They are off and running for September 7

After hosing down speculation yesterday, Kevin Rudd has announced a September 7 election. AAP/Alan Porritt

Kevin Rudd has called an election for September 7, with Labor and the Coalition entering the campaign close in two party terms and the next five weeks likely to be decisive for the outcome.

Rudd went to Governor-General Quentin Bryce this afternoon after flying from Brisbane.

This followed two last minute federal government victories - Victoria signed up to the Gonski school plan and Western Australia joined the national disability scheme.

In news conferences in Canberra, the two leaders framed how they see the choice for Australian voters.

Rudd said, “This election will be about who the Australian people trust to best lead them through the difficult new economic challenges which now lie ahead. New challenges brought about by the end of the China resources boom.”

Abbott said the election was “really about who is more fair dinkum - who can you rely on to build a better future? The people who have been stable and consistent for the last three years or a government which has been wracked by division and dysfunction and which promises more of the same if it’s reelected?”

Rudd contrasted his positive, future-looking approach with the negativity of his opponent. “The old politics of the past just won’t work for the future. Wall to wall negativity doesn’t create a single job. Negative personal politics doesn’t build a single school. The old politics of division doesn’t build a single hospital. Clinging to the past is not going to help build a national broadband network of the future. Three word slogans don’t solve complex problems,” he said.

“Australia is too open and positive a nation to retreat into a tight little ball of negativity.”

Confronting the opposition claims that Labor has thrown Australia into debt and deficit, Rudd said his opponents “can never answer this simple question: if this is the case why does Australia, among only eight countries in the world, continue to have a AAA credit rating.”

He said he entered the election “as the underdog. In fact, my political advisers tell me that if we had an election yesterday Mr Abbott would be Prime Minister as of today.”

Rudd, addressing the media in the same courtyard that saw his final news conference after he lost the leadership in 2010, said that the Australian people had over the years seen him at his highest highs and at some of his lowest lows. These times, whether they were good or bad, “have certainly made me a much stronger person”. “You the Australian people know me pretty well, warts and all. I would be deeply honoured to serve you, the Australian people and our country into the future.”

In an email message to supporters appealing for funds, Rudd said: “We’ve got one hell of a fight on our hands. Abbott and a few millionaires will out-spend us. But if we join together we can even the playing field.”

Abbott said the choice for September 7 could not be clearer, it is “between the positive plans of the Coalition and more of the same under the Australian Labor Party and Mr Rudd.”

A Coalition government would “build a stronger economy so that everyone can get ahead. We will scrap the carbon tax, we will get the Budget back under control, aye we will build the infrastructure of the future and we will stop the boats.”

“Who do you think is more fair dinkum? The people who actually stopped the boats in the past, or the person who started them up again in 2008? The people who have actually delivered surpluses or the man who started the spend-a-thon which has got us into the fiscal position we’re now in where the Budget is blowing out by $3 billion a week?

"The people who have been stable and united for three years of opposition, or a government which hasn’t had the same policy from one week to the next and has given us over a little more than three years, two prime ministers, six small business ministers, five assistant treasurers and four ministers for immigration?” Abbott said.

Abbott said he was determined to build a country “where no one ever feels like a stranger, to build a country where the bonds of social solidarity, the bonds of community are stronger and stronger.” He pointed to the government’s 457 legislation as demonising people who came to Australia legally and worked and paid taxes.

Abbott declared that if the election resulted in another hung parliament he would not do any deals with independents and minor parties to lead a minority government. “If there is hung parliament, there won’t be a Coalition Government led by Tony Abbott.”

Cabinet is scheduled to meet tomorrow to discuss election planning, while both sides are gearing their campaign offices.

Labor has dramatically revived since Kevin Rudd seized the leadership from Julia Gillard in June, putting it back in the race after it had been written off completely.

But big regional variations are expected, which could be critical in the result.

The ALP has received a boost in Queensland, Rudd’s home state,. But it has problems in NSW, where the corruption issue has dogged it and support in Western Sydney remains problematic.

A 7 News/ReachTEL poll last night had Labor trailing the Coalition 48 to 52 on a two-party vote, Kevin Rudd trailing Tony Abbott as better Prime Minister 49.1 to 50.9 and the Coalition leading Labor as the party trusted to effectively manage to economy 60.7 to 39.3.

Since he’s been PM, Rudd has moved to try to neutralise key issues including boat arrivals and the carbon tax. But the government’s economic statement released on Friday showed a sharp deterioration in budget numbers, with larger deficits in this financial year and next than predicted in May.

The poll culminates weeks of speculation about the election date, after Rudd abandoned Gillard’s choice of September 14. On Saturday the PM threw the September 7 date into doubt when he said he intended to go to the G20 and the government still had things to do.

But Rudd’s senior advisers and Labor Party strategists have been urging him to call an election as soon as possible, believing the government should take advantage of the honeymoon phase of his leadership.

The victories on Gonski and the NDIS put in place key planks for the government.

Greens leader Christine Milne said her party would be calling on people to vote for a “caring and sustainable Australia and to vote against cruelty and environmental destruction.

"Unlike the old parties, we care what life will be like in 50 years, not just the next three.” The Greens are facing a major fight to keep their sole balance of power in the Senate and Adam Bandt’s seat of Melbourne in the lower house.

At the end of the outgoing hung parliament Labor had 71 seats, the Coalition 72 and there were seven crossbenchers including one Green.