A year as tumultuous as 2017 can only prompt soul searching, and there was plenty of it as federal MPs made their way back to their families for Christmas and prepared themselves for the organic focus group feedback politicians generally get over the summer as they make their way around seasonal social gatherings.

Weary Liberals worried about the negative poll trend, the grinding year just elapsed, and those Nationals roaring unpredictably at one another, like a bunch of bulls in a paddock. Labor MPs were also inclined to introspection after the party’s obvious underperformance in the critical Bennelong byelection in mid-December.

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While the question facing government MPs at the end of the year is a simple one – can we come together as a government, overcome our tendency towards self-sabotage, and get our collective act together in 2018 – Labor people were also asking tough questions as the country exhaled and hit the beach.

The polls suggest Labor is well-positioned to take back the government benches, but not everyone in the opposition is convinced. The question floating around Labor unresolved at the end of 2017 was also simple: have we peaked?

Better days ahead – again

Way back in May, which at year’s end feels almost like another lifetime, the treasurer, Scott Morrison, predicted there would be better days ahead when he delivered the government’s budget.

Facebook Twitter Pinterest Scott Morrison delivers the traditional after budget day address at the National Press Club. Photograph: Mike Bowers/The Guardian

Morrison would have hoped for a more immediate fillip from a document which was principally political. The budget jettisoned Tony Abbott’s toxic policy agenda and reset the government after a near election loss the year before.

But the better days didn’t quite show up, largely because the government spent 2017 at war with itself and, when it wasn’t scrapping internally, it was being buffeted by events, principally the dual citizenship fiasco, which cut a swathe through the parliament in the last six months of the year.

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Malcolm Turnbull believes 2018 will be a stronger year for his government than the chaos of the 12 months just gone. The prime minister thinks he’s turned a corner because he’s settled two of the most dangerous internal issues the government faced: legalising marriage equality and resolving the framework of a new energy policy.

While it’s true both issues have worked their way through internal processes, and Turnbull is still safe in the Lodge, neither is fully resolved. Conservatives were pacified during the marriage debate with an inquiry process into religious freedom, deferring a fight that will play out next year. Energy policy also has months to run still. The government has signed off on a prototype. Much detailed work remains to be done.

Another reason Turnbull looks to 2018 in optimistic fashion is because he thinks the government has weathered the worst of the citizenship fiasco and Labor is now more exposed. After holding two seats in byelections triggered by high court rulings, the Coalition now has the parliamentary numbers to carry out hostile referrals. Two Labor MPs are already bound for the high court, and a handful more are facing eligibility questions, with that issue set to roll on in the first quarter of the year.

Facebook Twitter Pinterest Malcolm Turnbull and John Alexander celebrate their Bennelong byelection victory. Photograph: Mike Bowers/The Guardian

As well as feeling itself through the worst of the citizenship typhoon, the government is also calculating the domestic economy is going to step up a gear as the world finally starts to bounce back from the biggest financial shock since the great depression. A stronger domestic economy gives voters more confidence and gives the government some room to move. By room to move, read room for personal income tax cuts as we gear up for another election.

On the cost-of-living front, the other bonus the government will probably have next year is a noticeable fall in electricity prices. At the end of the year the Australian Energy Market Operator said after increases in power prices during 2017, prices would start falling in the second half of 2018.

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The government will doubtless attempt to claim credit for this development, attributing it to its own policy actions. But in truth the forecast fall in prices has nothing to do with the government’s proposed national energy guarantee.

The predicted fall is entirely attributable to the entry of 5,300MW of new generation capacity into the national electricity market – most of it renewable, encouraged by the renewable energy target Coalition MPs like to rail against. But don’t expect a lot of focus on that inconvenient fine print.

Given the ill-discipline in his own ranks, and the tendency of the government to be fractious, Turnbull must always have an eye to internal balances. He ended the year with a ministerial reshuffle that rewards Western Australia and Queensland, which just happen to be the home bases of his praetorian guard, the conservatives Peter Dutton and Mathias Cormann, who have worked diligently to keep the prime minister on his feet throughout a difficult year, when elements of the right were fully intent on doing harm.

Both Dutton and Cormann end the year with promotions – Dutton to his super ministry of home affairs and Cormann to Senate leader.

But while Turnbull has rewarded supporters, and kept the assassins at bay, the Nationals remain a problem for the prime minister.

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The party’s leadership team were early casualties in the citizenship debacle. The Nationals remain under pressure from rightwing protest parties, such as the Shooters party and One Nation, and that pressure manifests in a tendency for them to act up in Canberra.

In the last quarter of the year the deputy prime minister, Barnaby Joyce, has been absent, defending his seat, or distracted. He told the parliament during the same-sex marriage debate that his marriage had ended and, while campaigning in New England, he faced questions about his private life from reporters and a barrage of innuendo on social media.

Joyce also inherited a deputy leader he didn’t want after Fiona Nash was ruled ineligible by the high court, and punished one of Bridget McKenzie’s chief supporters, the well-liked Victorian Darren Chester, by bundling him out of cabinet. Another demotee, Keith Pitt, is now making noises about departing to the crossbench.

Facebook Twitter Pinterest Barnaby Joyce in full flight during question time. Photograph: Mike Bowers/The Guardian

It’s a combustible set of circumstances, and Turnbull has only limited means of influence and control given that the trouble is in the Coalition partner rather than in the Liberal party.

As well as managing fractious internals, the government will be facing a recalibrated Senate crossbench in the new year after the departures of Nick Xenophon and Jacqui Lambie – the former to run for the South Australian state parliament, the latter owing to dual citizenship rendering her ineligible. New relationships will have to be forged in the red place.

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So can we predict happier times with more certainty than the last prediction in May 2017? Perhaps things will calm down over the summer, with MPs out of the institutional stresses and corridor conclaves of the Canberra hothouse. Finding a moment to decompress after a brutal and frustrating 12 months can only improve collective wellbeing.

I think it’s also likely that external events will be more favourable to the Coalition than they were in 2017, and a little bit of luck can carry you a long way in politics.

But folks placing bets on better days ahead might want make their early punts modest.



Anxious Labor

The field evidence suggests Labor had a good year in 2017. Labor led the government on the two-party-preferred measure in every poll in 2017 apart from a new entrant to the Australian scene, YouGov, which suggested a closer contest.



There were signs of ongoing strategic thinking in opposition ranks – the shadow foreign affairs minister, Penny Wong, had some interesting things to say about Australia’s relationship with the US in the age of Trump, and the shadow treasurer, Chris Bowen, kept plugging away on the fiscal side, with more on tax policy – but the bulk of Labor’s activity in 2017 was tactical.

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Making yourself the story when a riven government is intent on putting itself on the ropes is generally considered a bad idea in politics, so Bill Shorten’s sharp political instincts, and the capacity of the team around him to unite and stand on the throats of their opponents was deployed, mainly successfully, in the service of short-term ends.

But while the objective measures suggest the year has to be considered a success, behind the scenes, Labor MPs began expressing concerns relatively early in the year about whether there was too much complacency creeping into the operation; whether more time was being spent metaphorically measuring up curtains for the Lodge than plotting an active path to get there.

Facebook Twitter Pinterest Bill Shorten with Kristina Kennelly after she conceded in the Bennelong byelection. Photograph: Mike Bowers/The Guardian

The disquiet flared publicly at budget time when there was an internal fight about the inclination of the leadership group to oppose the government’s proposed increase in the Medicare levy for low- and middle-income earners. That fight spilled over into the public domain, and it was as much a proxy battle over direction and decision making as it was about taking a stance on a particular policy issue.

Later in the year the internal anxiety bubbled again after Labor lost the Bennelong byelection, despite ploughing resources into the contest and fielding a high-performance candidate in the form of Kristina Keneally, the former New South Wales premier.

When you ask people to put their finger on the anxiety, it’s generally expressed in experiences of the past. Some in Labor think they are now tracking in Mark Latham territory rather than Kevin Rudd territory. Latham put up a good fight against John Howard in the 2004 election – he made Australian voters look up and take notice – but, in the end, the voters said no.

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People inclined to be concerned can see a set of circumstances in 2018 where the economy turns, the government finds a collective sense of mission, the voters get a fistful of dollars in an income tax cut, and Labor isn’t positioned sharply for the next fight.

While the local campaign Labor ran in Bennelong in November and December signals the party thinks it can run a version of the national campaign it ran in 2016 again at the next federal election, the result in the seat suggests a refresh is needed.

Hard heads also think it is entirely possible the ALP could lose the Victorian seat of Batman to the Greens if David Feeney’s dual citizenship case triggers a byelection early in 2018 and, potentially, the highly marginal Queensland seat of Longman if the incumbent, Susan Lamb, finds herself in eligibility strife.

Shorten also faced trouble on his home turf at the end of 2017, with a factional brawl coming hot on the heels of him having to move against the accident-prone NSW senator Sam Dastyari – a development that irritated the NSW right.

Labor has shown itself to be highly disciplined during this time in opposition, and my judgment is the party will not lightly return to the destructive habits of the Rudd/Gillard period.

But with that said we end 2017 at an interesting crossroads, and the first quarter of 2018 will determine the psychology of the major-party contest for the year ahead.