The Coalition in Australia has broken apart following major disagreements between the Liberal and National parties. The split came after the Nationals demanded support for four key policies in exchange for renewing the Coalition agreement. These included lifting the ban on nuclear energy, creating a $20 billion regional development fund, expanding mobile service obligations, and granting power to break up major supermarkets like Coles and Woolworths.
Sussan Ley, deputy leader of the Liberal Party, rejected these conditions. She had promised her party a complete policy review and did not want to make early commitments. This decision led the Nationals, led by David Littleproud, to walk away from the deal.
Each of the Nationals’ proposals involved a stronger role for government. This clashed with the Liberals’ preference for private sector solutions and minimal government interference. The disagreement over nuclear power is a clear example. While the Nationals support government-built nuclear plants, many Liberals want the private sector to take the lead if the ban is lifted.
Another major issue was the proposed regional development fund. The Nationals believe rural Australians deserve equal services, even if the market won’t deliver them. This includes funding for roads, health services, and telecommunications in remote areas. The Liberals, however, are concerned about large-scale public spending that goes beyond what the market cannot provide.
Telecommunications was another point of conflict. The Nationals pushed to expand the universal service obligation to include mobile coverage in rural areas. Historically, this obligation ensured that all Australians had access to basic postal and telephone services. While it still applies to Australia Post and Telstra, the Nationals argue it should now include mobile services. The Liberals, focused on policy reform, are reluctant to agree to expanded obligations before reviewing their overall position.
The fourth point of tension was over supermarket regulation. The Nationals want laws that could force dominant retailers to sell off parts of their business if found to abuse market power. This approach would give the government strong authority over private companies. For the Liberals, such a step goes against their commitment to free market principles.
These policy clashes reflect a deeper divide between the two parties. The Liberal Party has always favored market-led solutions. The Nationals, rooted in their rural support base, often back government involvement to ensure fairness for country communities. This difference was once described as “Country party socialism” because of the Nationals’ support for government subsidies and public investment, even while opposing union-driven labor policies.
In the past, these tensions were masked by shared cultural values. Both parties united over topics like national identity and family values. But after their electoral defeat on 3 May, economic and policy differences have come back into focus.
With no new Coalition agreement in place, both parties are now charting separate paths. The Nationals may seek greater independence to push their rural-focused agenda. The Liberals, meanwhile, are expected to concentrate on reshaping their policies to appeal to a broader base, especially urban voters.
This recent break is not just a short-term dispute. It highlights a long-running fault line that has always existed in the Coalition. Whether the two parties can find common ground again remains uncertain. For now, the future of the Coalition appears more divided than ever.
