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Home / New Zealand

Claire Trevett: Labour and the weight of Budget expectation

Claire Trevett
By Claire Trevett
Political Editor, NZ Herald·NZ Herald·
14 May, 2021 05:00 PM5 mins to read

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Prime Minister Jacinda Ardern on how the Government plans to reopen New Zealand's economy to the world in a pre-Budget speech today.
Claire Trevett
Opinion by Claire Trevett
Claire Trevett is the New Zealand Herald’s Political Editor, based at Parliament in Wellington.
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OPINION:

Back in 2018, when times were simpler, NZ First leader Winston Peters used the analogy of bus stops to explain why there had been so many strikes under the Labour coalition government compared to National's nine years.

His analogy was that people did not bother going to the bus stop if they knew no bus would turn up.

The past week has seen the Peters-less Labour Government embroiled in something of a messy wrestle as it tried to manage expectations about what the bus would deliver now Covid-19 was driving it.

The expectations in question were those of the public-sector workers. The Government will not necessarily be that upset by the way an edict of pay restraint has been portrayed as a "wage freeze".

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It let it play out that way for four days before the PM stepped in to try to calm things.

The reason the Government will not be upset is because it is hoping the "pay freeze" label will have done the job of crushing the high expectations of some in the public sector – most notably nurses and teachers – for big pay rises.

The row dominated in what was otherwise a busy week for the Government.

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The usual flood of pre-Budget announcements has been reduced to a fairly small handful.

Illustration / Daron Parton
Illustration / Daron Parton

But this week delivered the people-pleaser announcement of funding for DIY tests to help detect cervical cancer.

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On the political front, the Government also moved to quash the rising concern about gangs that National Party MPs have been drumming up around New Zealand, holding community meetings on law and order.

The Government's move to give police more powers to seize firearms and assets from serious criminals met with a round of only slightly sarcastic applause from National Party MPs in Parliament – and a "you're welcome" for filching National Party policies.

Then came a decent salary boost for early-childhood teachers.
But the week also delivered reminders of the expectations that are still on Labour – and the competing bids for the Budget.

One was a report on child poverty, showing little improvement in the plight of the families Labour has sworn to help.

The wrestle over expectations moves to another field next week when Robertson will deliver the first Budget of the new Labour Government.

Budgets see the expectations of all of New Zealand in play, and have long been analysed for what they mean to the hip pockets of voters.

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Robertson will at least know that the expectations of middle New Zealanders are pretty low in this regard.

Prime Minister Jacinda Ardern delivers a pre-Budget speech to Business NZ. Photo / Dean Purcell
Prime Minister Jacinda Ardern delivers a pre-Budget speech to Business NZ. Photo / Dean Purcell

Middle New Zealand got its chunk last year by way of an emergency transfusion. The Covid-19 budget focused on middle NZ: the billions of dollars needed to keep people in their jobs through wage subsidies.

Labour's priorities this time round skew back to those on lower incomes: the priorities include child poverty and affordable, decent housing.

But the sales job of it will still involve Covid-19. Robertson has called it the Recovery Budget, the sequel to last year's Covid Budget.

In that regard, Robertson has focused on the economic recovery – promising to work on that difficult juggling act of bringing down debt without lurching into austerity measures.

The PM has taken on the job of focusing on the morale recovery for a country that is heavily dependent on the rest of the world - but has not been able to get there for more than a year now.

She moved this week to try to send a signal to business that she was not so fixated on maintaining the "elimination" of Covid-19 in New Zealand that she had neglected to think about how and when to reopen.

That was aimed at drawing something of a psychological line between Covid mode and post-Covid mode.

Her pre-Budget speech did not contain any Budget announcements - but did include the news that the Government was travelling again. Trade Minister Damien O'Connor would head to Europe to try to put some impetus into trade talks with the EU and United Kingdom.

Ardern herself would head to Australia on a business delegation.

The announcements were aimed at making it clear that Fortress NZ would not last forever. They were also aimed at addressing accusations that the Government did not seem to have a plan to get the country out of it.

There was no certainty about what it would take for Ardern to open the borders again – or when that might happen.

The recipe Ardern gave for that will have done little to reassure those business people that a concrete plan was in place. She said it was "possible" the borders would open to vaccinated travellers before New Zealanders were widely vaccinated.

But she also emphasised that until the vaccines were rolled out around New Zealand, the borders remained the main defence. She could also not give certainty about the vaccine supply, and added that it was also dependent on ongoing evidence that the vaccine was effective.

That was a lot of "ifs" and "buts" for the passengers at the bus stop waiting for the Covid-19 bus to depart.

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