Education Minister Erica Stanford and Prime Minister Christopher Luxon. Photo / Getty Images
Education Minister Erica Stanford and Prime Minister Christopher Luxon. Photo / Getty Images
Opinion by Thomas Coughlan
Thomas Coughlan, Political Editor at the New Zealand Herald, loves applying a political lens to people's stories and explaining the way things like transport and finance touch our lives.
Decisions on the Frontier Economics report are due before the end of the year.
France, Britain and Canada have said they will recognise a Palestinian state.
This week’s parliamentary recess has been a busy one, with the Government trying to shift focus on to education after a dreadful few weeks’ focus on the economy.
Bubbling away in the background, the parties of Government are working out their positions on two other hot-button issues, energypolicy and the recognition of a Palestinian state. On the former of these two issues, Labour is also working out where it stands.
Education Minister Erica Stanford rescued the Government’s fortunes this week with a nearly flawless unveiling of plans to replace NCEA. Stanford built a case for reform and presented it this week.
For such a major change, it hasn’t been all that terribly received. There has been criticism from some teachers and Labour about the scale and direction of reform, but not much about the need for change of some kind.
The cherry on top for Stanford will have been critics of the reforms, including Labour, focusing on the short consultation time (it is probably too short), only for emails to show that Labour’s education spokeswoman Willow-Jean Prime ignored and then rebuffed efforts from Stanford to consult her on the changes.
Act leader David Seymour said he’d have sacked Prime over the cock-up. That’s taking it a bit far but the stuff-up embarrasses her and Labour. Not least because it has echoes of the Michael Wood scandal, which also involved a slew of ignored correspondence.
Stanford’s week was only undone by revelations a new maths textbook is full of errors. Embarrassing – although it’s not uncommon for first editions to be sent out with a sheet of errata.
The right likes to think the politics of education are very fluid. During Jacinda Ardern’s first term, when asked whether there were any big political trends the media were missing, a senior politician then in Opposition answered that the right’s increasing popularity on education was commonly overlooked.
They slotted this into the fairly classic right-wing thinking, which pits the left as champions of equality against the right as champions of aspiration. This politician reckoned Labour’s proximity to teachers’ unions and attachment to equal outcomes were frustrating parents who wanted more aspiration. These parents were becoming particularly concerned as the sluggish post-GFC recovery and soaring house prices meant education was the last great hope for their children’s social mobility.
Rising private school fees mean fewer families can opt out of the state system, making them increasingly invested in its ability to get their children ahead. Simon Bridges, first as National leader and later as finance spokesman, was fond of needling Labour over former Prime Minister Norman Kirk’s famous (and misquoted) dictum that everyone needed “somewhere to live, someone to love, somewhere to work and something to hope for”. He reckoned that in the 21st century, voters wanted more: an education that could get their kids a spot at a foreign university, for example.
Like most political theories, the empirical evidence for this one is patchy. The Ipsos Issues monitor, which polls on which party is trusted most on certain issues, shows Labour leading month after month on the issue of education under the last Government, with National only supplanting Labour in late 2023, about the time Ipsos found voters had lost faith in Labour over just about anything. They held that lead in early 2024 but lost it by the end of the year.
If the Government is feeling good about education, it is feeling anxious about energy.
Prime Minister Christopher Luxon and Education Minister Erica Stanford visit Botany Downs Secondary College. Photo / Dean Purcell
There’s some disquiet about the report itself. It was commissioned last year by Energy Minister at the time, Simeon Brown, and seems to have been set up to investigate something along the lines of the structural separation of the gentailers, which has long been held up as the silver-bullet reform to boost generation and reduce prices.
Question one of the reforms’ terms of reference was pretty obvious: “How does business ownership, structure or design of markets affect incentives or opportunities to invest in generation, storage, transmission and distribution?”
Strangely for the Government, at least part of what is included in the report seems to hark back to an old Contact Energy idea to place all the gentailers’ thermal (fossil fuel) generation assets into a single entity, which would be heavily regulated by the Government in terms of the prices it could charge to turn that generation on. As fossil-fuel generation costs are one of the most important inputs into overall power prices – if not the most important – the reform would ideally bring prices down while encouraging investment in renewable generation.
The problem is the Government remains quite divided on the report. There’s frustration at the fact Frontier recently did economics work on behalf of the merger of Contact Energy and Manawa. There’s also a feeling the report itself is based on flawed assumptions.
NZ First is clearly keen on a ThermalCo idea; National’s position is less sure, but probably favours something closer to the status quo. Unusually for a Prime Minister fond of delegating, Christopher Luxon seems unafraid of getting his hands dirty in the policy area of energy. It’s also an area where his office is stacked with expertise: policy adviser Matt Burgess has written about energy economics at the NZ Initiative; policy director Joe Ascroft has a PhD in energy economics; and chief of staff Cameron Burrows came to Luxon’s office after heading up the Electricity Retailers Association.
This means that of all policy areas, this is one in which the ninth floor is not afraid to intervene. There is a sense, however, that the balance of thinking in the PM’s office is that the problems in the energy sector can be mainly blamed on the uncertainty unleashed by the oil and gas exploration ban, indecision over the Tiwai smelter’s future, Labour’s 100% renewable target and Lake Onslow.
That’s all true - all of those problems contributed to the dearth of net new generation built in recent times, but not all the sector’s problems began under Labour, and undoing them will not axiomatically mean a return to cheap energy. The current thinking is that there’s probably not a lot of gas out there to be found - there certainly wasn’t the last time a National Government went looking.
The messiness inside the Government was matched by the Opposition this week with Labour Leader Chris Hipkins seeming to forget or misspeak his party’s position on the oil and gas exploration ban on Tuesday morning. The position is, and has been for more than a year, that Labour would re-ban exploration, but for some reason, Hipkins was unable to articulate that when pressed on Tuesday morning. He was far clearer on Wednesday and again on Friday: the ban is back under Labour.
In the backdrop to all of this is a far more significant problem: where New Zealand stands on the recognition of a Palestinian state.
The Government continues to take a watching brief on the issue but the cascade of nations – most recently France, Britain and Canada – saying they will recognise a Palestinian state when the UN General Assembly meets in September, has put pressure on the Government to move.
Foreign Minister Winston Peters. Photo / Mark Mitchell
The Government’s position has been that New Zealand’s long-standing support for a two-state solution means recognition of a Palestinian state is a matter of “when”. In their view, New Zealand will recognise a Palestinian state … just not now.
It’s a convenient position, because it tries to capture the diplomatic upside of recognition without grappling with the downside, which Canadian Prime Minister Mark Carney got a taste of last month when US President Donald Trump posted to social media that Canada’s upcoming recognition of Palestinian statehood would “make it very hard for us to make a Trade Deal with them”.
New Zealand’s fudge was never going to be tenable forever – if it ever was at all. As Australia’s Foreign Minister Penny Wong recently warned, there is now a risk “there will be no Palestine left to recognise”.
The position is deeply challenging for the Government. Act is probably the most pro-Israel party in Government, its position best summed up by Simon Court’s contribution to a parliamentary debate last month saying that recognising a Palestinian state would be viewed as “a reward for acts of terrorism” committed by Hamas against Israel.
National has powerful MPs who tend to be more pro-Israel than not, including Chris Bishop and Nicola Wills, but the party is also full of new backbenchers, who are feeling the full force of the public campaign in support of recognition from grassroots campaigns in their electorates. It probably helps that the campaign comes as National’s polling dip puts those MPs’ futures in doubt.
NZ First’s position is less clear. Foreign Minister Winston Peters has been a staunch supporter of Israel in the past. He too has become more critical as Israel’s devastating and deadly campaign in Gaza has taken hold.
New Zealand doesn’t want to be among the very last to recognise a Palestinian state – and it very well may be if, as expected, Australia moves towards recognition in the next few weeks.
There’s precious little upside for the Government.
All the Government’s genuflection, even offering an FBI outpost to the Trump administration, couldn’t save it from a 15% tariff – and that coming the very same week China lashed out at New Zealand for providing a platform for FBI Director Kash Patel to allege one of the key reasons for the new outpost was countering China.
Since Donald Trump’s first election, economists and trade watchers have warned that a deterioration in the boring but stable rules-based order was a world in which New Zealand could not succeed. Our messy winter, betrayed by one trading partner while annoying another, is proof that hypothesis was sadly correct.
