We saw the Brexit vote for the UK to leave the EU, and the victory of Donald Trump in the US presidential elections, both strongly against the polls.

It was also another challenging year economically, as the world economy and world trade remained flat despite historically low interest rates and stimulatory budgets.

It was also a surprise to many that the Turnbull government just scraped back with only a one-seat majority in the Lower House. Pauline Hanson won four senate spots, and the government now needs nine of 11 crossbench votes to carry its legislation through the Senate, if opposed by the ALP/Greens.

We move into 2017 with an electorally weak government, at what is the most challenging and unpredictable time in our memory. Not only is it difficult to predict how events may unfold, but we have little idea how governments and policy authorities will respond.

Trump is, of course, a major source of uncertainty. He has already ‘shaken things up’ with his Twitter feed on China, Taiwan, the UN, Israel, and nuclear weapons, and with several controversial appointments to his prospective administration.

Also, somewhat against his promised revival of the US economy, the US Federal Reserve has begun a pretty aggressive push to raise US interest rates.

Although the Turnbull government closed this year with some legislative success in finally passing its industrial relations bills (although in a denuded form), and having made a small start towards budget repair, we have been given little idea of the government’s strategy and priorities for this year and beyond.

The immediate challenge for Turnbull is to hold his team together.

We have already seen warnings from some of his National Party members as they pursue their narrow self-interest, and Cory Bernardi has elevated his threat to break away by forming his Conservative movement, as Hanson threatens to broaden her support running a host of candidates in forthcoming state elections.

Indeed, there is also talk that Bernardi and Hanson might unite.

Turnbull would be most unwise to underestimate the significance and urgency of this ‘conservative challenge’. It’s an easy sell to an electorate, especially a regional electorate, which feels dispossessed by politics generally, and by the major parties in particular.

Hanson has already rattled both the LNP and the ALP with her anti-establishment, anti-Islam/immigration message – she will pull support faster than they fear!

This is a global phenomenon. Not only is it basic Trump, but just look at the way the mood is shifting in Europe, where many who once voted communist in France, for example, are now shifting to support ultra-conservative Le Pen, or the rise of the anti-EU ethno-nationalistic movement in Germany, and across Europe more generally.

At the very least, Turnbull should be strategising as to how he would “coalesce” with these forces, probably from outside his team, as he will need to do to retain government.

And all this at a time when, with his narrow majority, he is only ‘one heart attack away’ from a dreaded bi-election that he would most certainly lose.