Why Labor can win the next election, but probably won't

Despite the continued bad polling, the Gillard Government has a good chance of being re-elected when the next federal election comes around. The main thing stopping them is themselves.

Few would argue that the Government is not struggling at the moment. The endless cycle of opinion polls continue to be negative for the government, with main issue of the day (the carbon tax) polling poorly and the Prime Minister remaining personally unpopular. Although polling of this kind (not as bad, and for a shorter period) killed off Kevin Rudd's leadership, it is unlikely that Labor will change leaders again, having learned by now (see also: NSW) that it doesn't work. Also, despite a recent kerfuffle in the Liberal Party over an email, the Coalition remains in a strong position, so Tony Abbott is not going anywhere. Journalists love nothing more than a leadership stoush, and having missed the last big one they can be understood for jumping at shadows.

Thus, the political landscape is likely to stay the same until the next election. With some big-ticket items on the agenda already, the next two years or so will be an exercise in how the current issues and personalities play out. An early election is unlikely – the Independent Members of Parliament have shown little appetite to switch their support to the Coalition, and Labor certainly don't want to go to the polls anytime soon.

The current popularity of the Coalition is arguably mostly a reaction against the Government rather than an embrace of Abbott's pitch to the electorate that he will take Australia back to the glory days of the Howard Government. The relentlessly negative approach taken by Abbott may very well succeed in delivering government to the Coalition – certainly it has been largely successful since he became leader in late 2009. However, just as Gillard has staked her future on the carbon tax issue, so too has Abbott staked his on destroying it, pledging to oppose it all the way and repeal it in government.

There is a real risk for Abbott in focussing so strongly on one issue. The legislation is likely to pass through the Parliament. The danger for Abbott is that, with the election two years or so after the introduction of the tax, the public have accepted it and moved on. While the Government is currently taking heat over the issue, climate change remains the issue of the day. It is possible or even likely that the issue will turn out to be a winner for the government, especially if generous compensation starts flowing to households.

Aside from the general advantages of incumbency, the Government has a few issues on its side. The National Broadband Network remains popular with voters, particularly in regional areas. Malcolm Turnbull's campaign to "destroy" the NBN has so far been unsuccessful, with the benefits of the project starting to register more in the public consciousness. There is a lesson here for Labor: stick to your guns, spend time explaining the benefits of a policy and voters will come around. The NBN also resonates with people as a big investment in infrastructure – something that usually goes down well with the electorate.

Strongly in the government's favour, the economy remains strong, with the key indicators (to voters) of interest rates and unemployment being low. The Coalition's campaign on debt and deficits has lost traction, with the Government strongly committed to returning the budget to surplus in 2012-13. Despite a short-lived campaign against the recent budget in the Murdoch press, its workmanlike nature did the trick in showing that the government was a safe pair of hands with the economy.

Despite this, there is a major problem facing the Government: a hopeless track record at communicating with voters. For example, the Building the Education Revolution (BER) program and the Home Insulation Program (HIP) were savagely attacked in the media for waste and cost blowouts, however independent reports showed that the BER was largely a success and that the HIP was nowhere near the debacle that it was made out to be. Australia came out of the global financial crisis stronger than most other developed nations, however the Government gets almost no credit for this. In Budget week alone, the Government also announced the deal with Malaysia on asylum seekers and released their long-awaited population policy, as if there was no co-ordination between various Ministerial offices.

This is not assisted by a toxic media environment, with News Ltd in particular appearing to have it in for the Government. The ludicrous campaign against "Carbon Cate" Blanchett for appearing in television ads supporting the carbon tax shows how far sections of the media will take their campaign against the Government.

The Government's primary vote remains low, however the two-party preferred vote remains extremely competitive. The Government should not pretend to be conservative by opposing same-sex marriage or sticking it to the unemployed. This will only drive its base to the Greens. A negative campaign against Tony Abbott didn't work in 2010 and won't work now. Labor needs a positive agenda to sell to the electorate. This is the only way that they can pull of an unlikely third term, as well as at least giving the party something to hang its hat on if they lose.

The next federal election is not due until sometime in 2013. Any attempts to accurately predict an election at least two years out is folly. In 2008, who would have predicted that Rudd would have been dumped by his own party and that we would end up with a hung parliament? Gillard has time to turn around the government's performance, and her predictions that she will be judged on her achievements may very well turn out to be accurate. While the signs are certainly not positive at this stage, and the government's record shows that they are unlikely to turn this around, they should not be written off completely.