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P 190719Z MAY 09
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INFO RUEHBN/AMCONSUL MELBOURNE PRIORITY 6359
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RUEHDN/AMCONSUL SYDNEY PRIORITY 4582
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C O N F I D E N T I A L SECTION 01 OF 02 CANBERRA 000477 
 
NOFORN 
SIPDIS 
 
E.O. 12958: DECL: 05/18/2019 
TAGS: PGOV AS
SUBJECT: STILL POPULAR RUDD SEES DROP IN POLLS 
 
Classified By: Political Counselor James F. Cole for reasons 1.4 (b) an 
d (d). 
 
¶1. (U) SUMMARY: Although Prime Minister Kevin Rudd's 
popularity has declined, he is still much more popular than 
Opposition Leader Malcolm Turnbull, whose net approval 
ratings remain in negative territory.  Support for the 
Australian Labor Party (ALP) Government remains high, 
according to opinion polls published since last week's 
budget.  The Opposition continues to vigorously attack the 
budget, in particular it's proposed deficit, and changes that 
make private health insurance more costly.  As speculation 
about an early election continues, Turnbull is hoping to 
highlight the theme of economic management - the Coalition's 
traditional strong suit - in the public debate. END SUMMARY. 
 
RUDD'S POPULARITY TAKES A HIT 
 
¶2. (U) In a Sydney Morning Herald/AC Nielsen poll released 
May 18, the Rudd Government's lead over the Opposition fell 
from 58-42 in March to 53-47.  Rudd's approval rating fell 10 
points to 64 percent and his disapproval rating rose to 32 
percent but this is still an excellent result.  Turnbull's 
disapproval rating, at 47 percent, remains higher than his 43 
percent approval rating.  A Newspoll, published in "The 
Australian" May 19, had the ALP extending its lead from 55-45 
to 56-44.  Rudd's net approval rating (approval minus 
disapproval) dropped 11 points to 27 percent, and Turnbull's 
net rating improved by seven points to minus two percent.  In 
the Newspoll, 45 percent liked the budget, versus 33 percent 
who did not (it was 49-23 last year). 
 
TURNBULL ON THE ATTACK 
 
¶3. (SBU) Turnbull's budget-reply speech, given on May 13 two 
nights after the Government's budget speech, was well 
received by Coalition MPs.  Turnbull largely focused on the 
increasing levels of government debt and the budget deficit 
caused by the Government's "reckless" spending.  He targeted 
Rudd's "ideological" attack on private health insurance, 
declaring the Opposition would vote against any changes to 
government support.  Instead, Turnbull proposed increasing 
the tax on cigarettes.  He also committed the Coalition to a 
range of measures to help small business and provide greater 
oversight of government spending.  Armed with the budget's 
deficit projections, which it compares to the Howard 
government's record, the Opposition believes the Rudd 
government is vulnerable, particularly if unemployment keeps 
rising. 
 
EARLY ELECTION TALK WON'T GO AWAY 
 
¶4. (C/NF) Speculation about an early election this year or in 
the first trimester of 2010, fueled by the Opposition's 
refusal to support the Emissions Trading Scheme bill which 
was introduced last week, was heightened by Turnbull's 
decision to oppose changes to the private health insurance 
rebate.  Some Liberal Party strategists, including it's 
national political director Brian Loughnane, believe Rudd 
wants an early election (most likely in February-March 2010) 
before his popularity is dented by the worsening economy. 
Former Treasurer Peter Costello predicted the AC Nielsen poll 
would only reinforce the Government's desire to go early. 
However, other observers believe Rudd is simply using the 
threat of an early election to pressure the Coalition into 
supporting its agenda.  Simon Banks, a former Rudd Chief of 
Staff and the head of the Canberra office of Hawker Britton, 
the chief ALP-affiliated lobbyist, told us Rudd is cautious, 
and that the election would probably be held on schedule, in 
Qand that the election would probably be held on schedule, in 
September-October 2010. 
 
COMMENT: EARLY ELECTION RISKY FOR RUDD 
 
¶5. (C/NF) Given Rudd's commanding lead over Turnbull, it 
would make sense for the Prime Minister to opt for an early 
election befre the voters start blaming him for a worsening 
economy.  The ALP won the 2007 election with 52.7 percent of 
the vote, to 47.3 for the Liberal and National parties.  Rudd 
is still polling above those numbers, and is much more 
popular than Turnbull.  Neither party could be ready for an 
election this year.  The electoral boundaries in New South 
Wales and Queensland are being redrawn to give Queensland an 
extra federal parliamentary seat, and that process will not 
be completed until the end of 2009 - although an election 
could theoretically be held with temporary boundaries.  The 
Liberal party, trailing in the polls and with little money in 
its coffers, has more to fear from an early election, but 
there are risks for the Government as well.  Voters may 
 
CANBERRA 00000477  002 OF 002 
 
 
resent having to vote early (as they seem to have in Western 
Australia last September when the ALP called an early 
election and lost), particularly if they think the Government 
is avoiding responsibility for a worsening economy.  For an 
early election, the Government would have to use as an excuse 
either the emissions trading scheme or the changes to the 
private health insurance rebate, which could sound hollow to 
voters who are worried about their jobs and the economy. 
 
COMMENT CONTINUED: PRESSURE ON TURNBULL AS COSTELLO LOOMS 
 
¶6. (C/NF) There is a growing sentiment in the Opposition and 
the media that this budget could mark a turning point in the 
Rudd government's popularity.  The Liberal-National Party 
Coalition believes - or at least hopes - that the national 
debt will be of increasing concern to voters.  In July, 
Turnbull will have served 10 months as Opposition Leader - 
the same length of time his predecessor Brendan Nelson served 
in the position.  If the polls do not continue to improve, 
Turnbull's enemies in the Liberal Party may begin to stir. 
One of them, a senator from South Australia, recently told us 
Turnbull is right on the economy, but is not getting through 
to the voters, as well evidenced by his negative approval 
rating.  The senator maintained that Costello remains the 
Coalition's best hope, and that the former Treasurer could 
easily win any future leadership ballot against Turnbull. 
Costello, meanwhile, showing no signs of retiring from public 
life, has just launched a website called 
"PeterCostello.com.au." 
 
CLUNE