Jacinda Ardern and Grant Robertson must publicly answer the question ahead of polling day: just how much will Labour concede to NZ First if the latter is once again in the position to dictate which major party gets to form the next Government?
Labour was comprehensively screwed by New Zealand First at the 2017 election. It signed up to five pages of line-by-line commitments to its minority coalition partner but forgot to get NZ First to sign off on its own key policies.
Three years on, and naivety simply does not cut it.
Ardern and Robertson could start by addressing the question: "where does Labour stand on the ownership of the publicly listed Air New Zealand? Will it rule out the re-nationalisation of Air New Zealand — which NZ First leader Winston Peters has already hinted at during his election campaigning — and make it clear that the ownership of the national carrier should not be treated as a political football?
Will it also rule out removing Air NZ from the NZX if the current coalition persists after the October 19 election and instead support a recapitalisation which is also available to participation by minorities?
Or are Ardern and Robertson happy to let Peters make the running over Air NZ's ownership to disguise a hidden coalition agenda to nationalise the airline? And is this part of the "big Government/State" agenda that Phil Twyford has been working on?
It remains incomprehensible that Air New Zealand — in which the Government had a 51.91 per cent stake as at August 3 — is having to play along with the faux nonsense that it is "engaging constructively with the Crown as it continues to assess its capital structure and funding needs", instead of simply going to the market with a capital raising.
Air New Zealand recently reported its short-term liquidity as at August 25, 2020 was approximately $1.1 billion, made up of cash and the $900 million standby loan facility from the Government.
Due to the strong cash position pre-Covid-19, swift action taken by management to reduce cash burn and a better than expected return of domestic demand after the initial lockdown was lifted in New Zealand, the airline has not yet utilised the standby loan facility. However, it expected to start drawing on these funds in the coming days.
Economist warning: NZ lockdowns may bring worse recession than Australia
The impact of the second Covid-19 wave in Auckland has also affected operations.
In its recent annual results statement, Air NZ said the Government had reaffirmed its long-standing commitment to "maintaining its majority shareholding in Air New Zealand, having regard to the unique and critical role the company has in New Zealand's economy and society".
"This is reflected in the Crown loan facility that provides Air NZ with liquidity support whilst the airline works through to a permanent solution."
Let's get some clarity here. Is this statement intended to provide confidence to the market that the Government is standing behind the airline? What does majority mean — 51.91 per cent? An increased shareholding following a recapitalisation, or 100 per cent ownership?
The Air NZ directors will face their shareholders at a virtual meeting on Tuesday, September 29. Chief executive Greg Foran will address all sorts of fringe issues except the major issue that all the institutions which are minority shareholders want addressed.
When Ardern and Robertson signed the Coalition Agreement with NZ First, it was essentially a one-way street. There's plenty of pure vanilla: "Together, we will work to provide New Zealand with a transformational government, committed to resolving the greatest long-term challenges for the country, including sustainable economic development, increased exports and decent jobs paying higher wages, a healthy environment, a fair society and good government. We will reduce inequality and poverty and improve the wellbeing of all New Zealanders and the environment we live in ..." And so it rattled on.
Then came the five pages of NZ First's policy wins.
NZ First Ministers like Tracey Martin later crowed about Labour's lack of negotiating prowess.
This enabled Peters to play wag the dog in a quite disproportionate manner by scuttling Labour's prime transformational policy — which was capital gains taxes — at Cabinet level. Ridiculously, the major player has had its feet to the fire far too often over the past three years.
Not only did Peters claim the deputy prime ministership and the Foreign Affairs portfolio, but he also hoovered up the State-Owned Enterprises portfolio — along with racing (the industry has been a long-term backer of Peters) and disarmament. There was a swag of economic portfolios: Shane Jones with Forestry, Infrastructure, Regional Economic Development and associate portfolios in Finance, SOEs and Transport; Tracey Martin with Children, Internal Affairs, Seniors and an associate responsibility for Education. Ron Mark has Defence and Veterans' Affairs. Then the $3 billion Provincial Growth Fund. Enough said.
This makes for substantial and disproportionate power.
It remains an absurdity that a party that secured just nine seats at the 2017 election should have been able to dictate such aggressive terms to Labour with its 55 seats.
But Peters got to dictate who would be Prime Minister and the Greens tucked in behind with a confidence and supply agreement. This was the first Government in New Zealand under MMP where the most popular party was not part of the Government.
So, to the Greens.
After three years as the coalition bridesmaid the party should have learnt a trick or two.
Green Party leader James Shaw is talking tough.
Shaw has said the party might sit on the cross benches if does not get its way during post-election talks.
Its signature policy is wealth taxes. Shaw won't say outright that wealth taxes are a Green Party bottom line for coalition talks — he simply says they are a top priority.
Labour has committed to introducing a top personal income tax rate of 39 per cent on annual incomes over $180,000.
Robertson says that is the only tax change Labour is putting on the table. Ardern has said, "in the aftermath of the election we deal with what the voters give us".
In other words, "I have wriggle room".
A bit of certainty would not go amiss.
Next week: Fran O'Sullivan focuses on National's bottom lines.