What the coalition split means for Australian foreign policy

The bitter fallout for conservatives from Australia’s federal election has continued with the National Party walking away from its 80-year coalition agreement with the Liberal Party.

This is just the third time the power-sharing agreement has broken (and the first since 1987), each time in opposition. It is a significant moment, bringing to a head long-simmering ideological and policy tensions between the rurally-oriented Nationals, whose representation has remained steady in the parliament, and the more urban-focused Liberals who have lost at least 12 lower house seats.

The split also underscores the challenges for both parties – but especially the Liberals – in unifying the “broad church” of Australian conservatism, while also appealing to more diverse urban demographics to recapture the centre.

It was disagreement over domestic issues – the Nationals’ demands for forced divestiture of supermarkets, the introduction of nuclear power, greater mobile phone coverage, and a regional investment fund – that led to negotiations breaking down.

But what might it mean for Australia’s international policy, with the centre right now split?

For government policy in the immediate term, very little. Labor won a resounding majority at the election securing power for the Albanese government for the next three, if not six, years. It will, however, make holding the government to account a more fractured (and likely messy) affair, with the position of Leader of the Opposition, Liberal Sussan Ley, now weakened and speaking for fewer members.

The Liberals, as the single largest non-governing party, will remain the official opposition, meaning the party exclusively makes up the shadow cabinet.

Apart from John McEwen’s brief tenure in 1940, the National Party (formerly the Country Party) has never held the foreign affairs portfolio. Similarly, apart from short stints and assistant ministries, the Liberal Party has always held the defence and other national security portfolios. However, the trade portfolio was traditionally held by the Nationals, reflecting the importance of agriculture exports to the Australian economy, until the Liberals took over the portfolio from 2013 to 2022.

Though the Nationals new deputy leader, Kevin Hogan, was the shadow trade minister in the last parliament, this role will now revert to the Liberals. This means a diminished voice on international policy for the Nationals, while the Liberals will have a monopoly and greater flexibility on official opposition policy for foreign, defence and trade policy.

Like other minor parties, however, the Nationals will have spokespeople for a full range of policies. This will force the party to develop independent positions right across foreign policy, defence and national security, including on topics that would normally sit with the Liberals. On some issues, we may now see three major sources of dissent to government policy: the Greens, the Liberals and the Nationals, making for a more complex, four-cornered debate.

In practice, climate, environment and energy are the areas of international policy where substantive differences between the Liberals and the Nationals are most likely to arise. Many Nationals members have been consistent sceptics of climate change and opposed the net zero agenda and Australia’s adherence to its Paris Agreement targets, while also preferring nuclear power to renewables. Outside the bounds of coalition policy, some Nationals will likely become more vocal on these issues, including opposing Australia’s COP 31 bid. Agricultural trade could also become a defining issue for the Nationals with Australia and the European Union looking to resume free trade talks that stalled over geographic indicators and EU market access.

The split will also have practical consequences. A new arrangement for allocating membership between the Liberals and Nationals of the senate and joint parliamentary committees on foreign affairs, defence and trade will have to be developed. The Nationals could also be shut out of the Joint Committee on Intelligence and Security, which conventionally only includes government and opposition members. Nationals’ members who would otherwise be in the opposition cabinet will lose out on additional pay and staffing entitlements associated with shadow ministry positions, making it harder to formulate coherent positions.

The disentangling of the Nationals and Liberals also changes the legislative pathways in parliament. Even with a lower house majority, to pass legislation in the Senate the government will likely need 11 votes additional to its own. With the Liberals now untethered to policy positions set with the input of the Nationals, the government may have more negotiating options – between the Greens, Liberals, Nationals and independents – including on climate, energy and free trade issues.

In the longer term, though, blowing up the coalition does not change the fundamental electoral calculus: the Liberals and Nationals need each other to form government. So, there will almost inevitably be a reconciliation before the 2028 election, as Nationals leader David Littleproud hinted.

However, the Nationals’ actions will shift the negotiating dynamic for the next coalition agreement. The Nationals have shown they are willing to walk away if their priorities are not met. When the party leaders do come back together, the Nationals could be emboldened to demand more on climate and energy issues and greater influence on international policy, including the return of the trade portfolio to their ranks.