Fran O'Sullivan: Election result gives Jacinda Ardern mandate to be bold

Jacinda Ardern could start by taking on a major portfolio herself. Photo / Dean Purcell

OPINION:

I am looking forward to Jacinda Ardern rocking Labour's boat free of the sandbar it's been stuck on for the past three years, and instead setting a new and bold course through what will inevitably be choppy waters ahead.

The Prime Minister is no longer a novice.

She has shown a sure hand in rising to the challenge of leading New Zealand through multiple crises — and there are more to come, with the International Monetary Fund forecasting a steep fall in international growth as the global economy struggles to recover from the Covid-19 pandemic-induced recession, its worst collapse in nearly a century.

As Reserve Bank governor Adrian Orr put it this week, New Zealand is just coming to the end of the first part of the impact of the Covid-19 pandemic. There is far more economic carnage ahead.

This will require surefooted leadership from Ardern and Finance Minister Grant Robertson.

Ardern was dealt such a strong hand at last Saturday's election, it would be a shame if she did not play those cards boldly rather than continue to take a mere incrementalist approach.

She could start by taking on a major portfolio herself: for instance, leading a group of ministers on climate change, or inequality. Setting ambitious targets and delivering on them.

There are major challenges ahead for New Zealand.

Here's just one example: for New Zealand to continue to remain — for all intents and purposes — a quasi-hermit kingdom will not cut it.

The Government has said it will reserve 10 per cent of places at managed isolation and quarantine facilities for essential workers (anyone from engineers, to scientists, to film-makers) as the number of returning New Zealanders starts to decline.

But New Zealand businesses are already calling out for the restrictions to be relaxed so they can bring more people across the border (and pay for their quarantine period). This can be done safely.

As the recent Mood of the Boardroom survey revealed, some 50 per cent of CEO respondents said their businesses had been impaired by their inability to gain border access for highly skilled professionals and workers. This is hampering productivity.

Ardern has had plenty of cautionary advice in the past week. Play it safe. Hold to the centre. Above all, don't rock the boat.

But the voters want the handbrake off.

Otherwise they would have put Winston Peters' NZ First party back into Parliament to act as "insurance" against a Labour-dominated Government.

Labour's own voting base — and even those those who switched their vote Labour's way on the back of its response to the pandemic — should also demand progress in the next three years.

As a Labour prime minister, Ardern will finally be expected to make headway during this parliamentary term on major issues such as inequality, child poverty and housing more New Zealanders.

Again, some boldness is required.

The Government can now steamroller over the objections of Nimbyists and the Greens, power through changes to the Resource Management Act and use the provisions of the urban development legislation to compulsorily acquire land for housing.

There will be objections on the grounds of private property rights, particularly in Auckland.

But why is this any different to acquiring land for a motorway?

In great cities — Seoul for one — metropolitan governments have done just that to house growing numbers of people at an affordable price. In Auckland, which faces the more urgent need, there are objections that increasing housing supply at a fast clip will drive prices down. Such policies have certainly held house prices in Christchurch. A tough call is needed.

As former Reserve bank governor Alan Bollard has noted, the question of "where is the revenue coming from" will dog this and succeeding governments.

Already, the size of the NZ economy has been reduced by the effect of the pandemic.

Problem is, Ardern has ruled out capital gains and wealth taxes during her prime ministership. But note: she has not ruled out land taxes (yet).

The IMF has forecast that New Zealand's real GDP per capita in 2025 will still be lower than in 2019. Only four "advanced economies" will be in this position.

Our nearest neighbour Australia is projected to increase its GDP per capita by 2.7 per cent in this period, suggesting it will remain a magnet for New Zealanders in times to come.

If we are to build back better (and bold) it will not be through the resumption of mass tourism.

There is no sign of bold ambition within Labour's 2020 election manifesto which was not released in full until October 13 — just days ahead of the October 17 election. There is plenty of spending commitment but little commitment to firm targets.

On election night, Ardern said "governing for every New Zealander has never been so important ... we are living in an increasingly polarised world, a place where more and more people have lost the ability to see another's point of view."

This could be a recipe for more consultation and more listening when what is desperately needed is action.