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Home / Business

Fran O'Sullivan: PM pushes growth as election winner

Fran O'Sullivan
By Fran O'Sullivan
Head of Business·NZ Herald·
10 Mar, 2017 04:00 PM6 mins to read

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This Prime Minister is endeavouring to present himself as a triumph of substance, not form.

This Prime Minister is endeavouring to present himself as a triumph of substance, not form.

Prime Minister Bill English is developing an election narrative based on the belief that New Zealanders have embraced a growth mindset.

And that a Labour-led Opposition - out of sync with this mood - is taking a defeatist approach by overly focusing on negatives.

At a series of both public and "in camera" events, English has been road-testing the themes which will dominate the lead-up to the September 23 election.

English still has some way to go to stamp his authority as Prime Minister.

He deferred to visiting Australian Prime Minister Malcolm Turnbull at their meeting in Queenstown three weeks ago.

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Turnbull has been Prime Minister for longer than his NZ counterpart. He is more practised in delivering a narrative. But where English needs more practice in rolling out a story, he does have a more substantive record behind him.

Almost imperceptibly, English has had a style makeover.

It's not obvious as Labour's Andrew Little, who returned to work this year with contact lenses (not glasses), new suits, and now Jacinda Ardern as a vivacious running mate to offset his dour image.

Since becoming PM, English has also had plenty of free advice: "take him off to Working Style at the weekend for new suits ... get more media training."

He has invested in some new suits, and credits wife Dr Mary English - not "friends" - for the change.
His confidence in the Prime Minister's role is now apparent.

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English still makes self-deprecating jokes about his predecessor, which spark plenty of laughs from business audiences.

But essentially, this Prime Minister is endeavouring to present himself as a triumph of substance, not form.

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Getting voters to appreciate that will be the key to his and National's electoral success.
English argues that New Zealand - and New Zealanders - have moved well down the track to adopting a growth mindset.

He has long argued that housing pressures, for instance, simply reflect the fact that more New Zealanders are staying put (rather than going to Australia in chase of higher incomes) and greater international interest in migrating here.

As an example, Wellington - which John Key labelled a "dying city" - has now had an increase in population.

Expect to hear more from English this year about how this equates to a lift in confidence, with people now visualising a growth platform for the region.

There is plenty of room for Labour to attack this proposition and argue that the Government failed to address a runaway housing boom which made the cost of housing exorbitant for younger generations.

But as the "wealth effect" spreads out round the country, as house prices in cities and towns outside Auckland appreciate, some of that angst may diminish.

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Expect to also hear more about how the Government's investment in Roads of National Significance - and shorter consenting periods - has opened up regional areas outside major cities.

English will contend that this growing confidence will provide more opportunities and jobs.

There will also be more on the numbers underpinning the Government's decision to legislate (assuming it is returned for a fourth term) to lift the superannuation qualifying age from 65 to 67 in 2040.

Critics - and I am one - say it should be rolled out much sooner, to start lifting the qualifying age in the 2020s to ensure the financial impact also hits older generations such as the baby boomers.

English's contention is that while Treasury has working numbers that do support a quicker phase-in period, that was based on projections that saw the NZ population hit 4.7m in the mid-2040s.

Now expectations are that the population will reach 5m by the mid-2020s.

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The biggest single risk which the Government has identified is the unpredictable political processes taking place around the world - such as Brexit and Donald Trump - and trade wars.

A major concern is the prospect of a trade conflict and the potential impact if the US adopts a border tax.

The Government has instructed Inland Revenue to examine the potential risk to the New Zealand economy and exporters.

It the US does implement a border tax - along the lines of a tariff - this would have a major impact here and in every other country New Zealand trades with.

English will outline the Government's policy response at an "International Trade breakfast" in Auckland in a fortnight's time, where he will spell out why New Zealand will continue to push for less protectionism and continued access to global markets for the good of business and the economy.

He is expected to say that while New Zealand can't manage this risk, we can adopt a policy response.

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That is likely to be along the lines of concentrating on opening more trade opportunities in other markets.

English does not have this theme to himself.

Labour's finance spokesperson, Grant Robertson, is also focused on developing policies to increase New Zealanders' resilience in the face of some radical international trends. Particularly around the future of work in an age where technology is fast making many jobs redundant.

English's approach is focused on social investment.

He now has numbers to prove there have been positive results in areas such as getting teenage sole mothers off benefits.

The next focus will be on the care of vulnerable children. He also believes he can bring the public round to supporting a "fair and reasonable" transition to a higher qualifying age for superannuation.

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Other issues relating to resilience include the NZ brand.

The debate about fresh water quality is a case in point.

Again, while there will be differing views over the part that dairy intensification and urbanisation have played in worsening water quality, his point is that moving to a framework that measures water quality will show whether progress is being made or not.

For English, understanding what New Zealand can't control is the key.

His belief is that the country's track record in making real progress by coming through the major recession after the GFC, large earthquakes and fiscal deficits puts NZ in good stead.

The contest will be between the belief that New Zealanders have adopted this "growth mindset" and his opponents' view that the new order has resulted in too many casualties.

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