Have we seen the end of Mr Nice Guy? The number of voters who say they'd like to have a beer or bbq with John Key might soon plummet, as the Government appears to be getting into the hard decisions early in its second term. According to John Armstrong, 'National seems unaware of how hard-edged it is starting to look with its noticeable drift to the right. The contrast with the soft pragmatism of its first term is starting to become pronounced'. In his column, Ministers risk seeming uncaring as jobs culled, Armstrong writes that public sector reform looks likely to start having a real impact on frontline services - despite Government promises - particularly with possible layoffs of nursing staff at district health boards. He warns that the Government is still to reveal the extent of contracting out of public services to the private sector, and says it may have a hard job selling that to voters. Tracy Watkins agrees and says even though changes to date have been done far more carefully than in the 1990s, real savings - particularly in the big budget health sector - will mean job losses in the thousands.
Labour's deputy leader - and ex-Mfat staffer - Grant Robertson also pushes these points in a Red Alert blog post, MFAT- Privatisation and the end of diplomacy. Robertson lays it on fairly thick, suggesting that the Mfat restructuring is essentially 'a large exercise in privatisation' and saying that 'a pretty much unfettered free market model is to be unleashed at MFAT'. He concludes that 'This second term National government is going to make the 90s restructuring look like child's play'. Robertson could be right of course, but Labour and the opponents of restructuring need to remember the fable of the 'Boy who cried wolf'.
Today's announcement of welfare changes will no doubt play well to National's core audience but these changes won't help the immediate return to surplus, as they will actually incur additional costs in the short term. What won't go down well with National's core support - particularly amongst small to medium sized business owners - is the possibility of a significant rise in workplace insurance levies.
This is on the cards if, as Danya Levy reports, the Government decides to remove ACC from covering work injuries. Levy also reports that ACC could be corporatised, turning it into a SOE that pays taxes and dividends - which would be a radical and significant reform. All these possibilities would be fraught with danger for the Government.
Those wanting to retain ACC as the sole public provider of work injury cover point out that not only would premiums increase, or entitlements would be reduced, but that the profits would overwhelmingly go to Australian-owned private insurance companies.
