Gillard Faces Danger Zone for Challenge as Rudd Hits Risky Seats

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Julia Gillard, Australia's prime minister, has lost “significant support” among the Labor caucus with Former Prime Minister Kevin Rudd being considered the alternative prime minister, the ABC reported on its website June 9, without saying where it got the information. Close

Julia Gillard, Australia's prime minister, has lost “significant support” among the... Read More

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Photographer: Mark Graham/Bloomberg

Julia Gillard, Australia's prime minister, has lost “significant support” among the Labor caucus with Former Prime Minister Kevin Rudd being considered the alternative prime minister, the ABC reported on its website June 9, without saying where it got the information.

Australian Prime Minister Julia Gillard, needing an unprecedented recovery in popularity to win elections in three months, faces a window in coming weeks where her leadership could again come under challenge.

With parliament sitting for a final two weeks starting June 17 before the election campaign gets into full swing, Gillard is approaching a danger zone when her Labor party colleagues will all be in Canberra, enabling a snap challenge and leadership vote.

Former Prime Minister Kevin Rudd, toppled by Gillard in a backroom coup three years ago, revived speculation of a contest after starting campaign appearances for colleagues in marginal seats, as opinion polls show Labor faces a landslide defeat by Tony Abbott’s Liberal National coalition. The Australian newspaper this week cited an internal Labor party survey as showing Gillard’s minority government may lose as many as 40 seats in September.

Consistently rated Labor’s most popular leader in polls, Rudd failed in a challenge to unseat Gillard in February 2012 and has said he stands by a commitment not to seek the leadership again.

Recent polling puts “the party under renewed pressure with talk of leadership challenges,” said Zareh Ghazarian, a lecturer in politics at Monash University in Melbourne who predicts the loss of 30 to 35 seats. “There’s still plenty of time for that to happen. If we look back for precedents, we know that Bob Hawke replaced Bill Hayden on the day the election was called in 1983.”

Photographer: SeongJoon Cho/Bloomberg

Kevin Rudd, Australia's former prime minister, last week campaigned in the Victorian industrial region of Geelong, where Ford Motor Co. has a factory. Close

Kevin Rudd, Australia's former prime minister, last week campaigned in the Victorian... Read More

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Photographer: SeongJoon Cho/Bloomberg

Kevin Rudd, Australia's former prime minister, last week campaigned in the Victorian industrial region of Geelong, where Ford Motor Co. has a factory.

Swan Polling

Hawke went on to defeat Malcolm Fraser in that election and become the longest serving Labor prime minister in the country’s history. Rudd, in his early days as leader, surpassed Hawke in recording the highest poll rating ever.

The internal polling reported in the Australian showed Treasurer Wayne Swan and eight other ministers, including Education Minister Peter Garrett and Trade Minister Craig Emerson, could lose their seats. Garrett and Emerson may avoid defeat if Rudd is restored, a separate Fairfax/ReachTel survey published two days ago by the Sun Herald newspaper said.

Gillard remained defiant today, referring reporters to Rudd’s own words when they questioned her on the issue.

“I will certainly be leading Labor at the next election,” she said. “There’s been plenty of speculation and rumormongering, and if people are wasting their time on that, that’s time that would be better used out there in the community.”

2010 Leaks

Gillard’s backers are reluctant to reinstall Rudd because they blame him for leaks during the 2010 election campaign that damaged the government and triggered a slide in opinion polls, resulting in the closest ballot in 70 years. Former Labor leader Mark Latham said on Australian Broadcasting Corp. television last night that Rudd is destabilizing the government.

“You’re getting into the realm of evil here with Rudd,” he said on the ABC’s Q&A show. “This is a program, a jihad of revenge the like of which we’ve never seen before in the history of Australian politics, and it goes beyond the normal human reaction of revenge.”

Gillard has lost “significant support” among the Labor caucus with Rudd being considered the alternative prime minister, the ABC reported on its website June 9, without saying where it got the information.

No-Confidence Option

A complication in any transition to Rudd is that Labor relies on independents for a majority in parliament. Key lawmaker Tony Windsor told ABC radio this week that his 2010 deal to back Labor was made with Gillard and a change of leader would render it “null and void.” The loss of independent support would potentially allow Abbott to call a vote of no confidence that the government could lose. In such a case, the governor-general, Australia’s head of state, may ask the opposition leader to form a government.

The Australian reported that the biggest swings against Labor are predicted in outer-suburban working class and migrant areas, with the party’s primary vote seen in the 30 percent to 33 percent range.

Rudd last week campaigned in the Victorian industrial region of Geelong, where Ford Motor Co. has a factory. The company announced last month it would end production in Australia after nine decades, with the loss of 1,200 jobs. He plans this week to campaign in the Labor heartland of western Sydney to help local members facing polling pressure.

The Fairfax/Reachtel survey showed Garrett’s share of the two-party preferred vote would rise to 53.4 percent with Rudd as Labor leader from 48.9 percent under Gillard. Emerson would enjoy an 11.8 percentage point swing, the survey showed.

Poll Drop

Labor fell 2 percentage points to 42 percent on a two-party preferred basis, while the opposition gained 2 points to 58 percent, according to a Newspoll published in the Australian newspaper on June 4. Gillard’s satisfaction rating dropped 3 points to 28 percent.

News Ltd. newspapers reported this week that Workplace Relations Minister Bill Shorten, a party powerbroker and key backer of Gillard, commissioned polling in his Melbourne seat that showed a 13 percent swing against him, a result that would make his district marginal.

“Mr Shorten has indicated publicly that he is supporting me as I get about this important work for the nation,” Gillard told reporters today. Shorten has come under pressure to urge her to step aside rather than face another leadership challenge, Fairfax newspapers reported this week.

The prime minister’s bid to woo voters disaffected by party infighting and policy reversals by announcing increased education and health funding failed to boost Labor’s ratings. Signs of an economic slowdown have given momentum to Abbott’s conservative coalition, which hasn’t ruled since 2007.

Employment Weakness

The Reserve Bank of Australia predicts the labor market will “remain somewhat subdued” and the government, in its May budget, projected unemployment would rise to 5.75 percent by June 30, 2014, from the current 5.5 percent.

The economy expanded at 2.5 percent in the first quarter from a year earlier, the slowest annual pace in almost two years.

Infrastructure Minister Anthony Albanese, who supported Rudd in the 2012 challenge, said today that nothing has changed in the party room.

“There’s a couple of people obviously didn’t get the message of what Kevin Rudd said earlier on this year and last year, which is that he would not challenge again for the leadership,” Albanese told reporters in Sydney. “He made that clear, he’s made that clear since.”

To contact the reporter on this story: Michael Heath in Sydney at mheath1@bloomberg.net

To contact the editor responsible for this story: Rosalind Mathieson at rmathieson3@bloomberg.net

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