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Welcome to the Politics Briefing for the week in which we realised that Donald Trump has been in power for only 100 days, not the eternity it feels like.
Trump is known for his exaggeration, but he understated his impact yesterday when he said: “In 100 days, we have delivered the most profound change in Washington in nearly 100 years.” The damage has been global, and New Zealand has not escaped it.
Finance Minister Nicola Willis testified to the damage this week as she revealed that the Treasury has been forced to downgrade December’s growth forecasts in light of the US tariff policy, which will materially impact this year’s Budget.
“That lower growth trajectory has an inevitable impact on the Government books, reducing revenue and threatening our already difficult return to surplus and debt reduction,” Willis said before announcing that the allowance for new spending has been cut from an already small $2.4 billion to a minuscule $1.3b. That’s from what will be a total spend of approximately $150b.
We’re virtually talking about a zero Budget, because so much of that sliver of $1.3b has been pre-committed to health. Most cost pressures and new initiatives in other areas will be funded by reducing or cancelling others, and that will amount to billions of dollars.
Labour leader Chris Hipkins’ response to the emaciated Budget allowance was not to blame Trump but to point to the choices the Government made, such as the “unaffordable” tax relief that’s costing $14.7b over four years.
Political editor Thomas Coughlan has looked at where Willis might find the money for her second Budget on May 22, and thinks KiwiSaver subsidies could be sacrificed (see below).
Trump hasn’t lost his sense of humour. When asked yesterday whom he would like the next pope to be, he said: “I’d like to be pope. That would be my No 1 choice.”
We trust it’s a joke. When he first talked about annexing Canada as the 51st state of the United States, it sounded like a joke. It is no joke for Canada’s Conservative leader Pierre Poilievre, who not only has not become Prime Minister, as looked certain six months ago, but has lost his seat in this week’s election. When the flag is under attack, voters tend to rally around it.
Liberal leader Mark Carney, a former Governor of the Bank of England, is now Prime Minister of Canada thanks to Trump who, by the way, has 1361 days to go.
Australia goes to the polls on Saturday after what some commentators say has been a terrible campaign from both sides, but especially Peter Dutton’s Liberals – who regurgitated the National Party in New Zealand‘s promise to get their country “back on track”. The polls suggest Labor’s Anthony Albanese is likely to get a second term.
But The Australian commentator Greg Sheridan is appalled at the lack of debate in the campaign, especially about defence.
“This is the worst campaign I’ve seen,” Sheridan wrote this week. “Both sides are at fault. It’s not spiteful or vituperative, but easily the most vacuous and irresponsible. Never has a campaign been more completely disconnected from reality. Endless giveaways, ridiculous quibbles about costings that are entirely speculative, policies of deep national self-harm and a resolute determination never to mention the fundamental threats and changes transforming the entire world.”
Tory Whanau has finally shown some good judgment and decided to bow out of the Wellington mayoralty contest in favour of Andrew Little. The manner of her announcement only confirmed the soundness of the decision. She scored herself an astonishing nine out of 10 on her performance as a one-term mayor, not having perfected the art of being demure. She will stand in Wellington’s Māori ward and, speculating on her future, suggested she could be Little’s deputy, and a Cabinet minister one day.
Speaking of ratings, I’ve done my own annual review of ministerial performance. Three ministers have been outstanding, in my view – Chris Bishop, Judith Collins and Chris Penk. There are no clear fails, but three ministers need to do a whole lot more to justify their appointments (see below).
• Labour MP David Parker’s valedictory speech is scheduled for next Wednesday, May 7, at 5.40pm.
• Foreign Minister Winston Peters is heading to New Caledonia to meet the French Minister for Overseas Territories, Manuel Valls, and the President of the Government of New Caledonia, Alcide Ponga, as talks continue on the future of the French territory. Defence Minister Judith Collins is visiting the Philippines, and Infrastructure Minister Chris Bishop is meeting potential investors in Sydney.
• Former Prime Minister John Key has been in Beijing this week and met Gao Yunlong, Vice-Chairman of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC), according to the NZ Contemporary China Research Centre.
• Arts and Culture Minister Paul Goldsmith took no part in the appointment of the newly announced chairman of Te Papa, investor Chris Swasbrook, declaring a conflict of interest because of a “personal connection”. Whether Swasbrook is a neighbour, friend, tennis partner, financial adviser or relative, Goldsmith won’t elaborate. But his office says it won’t prevent him from continuing to oversee the Museum of New Zealand.
“America wants our land, our resources, our water, our country. But these are not idle threats. President Trump is trying to break us so that America can own us ... That will never, ever happen.” – Mark Carney, Prime Minister of Canada, in his victory speech
What announcement did Justice Minister Paul Goldsmith make yesterday about prisoner voting? (Answer below.)
Goes to Local Government NZ president Sam Broughton and all the other mayors for grizzling about David Seymour’s call to help get kids back to school. What’s the point of being a community leader if you’re not prepared to show community leadership?
Goes to Education Minister Erica Stanford for funding the $550 registration fees and practice certificates of 115,000 teachers over the next three years. Real relief.
OPINION – Cabinet report card: Audrey Young rates the coalition Government’s ministers – from the heavy-hitters to the second-rate and those on notice.
ANALYSIS - Budget 2025: As Nicola Willis signals a tight May Budget, Thomas Coughlan looks at what Government spending might be cut - and why.
Whānau Ora contracts: Four new commissioning agencies for Whānau Ora services have been announced after a major overhaul that saw all three inaugural agencies lose their decade-long contracts.
OPINION – Trump administration: As US President Donald Trump marks 100 chaotic days in office, some New Zealanders are following right along, writes Simon Wilson.
Pharmac review: A Pharmac culture review has found a wide-ranging “reset” is needed, but staff “at all levels of the organisation” doubt it will happen.
Quiz answer: The Government will reinstate a ban on all sentenced prisoners from voting, overturning the last Government’s law allowing prisoners serving less than three years to vote.
For more political news and views, listen to On the Tiles, the Herald‘s politics podcast.
Prime Minister Christopher Luxon was joined by Deputy PM Winston Peters and Minister of defence Judith Collins to make a pre-budget defence announcement. Video / Alex Burton