Ley had hoped an agreement could be reached. The split will make running a strong opposition more difficult and complicated.

The Nationals’ dramatic decision is also likely to risk greater instability within the Liberals, where the numbers between the conservatives on one hand and the moderates and centrists on the other are narrowly balanced.

Nationals leader David Littleproud told a news conference on Tuesday morning the party, which met earlier Tuesday morning, had taken a “principled” decision to sit alone.

Littleproud said Ley – who has said all policies are on the table – needed to rebuild the Liberal Party. “They are going on a journey of rediscovery, and this will provide them the opportunity to do that without the spectre of the National Party imposing their will.”

He said the Nationals wanted to look forward, “not having to look back and to try and actually regain important policy pieces that change the lives of the people we represent.

“We wanted to look forward and not have to look back and have to continue to fight for another three years.”

Littleproud said he “made it very clear that we remain committed to having the door open, respecting the position that Sussan has been put in. That she is a leader that needs to rebuild the Liberal Party.”

He said his preference was to bring the Coalition together “hopefully before the next election”. “I’m passionate in the belief that we can bring this back together”. His deputy, Kevin Hogan, said he hoped the parties would come together again “sooner rather than later”.

The minor party demanded the election policies of competition laws including divestiture provisions; nuclear power; a $20 billion proposed regional Australian future fund, and better standards for regional communications be preserved. Ley wanted the agreement to be about the architecture of the Coalition rather than including policy demands.

The Coalition has broken only twice before since 1949. After the 1972 Labor election win, the Liberal Party and the then Country Party separated. They reunited before the May 1974 election. There was another split, under the pressure of the Joh-for-Canberra campaign, for several months in 1987.

The split means the Nationals will lose some extra pay that goes to frontbenchers.

The Nationals’ stand is a victory for the party’s hardliners, although it is notable that the issue of net zero by 2050 was not one of the sticking points nominated by the Nationals.

The party’s position vis-a-vis the Liberals was strengthened because it held almost all its seats, while the Liberals’ numbers were devastated. So far the Australian Electoral Commission has declared 18 seats for the Liberals in the House of Representatives, nine for the Nationals, and 16 for the Liberal National Party of Queensland, where they operate as one party although they separate into their respective parties in Canberra.

The Nationals Senate leader, Bridget McKenzie, claimed, “We have not left the Liberal Party – the Liberal Party left us”.

The Nationals met on the issue on Friday before more talks between Littleproud and Ley. After Tuesday’s meeting, Littleproud spoke to Ley to inform her of the decision. Ley called a “virtual” Liberal Party meeting for Tuesday afternoon.

In comments to The Australian, former prime minister John Howard warned of the danger of the split. “The best interest of the two parties is served by being in Coalition and they are strongest politically and policy-wise when both parties have been together,” he said.

He said there had “always been some policy differences,” between the two parties. “It’s important that the policy differences be resolved or accommodated within the framework of a Coalition. If we go our separate ways, those issues will harden and become greater.”

Treasurer Jim Chalmers said the Coalition was “a smoking ruin” after a “nuclear meltdown”.

‘We offered to work constructively with The Nationals’: Liberals

In a statement, the four liberal leaders, Sussan Ley, Ted O’Brien, and senator Michaelia Cash and Anne Ruston expressed disappointment at the Nationals’ decision.

“The Liberal Party’s door remains open to The Nationals’ should they wish to rejoin the Coalition before the next election,” the leaders said.

They pointed out the Coalition agreement had “conventionally” focused on the makeup of their executive, anchored in shared values.

“The Nationals’ sought commitments on specific policies.

“As was explained to The Nationals, the Liberal Party’s review of election policies was not an indication that any one of them would be abandoned, nor that every single one would be adopted.

“We offered to work constructively with The Nationals, respecting the party’s deeply held views on these issues. We asked The National Party to work constructively with us, respecting our internal processes.”

The leaders said the Liberals had proposed appointing a joint Coalition shadow ministry now, with separate policy development in each party and then joint policy positions determined as usual.

“Unfortunately, The Nationals determined this was not possible.

“The Liberal Party also insisted that shadow cabinet solidarity be maintained in any Coalition agreement. This was not explicitly agreed to by The Nationals.”

Ley told a news conference she was a “committed Coalitionist”. Quizzed about how room would be made for Nationals “shadows” if the Coalition was re-formed at some point, Ley could not give any clear answer.

Ley will soon announce an all-Liberal shadow ministry.

Michelle Grattan, Professorial Fellow, University of Canberra

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Viet Nguyen, The University of Melbourne; Ferdi Botha, The University of Melbourne, and Kyle Peyton, The University of Melbourne

Growing economic pessimism appears to have pushed many voters away from Australia’s two major parties, Labor and the Coalition. Support for minor parties and independents has doubled since the Global Financial Crisis in 2008.

In the latest federal election, minor parties and independents are on track to gain a record share of the vote, at 33.4%. Although Labor won just 34.6% and the Coalition 32% of first preferences, Labor secured a majority after preference flows, reflecting a broader shift away from the major parties.

Commentary in both Australian media and in the United States framed the result as a reaction against US President Donald Trump’s return to politics. That echoed analysis of Canada’s surprise centre-left Liberal party win a week earlier.

But a more straightforward explanation lies in Australian voters’ dissatisfaction with economic conditions.

In a new study, we used three decades of data from the leading monthly consumer sentiment survey, the Consumer Attitudes, Sentiments and Expectations in Australia (CASiE) Survey, to study how shifts in economic expectations align with changes in voting behaviour.

Support for minor parties and independents has been rising

In the 2007 federal election, minor parties and independents won just 15% of first‑preference votes and two seats in the House of Representatives. By 2022 their primary vote had doubled to 31.7%, delivering a record 16 seats.

In the latest federal election, their first‑preference share rose further to 33.4% (as of May 14). But because of preference flows, they secured fewer lower house seats than in 2022. The underlying shift away from the major parties therefore continues, even though it is not reflected in seat numbers.

This realignment has unfolded alongside a sustained slide in political trust. Surveys such as the Australian Election Study show satisfaction with democracy is at its lowest level on record.

The decline is often linked to perceptions of poor economic management, leadership instability, and unresponsive government. Voters repeatedly cite housing affordability, cost‑of‑living pressures and difficulty accessing health care as unmet concerns.

Minor party support differs across demographic groups

The shift away from the political mainstream is broadly distributed across demographic groups, indicating widespread economic disaffection rather than isolated grievances.

Younger Australians, facing acute economic challenges, have increasingly supported the Greens. Older voters have turned to One Nation and Teals amid broader dissatisfaction with economic management.

Support for minor parties and independents has climbed among both men and women, though the pattern differs. Women lean more toward the Greens; men more toward other minors and independents.

Economic pessimism matters at the ballot box

Rising economic pessimism, along with other social and cultural factors, has been a driving force behind the collapse in support for the political mainstream.

Since 2010, the average share of Australians saying their finances have improved over the past 12 months fell from 27% to 20%. The share reporting deterioration increased from 34% to 37%. That means a net shift of 10 percentage points toward pessimism.

Looking ahead, more Australians expect their household finances and the national economy to worsen over the next year than to improve.

The charts below show support for minor parties has climbed across the board since the mid‑2010s. It is consistently highest among voters who expect their household finances and the national economy to get worse.

Voters who feel worse off have consistently been more inclined to back minor parties or independents. The gap between pessimists and optimists has widened under both Coalition and Labor administrations.

The divergence is most pronounced for expectations about national economic conditions. This suggests political disaffection is increasingly linked to pessimism about Australia’s economic outlook.

Growing economic pessimism is consistent with a broader picture of weaker economic growth, lower living standards, a fall in productivity and slower wage growth over the past decade.

For example, economic growth (gross domestic product or GDP after inflation) slowed from an average of 3.5% between 1995 and 2009 to 2.4% between 2010 and 2024. Growth in GDP per person, a more direct measure of living standards, slowed even more, from an average of 2.1% to just 0.9%.

Since both actual and perceived economic conditions influence voting choices, collapsing support for mainstream political parties is perhaps no surprise.

Implications for the future

Because of the complex flow of voting preferences, a smaller vote share going to major parties does not always translate into fewer seats in parliament. However, vote shares and seat counts tend to be highly correlated over time.

Sustained declines in primary vote shares going to the major parties will eventually translate into reduced legislative power.

The trends in Australia’s voting patterns are consistent with voters’ growing dissatisfaction with the performance of successive governments.

While the rise of non-mainstream parties may signal political renewal, it also carries risks. In the absence of credible responses to persistent social and economic challenges, political resentment is likely to deepen.

Decades of policy responses have failed to address the scale or structural nature of the country’s economic problems. This has contributed to mounting pressures.

Without meaningful reform, Australia risks following the trajectory seen in parts of Europe and the US, where the weakening of mainstream parties has created space for more radical and anti-democratic political movements.

Viet Nguyen, Principal Research Fellow, Macroeconomics Research Program, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne; Ferdi Botha, Senior Research Fellow, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne, and Kyle Peyton, Senior research fellow, The University of Melbourne

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Mark Kenny, Australian National University

Three years ago this month, Ley had done something uncannily similar to what Ted O’Brien was doing now. Then, it had been her standing next to Peter Dutton as his dutiful deputy. The freshly installed pair talked a big game about the contest ahead, assured of the urgency of their mission and the potency of their message.

Ley had enthusiastically supported Dutton’s leadership. But now in 2025, it was Ley fronting the press, this time as the new leader following the catastrophic rejection of that Dutton-Ley project, the Liberal Party’s worst ever defeat.

It was the inexperienced O’Brien at her side, newly elected as her bright-eyed second in command.

Policy rethink?

Sharpening the metaphor, it had been O’Brien who had acted as chief design architect and salesperson for one of the Coalition’s most expensive yet unloved policies in the May 2025 election – nuclear power stations, government built and operated.

Back in 2022, Dutton’s task had seemed difficult, but success was far from unimaginable as he faced a new Labor government elected with a record-low primary vote and a tiny two-seat majority.

Ley’s degree of difficulty three years hence is some orders of magnitude greater, not least because of O’Brien’s nuclear energy policy – which will be high on the list of policies to be reviewed, and presumably ditched, if a Liberal recovery is to occur.

Stripping away unhelpful policy that is nonetheless beloved in sections of the party’s conservative and right wing base, is a threshold challenge for Ley – one of a panoply of traps and trying circumstances she confronts.

Ley’s challenges

First, there’s the simple maths given the Coalition now trails the Labor Party by a staggering 50-plus seats.

Few observers think the Coalition can seriously compete for government at the 2028 election. Thus, Ley needs to keep hope alive among Liberal mps and senators, even when the prize of power seems two terms away.

Then there’s her task of leading the Liberal Party back to the political centre-ground or as she puts it, meeting Australian voters “where they are”. This seems like politics 101. Yet she faces many internal sceptics.

Leadership tightrope

At 29 votes to 25, Ley’s victory against a more right-wing candidate, Angus Taylor was narrow and reportedly relied on the votes of senators whose terms end on June 30.

In other words, even her current majority could evaporate.

It is worth remembering that by December 2009, just two years after the Howard government ended, the Liberal Party was already on to its third opposition leader.

Doing it her way

So what effect will she have on the Liberal Party? In her first press conference she gave several clues.

In contradistinction to Dutton, who avoided Parliament House press conferences and searching interviews, Ley gave a crisp three word answer when asked if she would front up to these rituals of public accountability – “yes, I will”.

She promised to make tax reform and economic policy the “core business” of the party she leads.

There was also a marked, if measured, departure from the bombastic declarative culture war politics of Dutton on matters like standing in front of the Aboriginal flag and welcome to country ceremonies at public events. On both, she expressed a more pragmatic acceptance:

If it’s meaningful, if it matters, if it resonates, then it’s in the right place and as environment minister and health minister I listened carefully and participated in Welcome to Country ceremonies. If it’s done in a way that is ticking a box on a Teams meeting then I don’t think it is relevant.

On other matters, she noted pointedly that RG Menzies had founded the party as the “Liberal” party not the conservative party, while acknowledging a breadth of alternative opinions among her parliamentary colleagues:

Our Liberal Party reflects a range of views from all walks of life that are welcome in our party room and that is one of our great strengths.

Ley the history-maker

That Ley is the first ever woman to lead the federal Liberal Party will pose potential challenges.

To pretend that gender stereotyping will play no role in any undermining by internal critics and media would be to ignore history.

Asked about the exodus of female voters from the Coalition at the election, Ley said, “We did let women down, there is no doubt about that,” as she expressed the need for “genuine, serious” engagement:

I want to say right here and now we need more women in our party. We need more women in the organisation, and we need more women in this party room.

However, she pointedly stopped short of backing affirmative action quotas in the Liberal Party even as she called for more women in the parliament.

Gaza about-face

Perhaps the most telling “real-time” demonstration of the uneasy balance she hopes to achieve as leader of a party that has shifted markedly to the right, was when she as was asked about the Israel-Gaza question.

As a former member of a cross party group called Parliamentary Friends of Palestine, Ley had implored parliament in 2008 to “think not of the Palestinian leadership, think of the people”.

She had described Gaza as “besieged, contained, and on the brink of starvation” while warning that a “crushing economic embargo feeds fury and resentment” both in Gaza and the West Bank:

Israel has many friends in this country and in this parliament. The Palestinians, by comparison, have few. Theirs is not a popular cause […] but it is one I support.

Asked about her view now, Ley felt the need to circle back to stress her principle concern over the rising tide of antisemitism in Australia. She now says the “hideous events” of October 7 has changed her thinking on the matter.

Gaza has given Sussan Ley an early lesson on the difficulties leaders face when it comes to straddling highly contentious issues.

Mark Kenny, Professor, Australian Studies Institute, Australian National University

This article is republished from The Conversation under a Creative Commons license. Read the original article.