Voters who remember the recessions and the high interest rates under the former Labor government were upfront with their concerns about Labor’s ability to manage the economy prior to polling day. With inflation hitting the top of the RBA’s target band and continued fragility in US markets, Crikey asked a panel of leading economists if now is a bad time to win government.

Richard Gibbs, chief economist, Macquarie Bank. Yes, it’s a more complex time than in the last couple of years. There’s no question about that. There are competing tensions, obviously. The policy challenge of balancing an economy at near full employment with price stability in that environment is going to be more difficult than in the past. I’m not of the Gittins view that this was a bad election to win. But it is going to require ongoing vigilance and dynamic policy settings to keep the show on the road. Of my discussions with [the incoming government] in terms of expenditure realignment and the like, they know that’s got to be done. They know that they can’t possibly fund tax cuts and additional spending on services and put all that income into the economy and not have inflationary consequences. They are aware of that. It’s a question of them now using their initiative in terms of how they realign that expenditure.

Shane Oliver, chief economist, AMP Capital. When you’ve been in opposition for 11 years there’s no bad election to lose. It probably would have been easier to win the 2004 election. Back then the global economy was still moving higher and the inflationary risk in Australia was a little bit less. It is true that there are a lot of uncertainties around now. There are more challenges around today than the Howard government faced in 1996 or the Hawke government faced when they won office in 1983. But Australian exports remain in a good position and that may be the case for several decades given our proximity to Asia and our supply of resources. Even though there are these uncertainties about the US, and also balancing our desire to spend the budget surplus, the underpinnings of the Australian economy remain pretty strong and are likely to remain so for some time to come.

Alan Oster, chief economist, NAB. What the government has to do is slow down the economy a bit. I actually think there’ll be another rate rise in February and then the Reserve Bank will sit back and watch. Unless the economy starts to slow, then they’ll probably have to do it again. By the time we get to May, the government will be looking for – I won’t call them non-core promises – but they’ll be looking for savings or other things they can switch around to help. In essence though, I don’t think it’s a bad time to win government. The economy is rolling along. The big issue globally is watching to make sure the US doesn’t completely run off the rails. If it does, we’ve got higher interest rates and we’ve got surpluses, so we’re in a pretty good position to make sure the economy doesn’t stumble.