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2015 budget winners, losers and political capital

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While fairness may be promoted as the foundation of this year’s budget, it would appear that political capital has funded the success of the announcement on budget night.

Treasurer Joe Hockey’s 2015 budget has been well received – a sharp contrast to his 2014 budget. While the belt isn’t as tight on this budget – taking surplus out by one more year – the key point that has earned Australia’s respect is the focus given to political capital. This year the government has learnt that, despite the power of political parties’, it is political capital that will determine the success or failure of any initiative.

Political capital is owned by the community and lent to politicians as a form of political currency to achieve desired outcomes. Now, more than ever, politicians are held accountable for their actions and will bend over backwards to retain or earn their political capital from citizens. This shift in the Australian political landscape explains why politicians will often fail to get their initiatives through or renege on their promises. Simply put, political capital is now the currency of the political system in Australia, and politicians are looking to earn.

Those without much political capital – such as big business (Google Tax), universities (deregulation concerns) and those overseas (not eligible or willing to vote) – have lost in this year’s budget. Without sufficient support and voice in the public sphere, these parties were not able to influence the budget or create a path of less resistance for the government to support them.

The overall winner of the 2015 budget was small business. As small business currently employees more than four million Australians it has a large supporter base to build capital. With evolutions in technology, small businesses are becoming more empowered to voice their concerns and build political capital. While their political capital has not been fully lent to the government yet, it has been recognised and rewarded with the budget outcomes.

This year’s budget comes with a powerful underlying message – don’t underestimate the power of political capital. Unlike in the past, platforms that empower grassroots advocacy have bred a political climate that is controlled by political capital. With increased connectivity and amplification of messages, politicians respect, follow and yield to the will of their constituents.

As this currency grows and is traded on the market, it is critical for businesses and organisations to invest in growing their political capital. This can be achieved with a number of business strategies but, at the end of the day, it is about growing numbers and influence in political markets.

If you would like to learn more about political capital or how this can be used to influence your regulatory environment, get in touch with The De Wintern Group. With years of experience in growing and lending political capital, combined with the latest political campaign technologies from North America, De Wintern specialises in achieving desired outcomes that often appear to be against the odds. To start the conversation please call 03 9948 2100 or email info@dewintern.com.