Understandably enough, policy detail was largely absent from David Shearer's first major speech as leader of the Labour Party. Three months is not enough to formulate such nitty-gritty. Yesterday's address was about indicating the direction in which Mr Shearer plans to take his party.

A lot of what he said hardly covered new ground. But there was enough tilting at previously sacred cows to make this a refreshing statement for a Labour leader. Much was relayed largely by way of hint, which means there will now be considerable interest in how Mr Shearer intends to implement his policies. The devil will, indeed, be in the detail.

Take his commendable talk of New Zealand not being able to afford "bad teachers in our classrooms". That raises the immediate question of how Mr Shearer plans to combat this. Is he, for example, considering performance pay? Whatever his talk about valuing teachers and investing more in them, any move against the inept in the ranks is unlikely to sit comfortably with the teacher unions.

Similarly, Mr Shearer criticised the "army of accountants" being turned out by universities as students followed the money. More engineers and scientists were what the country needed. The sort of signals he would employ to achieve this were not explained.


This lack of detail meant many of Mr Shearer's thoughts on education, a major element of his speech, were merely a recitation of the obvious. The same could be said for his wish for New Zealand to transform itself into a highly skilled, export-focused economy, as Finland, Singapore and Israel have done.

Here he harked back to territory last traversed by Helen Clark's knowledge-wave economy. But how this process would move beyond warm, fuzzy feelings went unanswered.

So, too, comment on welfare reform was restricted to the hint of a harder line. Mr Shearer talked of a social contract binding society, and a "nudge" for those not meeting their side of it. Labour's muted response to the Government's recent reform package was clearly no accident.

The one policy announcement was that Labour would continue to champion a capital gains tax. That is welcome and significant. As Mr Shearer indicated, such a tax is "pro-growth" because it directs people's savings into productive enterprise. He also sees it as a way to cut taxes in other areas over time.

But a capital gains tax's effectiveness depends on its application. Labour's policy at the last election encompassed shares as well as property investment. But shares are exactly the type of investment destination that should be fostered, not discouraged.

Unlike Phil Goff, Mr Shearer has time to get the fine print right and to sell the tax to a public which seems no longer to regard it as the ultimate election poison.

Most certainly, there will be no controversy over the rejection of another of his predecessor's initiatives, a tax-free zone for the first $5000 of income. This policy suffered, as too often with Labour, from a lack of targeting. Supposedly to help the poor, it would have meant everyone got the same-sized tax cut.

Mr Shearer's speech suggested many of the lessons of Labour's humiliating defeat last year have been learned. There will be a concerted attempt to regain the central territory once occupied so adroitly by Helen Clark. In that context, what was not in Mr Shearer's address was as important as its focus.

Not once, for example, were the words "trade union" uttered. Neither did the National Party rate a mention. There were plenty of jibes, however, including Mr Shearer's observation that he has no interest in being a prime minister who just cautiously tinkers. This was all good as far as it went, even if, for the moment, that is not too far.