Workplace Relations and Safety Minister Brooke van Velden with Prime Minister Christopher Luxon in March. Photo / Mark Mitchell
Workplace Relations and Safety Minister Brooke van Velden with Prime Minister Christopher Luxon in March. Photo / Mark Mitchell
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.
The Government passed controversial reforms to the 2020 Pay Equity regime this week.
The reforms were passed under urgency in two days. A typical bill can take six months to pass.
The Government says the changes will save “billions”.
Something stank in Rotorua on Wednesday, and it wasn‘t just the hydrogen sulphide from the nearby geothermal zone.
Prime Minister Christopher Luxon had decided to skip Wellington for the Trenz tourism trade show that Rotorua happened to be hosting.
It’s not uncommon for party leaders toleave Wellington when the House is sitting. They usually block out some time in their diaries for getting out of the capital to tour “real New Zealand” (defined as everywhere but Wellington), but this is always on a Thursday, not a Wednesday, which is when leaders are expected in the House. This is especially the case for the Prime Minister, who is expected to take questions from the Leader of the Opposition.
Officially, Luxon‘s absence had nothing to do with the controversial rollback of the 2020 pay equity regime, which Luxon’s MPs were grafting away at under urgency on Wednesday - he had the alibi of the tourism conference.
Unofficially, not everyone believes that explanation.
These reforms will hit National hard. Very hard. You can already see it.
National’s former chief press secretary, Janet Wilson, tore strips off the party in a column in The Post, stating the obvious: National cannot succeed without large numbers of women voters. The “grafters and battlers, the women working nightshifts in hospitals and aged-care homes or teaching those in need”.
She noted that large numbers of women backed National during the Key-English years, the high-water mark for its polling in the MMP era.
Protesters rally outside Workplace Relations Minister Brooke van Velden’s electorate office in St Johns, Auckland, opposing the rollback of pay equity legislation. Photo / Jason Dorday
But it wasn‘t just Wilson‘s side of the party unhappy with the changes. Simon O‘Connor, a former National MP (who lost his seat to Brooke van Velden, the Act minister in charge of the pay equity rollback), was also a critic.
And yet he did. He wrote on Substack that, while he was no fan of Labour’s pay equity regime, the Government’s reforms did not “pass the sniff test”.
He argued that the changes looked, on the surface, like an attempt to find a “quick windfall” for the Budget by targeting low-paid workers.
“It also makes for terrible optics - spending billions for military helicopters (which will be obsolete before they land), yet gleefully ‘saving’ billions at the expense of our lowest paid,” he said.
If you’re the broad-church National Party and you’re being squeezed by Janet Wilson on one side and Simon O‘Connor on the other, you know you have a problem.
And National already knew this week would be ugly.
Brooke van Velden announcing the pay equity reforms earlier this week. Photo / Marty Melville
On Sunday, MPs scrambled on to a caucus Zoom call.
The party’s regular caucus meeting is on a Tuesday morning in Parliament. Meetings outside this are not unheard of, but they are rare.
On that Zoom, they were given the news that their first week back in Wellington after a three-week Easter recess would be spent chained to their seats in the House, voting through the pay equity changes under urgency.
Parliament spent the whole week in urgency, debating until midnight on Tuesday and Wednesday and starting again at 9am the next morning, exhausting backbench MPs.
It’s the National MPs who will wear this particularly hard.
This is a taste of things to come. Hundreds of thousands of people are touched by these agreements - one estimate is that up to half a million workers could be caught up in a pay equity deal at some point now or in the future. That’s more than one in every 10 workers (enough people, if they all voted the same way (which they won’t), to become the third-largest party in Parliament).
The pay equity row has been a gift to Labour leader Chris Hipkins and his party, who have characterised the law changes as "robbing Paula to pay Paul". Photo / Jason Dorday
The controversy was a gift to Labour. Its caucus had been a bit deflated recently, having failed to cement its early polling lead over National. With Te Pāti Māori refusing to play ball when it comes to presenting a coherent alternative government ($200b capital gains tax anyone?), Labour could see little credible path to power.
But pay equity has given it something to fight for. MPs swelled the Opposition benches during the debate, sending more MPs to the House than the minimum required for casting proxies.
The issue is perfect for Labour. Its path to victory in 2026 is to ask whether some spending cuts are so inhumane that they would be worth paying more tax to avoid - this cut may be the star witness in their case.
It needs to be careful, however. Labour has implied it would roll back a lot of the coalition‘s cuts, but it has yet to outline any plan to pay for them.
Balancing the Budget by restraining wage growth among female-dominated industries is cruel but, if Labour seeks to unwind that without significant extra revenue, then it will still be left with the problem of an unbalanced Budget. This is cruel too, in its own way, but it‘s a delayed kind of cruelty (perhaps the 2026 election will be argued about the discount rate of cruelty in the name of fiscal restraint).
For National, the same argument can be made in reverse: the party campaigned in 2023 on bringing the Budget slowly to balance without cuts to frontline services. One careworker protesting on Tuesday noted that part of her job was to wipe people’s bottoms for them. If that isn‘t the frontline, then there is no frontline.
Unless this new regime starts inking fair and workable pay equity settlements quickly, National will find it difficult - perhaps impossible - to argue in 2026 that its spending restraint avoided the frontline.
The controversy will not trouble Act. David Seymour and Brooke van Velden campaigned on taking painful spending decisions in order to bring the budget into balance — in this, they’ve succeeded. It’s the marginal National-Labour voter, not the marginal Act-National voter that will be troubled by these changes.
Luxon may have a serious caucus problem on his hands. For hour upon hour of urgent sitting, Parliament became a studio, cameras, lighting and all, for Labour Party campaign ads. Every National MP who spoke on the bill will likely have the most unflattering parts of their speeches chopped up and regurgitated on social media by their Labour rival at the next election. Labour will never let them forget it.
Most MPs, even National ones, don‘t go into politics to roll back pay equity laws in hours of urgent sitting. Backbench MPs know they’re going to get it in the neck.
In a speech to Parliament on Wednesday, Finance Minister Nicola Willis laid out her case for a more workable pay equity regime. Her audience, writes Thomas Coughlan, was not the public but her party's own backbenchers. Photo / Marty Melville.
Backbench demoralisation is a particular problem for Luxon, who, having spent just over 400 days as a backbencher before becoming party leader, never had the experience of being marched by the party whips into the House late at night to fill a 10-minute speaking slot waxing lyrical on the unparalleled sensibleness of some godawful bill with nothing but the odour of second-hand whisky to keep him company. It’s a rite of passage for most MPs.
For most of Luxon‘s time as an MP, he’s been the party leader - and that means he’s had almost total control over what he’s said and total accountability over the positions he’s taken. That’s a rare privilege in a parliamentary career. Every current National MP bar one has spent longer on the backbench than Luxon - he doesn‘t understand their plight, but he needs to start trying.
That’s one reason Luxon should have made an effort to show up to Question Time on Wednesday. If you’re going to force your caucus to risk their electorate majorities in hours in hours of urgent sitting, it’s a good idea to at least show up for the only hour of Parliament everyone expects you to attend.
One person who seemed to sense the need for a vibe shift was Nicola Willis.
On Wednesday, she unexpectedly took a speaking call on the third reading of the pay equity bill (she wasn‘t required or expected to speak), in which she laid out a case for the unworkability of the existing regime and National’s principled belief for a more functional system.
It’s probably too late to convince the public (if the Government really believed there was a winnable case for reform, it should have begun making the case months ago), but the audience for Willis’ act of parliamentary defibrillation wasn’t the public; it was National’s caucus.
It might have been one of Willis’ more courageous moments in the House, given that the speech was delivered in front of one of the most hostile audiences imaginable. She spoke immediately before Labour MP David Parker’s valedictory speech to an audience that included not only a full Labour caucus, but a public gallery packed with some of the most senior figures in the Labour Party and the union movement, including serial glass-ceiling shatterer Helen Clark and Sir Geoffrey Palmer, a lifelong critic of the excesses of executive power and legislative vitesse.
It was the shock the caucus needed - Willis faced Labour down, arguing it was kind but profligate, while National was compassionate but sensible.
In lieu of any official advice on the Government’s reforms, a sceptical public will simply have to take Willis’ word for it. But for the National caucus, it was everything they needed to hear.
It was precisely the right speech National’s deputy needed to deliver, with the Prime Minister enjoying the privilege of being able to keep his distance from the sordid business of the House.
Luxon shouldn‘t have been speaking in the debate - it’s not the sort of thing prime ministers do - but he should have been at Parliament to take questions.
What irony that the political clean-up job fell to his hardworking and considerably less well-paid female deputy.
Thomas Coughlan is the NZ Herald political editor and covers politics from Parliament. He has worked for the Herald since 2021 and has worked in the Press Gallery since 2018.
