The Ardern government is cruising along with poll ratings still far above those of its opponents and a leader enjoying almost cult status.
Her deputy, Grant Robertson, wears a matching suit of political armour, although one-time Labour Minister (and then ACT leader) Richard Prebble contends he is the worst finance minister since Rob Muldoon.
Until now the government has been borne along on a cloud originating in the successful deflection of the Covid pandemic. Its policies have escaped any deep scrutiny from mainstream media, partly because of preoccupation with the pandemic, and partly because of the teflon aura surrounding Ardern.
Even when there is a stumble, as happened this week with her speech on NZ-China relations and the latest chapter in the Mallard story, she is within hours back on her cloud. But now the rubber is beginning to hit the road. As Robertson told a Wellington audience this week, NZ is still at a difficult period in the recovery from Covid.
What this means will be spelt out more fully in the Budget, but already the first signals of a reimposition of fiscal responsibility rules have provoked shrieks of rage. Public service unions are incensed that ministers have imposed a three-year pay freeze.
How can this be, they are demanding, when hospitals are short of doctors and nurses, when schools can’t find enough teachers?
Then there is the issue of the $926m found by ministers under prodding by Robertson that had been earmarked for Covid projects but unspent.
Now there is going to be “delivery unit” in the Department of Prime Minister & Cabinet, with Robertson in charge, to check on how critical allocations are spent. Does this make individual ministerial responsibility redundant?
Robertson talked this week of how his three Budgets this term will seek to make “significant progress in addressing foundational challenges in our economy”.
Hello, what are these challenges? Surely NZ came through Covid better than most other countries? Where’s the “resilience” in the economy he keeps talking about?
Well, there’s the “housing” challenge, which involves soaring prices and more homeless people. Robertson says turning around a housing crisis decades in the making will take time
“… but we are committed to improving affordability and accessibility of housing”.
Then there is the “pivotal moment” in the transition to a low-carbon economy.
“Almost every sector of our economy is affected by the carbon budgets that have been outlined by the Commission”.
Robertson will detail
“ … our approach to meeting the targets we have set, but we will continue to look for not just the measures we must take to reduce emissions but the possibilities and opportunities that exist to create high-paying and sustainable jobs as we make that transition”.
And did you know good progress has been made in the area of child wellbeing, with more than 40,000 children lifted out of poverty since Labour got into office using the after-housing costs measure?
Robertson followed that up with his favourite phrase: “there is of course always more to do here”.
Health? Well, the Ardern team is modernising the system to “ensure quality services are provided” wherever we live in NZ.
“From a fiscal perspective Budget 2021 will continue our careful and balanced approach. The levels of debt that we have taken on to save New Zealanders’ lives and livelihoods are projected to reduce from the middle of the decade. We are in a good position to handle the debt we have taken on”
So those who thought Robertson would repeat the big $50bn spend-up he embarked on last year could be in for a rude shock.
Although NZ’s current levels of net debt are slightly below 22% of GDP Robertson is warning:
“It is sensible that we look to reduce our public debt as the economy returns to full health”.
There’s not much prospect, then, either of tax cuts or big rises in welfare benefits.
It looks as if the best New Zealanders can hope for in this budget is there won’t be any turn to austerity. The state-sector wage freeze nevertheless will make it feel very austere for many thousands of workers.
Robertson says Budget 2021 will still be a COVID Budget.
Will it be good enough, then, to sustain the government’s high poll ratings?