Malcolm Turnbull’s ‘wafer thin’ majority a threat to Australian economy: Peter Costello

Herald Sun

8 August 2016

Annika Smethurst – National Politics Reporter

AUSTRALIA’S triple-A credit rating will be downgraded if the Turnbull Government can’t manage its “wafer thin” majority and pass budget savings measures, former treasurer Peter Costello says.

The stern warning comes as former cabinet minister Eric Abetz hit out at Prime Minister Malcolm Turnbull over the Coalition’s superannuation policy and his failure to promote conservatives, such as former PM Tony Abbott, to the frontbench.

Mr Abbott said while he won’t return as party leader, he wants to influence the future direction of the Liberal Party over the next three years to try to “crystallise and clarify where centre-right politics in this country goes”.

Speaking to the ABC TV’s Four Corners program, Senator Abetz issued his own warning to senior Government MPs saying: “it will only take one person or two in the House of Representatives to cross the floor to defeat Government legislation.”

“If we keep going full steam ahead and pretend that nothing happened on the Second of July … we will be going to an electoral disaster in 2019.”

The conservative Senator is leading a push within the Coalition to change the Government’s superannuation policy which targets generous tax breaks.

With one member of the Coalition — conservative Queensland MP George Christensen — already threatening to cross the floor if policy isn’t changed, former treasurer Peter Costello said Mr Turnbull will be “beholden” to his backbench.

Mr Costello — who was treasurer under former prime minister John Howard — said it will be an “alluring prospect” for Coalition MPs to sit on the crossbench.

“This is the risk on any particular issue at any particular time, not that these people will cross the floor, but they’ll threaten to go independent.”

He said the Government’s one-seat majority has rattled ratings agencies who now believe the chances for budget repair have declined.

“Will we make any progress on our budget deficit? Will we be able to reduce debt? If we’re not able to do that, if the political situation stops us from doing that, that’s the time we’ll get a downgrade,” the former treasurer warned.

During the one hour program which examined the challenges facing the Coalition, former PM Tony Abbott also called for reform within the NSW Liberal Party saying lobbyists are acting as powerbrokers and creating “a potential for corruption”.