Despite funneling in hundreds of thousands of dollars into campaigning in the electorate, and having thousands of volunteers on the ground in Bennelong, in the north west of Sydney, Labor was unable to secure enough votes to win the traditionally Liberal-held seat from John Alexander.
At last count the AEC had John Alexander winning the seat 54.27% to former NSW premier Kristina Keneally 45.73%. There was a 5.45% swing to Labor but it wasn't close to the 10% needed to take the seat from the Liberals. Labor has only held the seat once before, between 2007 and 2010 when Labor took the seat of then-sitting prime minister John Howard.
On first preference votes, Alexander had a 6% swing away, and Keneally had a 7% swing to Labor with the party picking up some of the Greens first preference vote, resulting in a 2% swing away from the Greens. Cory Bernardi's Australian Conservatives party candidate Joram Richa picked up 4.48% of the vote, but preferences flowed back to Alexander.
Both of the major parties are seeking to claim a win from the by-election, with Labor stating that if the swing held uniformly across all electorates at the next election, then it would be an easy win for Labor.
"Kristina may not have won the election tonight, but she and you and the voters of Bennelong have given Labor an election-winning swing at the next election," opposition leader Bill Shorten said on Saturday night.
.@JAforBennelong says the #Bennelong by-election has brought the Liberal Party together and has been a ‘unifying mo… https://t.co/XbWYHnz2KQ
Alexander said that the by-election had been a "unifying and humbling experience" for the Liberal party, suggesting that it had brought the party together in its bid to retain the seat.
The win means prime minister Malcolm Turnbull retains his one-seat majority in the House of Representatives, ahead of a likely reshuffle of his cabinet in the coming days, and ahead of the mid-year economic and fiscal outlook (MYEFO) to be delivered by treasurer Scott Morrison on Monday.
The government is claiming that the victory is a verdict on Shorten's leadership. On Sky News Sunday Agenda, Liberal MP Craig Laundy said that spite running a "star candidate" and pouring so much resources into the electorate, Labor was unable to pick up the average swing against a sitting government MP at a by-election of 7%.
There is speculation that Keneally will take the Senate spot vacated by Sam Dastyari following his resignation last week. During the campaign, Keneally refused to rule out taking the seat, but said she had turned down offers for the Senate in the past.
It has been previously reported that Keneally had been eyeing off a move to the ACT to run for Canberra's new third federal seat.