Gillard to get grief over policies

Julia Gillard. Photo / The Australian.

CANBERRA - Prime Minister Julia Gillard faces the grim prospect of fighting both miners and environmentalists for the remaining four weeks of the election campaign after a sharp shift in fortunes yesterday.

While polls since the August 21 election was called last Saturday have pointed to a Labor victory, supported by a deal with the Greens to swap preferences, two of her biggest problems have returned to darken her political horizon.

The mining industry has threatened to re-open its anti-Government television blitz, called off after Gillard deposed former Prime Minister Kevin Rudd and struck a deal with the country's biggest miners.

And Gillard has been hammered from all sides on her new climate change policy, which has skipped around the issue of carbon pricing by proposing a 150-member "citizens assembly" to study climate change science and debate alternatives.

Acceptable mining tax and climate change policies were two of the preconditions for an election Gillard set down after winning office.

The third - a new approach to asylum seekers - has also flopped, hamstrung by the failure to win approval for a detention centre in East Timor under a modified version of former conservative Prime Minister John Howard's "Pacific Solution" of camps on Nauru and Papua New Guinea.

Gillard struck a deal on a new, lower, resources rental tax with mining giants Rio Tinto, BHP Billiton and Xstrata after an earlier proposal for a "super profits" tax outraged the sector, sparked a damaging TV campaign and alienated voters in marginal seats in Queensland and Western Australia. The dispute ultimately triggered Rudd's downfall.

But last week smaller mining companies, angered by the deal and warning of serious impacts on future regional development by the sector, fell behind Fortescue Metals Group chief executive Andrew Forrest, who described the negotiations leading to the agreement as secret and sinister.

Forrest said that while his company had kept out of the earlier anti-Government campaign, it would now be likely to contribute to a new assault by the Association of Mining and Exploration Companies. The association said it was now assessing its options, which included the possibility of a new advertising blitz against Gillard's policies.

The miners have also been angered by the Labor-Greens preferences deal, joining Opposition claims that the agreement must have included confidential conditions that would not become apparent until after the Government won a second term - if it did.

Their suspicions were hardened by Greens leader Bob Brown's warning that if it won the balance of power in the Senate - as is widely expected - the party would ignore Gillard's deal and demand more from the sector.

"I am going to the election saying we want a better return from the big miners and I expect more than a million people will vote for that, so I'll have a mandate from where I sit in the Senate," he said.

Billionaire Queensland miner Clive Palmer responded: "If people want this country to remain on a positive economic track, don't vote for the Greens or Labor."

Yesterday, Gillard alienated another large bloc, spanning right and left, with her new climate change policy based around the citizens assembly process of building a wide public consensus on carbon pricing.

Carbon pricing was dumped by Rudd in another costly backflip when he shelved a planned greenhouse emissions trading scheme, and Gillard has refused to force it back on Labor's immediate agenda because of deep resistance.

The best she promised was to revisit emissions trading in 2012, a new commission of experts to inform public debate and report on global progress, reward industry for making early emissions reductions, invest A$1 billion ($1.23 billion) over 10 years in the electricity grid, and impose strict conditions on new power stations.

Gillard said climate change was real and the Government needed to show leadership and chart a way forward. But the policy met immediate condemnation, not least from chanting demonstrators and a protester who was wrestled to the ground after breaking through police lines and yelling: "Miners have her tongue."

The Greens and environmental groups from the Australian Conservation Foundation to the 53,000-member Australian Youth Climate Coalition slammed the approach.

"Young Australians will draw little hope from today's announcement," coalition director Amanda McKenzie said.

Opposition Leader Tony Abbott described Gillard's policy as camouflage for a planned carbon tax.

"There is a hell of a lot to worry about because sooner or later even a Government as decision-challenged as this one will actually get something done."