Monarchy a key poll issue for Keating

Undeterred by his status as Australia's perennial political underdog, Paul Keating will set out this week to sell voters his plan to ditch the monarchy as part of his campaign to win an unprecedented sixth term in office for his Labor Party.

Even as the Prime Minister, who has called an election for 2 March, embarked on a gruelling five-week campaign, the pollsters were predicting the end of Labor's record 13-year reign in Canberra. An opinion poll yesterday put Labor 8 points behind the opposition Liberal-National coalition, which needs a national swing of only 0.5 per cent to sweep the government from power.

Mr Keating himself has fallen behind John Howard, the opposition leader, in personal ratings after leading in opinion polls for much of last year. In the Northern Territory, the only place in Australia where betting on elections is permitted, bookies make the opposition firm favourites, offering odds of 2-1 for a coalition win against 5-4 for a Labor victory.

But that is precisely what the polls said three years ago when Mr Keating called an "unwinnable" election as Australia was emerging from a recession which many voters thought was his fault. He went on to defy everyone and increase Labor's majority.

Mr Keating's problem this time is that Labor has been in power since the early Eighties, and many Australians feel the government is suffering from fatigue.

Although the economy has recovered steadily, unemployment at 8 per cent is still disturbingly high, having fallen from 11.3 per cent at the time of the last election. Foreign debt has exploded to record levels. Strikes, which the government had almost wiped out, have begun to re-emerge. Business leaders complain that the government has not been tough enough in pushing through its industrial relations reforms.

Yet there is little to choose between the two main parties in policy terms. The conservative Liberal Party, the senior partner in the coalition, has seen Labor steal and expand on most of its free-market economic policies over the past decade.

During the campaign, Mr Keating will push his pledge for a referendum to turn Australia into a republic by 2001, the centenary of federation. Opinion polls suggest that this will be a winner. Mr Howard, an avowed monarchist, has been forced to drop his strident opposition to the republican cause, although he has yet to spell out how he will handle the issue.

The contest is likely to boil down to a test of leadership.

While Australians do not like Mr Keating, they grudgingly respect him as a strong leader who has never pandered to personal popularity polls. And, while Mr Howard might be right when he said that "many millions of Australians are aching for change", it remains to be seen whether they are ready to swap Keating for the colourless, uncharismatic Howard.