Editorial: A tale of tax reform and two new polls

National leader Christopher Luxon and deputy leader Nicola Willis in Tawa, Wellington, earlier this month. Photo / Mark Mitchell

Editorial

Two new polls and a definitive policy statement on tax reform from the Prime Minister have created more uncertainty over the election with three months to go.

Chris Hipkins yesterday confirmed that Labour was considering wealth and capital gains taxes earlier this year before he ruled them out. More importantly he ruled out both taxes while he is leader.

It puts the Government’s focus totally on current economic issues rather than future goals - plastering more butter on that bread.

The move also appears to be a calculated gamble to mop up middle voters unconvinced by National’s leadership and approach and wary of the influence of Act in a governing coalition.

It makes Labour look as mild, unthreatening and uninspiring as can be. Not digging up policy relics like National but seemingly standing still for fear of scaring anyone off. A Newshub Reid Research poll in May actually suggested there was reasonable support - 53.1 per cent - for a wealth tax.

The decision seems set to send Labour supporters keen on tax reform into the arms of the Green Party. It gives the expected coalition partners quite separate identities.

It will take some time to see how Hipkins’ move plays out with the public. Two new polls out this week have shown both Labour and Hipkins’ support slipping but also some softness in backing for National Party leader Christopher Luxon.

Tuesday’s Talbot Mills poll shows how dangerously Labour has been playing with fire with its own ministerial kindling. It appears to have captured the brunt of public disapproval over the Government’s internal troubles over the past nearly six weeks.

Labour’s support is at 31 per cent - five points behind National which was up one. Hipkins is down six points to 32 per cent as preferred leader.

The survey was taken between June 28 and July 2 - a week after Michael Wood resigned as a minister after a month of drama over his airport shares. At the time, media commentary was assessing the damage to Labour from serial problems involving senior Cabinet figures.

And during the polling period, allegations surfaced about minister Kiri Allan yelling at people in her office, and minister Jan Tinetti was ordered to apologise to Parliament by the privileges committee.

Hipkins has had two worthwhile trips to China and Europe, and the Wood trail has mostly gone quiet. Allan’s issue is still open-ended.

But the PM yesterday acknowledged the central problem: “It is an indication that New Zealanders don’t feel like we’ve been focused on the issues that they want us to be focused on, and I think that’s a message that the whole of the Labour Party will hear”.

A Curia Taxpayers’ Union poll released on Wednesday and covering a more recent period than the Talbot Mills poll - July 2-10 - showed a tighter result. National was down three points to 33 per cent and Labour was on 31 per cent, down two. With an improved showing for Te Pāti Māori, it would mean a hung parliament.

The results highlight Labour’s rickety bridge to victory. The party’s fortunes may twist upwards, but it can’t afford wobbles. There’s no solid ground.

It’s in territory tailor-made for opposition parties and the Talbot Mills poll commentary noted that: “The centre-left had seemed to have been defying the political gravity of a generally negative mood; the acute political pressures stemming from cost of living rises and cascading ministerial scandals”.

Ominously for Labour it also speculated that “after a long period of very close results, we may now be seeing the long expected breakout of the centre-right. The next few polls will tell.“

People have been sheltered in this downturn by an unemployment rate of just 3.4 per cent, but that could change. Voters are also being hit with higher mortgage rates. Lower fuel price help for motorists has ended.

Labour needs to stay disciplined. National and Act aren’t, at present, offering free hits in the form of party scandals.

There’s still an 11-point gap in the Talbot Mills poll between Hipkins and Luxon, who dropped one point. In the Curia Taxpayers Union poll it was much closer - a three point gap - with both rivals down.

Overall the electoral landscape favours a National/Act combo over a Labour/Green/Te Pāti Māori grouping, according to the Herald’s latest poll of polls.

Feeling motivated to vote against a party - rather than for another - can have the same practical impact. Turnout is going to be critical. And there’s still time for late twists.