Beneficiaries might be mollified by increased govt supports – but there are lots of votes among those who miss out

For  the  second  successive day, Opposition  parties in Parliament hammered  away  at  the  government over  what  they call  the  “cost-of-living crisis”.   Between them National  and  ACT  have  made it  almost a  symphonic  chorus.  As  a  coda  they  ask:  why isn’t  the  government  considering   tax  relief  for the  embattled  inhabitants?

What’s  more, they might at  last have  got  on  to  the  wavelength  of  the  average  voter.  Certainly  in pushing into the  background the Covid pandemic   and  focussing  on surging  prices,  the  Opposition has  thrust  the  government on  to  the  defensive,  and  the  exchanges   at  Question Time  have  become  more  robust.

Moreover, the  government’s  tactic  of  getting  their  own backbenchers  to  put up patsy  questions to  ministers leaves them looking  feeble instead of  making  them  sound  like they are on the  ball.

The   media  inadvertently aid  the  Opposition with  the  stream  of  reports   with  headlines  like “Why is  the  price of  groceries so  high?”  and “Inflation forecast to  go  even  higher”.

Yet more  fuel was added  to  the  fire  over  raging inflation by what  many  think  was  the  failure of  the  Commerce Commission to strike  down  the  high  profits  of  the  supermarket  duopoly, particularly  as Commerce Minister David Clark   had stoked  expectations of  drastic  action.

It’s  true  that  both the  PM  Jacinda Ardern   and  her  deputy, Grant Robertson,  can hold  their  own  in  the  exchanges, and  some  might  say even  repulse their opponents.

But you  know Robertson is  batting  on   a  sticky wicket when he begins  an answer by saying:

“I continue to acknowledge that many households are feeling under greater financial pressure as we work through this period of elevated inflation….” 

He  says he believes   the  inflation  will  be  temporary,  but  the  Opposition  parties –  with the  election  in  mind  – see it  running  through  to 2023.

And  now   with  oil  prices  rising  to  levels not  seen  since  the global financial crisis of 2007-2008, it  is  unlikely   they  will unwind  soon.  Indeed the rundown of  energy reserves has  been  compounded  by  the  move  of  global warming-conscious countries  of  the  need to  cut  back on fossil fuels.

With the  government  committed  to  announcing  its  measures  to  curb  carbon  emissions,  it  is  likely  to be  making  another indirect contribution to inflation  later  this  year.

In  her  responses   to what  the  government  is  doing  about  the  cost of  living, Ardern likes  to  concentrate on  the  support  the  government has provided for low-income  earners to  counter its  impact  on household  budgets,  as  she did  yesterday:

“ …We’ve overseen a $5 increase in the minimum wage, benefiting around 300,000 workers. We’ve increased Working for Families … [which] will make around 346,000 families better off by an average of $20 each a week. We created the winter energy payment, starting again from 1 May, benefiting over a million New Zealanders during the winter months. We’ve made the largest across the board increases in benefit incomes since the 1940s, and we’ve increased the pay of new police officers by 19 percent since 2017, 16 percent for primary teachers, and 21 percent for new nurses.

“Our Government is choosing to target support to those on low and middle incomes who need help the most through raising wages and increasing support. Families earning between $40,000 and $70,000 will benefit by an average of $21 per week through our proposed increase in the family tax credit rather than the Opposition’s proposal to cut taxes for property speculators and the highest earners”.

This,  of  course,  is  very  appropriate,  and  cements in  the  vote   of  those  low  to middle  income  earners.  But  those  who  miss  out   feel  acutely  hard  done  by.

With political  polls  showing the  gap between  the  main  parties   has   narrowed  (and in  the  case  of the Roy Morgan poll  disappeared), the  focus  on the  middle,  where  elections under  the  MMP  system  are  decided, is  clearly  paying  dividends  for the Opposition  parties. And  the  Ardern government has  to  keep motoring  down the  road  which  its  driver  has  chosen.

One thought on “Beneficiaries might be mollified by increased govt supports – but there are lots of votes among those who miss out

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