Jacinda Ardern's decision to pick a fight with our nearest neighbour over the Manus Island imbroglio risks inserting a thorn right back in the Aussies' paw.

It's no secret that successive Australian governments have tended to view New Zealand as "freeloaders" - freeloading when it comes to bearing our fair share of the regional defence burden, and freeloading when it comes to the export of New Zealanders who cross the Tasman to seek better opportunities.

No amount of focus on the real value that New Zealand brings to the table obscures these underlying tensions.

It is why previous governments have trod cautiously - with varying success - when engaging with Australia, to try to protect the gains New Zealand has made.


Since his arrival back on home soil from a week's summiting, Australian Prime Minister Malcolm Turnbull's Government has returned fire on Ardern.

It's notable that Turnbull - already under domestic pressure over the plight of the asylum seekers in the Manus Island centre - did not sandbag Ardern while the pair were at the Apec Leaders' Meeting and the East Asia Summit.

From Australia's perspective, he had more important fish to fry.

Turnbull would not have appreciated being openly embarrassed by Ardern while he was on the world stage.

But his Government's proxies were out in force, with a well-staged leak to the Courier Mail suggesting the Australian taxpayer was stumping up the cost to keep the people smugglers from arriving in New Zealand with boatloads of economic asylum seekers.

The Courier Mail leak revealed that Australia's border protection forces had turned back four people-smuggling boats that were intent on reaching New Zealand.

The Daily Telegraph has since chimed in, labelling Ardern's campaign as "meaningless virtue signalling".

Another leak - this time of an intelligence report given to the Australian Financial Review - alleges that men on Manus Island are using drugs and luring local girls as young as 10 into sex.

It is not difficult to understand the cynicism now erupting within Australia towards Ardern's politicking and her offer to take 150 Manus Island refugees and contribute $3 million.

In truth, her $3m offer is a drop in the bucket compared to the small fortune Australia has spent on its offshore processing centres at Manus Island and Nauru.

To date, Australia has spent a total of A$4.9 billion ($5.4b) erecting and funding the two offshore centres.

The latest departmental estimates - disclosed in the Australian Senate last May - showed Australia expected to spend a total of A$978m in 2016-17 - A$922m in operating costs and a further A$56m in capital expenditure.

This follows an initial investment of A$358.77m for the 2012-13 year, comprised of A$219.35m in operating costs and A$139.42m capital expenditure; in 2013-14 the gross expenditure was A$1.1b - A$715.57m operating costs and A$391.37m capital expenditure; for 2014-15 gross costs were A$1.31b - A$999.37m operating costs and A$333.69m capital expenditure; for 2015-16 the gross figure was A$1.13b - A$999.37 in operating costs and A$139.21m in capital expenditure.

On top of these costs, there is the large budget which sits behind Australia's Operation Sovereign Borders programme to turn back people smugglers.

Given the financial realities, it is not hard to understand why Immigration Minister Peter Dutton has now broken cover and rubbished Ardern's plan to spend $3m improving essential services on Manus Island.

It's also notable that Dutton represents the Division of Dickson, an electorate adjoining Brisbane which is the home of the Courier Mail. Queensland is also home to the largest New Zealand-born community in Australia - more than 200,000 Kiwis.

Dutton's argument that New Zealand benefits from Australia's border protection laws without paying is concerning. If this line of thinking is cemented (again) within senior circles in Australia, it will not be helpful. It will likely lead to a call for New Zealand to stump up much more than $3m towards mutual protection.

It's notable that Australia's harsh approach to illegal asylum seekers has paid dividends.
The people smugglers now know Australia is not a soft touch.

But it's also worth noting that Australia is host to far more refugees on a per capita basis than New Zealand.

Standing on principle is fine, but in this area the New Zealand offer risks being seen as risible.

The unfortunate aspect of this affair is that it has detracted from the Prime Minister's focus on domestic matters.

Case in point: the opportunistic move by a Chinese property website to ramp up sales of NZ homes before the legislation banning sales to foreign buyers comes into effect.

Ardern's focus would be better deployed in ensuring legislation is rammed through next week to stop this move in its tracks.