National's pre-election challenge

No voter should be in doubt now about the choices that will be before him or her at November's general election. Unusually in New Zealand politics, the ruling party has declared its hand well in advance of the poll, seeking a specific mandate across several policy areas to govern for a further term.

The strategy has several obvious advantages at this time, chief among them the dominance in opinion polling enjoyed by the National-led Government. Voters like active, positive leaders and respond favourably when they believe new and possibly personally damaging policies are being explained honestly to them.

Thus the Government has hardly taken a serious hit from its Budget measures to alter KiwiSaver and trim Working for Families. There may be some negativity in the capital to National's latest plans to further cut state services, but the leadership will be well aware there is no great love for the bureaucracy among the working classes and small business owners, so the overall electoral price National may have to pay is likely to be small.

There can hardly be an argument the state sector has become large for a population of New Zealand's size. Somehow, after all the changes of the 1980s and the cuts of the 1990s, the Clark government added some 30,000 new people to the state payroll over nine years.

A few thousand have been trimmed since the Key Government took office, and the new proposals announced this week will trim a few thousand more, saving the taxpayer perhaps a billion dollars a year within the next five years - a relatively tiny sum in terms of overall government expenditure.

The merging of departments and state agencies may result in efficiencies - that seems to be the ideological goal - but may also have the eventual effect of failing to fulfil one of the Government's electoral pillars, delivering better "front line" services to the public.

Similarly, the proposed increased use of private consultants to advise departments, or deliver services, may improve the appearance of the state's books but result in the cost being transferred elsewhere - usually to consumers.

Furthermore, whereas departments of state can be made answerable to taxpayers through Parliament, private consultants are not so beholden, being answerable only to their shareholders. None of this would matter much if the theory matched reality, but similar exercises have been tried for the past 25 years with mixed results.

In similar vein are the proposals to trim welfare costs, a recurring feature of conservative governments since the days of Rogernomics, represented most emphatically during the period when Ruth Richardson was minister of finance. This time, too, ideology lies behind the proposals, and will be reinforced should a Don Brash-led Act New Zealand join forces with a re-elected National government after the election.

Act does not believe the proposals for state sector reduction or welfare support changes go far enough, and amount to mere "tinkering". The reforms so far proposed amount to not much: most solo parents and sickness beneficiaries will have to look for work, and benefits for most part-time workers will be scaled back in return for tax credits.

There will be more to assist people in training for jobs. More pointed is the Government's approach to beneficiaries, along the lines of "if you can work, you must work".

That adds a threat factor, which National's supporters will expect to be unrelenting.

These proposals, together with the plan to sell parts of the state's commercial holdings such as energy and transport utilities, present a formidable challenge for uncommitted voters and represent a considerable gamble by the National Party.

The odds, however, must be counted in its favour in all but the issue of the part-privatisation of SOEs, for which opinion polling indicates a clear opposing majority.

Yet the gap between National and its chief opposition, the Labour Party, remains wide, and Labour has been unable to yet find an effective means to close it.

The boldness of National's bid to seek a pre-election mandate for policies which, on the whole, might be regarded as having little attraction compared with more usual "hip-pocket" measures suggests the party's strategists are reading middle New Zealand considerably more accurately than their opponents.


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