By Alex Tarrant
Ending poverty, cleaning up our rivers and tackling climate change – the nukes of our generation.
Not a James Shaw Greens-to-arms – although you’d be forgiven for thinking it. Rather, Jacinda Ardern rallying Labour’s troops with a cry intended to cement ‘watermelon’ Greens early on during the campaign while also signalling a move for the centre.
Labour’s campaign launch Sunday certainly got the coverage the party was hoping for. A full Auckland Town Hall, Don McGlashan, Helen Clark and an overflow room needed to house all the willing grass-roots party faithful.
I wrote on Sunday morning that Ardern would spend the campaign trying to cement the middle class voting block with nice urban soundbites like clean rivers, free university education and the like. She didn’t disappoint. We even got some talk about inclusion of cow emissions under the ETS – existing policy but this time not being said by Andrew Little, so it might as well be new.
Meanwhile, I wrote that National would be focussed on trying to grab back a few percent of deep-down Nats who are leaning towards New Zealand First, with a handful of meaty, populist policies designed to attract this very specific voting bloc.
And indeed, Prime Minister Bill English, Transport Minister Simon Bridges and Hastings Mayor Lawrence Yule on Sunday announced $10 billion for new Roads of National Significance. Four-lane highways so we can get produce from our regions to our export markets more quickly, while also improving our standard of living by being able to drive around easier in our cars from place to place.
You know Labour’s press release writers are in heaven when they can claim National’s announcing a policy that lacks a business case and that Labour would spend taxpayers’ money more wisely. Unfortunately, Labour voters are not the core crowd the policy was aimed at.
It’s a good, solid announcement that won’t excite too many people other than Mr Hastings-to-Napier who may have “had enough” as Winston Peters’ billboards put it, albeit in question form – “Had enough?”. National will be hoping the reply is: ‘we may have, but you might go with Labour so we’re voting for Bill and Larry.’
National over the weekend also moved to look like they are doing something forward-looking to tackle what is being described as a health crisis, with English and Health Minister Jonathan Coleman announcing Dunedin will get a shiny $1.4 billion new hospital. Another solid move. Talk in billions and say you’ll build something. Hospitals are probably worth more points than roads, but both fit the profile.
Labour’s health spokesman David Clark should take the announcement as an acknowledgement of how well he has performed since taking over the portfolio from Annette King only a few months ago. Clark is a Dunedin MP who has increasingly been landing blows on Coleman during Parliament’s Question Times – or at least making the Health Minister look overly confident, a bit smug and without a solid grip on his Ministry and director-general.
Under my (Green) thumb
The Greens meanwhile are announcing a “game-changing” transport policy for Auckland later Monday. I’m sorry guys but the train has already left the station on that one. You may well have kicked things off on earlier rail to the airport, and the Auckland-Hamilton-Tauranga link, but anything Auckland transport-wise has been taken over by Labour now.
In fact, everything the Green Party has struggled so hard to get into headlines these past few months, Labour under Ardern has just swanned along and taken over. Labour’s plan appears to be to keep its MoU partner under its Green-thumb.
Just read these lines from Ardern’s campaign launch speech on Sunday:
- “for me it’s simple: I want to build a country where every child grows up free from poverty, and is filled with hope and opportunity.”
- “the gap between rich and poor is just getting more and more entrenched.”
- “we have nearly 300,000 kids living in poverty…we will change the Public Finance Act so that every budget, you don’t just hear about surpluses and deficits, you will hear about how many kids we have lifted out of poverty.”
- “[Climate change is] the challenge that defines my generation…This is my generation’s nuclear free moment, and I am determined that we will tackle it head on.”
- “We will clean up our rivers. We will do it for the next generation. And we will do it together.”
James Shaw doesn’t have to write his next speech – he can just lift that one.
Labour on current polling still needs the Greens to have a hope of forming government in a three-way agreement that also includes New Zealand First. About 5-7% would be welcomed by Labour’s campaign managers – that means the other 10% of voters who had previously leant Green are hopefully in Ardern’s pocket now. And hopefully not over at TOP.
On Gareth Morgan’s bunch, on Sunday they announced their party’s only bottom line. No government TOP is a part of would be allowed to get rid of the Maori seats. This is a blatant continuation of Morgan’s infatuation with Winston Peters. It’s still looking more likely that Peters will hold the balance of power though.
There’s still a lot of work to do for Labour to get above National even though the gap has narrowed to potentially four or five points since Ardern took the top job. Both parties have earmarked extra votes they can potentially picked up – see more on that here.
‘The Economy’
For Labour, having taken ownership over the Greens’ sound-bites, Ardern showed signs of how she will now focus on the centre. Free university education, improving productivity, a focus on wellbeing over GDP, and: “you will never hear me question the importance of a strong economy.”
“The economy” is a topic (sorry, political term for ‘confusing stuff with numbers that you should just trust us on’) National will try and hurt Labour on. Gerry Brownlee spent a good deal of time during Parliament’s adjournment debate last Thursday talking about how we’d never hear Ardern talking about the economy – essentially implying she doesn’t understand what she’d be talking about if she did try mention it.
Ardern had a line ready on Sunday: “the major point of difference on economic issues this election is not how long either leader has spent working with Treasury – it’s what we use as the signs of success. I will always maintain that a successful economy is one that serves its people. Not the other way around. And that means judging success differently.”
English is certainly someone who has spent much time working with Treasury (and even in it before his political career). Where Ardern talks about wellbeing over GDP, rail over roads and climate change over growth, expect to see a lot of pictures of English this campaign in machinery workshops, discussing export markets, resilience, and talking in billions of dollars for building solid things like roads. Things we can see and touch so we can feel good that “the economy” is progressing.
42 Comments
Be prepared to expect more bribe policies from national.
Voters should judge opposistion parties for their policy announcement and National for what they have been doing and what their policies have been over last 9 years AND not what they announce now to get vote like Rebuilt of Dunden hospital.
Oh get over it , Labour have announced nothing new at all , they are simply reverting to type , and we have seen it all before , offering all sorts of complicated new taxes , higher personal taxes , and nanny state nonsense like telling us how much water we can use to shower , and to cap it all announcing they will be giving more help to people on welfare, because they are struggling .
I am sure they are struggling , my adult kids all have jobs and they are also struggling to get by with horrendous Auckland rents and expensive public transport they use to get to work , to name just two issues .
Welfare is not meant to be comfortable , its there if you really need it to put food on the table and buy clothes for the kids, when you are unemployed.
The only thing people on welfare need is the link to the WINZ JOB SEARCH which has literally thousands of desperate employers looking for staff . Those employers out of desperation are looking at Fillipinos and Indonesians to come in and work here
Labour is suddenly very quiet about their previously much touted 100,000 new house -building public works program idea that has fallen on its arse now that they have realized it cant be done because we dont have the tradesmen , and the Government does not have the money or resources to do it.
Something of this scale and scope needs to be done on a scale akin to going to war , using every able bodied man , every financial resource possible , and it has a tendency to crowd out everything else .
After WW2 we had tens of thousands of ex-servicemen needing something to do and went into a public works house- building program on wages that were a few pounds a week .
This option no longer exists, this is 2017 not 1947, things have changed .
Government could fund 3 house building factories near the main centres which could produce highly precise. well-insulated walls with windows pre-installed. These can be produced cheaper and faster than building on site. This would help lower costs and time to build. Note that this model already exists for trusses.
Source: I did this for my house (albeit on a smaller scale) and it went from slab to weathertight in 2.5 days
You've got to laugh at all of this spend by National. When it's Labour, it's "tax and spend". When it's National it's....investment??
Of course it's all free when National spend, no need to tax or anything like that....especially when you can borrow and pass that burden on to someone else in the future.
Water tax to ruin food producers , and increase food prices when producers have no alternative but to pass it on to people who eat food .
Auckland road tax which will add to costs when its passed on to end users and consumers by everyone from couriers , to tradies , and essential services
Capital Gains tax which will affect our already weak capital base , frighten those who provide housing rental stock , and do a whole lot of damage to baby boomers who will then have to rely on the state for more thing such as dental and optometrists, etc
A new levy on builders who dont have apprentices
Reversal of the cost-of-living adjustments to the Tax Tables tables in the last budget
Now that all adds up to TAX AND SPEND on a spectacular scale
Our rivers are half ruined, and I honestly don't believe Labour will implement a policy that will kill farming (you can tell me you told me so if they do).
Our couriers and tradies and essential services can't do their jobs Auckland is so grid locked. Someone has to pay for all of National's spend on roads, that isn't free.
It was National who introduced the "bright spark" test, essentially a mini capital gains tax.
Labour are proposing to pay for the first three years for apprentices.
The reversal of cost of living adjustments goes into another allowance, no net change there.
I have been a National voter in the past, but enough is enough. Boatman you've got those blinkers on so tight it's a wonder you don't hit your head on every door frame in the house mate.
You're just part of the problem, Boatman.
You are stuck in a mindset that everything should be subsidised, but without you paying for it. Then, when someone dare highlight the fact that it is impossible to lower taxes ad infinitum, your whole world blows up.
Water tax - This is a preemptive measure to curb the systematic draining of our aquifers. In 50 or so years when drought is more prevalent in the reliant areas (think California now) and the aquifers drained from overuse, we will be pretty thankful for such a policy.
Whatsmore, farmers are ruining our waterways with run-off, accentuated by easy/free access to irrigation.
Auckland road tax - God forbid the users of the roads actually pay the full cost of usage.
The reason we have crappy traffic in Auckland is solely due to this fact that no one pays an appropriate amount for usage. It's the same reason that in a year's time, the Waterview tunnel will have no effect on congestion.
CGT - Labour haven't promised this. They merely said that they will act according to the findings of an independent examination of the system.
A new levy on builders without apprentices?
So, what on earth should those builders do? Perhaps take on an apprentice and milk the government for all the associated subsidies surrounding the proposed scheme (effectively no cost)? No, that'd be crazy. Much better to follow the current model and import unskilled labor.
And, I have one question...
Where is National going to get the money for their colossal spending projects that they have 'promised'?
OK let's analyse.
Water tax is about $1 per 100 tonnes of water. Seems fair to me. If that's too onerous, then someone's not being particularly cautious about how they use our water resources. The natural resources of this nation belong to all of us.
Auckland petrol tax. 10c/l. That's an extra dollar per 100km. I think it's good to disincentivise automotive transport to decrease traffic issues. Bad traffic is already taxing your fuel consumption through wasting it while you're sitting still. And that money is also going to fund new transport infrastructure in Auckland to further reduce traffic, which reduces not only wasted fuel, but also wasted time which arguably is far more valuable. This is a clear win-win, which only someone being intentionally obtuse would argue against. I personally quit being a tradey in Auckland number 1 reason being I was so frustrated with the traffic wasting my life.
CGT is a good step at redirecting investment and incentive in our economy. An LVT would be even better but baby steps are OK. I think the baby boomers have done well enough out of this country, and out of their forebears, their children and their grandchildren. It's terribly disingenuous to claim poverty on behalf of the baby boomers.
I haven't heard about this "new levy on builders who don't have apprentices". I thought it was more, assisted labour spending for tradey's who take apprentices.
It would be nice if we actually had a government who would tax and spend instead of one who's borrowing from our future, by BORROWING AND SPENDING on tax cuts for the rich. You need to ask yourself who really are the fiscal conservatives. I'll give you a hint, it's not National. Their last 9 year in power they have quintupled our government debt.
Not strictly true.
a) Before irrigation projects we grew food. What we are doing now is putting in such projects to grow food in areas that are otherwise not ideal for that type of crop or to increase production beyond what the soil and//or climate can give us. Or to combat climate change as desertification moves growing areas. Meanwhile we damage the environment in order to make short term profit which makes it less viable longer term, not sustainable.
b) CGT this is simply a re-balance or a "leveling of the playing field" where before some capital gains were taxed and some were not. Take TOP's CGT policy, 80% of people who would pay CGT would actually pay less PAYE so the policy is tax neutral. So those paying little or no tax now have to pay their fair share and those paying the "rump" of tax actually pay less. I cant quite see why a deposit holder pays tax on the profit / interest but a property holder does not, makes no sense to me.
A CGT wont threaten our capital base it just reduces or hopefully stops mal-investment of capital.
Auckland road tax, yeah OK but how else do you expand transport? Listen to business screaming they want better transport but yeah sure they dont want to pay for it. ie If its not on "user pays" then its on rates, so its socialise the losses, privitise the profits.
How about Labours 'training levy' tax on business and the latest water tax on businesses in irrigation dependent provinces, for starters. That's before we get onto the capital gains tax Labour says it will implement but, as with most of Arderns sound bite announcements, little detail. Then there is the scotching of bracket creep tax reductions that middle NZ should have got but won't if Labour is voted in.
Propaganda at its worst ....
National introduce a CGT-Lite in the guise of a 2 year bright-line test and Ardern proposes to extend that out to 5 years from 2 years and here you are accusing Labour as "introducing" a CGT
As for the irrigators converting what was once crop land into dairying, which is now reliant on government subsidies to make those conversions viable - let them pay for it
As for training levies - any business that is reliant on migrant labour should be charged a training levy - if they don't want to do the training, the government can get someone else to do the training
two other guys. So .. more tax, yes. As per boatmans point. And I note you don't respond on the bracket creep reductions for middle NZ that Labour has canned.
But - as you have diverted to a bit of historic context - the bright line test was to curb rampant AKL house price inflation, not a tax raising exercise.
On irrigation - I suggest you actually have a look at irrigated areas as you would observe a significant increase in arable farming. Dairy is popular focal point for water tax advocates but in fact it is now very hard to secure a consent for a conversion. Cropping and horticulture will be the major beneficiary of irrigation over coming years.
Labours training levy is a tax on SME's. Larger business will be exempt as they already have structures in place. it won't fix the problem of Kiwis not being motivated enough to do the work that we have to bring migrants in for. It will end up being just another tax on the SMEs that employ over 90% of Kiwis.
Not discussing the purpose of the Tax-raising properties of the CGT. The tax treatment of "capital gain" has been in force for many years if you buy and sell a property with an intention to make a profit.
Was simply drawing to your attention that National codified that original rule somewhat - whether it was aimed at Auckland or not it was to be applied at a national level. How much tax may or may not be raised is irrelevant
The point was that by ACCUSING Ardern of INTRODUCING a CGT by extending the 2 year test to 5 years you are blatantly wrong - that is propagandist
Disclosure - I'm neither a Labour or Green voter-supporter
two other guys. Irrigation certainly does not let you convert from arable to dairy. It enables you convert from dryland sheep farming to dairy, horticulture or viticulture.
And I get tired of hearing about how dairy is subsidised. Ours is the least subsidised dairy industry in the world. And lets take a look at our other export industries - tourism, that we all subsidise by letting the tourists use our infrastructure for free, and putting up with having crowds of them everywhere, and export education subsidised by giving away residencies.
You never know with National though. They promised not to increase GST, then did so (after saying "If we do a half-decent job economically, we won't need to."). They also then started taking one third of your employer Kiwisaver contribution - a backwards action given allowing people to save this would have very positive downstream effects on retirement savings.
We're also now just finding out some of the true negatives of underfunding in health etc. ...so you'd have to wonder why we prioritise small tax cuts over positive health outcomes at election time.
Underfunded relative to what ?
Health spending in real (additional to demographic trends) terms, is 4.6% higher than 2009. Total spend is higher than the OECD average, especially once ACC is factored in.
If NZrs want to pay more tax to have a better health system, that's fine but is another discussion and until that conversation is properly had, the blanket statement that health is 'underfunded' remains meaningless.
RickStrauss. Demand for health services is a bottomless pit, exacerbated by lifestyle choices. Healthcare must always be rationed according to national spending priorities. The media is well aware that NZs spend and the increase in efficiency of our healthcare system over recent years, compares favourably with many developed economies, yet relentlessly exploits individual human suffering stories to construe an underperforming service.
There are of course notable cases of systemic failure, with Canterbury budget mismanagement and Otago/Southland delivery issue recent examples. But overwhelmingly, the public experience of our system is positive.
Try experiencing health systems in other countries if you haven't already - I am very glad to have our system with its wonderfully dedicated people. I'd also be willing to pay a bit more tax to achieve an even better system but past history of just chucking more money at it shows that is not, of itself, the answer.
True - the problem I have is we seem more ideologically wedded come election time to tax cuts than to looking after those who need healthcare. Sure, it doesn't affect me because I have private insurance uninterrupted since I was born. But it affects the young and the pensioners alike who cannot afford private insurance to avoid the spectre of waiting to get on a waitlist to wait a year for an operation.
I've lived in a couple of Third World countries for years at a time. I'm aware that our socialised medical care is much preferable to the alternatives, hence my eagerness to have it delivering.
I'm pretty sure that as a % of GDP our healthcare spend has been decreasing for the last 8 years, hasn't it?
I agree that actual spending has increased (likely by 4.9%). However, in the same time, our population has grown by ~10%.
Is my maths wrong, or is there some sort of relative reduction here...?
nymad. There are multiple references but I'm a bit of a Brian Fallow fan so here's a take out from his 6/6/17 Interest.co article :
'Real (above what is necessary to keep up with population increase) per capita health spending next year will be 4.6% higher than in 2009, but that in turn was 26.7% higher than in 2000.
At least the health spend has increased in real per capita terms under the present Government and held its own as a share of the Budget'
Important to look at the entire article again - the crux of it is that the National government has been running an austerity budget.
Looking instead at the average real per capita spending over the terms of the two governments, the VUW/NZIER data indicates a decline of 11.7% between Labour and National.
https://thespinoff.co.nz/politics/06-07-2017/analysis-contrasting-the-s…
And this is great - the points Fallow makes in a bar chart;
https://twitter.com/danylmc/status/882686211256717314/photo/1?ref_src=t…
So health just over the line but all else (aside from super) has suffered.
Once again, what most folks don't realise is that we've be living an austerity budget more or less by stealth as a means to get to that surplus target. Whether that is right or worng, I don't know, but the point is that National needs to be upfront about it and tell us why that is necessary.
If we want to move the discussion to wider than health, yes, overall government spending as percentage of GDP has declined in real terms.
But the extent to which that decline has resulted in deteriorated outcomes or whether spending should always be a set percentage of GDP, are moot points. There have been significant efficiency gains in the cost of government service delivery resulting in historic spending to GDP ratio multiples being no longer relevant.
Left wing politicians are locked into a mindset that insists additional spending and creation of bureaucracies to a administer that spending, will always produce proportionately improved outcomes. When the evidence is clear that this is not a given.
I might be wrong here but I thought the real figure was actually backwards, i.e not keeping up with inflation and demographics? DHBs are desperately trying to slash costs all over the place.
On your second point I've just paid my ACC bill and I was staggered to find out that it capped my payment at $122k of earnings, apparently they don't take contributions beyond that. I've got private medical insurance but for minor accidents and what have you we use ACC, so would be more than happy to pay what I see as my full contribution.
NickBOP. If Fallow has done his numbers correctly, the increase in spending is 'real' i.e. the extra spend needed to keep up with population increase was deducted before he made his calculations. In addition to this increase in spend there has been a significant improvement in productivity per dollar spent. So a compounding positive effect.
Of course, its obvious there are still some significant issues with our healthcare system. But the extent to which this is maladministration, inefficiencies, underfunding or growing public expectations is a debate that is not being objectively had.
Here's the full analysis;
https://thespinoff.co.nz/politics/06-07-2017/analysis-contrasting-the-s…
Let's look at the truth John Key resigned leaving the country with massive debt, I feel National have had a long enough reign. Bill English is not the type of leader this country needs, we need change with a new focus on what is important, and that is the people, I most certainly won't be ticking the blue box.
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