The first thing to remember is that Liberal = conservatives in Australian politics.
The Liberal Party Coalition is a coalition between the Liberals and the Nationals, who have been in power since 1996 (that's longer than Thatcher, yo). The Liberals are by a wide margin the senior partner, and they are a chimeric mixture of arch-Tories and small-l liberals (called "dries" and "wets" in the parlance of the times), with the Tories now in absolute control. They've always been the more business-friendly of the two parties, they absolutely LOATHE unions, and the religious right's influence is also growing in the party, much to the disdain of more economically minded Liberals. Likewise, their youth arm is a mixture of hardcore libertarians and borderline fascists and almost to a person, they are maladjusted weirdos and the butts of endless jokes.
The Liberals' strengths are usually stated as economic management and security, which I think simultaneously illustrates all the areas that they're found pretty wanting.
PM John Howard is proud of being the most conservative prime minister we've ever had, to the extent that former Liberal Prime Minister Malcom Fraser (1975-83) is a pariah from the party, frequently critical of their actions, and better friends with his former Labour Party nemesis Gough Whitlam than his own party.
The National Party is the junior member of the coalition, theoretically representative of rural interests (particularly wealthier rural interests, historically) but pretty spineless when push-comes-to-shove, because they owe their continued existance to the Liberals not competing against them in designated rural seats. They're far less free market committed than the Liberals, often derisively called Agrarian Socialists. Their stronghold is Queensland and they have very conservative social values everywhere they have any influence, though I understand that their almost nonexistant West Australian arm supports gay marriage. The Nationals pretty consistantly lose one parliamentary seat an election and are a dwindling force in national politics.
Labor is the opposition, who have been in the political wilderness since 1996, attributable to multiple factors, not least of which is Howard's sheer political cunning and Labours lacklustre leadership choices. Additionally, like Fabian Socialist parties worldwide, they're suffering an ongoing identity crisis in the face of neoliberalism and the New Left. They were traditionally the working class party as the name implies, and I believe the Queensland Labor Party was the world's first Labor government. They were more Catholic than Protestant back when that was a meaningful social division, and even today union membership is a must for navigating their byzantine factional politics. Naturally, they're more Social Democratic than the Liberals, though these days not by much, and in fact a raft of almost Thatcherite reforms were instituted by the last Labour government between 1983 and 1996 (yielding economic benefits that the Liberals have been quick to take credit for, somewhat unfairly). Basically, on that front, we can expect that they'll roll back the Liberals' extremely radical industrial relations legislation and maybe fiddle with tax rates a bit, but beyond that, there won't be any major economic reforms.
It's generally difficult to pin down just what it is Labor stands for, becuase having been in opposition for so long, they're pretty tight-lipped about it. Under Kevin Rudd they're likely to steer a fairly conservative path, though with token gestures on a variety of social issues. We probably won't see them legislate for gay marriage, grant autonomy to indigenous communities or end mandatory detention of refugees, but they might make small gestures in these areas.
The Democrats are a disappearing minor party that was once the great hope for ending the two party system. Think Lib Dems or NDP, but less successful. Formed by Don Chipp, a disgruntled Liberal, they set out with a policy to "keep the bastards honest" and generally presented a mixture of Liberal Party liberalism and Labor Party social justice. For a while they held the all important Balance of Power in the Senate (unlike Canada and the UK, we have a robust Upper House which, provided one party doesn't control both houses, provides an effective check on the government. By contrast,Australian state governments are far weaker than Candian provinces or American states despite our nominally federal set-up). Unfortunately for them, politics moved sharply to the right in the 1980s and 1990s, and they ended up looking like a left-wing party purely by sticking to their values. Several leadership crises and the rise of the Greens look set to, regrettably, wipe this party out in the near future.
The Greens are a slowly growing force that gets significant votes in many seats but is essentially locked out of the Lower house by our electoral system, despite having a higher national primary vote than the Nationals who hold 12 seats. In the Senate, however, they are a reasonably robust force and could well end up with the Balance of Power. They're much like the Greens elsewhere, maybe slightly more heterogenous on the economic front (most of the Greens I know are essentially environmental capitalists). They have pretty comprehensive policy statements that often make sense, but don't get a run in the media and are difficult to soundbite. As concern over the environment rises, the question is whether they can capitalise or whether environmenta issues will be co-opted.
Family First is the new "family values" party, often thought of as the analogue to the hyperaggressive American religous right, but this is unfair. That'd be the Christian Democrats, a marginal force held together basically by the Reverend Fred Nile, Australia's biggest douchebag. Rather, Family First appear to be more of the religious centre-left... sure, they're not fans of the gays, but they have fairly leftish views in immigration, refugee issues, indigneous affairs and industrial relations, in that their 'Christian' reading of these issues compels them to actually have some compassion, unlike the hard-right views of the Liberal Party. Even on gay issues, their official gay rights policy is that "all co-dependents should not be discriminated against – whether Homosexual or not."
All other parties are vanishingly insignificant, except when it comes time to allocate those final couple of senate seats through the quota and preferences system.
As for the important issues in the election... security has taken a back seat now that everyone's sick of the war on terror and its collateral damage. Instead, the election it's likely to be fought over (if the Liberals get their way) economic management or (more likely, and massively beneficial to Labor) industrial relations and the environment.
Sparks between Howard and Barak Obama nonwithstanding, foreign policy is a non-issue. Everoyne disagrees with the invasion of Iraq these days except diehard Liberal fanboys, but aside from disagreement over Iraq (which was so random and stupid an endeavour that it's best thought of as an aberration form normal international relations) Australia has a firm bipartisan consensus in favour of the American alliance. There are slight disagreements over the degree of subservience and how much we should be "engaging with Asia" (though the rise of China has answered the latter question pretty conclusively) but these are insubstantial. Neither party is going to end ANZUS and but neither party is going to upset China for the sake of the US, either.
At the moment the polls and the betting all indicate a Labor landslide but 6 weeks is long time in politics.
As much as it would be entertaining to see the Greens trying to run the country, its never going to happen.
