The Coalition Government with a side of greens has blown out the candle on top of its first birthday cake and Prime Minister Jacinda Ardern is quite entitled to feel cockahoop.

The attention that would normally be given to such an occasion was somewhat missing courtesy of the action rolling out in the National Party.

It was marked by Ardern doing joint interviews with NZ First leader Winston Peters in her office. Peters sat at her side, quite happy with himself.


The Greens were almost an afterthought. Ardern met with the Green Party leadership for afternoon tea the next day.

It was somewhat symbolic of the hierarchy of the Government and the forces within in.

The only time the leaders of all three parties have been seen together was in September when Ardern was trying to put to bed talk of a schism in the arrangement.

She released a rather waffly "coalition blueprint" setting out their targets ahead.

Ardern got through the first year in a stronger position than she began it.

Labour's polling is now at a respectable level for the major governing party. While the hubcaps got a few chips along the way, the wheels remain on the car.

When the Government was set up, Peters was viewed by many as the greatest risk of instability.

He had a track record.


Nor did he come with a user manual, although it's fair to say former Prime Minister Helen Clark provided some handy hints.

The Opposition has tried to paint things as a case of the tail wagging the dog, and of Peters holding the Government to ransom in policy differences.

It is true NZ First pushes its case hard.

But as with the the previous National government, the Prime Minister has been by far the most dominant figure of this Government.

Some of that has been the optics. Most of it has been because while her Government has had its hiccups, Ardern herself has rarely stumbled.

The personal popularity of a leader rather than a party now seems to mean more than it did in the past.

It was not until Key came along that voters got used to having a prime minister they actually liked as a normal person.

Helen Clark governed for nine years without scaling the heights of personal popularity Key maintained throughout his eight years in the job.

She was respected and seen as effective and capable, but those are different from likeability.

Key made likeability almost an essential attribute in modern politics, as National's leader Simon Bridges is finding out.

Ardern has not yet reached Key's stratospheric levels, but likeability is power and Ardern has it.

Key put his down to his "sunny disposition". Labour once derided it as "smile and wave".

It was more than that. It was also the management he provided when things got tough.

Over the past week Ardern held back wading into the National Party's woes, and frequently speaks of her wish for "kindness" in politics.

She can afford to – she has the advantage of having Peters on side, so she can – and does - outsource unkindness to him, as happened this week with the response to National's woes.

There is a risk in going overboard on the caring stuff. Voters do like positivity but can also see through platitudes.

Had Ardern not had to contend with issues such as the departures of former ministers Clare Curran and Meka Whaitiri, she would risk being seen as naive.

Ardern's greatest threat is not Peters throwing in the towel, or Bridges managing to dent her popularity.

It is money.

In the 1 News Colmar Brunton poll, the aspect that most pleased National and concerned Labour was the six-point spike in those who were pessimistic about the economy.

That is a perception that has bedevilled Labour since it got into power.

It will worry Labour even more that the perception is lingering even after the opening of the books showed a fat surplus, decent growth forecasts and lower debt tracks.

The spike in the poll coincided with sharp spikes in petrol prices – something National was running a very effective campaign on. If those prices stay high, the cost of freight and goods will follow.

Ardern showed she was well aware of the dangers in those figures when she made her very rare Captain's call to rule out allowing any councils other than Auckland to apply a regional fuel taxes for as long as she was Prime Minister.

It leaves those councils with few options to raise revenue other than rates increases.

Ardern and Labour will not care. The Government gets blamed for regional fuel taxes, but it's councils that get blamed for rates increases.

There are other thorny issues that will polarise people.

There is a cacophony of moral issues, from the euthanasia debate to abortion law reform on which Ardern has promised to take action.

Prime Minister Jacinda Ardern marks the Government's first anniversary with Deputy Prime Minister Winston Peters. Photo / Mark Mitchell
Prime Minister Jacinda Ardern marks the Government's first anniversary with Deputy Prime Minister Winston Peters. Photo / Mark Mitchell

Governments tend to cop the flak for social reform regardless of whether it is a conscience issue for MPs or not.

Criminal law reform and water rights are other potential minefields for any government.

But perhaps the most dangerous is tax reform, being worked on by the Tax Working Group.

Tax policy has long been one of the key distinctions between National and Labour.

Labour held up the latest Government accounts as proof it was responsible with money.

But those accounts also showed the surplus was primarily because of higher-than-expected tax revenue – and because Labour has not had time to spend it yet.

The first part of that equation means Labour has no convenient excuse for extra taxes.

Any new proposals the Tax Working Group comes up with are a risk to Labour - unless they are offset by a tax cut elsewhere, say income tax.

Ardern very first Captain's call was also about a tax.

That came during the 2017 campaign when she reversed her predescessor Andrew Little's decision to rule out a capital gains tax until at least 2020.

Ardern opened the door to introducing one earlier, believing it showed strong leadership and a willingness to do what was necessary.

Three weeks later, she reversed that call and the prospect of a capital gains tax was back off the table until after 2020, if ever.

Likeability is critical when it comes to pushing through potentially unpopular changes or reform.

But ask those ordinary voters if they prefer kindness or money and the answer is easy.

Kindness doesn't pay the bills.