From left field: demographic targetting and taxation for Labor

Labor’s announced roll-backs represent the epitome of modern day demographic targeting at work. The question now is, will Labor successfully hit the targets it needs to? Let’s try to answer this question.

To begin with, it’s important to remind everybody that the dynamics of single member electorates is that the objective is to win the majority of the two-party preferred vote in the majority of electorates (in this case, 76). And not the majority of the two-party preferred vote overall. This means that the election is always about what happens in the volatile seats - that is those that have the potential of changing hands. (Labor won over 51 per cent of the preferred vote nationwide in 1998, but only 46 per cent of the seats.)

As such, it’s not just about the margin from the last election, often seen in the form of the electoral pendulum, which can in fact be incredibly misleading. Seats with slim margins do not necessarily mean that they are more likely to change hands.

Because the issue is about volatility, the questions from a campaigning point of view are simply these:

• who are the volatile voters (that is, those most likely to ‘churn’ from one party to another);
• where are they located (that is, the distribution/concentration of the target demographic across the 150 electorates); and
• what makes these voters tick?

With its roll-back plan Labor is very conscious about the need to "target" the measures to maximise voter impact. In many respects, it’s exactly the mentality that underpinned its tax credits policy of 1998.

In 1998, however, Labor’s tax policy simply missed the mark. Demographic analysis published by former Labor Senator John Black in Electoral Snakes and Ladders (which can be downloaded from www.australiandevelopmentstrategies.com.au) shows very clearly the demographic-tax dynamics of the 1998 campaign. It’s worth reviewing Black’s research findings because they may give us a clue as to the potential electoral impact of the 2001 roll back targeting.

The demographic correlation analysis, summarised in Chart 1, shows that:

• the Labor Party was successful in gaining support amongst the individual income groups earning between $400-499 per week (1996 levels) including the welfare recipient group earning between $80 and $159. This group was a strongly pro-Labor group; and
• those earning between $200 and $500 per week were, on average, Coalition supporters. Labor received no swings among any income groups earning more than $500, and above $600 the swings were sharply anti-Labor among an already conservative group.

Chart 2 shows us where the swinging voters were located across marginal and safe seats.

This shows that:

• welfare recipients and low-income earners were strongly concentrated in safe Labor seats (columns 4, 5 and 6 from the left), a category in which Labor performed quite well. This success was replicated in the $200 to $299 and $400 to $499 income groups, which were located disproportionately in key marginal Liberal seats; and
• however, Labor did not gain swings in the $500 to $799 group, which are disproportionately located in marginal Liberal seats.