Bloomberg News

Australia’s Gillard Loses Lead as Better Manager of Economy

February 13, 2012

(Adds manufacturing job cuts in fourth paragraph.)

Feb. 13 (Bloomberg) -- Australian Prime Minister Julia Gillard has lost her lead over opposition leader Tony Abbott among voters as the preferred manager of the $1.3 trillion economy, according to a poll published today.

Thirty-four percent of people surveyed said Labor’s Gillard, the nation’s first female prime minister, is a better economic manager, compared with 43 percent for the Liberal- National coalition leader, according to the Newspoll in the Australian newspaper. That reverses her eight-point lead over Abbott in its last poll on economic credibility conducted in August 2010, which put her at 48 percent, the newspaper said.

Gillard’s bid to trumpet her government’s economic credentials, mainly in shepherding the nation through the global financial crisis, has been offset by speculation former leader Kevin Rudd may challenge for the job she took in June 2010. Abbott has criticized her plan to introduce a carbon tax and her handling of the economy, highlighting that last year the nation recorded its worst job growth in 19 years as the higher currency makes manufacturers uncompetitive.

“Circumstances have changed since the previous poll, held just before the 2010 election when Gillard was still promising there’d be no carbon tax,” Newspoll Chief Executive Officer Martin O’Shannessy said in a phone interview today. “Labor won kudos for getting the nation through the financial crisis but voters would be thinking that’s a long time ago now.”

Currency Gains

Australia’s export industry has suffered from a more than 60 percent rise of the local currency against the U.S. dollar in the past three years, making products less competitive in overseas markets. BlueScope Steel Ltd., the country’s largest steel producer, last August shuttered its export division. Toyota Motor Corp. and General Motors Co. have cut jobs in Australia this year, citing the currency’s strength, while Alcoa Inc. is reviewing the future of an aluminum smelter.

The Reserve Bank of Australia sees average growth of 3.5 percent in 2012, down from its Nov. 4 estimate of 4 percent. Consumer prices will rise 3 percent in the year through to the fourth quarter, less than a previous prediction of 3.25 percent, the central bank said Feb. 10.

The survey of 1,205 people aged 18 and over was conducted Feb. 10-12 and has a margin of error of plus or minus three percentage points, the Australian reported.

--With assistance from Michael Heath in Sydney. Editors: Iain Wilson, Edward Johnson

To contact the reporter on this story: Jason Scott in Canberra at jscott14@bloomberg.net

To contact the editor responsible for this story: Edward Johnson at ejohnson28@bloomberg.net


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