 Liberal Democrats 1-2 1 Other Independents 1-3

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Conclusion

It is incredibly likely that the Coalition will be returned to power with a smaller majority than currently exists. Strategic Political Counsel projects the Coalition winning between 81-83 seats, losing seats such as Petrie, Capricornia and Eden Monaro, but gaining seats in Fairfax and Parramatta. The Senate make-up will prove somewhat problematic for the Government going forward, with the minor parties potentially holding up to 10 seats.

What does this mean?

After every election, there are always major changes in the makeup and structure of the government and opposition. These changes affect the bureaucracy and often these changes result in staff changes across many industries, particularly in government or policy focuses roles.

How can Strategic Political Counsel help.

We have the in-house expertise to walk you seamlessly through any changes in the government that you think may affect you.

We are not associated with any one party, and as such can offer wide access to important policy makers. We have links to all major parties: Liberal/Nationals, Labor, Greens and NXT.

So whether you are an individual, sole trader, small business owner or global company, if you need good advice, please get in touch and we will assist you to ensure you are best positioned as we welcome the incoming government.

Michael Kauter Founder and Director

Samuel Thomson Adviser

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