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Lynton Crosby: 1998 Election Analysis

Lynton Crosby has addressed the National Press Club on the outcome of the 1998 federal election.

Crosby is the Federal Director of the Liberal Party.

Transcript of Lynton Crosby’s Address to the National Press Club.

Lynton Crosby, Federal Director of the Liberal PartyIn preparation for this address I took the time to read the remarks of my predecessor when he addressed the National Press Club following the 1993 Federal Election where Fightback and the GST were the focus.

In his speech he spoke of the many advertising experts who contacted him to proffer the “one and only” solution to “better sell or explain the GST”. Well I’ve got news for my predecessor, they’re still around. And to the literally dozens, if not hundreds, of advertising and marketing experts who rang and wrote with their great idea thanks for your thoughts. To the jingle writers, thanks but it was just too hard to choose. To the budding copywriters who managed to come up with a multitude of phrases all built around the letters GST thanks for those ideas too!

A campaign director never wants for free advice.

The 1998 election, by any measure, was going to be a difficult fight and a difficult fight it proved to be.

If you take into account Labor’s much vaunted claim of the superiority of their campaign skills, the fact that we were offering a cautious Australian public a bold plan for tax reform that included a GST and that Labor reckoned that its 1996 loss was just the result a protest vote against Paul Keating then Labor should have won easily.

They did not win because the community knew we needed tax reform. They did not win because 1996 was much more than a rejection of Paul Keating – it was a rejection of an out of touch Labor Party that was seen to have remained out of touch. They did not win because our members and candidates performed on the ground, in the seats, where it mattered.

And they did not win because of our leader John Howard whose leadership, strength of conviction and his ability to communicate his Government’s plan for the future could not be matched by his opponents.

It was a remarkable personal peformance by a Prime Minister committed to the politically courageous but necessary advocacy of tax reform.

John Howard’s energy, persistence and determination, often in the face of the odds, have been the hallmark of his political career.

He was completely aware that no other political party in the Western world had been successful in promoting an entirely new tax system during an election campaign. Yet he proceeded for one simple reason.

He passionately believed it was right for his country.

People knew precisely what John Howard and the Coalition stood for and what policies they would implement if re-elected. Yet they had no idea what Labor would do if they won. What is more, they saw Kim Beazley as a timid leader who also had no idea of what he would do if Labor fell over the line.

Research showed us that the Australian electorate was looking for a leader to tell them where he wanted to take our nation.

People were worried about the Asian economic crisis and how it could affect them. They saw the Coalition as the better economic managers and in this context able to secure Australia’s economic future.

Whilst there was a level of community concern about some of the tough but fair economic decisions the government took to get the nation’s books back into the black, it was clear that people had not permanently shifted away from the Coalition. Australians were looking for a reason to re-elect John Howard and fully expected the Government to be re-elected.

Labor, on the other hand, had no clear direction. They were not providing the community with the necessary answers nor with any evidence that they had learnt from their defeat in 1996.

For example, the defection of Cheryl Kernot, rather than convincing people that Labor had remade itself, simply reinforced the notion, that they would do anything for a vote – even accept the leader of another party who lacked the courage and the good grace to even tell her close confidantes of her switch. Soft voters did not believe that the well understood factional structures and union influence of Labor would be changed to give Cheryl Kernot any real say in policy development or formulation. It was widely interpreted by voters that Kernot’s defection was accepted by the Labor machine solely because they thought there would be some votes in it.

For all the claims from some commentators that the Labor Party is progressive, real Australians saw Labor as the same old faces with the same old prejudices that was a hallmark of their 13 years in office.

In contrast it was the Liberal Party, which was seen to be the progressive party of the future with a real plan to take Australia forward.

At no stage during the campaign did swinging and soft voters in the key seats believe Labor had a plan. Even their much vaunted tax package was seen as nothing more than a grab bag of promises designed to buy votes from a narrow group of voters. And no matter how many times Mr Beazley or Labor’s advertising used the word ‘plan’ at no time were the Australian public willing to believe it.

On October 3 we undertook a major polling day study.

That study, undertaken in Coalition held seats with a margin under 6%, reveals some key insights into the campaign and its outcome.

Amongst voters in these seats John Howard held a 10% lead over Kim Beazley as preferred Prime Minister – a very strong result which underscored the strength of the Prime Minister’s campaign performance.

60% of those who voted for the Coalition in 1996 but defected to other parties in 1998 did not expect a Labor win. What is more, that same proportion, 60%, stated they would not be pleased with a Labor win. So their Labor vote was never actually intended to deliver Labor government.

The male vote was crucial to the Government’s re-election. In 1996, for the first time, the Coalition led Labor amongst males with a 5.7% increase in our vote to 50.5%. This included a 12% swing amongst 25-34 year old males. This was unusual because women voters have traditionally been the swing group.

In 1975 and 1983 it was women who changed the Government. In 1996 it was men.

Again, in 1998 our male vote sustained a lead over Labor 42% to 40% on a primary basis even though we lost the female vote 40 to 42%.

The Coalition also held favour with females over 45 (46% to 38%). This was important because the swing against us amongst this demographic in 1993 was the largest and cost us that election.

Lower white collar workers who were a large block of the Howard Battlers were retained 44% to 36%.

We also held married people with children (46% to 41%) and can still rightly claim to be the party representative of Australian families.

In spite of Mr Beazley’s protestations that Labor was coming from behind, Labor actually began this campaign ahead of the Coalition. Of the 16% who were not locked into support for any specific party and who made their minds up before the election was called, 52% opted for Labor and only 28% for the Coalition.

Research also fully supports the proposition that it was John Howard and the Coalition who won, not just the election but the campaign as well.

Of the 19% of people who made up their minds in the last few days of the campaign 39% chose the Coalition whilst 35% chose Labor.

Most significantly, of the 8% who decided how to vote at the booth on polling day 46% voted for us, 24% opted for Labor on a primary basis. This demonstrated how important John Howard’s style of campaigning to the very end really was.

As I visited party forums in the 12 months prior to October 3, I always characterised the challenge of the election as guerilla warfare, rather than aerial bombardment. A battle where what was happening on the ground, in local communities, on local issues, involving local identities would be more important than the usual commentary on national issues and the unrealistic application of notional, nationwide swings.

There was, and will remain, a challenge for the Canberra-based media in particular from this. From the distance you cannot see the fox holes or hear the sniper cause a rustle of the bushes.

You see, a campaign works on two levels.

There is the national campaign which the national media see. And then there is the below-the-line campaign – the campaign that is implemented at a regional or local level. The below-the-line campaign is especially important because it is the one the voters experience directly and come into contact with daily. They may watch the national campaign on the television at night, but the direct contact of the below-the-line campaign is often more personally relevant.

It is the below-the-line campaign where a significant portion of our resources were directed during the course of this campaign.

We ran 20 separate regional candidate television advertisements focussing on the record and agenda of our local members. In the final week of the campaign we also ran separate regional television advertisements and distributed preference pieces which reminded people of what happened last time they voted directly or through preferences, for a Labor member, how that Labor member voted to increase taxes and how he or she would do it all again given half a chance.

The direct appeal to minor party voters for preferences, which was made by the Prime Minister and reinforced by our paid communications was always to be a key component of the campaign, especially because of the erosion of our primary vote due to One Nation. This is a point I will touch on shortly.

Derided by some as desperate, it was a necessary and calculated strategy which took account of our fully preferential voting system.

In 1996 Labor recorded a primary vote of 38.8% – their lowest since World War 2. The Coalition’s 1996 vote of 47.3% was our highest primary vote since 1977. So, where Labor was coming off an extremely low base, we were coming off a relatively high base.

What Labor don’t want you to focus on is that their primary vote could barely increase 1.3% to 40.05% – still one of the worst results for Labor since the war.

The electorate clearly did not embrace Labor on first preferences. Had Labor received such a primary vote in any of the elections during the 1980’s – they could have lost them.

The results in marginal seats tell the story of this campaign. In Labor’s top ten safest seats going into the election they recorded a swing to them of around 4%. In the Coalition’s top ten safest seats, Labor recorded a swing to them of 6.2%. All of these results stand in contrast to the Coalition’s top ten marginal seats where the swing to the ALP was only 2.5% – half the nationwide swing.

Labor has already put its own spin on the 1998 election result. You have probably heard the one that as a result of this election 3622 voters in the 8 most marginal Coalition seats would be required to change to return Labor to Government.

Consider that this figure is double the number that was needed to change the Government after 1993 when half this number – or 1670 voters – would had to have changed their minds in Labor’s nine most marginal seats for the Coalition to have won. It is more, too, than the 3420 voters who would needed to have changed their vote in 1990 in 6 seats for the Opposition to have won.

When Bob Carr won the New South Wales election in March 1995 with 47.8% of the two-party preferred vote compared to the Liberals 51.5%, he was seen as a hero. Media commentators described it as a “triumph for the Labor Party’s on the ground campaigning skills in NSW.”

When Bob Hawke won in 1990 with less than 50% of the two party preferred vote, Paul Kelly described it in The End of Certainty as “a case study of Labor’s superior professionalism.”

A lot has been written about mandates and the legitimacy or otherwise of the government. Most of it seriously misses the point.

In this regard, there are two facts that should be stressed.

The first is that at present, under our system, the Party which governs is the party which secures a majority of seats in the House of Representatives. That is the requirement – to win the most lower House seats – and that is what our campaign was geared towards. If the requirement was something different the campaign would have been quite different. That is the key point. If the requirement was a majority of the two-party preferred vote, or if it was a first-past-the-post race, then you would run a completely different campaign.

The second fact to highlight is that electoral boundaries are drawn up on a State basis driven by the State’s share of the national population. That means you should analyse what happened at a State level at this election. And the simple truth is that in every State except one, where the Coalition received a majority of the vote it received a majority of the seats. With the exception of New South Wales, in the States or Territories where it did not receive a majority of the two party preferred vote it did not receive a majority of the seats.

Whilst our tax plan was a comprehensive package of reforms offerring extensive personal income tax cuts and the abolition of a raft of job-destroying taxes on business the GST quickly became the focus of attack.

It is salutory to note that our polling day study indicates that the number one reason given for voting for the Coalition was GST/tax reform at 26%. Fewer Labor voters (23%) cited the GST/tax reform as the reason for voting for that Party. So GST/tax reform was a positive motivation for a significant number of voters – and a larger proportion of voters voted for the Coaltion because of it than voted for Labor because of it.

As for the Australian Democrats, their claim of mandate is very hollow. 24% of Democrat voters cited the party’s general approach as the main reason for voting for the party. 21% voted Democrat to keep the bastards honest. 15% voted Democrat because of their social attitudes. Only 13% cited the GST as reason for voting Democrat.

Coupled with the earlier indication that 60% of Coalition defectors from 1996 did not want or expect a Labor win, these figures underscore the argument that the election was not a rejection of the government’s tax reform plans. People were not voting consciously to bring the government down.

Qualitatively, we know that people believe that if the package is brought in with the elements which it contains intact, they believe it will be good for them, their families and overwhelmingly for Australia.

The election showed us that the cult of personality does not work. Labor’s attempt to impose so-called high profile, “named” candidates on electorates with whom they had little or no real affinity or connection fell short of its objectives. David Hill and Belinda Neal in New South Wales and the now lame duck Cheryl Kernot in Dickson performed poorly. It only served to reinforce that Labor had not changed their old ways. It showed the arrogance of Labor in thinking they could just impose candidates on voters.

The election also showed us the importance of effective local MPs and candidates in touch with their local communities and working hard on local issues of concern. The standing of these people, and their impact on the ballot paper is something that national opinion polls – which mention only parties and not candidates – do not measure or reflect.

After the 1996 election the Liberal Party went into the Parliament with a key seats program that encompassed 38 marginal and first time members.

Following the recent election we will have 34 seats (including Blair and Mayo) under 5%. Labor will have 19 seats under 5%.

Then there is the important consideration of women in the Parliament. The Coalition went into the previous Parliament with twenty-six women in total. We go into the new Parliament with the same number. So there has been no net loss of women in the Coalition. Indeed the proportion of women in our parliamentary ranks has actually increased.

In terms of paid communications, television was the main battleground in this campaign. The $12 million advertising spend by Labor compared to the Liberal Party’s $7 million was focussed largely on this medium.

Political advertising is unique, a fact that the dozens of marketing and advertising experts which seem to be wheeled out to make commentary during and after a campaign do not seem to understand. Your advertising is not designed to be liked but rather to have an effect on people’s voting behaviour.

A political campaign is not the place for slick, glossy and too-clever-by-half corporate style advertising which might win an award but won’t win a campaign.

Our research showed that Labor’s advertisements missed their mark – especially the early family portrait theme, which attempted to blame the Coalition for most of our ills – a notion voters did not find as believable.

Others – like that featuring a visually distracting GST blowfly which diverted people’s attention from the message of the advertisement – received heavy airplay. I could not have imagined John Singleton or our advertising team running many of the advertisements Labor did. Some advertisements left people confused about Labor’s message. When Labor played the anti-GST advertisement with Cheryl Kernot our tracking showed it actually drove their vote down. People found her patronising and condescending. My only regret was that Labor didn’t play that ad even more.

But what Labor’s paid campaign lacked in message they certainly made up for with money. They ran the heaviest political advertising weights ever seen in some markets.

In our case we kept to a smaller range of flagship advertisements – about 5 – each of which we exposed more heavily than Labor did for individual advertisements.

The whole focus of our national campaign was to remind people that if they voted for Labor they would pay for it. This was reflected in our advertisements that reminded people how they paid for Labor in the past – by way of higher debt, higher taxes and higher interest rates. We wanted to remind people of Labor’s record, how they had not changed and would do the same again if they were given half the chance.

I do not want to spend too much time dealing with One Nation especially since it failed to achieve any House of Representative seats but the focus on that party over the previous twelve months or more, and the fact that it nevertheless received over 8% of the vote, requires me to make some comments.

Let there be no mistake about Labor and One Nation. Labor sought to divide decent Australians, particularly in rural areas, because Labor apparatchiks saw One Nation as Kim Beazley’s vehicle to the Lodge.

The decision to put One Nation last on Labor how to vote cards came at absolutely no cost to the Labor Party whereas a similar and totally correct decision by the Liberal Party came at a considerable political price.

In what must go down as perhaps the most cynical and insincere political campaign cloaked in words of political morality Labor’s intention was always to benefit from One Nation preferences.

Labor were hoping to create their own DLP. Labor knew that a significant majority of One Nation voters – at least two thirds – were previously Coalition voters and they hoped that if these people were sufficiently angry at the Liberal Party for advocating putting One Nation last then they would not go back to the Coalition with their preference vote. Or, having made the break from a lifetime’s voting practice they would not stop at primaries and change their second preference too.

This nearly worked and can account for the bigger primary and two party preferred swings in some of our safer seats. 67% of One Nation voters previously voted for the Coalition. Yet only 53% of these voters actually preferenced the Coalition at this election.

The nature of Labor’s tactic was confirmed when, during the election, Labor officials such as their South Australian State Secretary acknowledged the help they would receive from One Nation preferences in key marginals.

Fortunately Labor’s hypocritical and cynical approach did not cost us government because of our preference strategy but there is no doubt it did cost seats, especially in Western Australia. There, One Nation ran press advertisements advocating Labor ahead of the Liberals in our four key marginals and gave Labor preferential placement on how to vote cards.

Handling One Nation was always an axiomatic issue. Our research found that every time the media or others focussed on Pauline Hanson, her support – and One Nation’s – would rise in the polls. John Howard was right all along in relation to the handling of One Nation. For many Australians who did not agree with much, if anything, that she said she earned points for sticking to her guns in the face of constant attacks. To hound her personally gave her the oxygen of publicity which was essential to her survival.

John Howard’s action in governing in the national interest irrespective of the personal political cost spoke louder than any words ever could.

The clue to dealing with One Nation was always in its policies. Ultimately, it was policies like a 2% easy tax and, the advocacy of printing money to fix your problems coupled with unacceptable attitudes on other issues which drove people away.

There remains an important task for the Government in engaging with those fair and decent Australians amongst One Nation supporters who gave that party their vote at this election.

Our review of community attitude towards Labor’s tax package revealed that people thought it demonstrated they were still out of touch. Labor’s tax plan was no tax plan at all. There was nothing in Labor’s promises which showed Labor was providing incentives for people to better themselves. Instead people felt through the symbols of the capital gains tax and the four wheel drive tax that Labor seemed to be punishing people who wanted to do better.

The more people saw of Labor’s policy the more they came to realise that Labor really hadn’t learnt – they were still out of touch with the aspirations of mainstream families.

The fact that Kim Beazley launched the new Labor capital gains tax policy showed that Labor had not done the hard yards in terms of policy development. They may have been out talking to people but they were not listening.

They were not hearing how the Australian people wanted to reform the tax system to provide them with incentives to save and better themselves if they wanted to work that extra time.

The campaign had many key moments. Some events which were to have great bearing on the campaign were to take place well before the election was called. One of these was the decision to axe Singleton as Labor’s advertising agency and replace them with Saatchi and Saatchi who had been dumped by the Tories in the UK and who were more corporate in their approach than the hard retail needed in political campaigns.

The Prime Minister’s press conference at the start of the campaign was a masterly performance in which he set the agenda for the campaign.

Despite sideshow events throughout the campaign, John Howard’s control of the agenda and focus on economic issues where he was so strong never wavered.

The announcement of positive economic news during the course of the campaign (such as improved job advertisements and continuing strong economic growth) helped keep the debate firmly focussed on our agenda by demonstrating that the government were competent economic managers.

As I indicated at the outset it was a tough campaign. Its ultimate success rests very much with John Howard and his team.

As Campaign Director I appreciated and benefited from a very strong working relationship with John Howard, and with Peter Costello and Tim Fischer and their colleagues.

I want to especially acknowledge the support and counsel of the Federal President Tony Staley and the enormous efforts of Ron Walker in ensuring a well-funded campaign.

I was fortunate to be able to work with a team of State Directors whose professionalism and skill ensured first class campaigns were run on the ground in their States. We had local members and candidates who had done their jobs well.

Our advertising team of Mark Pearson, Ted Horton, John King and Toby Ralph gave us the advertising campaign we needed and our pollster Mark Textor ensured we understood very clearly the thoughts of the community. As a team they are the best.

To my Federal Secretariat team I express my sincere thanks for working seven days a week for 2 and a half years in the interests of the Liberal Party and building a first class political outfit.

Finally to the hundreds of thousands of Liberal Party supporters my thanks. They are the lifeblood of the organisation and my sincere thanks will always go to them.

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Malcolm Farnsworth
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