Bryce Edwards ' Opinion

Bryce Edwards is a lecturer in Politics at the University of Otago.

Bryce Edwards: Political round-up: May 24 - Budget day

Finance Minister Bill English looking over copies of his 2012 Budget hot off the press at Printlink. Photo / Mark Mitchell
Finance Minister Bill English looking over copies of his 2012 Budget hot off the press at Printlink. Photo / Mark Mitchell

The race has already begun to attach a folksy label to this year's Budget and capture in two or three words what it's all about. John Armstrong's bid for the title is 'sweet and sour', reflecting how each unpalatable cut is balanced with a sweetener. He thinks this approach has worked so far and that with the outcry over cuts and increased charges effectively minimised, today's fare will be fairly bland - see: 'Sweet and sour' approach averts Budget outcry.

'Bach, boat and beemer' is Patrick Gower's pick for an catchy handle, reflecting Bill English's hint that he will be closing down on tax loopholes such as tax write-offs for holiday homes - see: Bach, boat and beemer targeted in Budget. Such measures will make easy headlines for English and make it easy for headline writers. But the measure is unlikely to harvest large amounts of extra revenue or cause real concern for the most affluent New Zealanders.

Will it be an 'austerity Budget'? Vernon Small says that by, 'New Zealand's historical standards, yes', but 'By recent European standards, not by a Southland country mile'. Small is picking an early return to government surplus as the possible Budget surprise, saying that all the bad news has been got out of the way over the past few weeks to avoid headlines about English 'socking students, smokers and the sick' - see: Is there a Budget bright side?.

The surplus target does appear to be firmly in the Government's sights, and Duncan Garner's contention that it has become a political target rather than an economic necessity is backed up by Berl's chief economist Ganesh Nana. Nana says that total external debt, which includes the 'extremely large' private sector debt, and a need for export growth are the real issues - see: Govt too focused on surplus - expert.

The 'getting your books in order' line, though, has a great deal of political value to the Government, irrespective of economic reality. A poll of 2000 Fairfax readers shows that '60 per cent rate it as the top priority' -- see Vernon Small and Tracy Watkins' Budget: Early return to surplus has strong backing. This focus on reducing Government debt suits National's ideological aims says blogger Danyl Mclauchlan and he notes how 'utterly our public debate and understanding of these issues is dominated by National's rhetoric' - see: Low hanging rotten fruit. Certainly both Labour and the Greens have all but accepted National's framework on this issue.

Comparing the Government's debt to balancing the weekly household budget makes good folksy soundbites but Robert Winter quotes Nobel prize winning economist Paul Krugman on why we should be very careful about this comparison - see: Budget tricks: myths about government debt.

If a return to surplus is the Government's shining trophy today, it will be based on Treasury forecasts, but Brian Fallow has an analysis of the difficulties Treasury have getting these right - quoting Bill English himself: 'the fact that Treasury forecasts something doesn't mean it will happen'. Fallow says Treasury forecasts have tended to be optimistic and the Government's own actions in the public sector are actually making the growth targets harder to reach. He argues that the focus on the return to surplus 'serves the useful purpose of distracting us from a bleaker outlook in the near term, at least compared to its previous forecasts' - see: Economic forecasting can be a foggy job.

Labour's David Cunliffe enlists some international economic heavyweights to attack government lines in his blogpost, Reading through National's Budget spin. Don't expect Bill English to use the word 'zero' much today - Labour have seized upon it with Cunliffe using the word six times in his brief post. This looks likely be the Opposition's main form of political rhetorical, with Shearer likely to taunt National about 'zero growth', 'zero ambition', 'zero hope' and so on. In contrast, Russell Norman takes a more positive line offering up the Greens as an alternative - see: Our Budget would be smart and green.

Other useful Budget primers today include: Claire Trevett's Ready to make bubble and squeak, Joshua Hitchcock's in-depth blog post, A Budget Primer, Robert Winter's A Day for Messrs Shearer and Parker to shine?, Pete George's Budget - wait until Friday and Duncan Garner's Budget 2012 expectations.

David Shearer's timing in standing down Shane Jones and calling in the Auditor General is not great. On the eve of the Budget, Labour has been forced to give the story legs in an attempt to defuse it in the long term. All of this also happened only a matter of hours before the protagonist in the affair, William Yan, was found not guilty. Danya Levy reports in Jones had to stand down: Shearer why the Labour leader had to move fast. Shearer says that 'It was clear during the week that despite Jones' explanations for his actions, they weren't "cutting through".' Levy also reports that the department of Internal Affairs is now trying to see if Jones' new claims about 'humanitarian concerns' can be corroborated with evidence from its files.

For more coverage of the alleged 'cash for citizenship' scandal, see the Herald's Jones won't speculate on political future and an interesting blogpost from Keeping Stock which makes a very good point that Jones' professed concern for migrants facing persecution and willingness to ignore official advice is completely at odds with an earlier decision Jones made as a minister - see: We can't help but wonder....

It's appropriate that in the lead up to the Government's Budget, the public has been afforded a further glimpse into the financial affairs of politicians, with the official release of MPs register of pecuniary interests. The big story has been that MPs lapped up RWC tickets from corporates. In this story, Claire Trevett has compiled a very useful list of 'Guests at the Games - Who hosted which MPs'. She also reports that 'Labour has been left red-faced after the latest disclosure of MPs' financial interests revealed eight Labour MPs took free tickets and hospitality from SkyCity casino during the Rugby World Cup. Geoffrey Miller challenges David Shearer's account, warning against politicians receiving corporate gifts and saying MPs should declare them more quickly than they do - see: Is taking gifts from lobbyists ever a good idea?.

The blog No Right Turn also condemns Labour politicians - see: Noses in the trough. He says 'The revelation that Labour accepted Sky City's hospitality is particularly damaging, and creates an image of hypocrisy. It also highlights the danger of MPs accepting gifts from anyone: no matter how innocuous, it will be perceived by the public as compromise'. He is also scathing of Labour MP Rajen Prasad who moonlights as a company director for the Bank of Baroda, which the blogger suggests might explain 'Prasad's virtual invisibility in Parliament'. David Farrar has also catalogued some of the more interesting or unusual entries.

Another revealing element of the story relates to the declaration - or lack of - by MPs of their property ownership. Andrea Vance has compiled a list of all the property declared by MPs in MPs own up to corporate freebies. Significantly, she notes that 'More than half of the country's MPs have interests in one or more trusts' and explains that 'Trusts allow MPs to hang on to assets but not reveal them in the annual public declaration'. Many MPs appear to be able to avoid transparency. In his article, The MPs' gift register: six highlights, Toby Manhire says that 'The word "trust" or "trustee" appears in the register 571 times'. He notes that he 'counted 104 declarations of Rugby World Cup tickets and/or hospitality. God knows how many came in under $500 value'.

- NZ Herald

Bryce Edwards

Bryce Edwards is a lecturer in Politics at the University of Otago.

Bryce Edwards is a lecturer in Politics at the University of Otago. He teaches and researches on New Zealand politics, public policy, political parties, elections, and political communication. His PhD, completed in 2003, was on 'Political Parties in New Zealand: A Study of Ideological and Organisational Transformation'. He is currently working on a book entitled 'Who Runs New Zealand? An Anatomy of Power'. He is also on the board of directors for Transparency International New Zealand.

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