Sir Bill English says one of the political achievements he is most proud of is the “tax switch” – lowering income tax and boosting GST. Photo / Mark Mitchell
This feature-length article expands on the story that promoted the release of the Money Talks podcast earlier in the week
It’s one of the great what-ifs.
After a strong showing on election night 2017 – that had the media treating him like the winner – a surprise coalition call by New Zealand First saw National’s Sir Bill English lose his grip on power.
Seven years and a world-changing pandemic later, how does he feel about the loss and what New Zealand’s response might have looked like if he’d been in charge when Covid-19 hit?
“Look, over time, the benefits of the personal situation take over,” he says, speaking on the Money Talks podcast.
“So, I wouldn’t want to swap the time I’ve had working with my family, being able to support Mary, running my own life. That’s been fantastic. There’s plenty of life beyond politics... I was a bit sorry about it. It was the wrong decision for the country, I don’t think there’s any doubt about that. But that’s MMP, the voters had a say. National did okay, but its coalition partners did badly.”
“I’m sure there’s some lessons from that, that I haven’t spent a whole lot of time on.”
These days, English says he spends time supporting his wife Mary, a GP with a fulltime practice. He also has several corporate and philanthropic directorships – including with Australian giant Wesfarmers and with New Zealand’s Todd Corporation.
“I spend the other half of my time on what I call family business where, along with my kids and one or two others, we’ve got into a number of smaller businesses that we’re developing.”
His daughter Maria English is chief executive of one venture, the ImpactLab, a data analytics company which aims to improve decision-making for charities and government agencies focused on social investment.
Despite a passion for social investment and his recent role chairing the review of Kāinga Ora, English says he has no plans to get involved with any more government work right now.
“In politics, you get these incredible opportunities. And you don’t necessarily deserve them,” he says.
“A lot of it comes your way from circumstance and other people who you work with or the great team around you, but it can go in an instant, if only because of your own mistakes and stupidities. [The] election, though, was the public’s view on it and you just accept that view and get on with the rest of your life and that’s worked out well.”
But in that alternative universe where Winston jumped right on election night, would a National-led coalition have tackled the pandemic differently?
“Look, you can’t tell for sure,” English says. “I didn’t focus a lot on the details of the policy-making. I think a couple of things might have been different. I think we would have recognised the trade-off and been willing to work with them a bit more than the Government at the time. You know, there’s a high cost to that kind of lockdown and, in a sense, we’re still paying that cost now.
“You look at other countries that have had a hard lockdown – and there are others who were harder than New Zealand... they’re paying a price too. I think the second thing was that sense of the Government [being] absolutely central to everything that happened in the economy. That lingered on after Covid, after it was necessary.
“I think that’s just part of the predilection of a Labour Government, a complacency in the public service and a lot of poor decision-making after Covid that flowed from attitudes developed during Covid.”
English says hindsight is a bit easy but he does want to see a decent review of the decision-making so we can learn.
“Look, people make the decisions they do at the time. I hope this inquiry they’re talking about doing will be a bit more than backslapping by the public health establishment about what a great job it did, because there’s a lot of other consequences and we just need to understand.”
As to reflections on his own time in power, English says he wishes he’d pushed more to open up the housing supply.
“The one area I think we could have pushed through harder, but is now happening, is around housing. Because housing affordability is such a significant driver of misallocation of capital [and] poverty for lower-income households.
“It’s like a juggernaut that needs to be turned around. And we got started on that. But perhaps we could have pushed harder. Sometimes these things are a matter of public acceptance. I mean, the current Government’s making decisions in that area which would have caused a riot as recently as 2017.”
Housing Minister Chris Bishop has, for example, been able to talk about the need for house prices to fall – a statement neither major party could make in the last decade.
“I remember making a few speeches around housing supply when it was regarded as a cranky right-wing idea that supply had any influence on housing prices,” English said.
“One unheralded success around that time was the Auckland Unitary Plan, which provided the biggest boost for house building in New Zealand in a long time.”
I think the lessons from that are now being picked up by the current Government and spread through the system. In fact, the last Government picked up some of those lessons.”
Does that passion for housing affordability stretch to a Capital Gains Tax, Money Talks asks?
“We had a pretty good look at it. I think every Finance Minister does, and then it runs into two problems. One is just the implementation of it. I think you’d find even in countries where they have it, it’s arguable about whether it’s net revenue or not.”
“And the other [problem] in New Zealand is just the politics.”
“It doesn’t work,” he says. “In general, you want your tax base moving away from things you want more of, like income and, and work and returns on capital... you want your tax base more around things that, that, that can’t move and that you don’t want more of.”
“So you, you want it on fixed assets, land, wealth and consumption.”
English says one of the political achievements he is most proud of is the “tax switch” – lowering income tax and boosting GST.
“We made the argument for what is good economics, reducing income tax and increasing GST, and the public went with that, to a large extent because of the skills of John Key. But it just showed you can win an argument.”
On the final episode of the Money Talks podcast for 2024, English talks about his personal relationship with money, growing up on the farm in Southland and how he made it to the top in politics with a degree in English literature.
“I think I was the only farm worker in New Zealand with scholarship Latin, in the early ′80s. So I went off to Dunedin and did an English degree and an accounting degree.”
He also reflects on his early years in Parliament (he was elected in 1990) and the depth of the grim recessionary period in New Zealand history that started in the economic turmoil of the 1970s and culminated with the Mother of All Budgets during National’s term in the 1990s.
“It was pretty grim in my community, which I knew better than any others,” English says. “In the rural communities, the dislocation that went on as part of the deregulation of the economy was enormous. When I hear people talking about crises today... by that standard of that time, that’s not a crisis.
“A lot of people lost their jobs and that went on for a while, longer than the proponents of deregulation and reform thought.”
English recalls the backlash to the cost-cutting by Finance Minister Ruth Richardson.
“That ′90 to ‘93 [period] was pretty rough,” he says.
“I was chairman of the Social Services Select Committee. So we bore the brunt of the front end of public reaction to the benefit cuts. I was on a select committee with Michael Cullen and Helen Clark and I’d never really chaired a rugby club subcommittee!”
“There were protests, there were crowds pushing down doors to get into our meetings. There was no security in those days, so it was a pretty hard-edged introduction to the politics of change.”
“It did leave a mark on me in the sense that, it’s easy to advocate for change if you don’t have to look into the eyes of those facing the consequences,” he says.
“If there’s less urgency than there was then, there are other better ways of getting control of government spending than what were some fairly tough decisions that were made then.”
Listen to the full episode to hear more from Sir Bill English also talks about the current state of the economy and how it compares to previous downturns.
Money Talks is a podcast run by the NZ Herald. It isn’t about personal finance and isn’t about economics – it’s just well-known New Zealanders talking about money and sharing some stories about the impact it’s had on their lives and how it has shaped them.
The series is hosted by Liam Dann, business editor-at-large for the Herald. He is a senior writer and columnist, and also presents and produces videos and podcasts. He joined the Herald in 2003.
Money Talks is available on iHeartRadio, Spotify, Apple Podcasts, or wherever you get your podcasts.
Legal action by PSA means some changes are currently on hold.