Luxon finds familiar ground ahead of 2023 election
Wednesday, 2 February 2022
Ben Thomas is a PR consultant and political commentator, who was press secretary to the Minister of Treaty Negotiations in the previous National government. His clients include iwi.
OPINION: As New Zealanders brace for the inevitable impact of Omicron, two years after the pandemic began, our politicians are looking to the future.
For the Labour Government, this means putting in place a legacy stymied initially by coalition with NZ First, and then by Covid-19. For the National opposition, it means preparing for a 2023 election where the virus is merely one of many factors making life tougher for voters.
After the party’s leadership was reduced to a kind of Tory caricature of automaton-like tax cut promises and race-baiting over the past year, Christopher Luxon must rebuild credibility across economic and social issues. The task is made more daunting because, in the wake of the pandemic, which exploded growing inequality and set the scene for the return of rampant inflation, the issues are more interlinked than ever.
Getting to grips with this more holistic view will be the party’s first task. A measure of the challenge it faces was shown by the session Luxon convened for his MPs to revisit “race relations”.
**READ MORE:
* Businesses want a cheaper, redundancy-only unemployment insurance scheme
* Government proposes unemployment insurance scheme funded by 1.39% tax
* Luxon's baby steps steady enough, but next milestones crucial
**
“Race relations” suggests a problem to be managed, as if New Zealand’s Treaty partners, the Crown and Māori, need to be called in for marriage counselling or emotional soothing. But more to the point, it still suggests a fundamental disconnect between what might otherwise be dubbed Te Ao Māori, or Treaty issues, and the rest of politics and government.
Luxon said the session, with businesswoman and director Traci Houpapa, would “make people uncomfortable” in his caucus. The most likely source of discomfort, for a party which has bungled its way through shadow budget mishaps, may have been having these issues explained by Houpapa, someone with a far more accomplished background in business and governance than the majority of those in the self-styled party of economic management.
This is because in this term National’s focus has been on shadow-boxing the speculative He Puapua report and largely imaginary radicalism, and it has seemingly lost sight of the fact iwi and Māori are crucial partners in regional economic development and social services, with leaders who are serious people with serious aspirations for their people and the country.
These ambitions are by definition often more nuanced and longer-term, and more connected with the real economy, than the flailing rotation of tax and spending cuts whiteboarded by MPs in Parliament.
Labour historically has seen itself as the trustee of Māori wellbeing, at the expense of genuine sharing of responsibility. However, the clear lesson of the pandemic has been that iwi and dedicated Māori health providers tend to be much better equipped than the state for local outreach to certain communities, whether in identifying the vulnerable, vaccination, or household care and support, and moreover that involvement at an early stage is better than being enlisted as a last resort.
This principle is entirely in keeping with the kind of localism has espoused as spokesperson for local government in his scant months in Parliament so far.
In contrast, the Labour Government is now focused firmly on its legacy, and has taken a risk by announcing consultation on a new income insurance scheme which will (as initially proposed) pay for a more generous unemployment benefit for workers who lose their jobs through redundancy or chronic disability.
It’s pitched as a solution to the “unprecedented” shocks occasioned most recently by the pandemic, and would cushion the state from blowouts like the wage subsidy. The scheme may be better understood as having evolved from the “future of work” thinkpiece that Grant Robertson steered in opposition to address the challenges to traditional employment by automation and a more dynamic global environment. More than Covid, Robertson will also have in mind the effect of redundancy on particularly older workers without transferable skills.
Business NZ supports the scheme, likely because it will increase flexibility for employers by providing a soft landing for restructures and, inevitably, employees sacked for non-performance, misconduct, or even personality differences under the guise of redundancy. It will also provide a strong incentive to be in the workforce for at least six months during any 18-month period.
On the other hand, it will effectively increase personal taxes by a small but not immaterial amount; $10-30 a week for fulltime employees, within the magnitude that, for example, Labour and National traditionally bid against each other on tax cuts or welfare credits during elections.
At a time when many voters are experiencing significant inflation for the first time in their lives, young professionals following the advice of baby-boomer nags to cut out their daily coffee and cancel Netflix would find themselves no better off, to say nothing of the impact on minimum wage earners.
By promising to abolish the scheme if elected, Luxon has given National a head start in the bidding war for the 2023 election. This is comfortable and familiar ground for National. He can get a head start on his potential legacy in government too, if he starts looking further afield for new ideas and deeper solutions now.