There is more than one way to skin a cat

The draft report of the Climate Change Authority is as much about trying to inform the direction of Direct Action as it is about making recommendations about Australia's national emission target.

Predictably, the Authority's finding the current target of minus five percent on 2000 levels is "inadequate" has been viewed in the context of the Coalition's plan to repeal the carbon scheme and that its amorphous Direct Action scheme will have trouble even reaching that level.

On the flip side, the Coalition's plan to abolish the Authority seems at first to make its recommendations somewhat academic. 

But that would be a short-sighted reading of it. It does a disservice to its chair Bernie Fraser, a pragmatic and canny political operator.

For a start, the CCA finds falling demand for power, reduced land clearing, changes to the economy and Australia's surplus under the first period of the Kyoto Protocol to reach the current 5 percent 2020 target. Was a result, it is going to be easier to hit the target with Direct Action than previously thought - the big swing factor will be what happens to energy demand.

More importantly, the CCA report shows there is more than one way to skin a cat when it comes to reducing emissions. The CCA board - like a number of other experts in the field - are trying to work out how to make something serviceable out of Direct Action.

Bear in mind that the United States is on track to achieve its target of reducing emissions by 17 percent, not with a direct price on carbon but through regulation and rapid expansion of its unconventional gas industry.

With clear awareness the days of the carbon price scheme and the Authority are numbered, the CCA has laid down markers and provided guidebook to the Coalition for reducing emissions without an explicit price on carbon.

Only last week, environment minister Hunt released an issues paper calling for submissions in relation to, among other things, "the likely sources of low cost, large scale abatement to come forward under the Emissions Reduction Fund".

"The ERF will provide incentives for companies to reduce their emissions," Mr Hunt said on releasing an issues paper.

In releasing its draft report, the CCA has obliged by providing advice on possible likely sources of low cost, large scale abatement. And it has gone out of its way to be positive about the Coalition's plan and deliberately refers to "price incentives' rather than  a carbon price.

According to the draft report, the scenarios in it are "largely based on the current legislative arrangements in the Clean Energy Act 2011 (Cth)"

But, the carbon price can be seen as a broad proxy for "incentive"- based measures, the CCA says. 

"The results show the potential scale and source of emission reductions available in Australia at different marginal costs," the report said. 

"Depending on the policy design, the Government’s Direct Action Plan may mobilise many of the same opportunities."

Store that away - it's not often you will hear climate change specialists speaking in such terms about the Coalition's plans. But the truth is that Direct Action will mobilise many of the same opportunities as a direct price on carbon; the problem is more that it is likely to do so at a much higher cost.

However, on the upside, direct contracts with polluters - envisaged under Direct Action - may provide more investment certainty to invest in low-emission technology than a carbon price scheme. While a carbon scheme is intended to provide a price signal to invest, uncertainty around future price path and the current low price act as a disincentive to investment.

As a result, the CCA has gone out of its way to provide pointers to the Coalition as to how it could target Direct Action through investment in low-emissions technology and also regulation.

"Other policies, including the Direct Action Plan ...could create price incentives to reduce emissions. Such policies may mobilise similar emission reductions opportunities to those identified in the modelling.

"There may also be a number of differences depending on the detailed policy design. "

The CCA has focused particularly on investment in low-emissions technology in the energy sector, where about half of the least-cost domestic opportunities to reach Australia’s minimum 5 per cent emissions reduction target could be found.  Energy efficiency measures come in for special mention but the CCA makes pointed reference to the need to ensure measures are "cost effective". 

"Incentives for emissions reductions could be established at different levels of government, using a wide range of policy tools. The type of emissions reductions and the rate at which they are realised will be affected by the relative costs of low-emissions technologies."

The CCA also - strategically- identifies the importance of the Renewable Energy Target.

"Pitt & Sherry (2013a) estimates that about 40 per cent of the reduction in emissions from the NEM in the year to 2013 was due to lower electricity demand, and 60 per cent due to the uptake of lower emissions electricity generation. AEMO’s (2013a) forecasts note the effect of the RET in lowering the emissions intensity of electricity supply."

In the transport sector - which is not currently covered by the carbon scheme and accounts for 15 percent of emissions - "sustainable biofuels, vehicle electrification and mode shift " could be deployed.

"Fleet-average fuel economy or carbon dioxide emissions standards for light vehicles have been adopted in many major markets, including the European Union, the United States, Canada, China, Japan and South Korea. Such standards warrant further investigation for Australia. "

Similarly, in direct combustion, beyond efficiency improvements, the main opportunity to reduce emissions could be to substitute alternative lower emission energy sources, such as biofuels.

And almost half of the estimated emissions reductions in the industrial processes sector in 2020 and 2030 could be delivered by nitrous oxide conversion catalysts for nitric acid production. The other significant emissions reduction opportunity is in the destruction and replacement of synthetic greenhouse gases.

But the problem in all of this is the growth of Australia's fossil fuel exports.

"The main challenge to reducing fugitive sector emissions  is strong growth in LNG and coal production, which could outstrip improvements in emissions intensity. "

Agriculture emissions are also projected to grow in the period to 2030 in all scenarios modelled, driven primarily by strong growth in demand for Australia’s agricultural exports.

Then of course, there is the big problem of how to increase the national target about minus five percent under Direct Action. A major factor behind the CCA's recommendations is the fall in the international price on carbon and the ability to increase the national target by purchasing overseas abatement with relatively little further cost.

"While there are extensive emissions reductions opportunities available in the domestic economy, the modelling also shows that international emissions reductions can help Australia meet its targets in a cost-effective way. There are many options for securing emissions reductions from other countries."

While the Coalition has been adamant it will reach the five percent target exclusively through domestic abatement, it has been silent on what will occur if it increases the target, which Mr Hunt has indicated may occur in 2015. Indeed, in some discussions Mr Hunt as even hinted the Coalition may look to purchasing international abatement if the target is increased.

And the CCA has picked up on these hints in its report and goes into detail about how to ensure the integrity of international carbon permits.

"In the Authority’s view, the Government should consider allowing the use of international emissions reductions to go beyond its minimum 5 per cent commitment, paying careful attention to the environmental integrity of the emissions reductions allowed,". Moreover, the Government could consider using genuine international emissions reductions to complement domestic efforts to achieve Australia’s minimum 5 per cent commitment. "

It seems unlikely - given Tony Abbott's strong views against international abatement - this would occur in the short term.

But the CCA is playing the long game, despite its limited short-term future. 

"The Politics of Climate Change" - Speech to La Camara conference on renewable energy, 24 October 2013

It is a statement of blindingly obvious that the present is a period of great uncertainty in the renewable energy sector. So I want to start with what we do know. Then I want to move to what lessons have been learnt over the last six years that might be applied in the next year.

So, let's start with the busy timeline for the next nine to 12 months:

·            Carbon repeal legislation to be introduced in November parliamentary sitting

·            Release of Green Paper on the development of the Emissions Reduction Fund for public comment in late 2013;

·            a White Paper containing final policy design to be released in early 2014.

·            Legislation for Direct Action to then be introduced and operational from 1 July 2014;

At the same time:-

o   there will be a RET review in early 2014

o   And an energy white paper that will focus " on those economy-wide reforms relevant to the energy sector, including streamlining regulation, improving workforce development, and stimulating research and development

What do know about the future of the RET ?

We have been assured by Greg Hunt the Coalition is committed to the current fixed 41000 gigawatt hour target. However, there will be a review of it early next year and we also know there are different views within the Coalition - for example new energy minister Ian Macfarlane who has hinted strongly in consultations with industry groups that if demand continues to fall it will be recalibrated; to outright opposition from the newly elected member for Hume Angus Taylor and other backbenchers such as Senator Chris Back.

However, one of the interesting aspects of the reshuffle of ministerial responsibilities, responsibility for the RET has gone to Greg Hunt. Hunt is counting on the RET to help  Australia to hit the minus five percent target. However, the problem for Hunt is that he may not have strong support within the party for his position.

The draft carbon repeal legislation released last week contained amendments to RET legislation to remove the Climate Change Authority as the review body of the RET. However, and this is important, the terms of that review remain the same. BUT there is now uncertainty about further reviews after next year's with the amendments giving the minister discretion over whether two-yearly reviews are done.

It seems highly Minister Hunt will ask his Department to review the RET. In that way he will keep control of its outcomes.

What do we know about Direct Action ?

It was developed in the lead up to the 2010 election - using as a starting point - a directive from Tony Abbott that it not impose a new tax and not impose additional regulatory burden.

The policy includes Abbott's Green Army and 1 million solar roofs for low income households. However, the heart of policy is the Emissions Reduction Fund;

Essentially, it is a baseline and credit emissions intensity scheme based on the Frontier model produced for Malcolm Turnbull and Nick Xenophon in 2009. However it is funded from the budget and. cost capped.

Mr Hunt, a former McKinsey consultant, tells us a reverse auction will be used to buy the lowest cost per tonne up the abatement "cost curve".

The so-called “incentives” model is the basis of the United Nations’ clean development mechanism. In Australia, it was used in the NSW greenhouse gas abatement scheme and also the carbon farming initiative commenced in 2011.

All have faced major challenges in defining real abatement and project baselines and the schemes are administrative complexity.

This is because it is inherently counterfactual to say this particular project reduces emissions from what they otherwise would have been.

Winning bids will enter a contract to cut emissions over a defined term with payment on delivery. However, it is not clear what length of the term will be and this could be critical for companies interested in bidding.

Hunt expects to buy abatement at $8 - $12 a tonne of carbon (based on industry estimates prior to the 2010 election. However, he has subtly changed his language from suggesting the principal source of emission reductions will be tree planting and soil carbon to focus more on energy efficiency.

There will be penalties. However, the Coalition thinks few companies will pay it. This is because it will be an emissions intensity baseline and historical experience is that most companies become less emissions intensive over time not more as they become more efficient.

To progress this plan an emissions reduction taskforce has been established within the Department of Environment. Last week, Minster Hunt released a one page issues paper  asking for submissions to assist in the development of Direct Action:-

·            the likely sources of low cost, large scale abatement to come forward under the Emissions Reduction Fund;

·            how the Emissions Reduction Fund can facilitate the development of abatement projects, including through expanding the Carbon Farming Initiative and drawing on the National Greenhouse and Energy Reporting Scheme;

·            the details of auction arrangements to deliver cost effective outcomes;

·            the governance arrangements that will support the Emissions Reduction Fund,

·            including the role of key institutions such as the Clean Energy Regulator;

·            the details of the monitoring, verification, compliance and payments arrangements for

·            successful bidders at auction;

·            transitional issues relating to the existing Carbon Farming Initiative; and

·            the design and operation of a mechanism applying to emissions above the business as usual baseline.

The key item will be the last; working out how the baseline is set and at whether it is applied at a facility or corporate level.

Repeal of carbon price scheme

The Government has made clear it will not extend the carbon tax beyond 2013-14, even if the Parliament does not pass the carbon tax repeal bills until after 1 July 2014. Lawyers better than I have highlighted the transitional problems that this commencement date will pose if it is not passed by this date. There are particular problems in the energy sector with supply contracts and calculating the carbon component in wholesale spot prices. On top of this, there will be the ACCC looking at whether prices are "unreasonably high" after 1 July 2014.

Labor has said it won't pass the repeal bills but the Coalition is confident it will in the same way they passed the WorkChoices repeal bill after they lost in 2007. However, there is no sign that will occur. In fact, quite the opposite - after suffering such an electoral backlash in 2010 when back-flipping on the CPRS and again following the election, there are many who think they are better off standing firm on a key party policy.  Former climate change minister Mark Butler, has also retained the portfolio in Opposition and in my view would be unlikely to support a repeal.

It's highly likely the repeal bills will be referred to a parliamentary committee and with Labor and the Greens having the numbers in the Senate it seems unlikely that will be a short inquiry

As a result, the Coalition will find it difficult to quickly get a double-dissolution trigger, which the Coalition is threatening to pull if Labor does not pass the repeal bills.

As a result, it seems more likely that the bills will not be passed until after 1 July causing the transitional problems I referred to earlier. It also seems unlikely the Coalition will want to risk a double dissolution given it will reduce the Senate quota, making it even easier for micro parties to get elected.  So I won’t go through in detail the D-D procedure.

This brings us to the big uncertainty after 1 July in what form the repeal bills come out of the other side of the Senate. New micro-parties – particularly the Palmer United Party - in Senate means the outcome and form of repeal of the carbon price and Direct Action is highly uncertain. As a result, it seems highly likely Labor will come under strong pressure from industry to pass before 1 July to avoid this scenario.

Double Dissolution ? Unlikely

Under Section 57 of the Commonwealth Constitution, the Governor-General can dissolve both Houses of Parliament if a bill is twice rejected or “fails to pass” the Senate, or if it passes with amendments which are unacceptable to the House of Representatives.

However, there needs to be a three-month interval between the Senate first rejecting, failing to pass or amending a bill and the second occasion.

In 1975, in similar circumstances, the High Court ruled the Petroleum and Minerals Authority Act was not eligible for the double-dissolution process as it was not one the Senate had failed to pass. Judges highlighted the Senate was entitled to a “proper opportunity for debate” and to undertake ordinary “deliberative processes”. Said Justice Harry Gibbs in that case:

“Nothing in the section favours the notion that the House of Representatives can require the Senate to treat as urgent any bill that the House happens to think ought to be treated urgently.”

This brings me to the second part of the speech

What have we learnt from the last six years ?

Nicola Roxon last week began Labor's painful post mortem of how it went so wrong over six years of power with her take on the removal of Kevin Rudd.

In such a post mortem there will need questions asked about how an issue that helped propel Labor into Government in 2007 and was a key cause of its loss in September - climate change – with the second lowest vote in a century.

From this post mortem lessons about policy making and implementation will need to be learnt by all sides of politics if there is to be major but necessary economic reform in the future.

As someone who covered the carbon pricing debate in some detail, I want to offer my own assessment of what went wrong.

By way of summary, here are the lessons that I believe can be cystallised from the last six years:

·            There is a need to properly explain policies and reasons for pursuing them

·            Language is important

·            There are dangers of over egging it - eg "greatest moral challenge"

·            There is a need to bring the community along

·            Support for tackling climate change may turn on weather events. But not always;

·            There is a danger in conflating weather events with climate change;

·            People like something they can have a personal experience of eg Solar.

Let me deal firstly with the first of those two points. I don't think there is any doubt that Kevin Rudd squandered the goodwill he earnt from the electorate in 2007 over climate change. He failed to properly explain the reasons for the carbon pollution reduction scheme and how it worked. Instead, he used it as a battering ram to undermine two Coalition leaders, Brendan Nelson and Malcolm Turnbull. There is a clear lesson in this as well for the Coalition which looks like it will attempt to use the Carbon Repeal process to damage a new Labor leader without adequately explaining its own Direct Action policy.

Secondly, Rudd made his task more difficult by calling his emissions trading scheme the rather unwieldy "Carbon Pollution Reduction Scheme". As I understand it, it was a title devised by Kevin Rudd’s former chief of staff Jordan over the objections of government advisers and senior bureaucrats who wanted the simpler title Emissions Trading Scheme. CPRS was an acronym that came to signify the scheme’s incomprehensibility. When it came to carbon price scheme mark 2, climate change minister Greg Combet tried again and came up with "Clean Energy Future" as it signified what the Government was working to achieve. But again it didn't really signify what the policy was or how it worked in the same way that the simple "emissions trading scheme" moniker would have done.

Rudd made matters worse by initially referring to climate change as "the greatest moral challenge of our time" and then refusing to take the issue to a double dissolution when the CPRS was blocked by the Senate and instead shelving the scheme. I’ll come back to this point about over-egging it.

The failure to properly explain and bring the community also plagued the policy process and implementation of the carbon price package. With a hung Parliament, a deeply divided Labor Party and a pre-election commitment not to impose a carbon tax, the Gillard government had none of the necessary conditions for major economic reform with a divided party and a hung parliament. As a 2010 research paper by the Organisation for Economic Co-operation and Development made clear:

“It pays to have an electoral mandate for reform,” says the working paper. “The cohesion of the government is also critical: if the government is not united around the policy, it will send out mixed messages, and opponents will exploit its divisions; defeat is usually the result.”

As a result, there was a real need for the Gillard Government to properly explain the policy and reasons for doing so. However, Gillard fell into the trap of conceding the scheme was effectively a "tax" in order to explain its operation - despite the fact it was an emissions trading scheme with a three-year fixed price. That concession - apparently in breach of her 2010 election promise - more than anything else undermined the electorate's trust in her Government. It left the way open to Tony Abbott to undermine it even further.

To make matters worse, Gillard and Combet announced the bare bones of the scheme in February and then spent five months in confidential negotiations trying to work out the detail. With the Government effectively vacating the field, the Opposition and opponents had free reign to speculate about possible scheme design, and suggest extreme outcomes. When the Government eventually got around to explaining the scheme, it was complex and it was almost impossible to rebut a simple and devastating Opposition attack on it.

Having said all that though the unremarked success story of Labor's six years in office has been the growth of household solar. Of course, small-scale solar subsidies are by no means the cheapest and most cost-effective form of renewable energy but there is no doubt that they are the most popular and potentially effective. I believe their success reflects an obvious political truth - people want to feel as though they have a personal stake in tackling climate change. They don’t want it to be imposed from on high. As the cost of solar PV drops worldwide, power prices rise and various schemes to incentivise the uptake have been rolled out, the uptake of solar is having a major impact on the energy market.

Dangers of Egging It

I want to now spend the rest of the speech dealing with something I believe really needs to be considered going forward, particularly with a new Coalition Government. And that is the need to cool the temperature of the climate change debate.

In the lead up to the release of the most recent report of the Inter-Governmental Panel on Climate Change an information kit was sent around to environment groups by a PR firm engaged by the IPCCC .

Contained in the kit was material the groups could use in their climate change campaigns including a sample opinion piece groups could submit to media organisations. According to that opinion piece the IPCCC report contained important information for people "who don’t like to end up in flames".

As is if to illustrate that point, within weeks large bushfires began raging throughout NSW after the hottest start to spring on record. And it didn't take long for some people to start pointing the finger at climate change.

Greens deputy leader Adam Bandt went one step further and attempted to link it to the new Government's plans to repeal the carbon.

Those statements make eminent sense to those who already understand the likelihood and intensity of such events increases as a result of climate change. But they continue a strategy that too often is counter-productive. With the election of a new Government there is a need to assess whether the traditional forms of advocacy and environmental campaigning are suitable.

The most obvious problem with Bandt's comments is that repealing the carbon price alone will do little to prevent future climate change. Much rests on what happens in China and its annual 10 percent emissions growth, rather than a country that accounts for 1.5 percent of global greenhouse gases.

More importantly, one of the lessons of the last 10 years of the climate change debate has been the danger of making overly dramatic claims. As the IPCCC report details there is a range of possible temperature increases and sea level rises. Yet too often, it is the top-end of those ranges used to underscore the need to take urgent action.

Consider for example, prominent scientist Tim Flannery's claim in 2004: "There is a fair chance Perth will be the 21st century's first ghost metropolis."

Three years later he was at it again saying:

"In Adelaide, Sydney and Brisbane, water supplies are so low they need desalinated water urgently, possibly in as little as 18 months".

Such claims have provided endless ammunition and mirth to people who seek to discredit the science of climate change. I remember speaking to one internationally respected climate change scientist who said he and his colleagues dread whenever Tim Flannery gives a speech as inevitably they have to go in afterwards and clean up.

Flannery's comments also highlight the dangers of conflating long-term climate change with short-term weather events. It is not possible to say whether one large bushfire or drought is due to climate change but only that they are consistent with a trend where such events become more probable.

Even so, Flannery's comments made at the time of the record-breaking millennial drought, helped feed public concern about climate change and acceptance of the need to introduce carbon pricing.

Yet when the millennial drought ended and public concern swung to the impact of the Global Financial Crisis, a great deal of the public momentum to introduce carbon pricing fell away.

After this time, other major weather events - the 2009 Victorian bushfires and the Queensland floods - failed to stir the same public opinion, so highlighting the dangers of basing a campaign on long-term climate change simply on short-term weather events.

Another of the problems of the climate change debate over the last 10 years has been how otherwise intelligent people become more and more entrenched in their climate scepticism as more and more scientific information about the likelihood of damaging climate change becomes available. It is the most curious paradoxes of the whole debate. There is a also seeming contradiction in the fact that those arguing most fervently against a market based mechanism to tackle climate change are those who otherwise believe markets are the best and most efficient way of dealing with social and economic issues.

 In the United States,  there is an increasing body of academic research that political ideology—and in particular conservative or free marketeer —is a major factor preventing acceptance of climate science.

One US study found individuals’ worldviews explained individuals’ beliefs about global warming more  fully than any other individual characteristic; So-called "hierarchs" and individualists tend to dismiss the claim that global warming is occurring and is serious threat to our society due to the belief it would lead to a redistribution of resources, whereas egalitarians and communitarians take the opposite view.

Further, it found with increasing levels of scientific literacy, liberals ("egalitarian communitarians") and conservatives ("hierarchical individualists") become more polarized over global warming.

However, the same research showed people who endorsed free-market economic principles become less hostile when they are presented with policy responses that do not seem to be as threatening to their world view, such as geo-engineering or nuclear engineering. In one experiment, subjects were supplied with one of two versions of a newspaper article. In both versions, a report was described as finding that the temperature of the earth is increasing, that humans are the source of this condition, and that this could have disastrous environmental economic In one version, however, the scientific report was described as calling for “increased anti- pollution regulation,” whereas in another it was described as calling for “revitalization of the nation’s nuclear power industry.” Those subjects receiving the “nuclear power” version of the article were less culturally polarized than ones receiving the “anti-pollution” version. 

In a recent New Scientist article Cardiff University research associate Adam Corner said the implication of this research was that climate change communicators needed to understand that debates about the science were often simply a proxy for more fundamental disagreements.

"Too often, they assume that the facts will speak for themselves – ignoring the research that reveals how real people respond.

If communicators were to start with ideas that resonated more powerfully with the right – the beauty of the local environment, or the need to enhance energy security – the conversation about climate change would likely flow much more easily."

There is some substance in that suggestion when you examine Prime Minister's Tony Abbott's oft-stated views on "practical environmentalism". In announcing his "Green Army" signature policy earlier this year he stated:

            Australia has a beautiful environment and Australians want to look after it.  We are all conservationists now. But as well as climate change, important  though that is, we have very big environmental challenges much nearer to  home, chief amongst them are our degraded land and our polluted  waterways

In other words, if people are concerned about climate change and want to convince the new Government to take action now, they need to come with better and smarter ways of doing so than simply expecting moral outrage and condemenation to suffice.

So let me finish with my three take-outs from these lessons.

·            Remember your audience;

·            Keep it measured;

·            Keep it simple - don't over complicate. However, that is different from being simplistic.

The first two of those take-outs are pretty much to summarise what I have just been saying. So I will finish by explaining the third. Many, many times when speaking to clean energy lobby groups and companies I have been bombarded with facts, figures and colourful graphs. In an extremely complicated and technical area, a lot of knowledge about the energy market, the RET and carbon pricing was also assumed. In order to rebut the simple claim, the RET was the cause of high power prices, I was given data on the South Australian wholesale market and NSW IPART's findings. It seemed to be based on an assumption that rational enlightment would result from providing more and more data and information. As we have already seen, that won't always be the case. And even if the listener does not have a fixed position, the complexity of the subject often ends up confusing rather than enlightening. So my final message is where possible keep it simple and remember your audience.

Views from the treadmill on Labor leadership

It used to be the way that the best insights into politicians' thinking was over a drink at the members' bar. But these days a great vantage point is the treadmill at the parliamentary gym.

At least, as never much of a social drinker, it was where I got my best intel.

As a regular gym goer, it has given me a ringside seat in two recent leadership battles. It arms me with the knowledge that while Labor is still underestimating Abbott, the new Prime Minister did not make the same mistake. But more of that a little later.

I have a pretty clear memory of the events leading up to Abbott's ascent to Liberal leadership. At the time, I was working as a senior advisor in the office of Robert McClelland, then Attorney-General, but had decided to pull the pin and go back to a real job in journalism.

Like most in Labor, quite a few of those around me couldn't quite believe Abbott could be leader, let alone Prime Minister.

But Abbott's assured performance in parliament after Malcolm Turnbull's attack on Kevin Rudd over the so-called "Utegate Affair" turned to dust convinced me that the former Health minister would be the next Liberal leader.

After spending 18 months in the political wilderness after the 2007 election defeat, Abbott's parliamentary experience and ability on the floor of the House - on display on that day - were critical in raising his standing and belief among party colleagues that he was an alternative leader.

It was a judgement that was validated in the coming years as Abbott ruthlessly used Question Time and manipulated parliamentary standing orders to launch daily attacks on Labor.

It created compelling vision for the nightly news and as an Opposition leader hampered by a lack of resources and concrete announceables,  those media opportunities are invaluable

In contrast, during this time Labor's best parliamentary performer, Julia Gillard, seemed trapped by the constraints and expectations of the office of Prime Minister. Only few on Labor benches rose to Abbott's challenge. The most effective of those was Anthony Albanese.

Yet despite Abbott's success in parliament, many in Labor refused to acknowledge his ability. It is rare that I find myself in agreement with The Australian's culture warrior Chris Kenny but I found myself nodding with his assessment that Labor continues to fail to under-estimate Abbott. http://www.theaustralian.com.au/news/features/know-your-enemy-tony-abbott-continues-to-confound-the-left/story-e6frg6z6-1226738524236#

"They betray not only a failure to learn from last month's landslide but wilful blindness to similar lessons from the entire Howard era."

Getting back to the insights I got from my vantage of the running machine, I offer this little anecdote to give colour to that point.

On 30 November 2009, I took myself down to the parliamentary gym as the Liberal Party tore itself apart with Malcolm Turnbull facing a mutiny over his support of the Carbon Pollution Reduction Scheme.

As I walked past Aussies to the gym, a group of Liberal staffers and MPs were gathered around a TV screen with glum expressions as the challenge to Turnbull unfolded.

In the gym, it was a different story. Craig Emerson and two other Labor MPs - whose identity now evades me - were peddling away on exercise bikes and chortling as it became clear Abbott would be the next Liberal Party leader. Despite the exertion, they had grins from ear to ear at the elevation of a man they considered unelectable.

Contrast that scene with one that I witnessed only weeks ago as the Labor party leadership contest between Bill Shorten and Anthony Albanese commenced.

It was the day Abbott's frontbench had been sworn in and the gym was nearly empty. The last person I expected to see coming into the gym was the new Prime Minister with his  distinctive swagger. As he came in, Albanese was launching his leadership campaign at NSW Trades Hall.  Spotting Albo on the gym TVs, he turned to myself and another still in the gym and asked if he could turn up the volume so he could listen while exercising.

"Gotto listen to him" he winked. He then proceeded to go through his gym routine of stomach crunches, all the time listening intently to Albo's speech.

Now I may be wrong but I suspect at that time Abbott had a clear view of whom his main challenge would be as Opposition leader and it was Albo having locked horns with the Marrickville mauler over the dispatch box for many years.

I could be wrong again but I suspect Abbott and colleagues would be most comfortable with the outcome of the Labor leadership ballot. To say, Shorten is a lacklustre parliamentary performer is an understatement. An embarrassment would be a closer description. Day after day he would come into the chamber with cheap arse workshopped gags that make most on his side of the chamber cringe. They made my Dad jokes look like the best of Oscar Wilde.

And with only little over two terms in parliament it is not surprising. For all the talk of "generation change", there is no substitute for experience;  an understanding and assuredness on the floor of parliament in most cases takes time. In contrast, having spent 11 years in the wilderness, Albo has that in spades, even if his campaign leader was tired and lacking.

As a result, I find myself searching to understand the decision by a majority of caucus members. The only thing I can think is that many not having ever been in Opposition have no understanding of what now confronts them.

The decision continues the disconnect between community views and those of caucus members which characterised the Rudd/Gillard years. It was clear from published polling that Albo was not only the lay members' favourite but also the community's. However, as has been the way in recent years, many of those in caucus - particularly among Right-wing apparatchiks - think they know better.

Good luck guys. You'll need every ounce of it.