Hayden Munro: Govt needs to speak up on the sense of its plans for the future


This week marked a vindication of sorts for the Government’s Covid strategy, but they’d be fooling themselves if they think they will get any political credit for it.

If the Government wants to see a sustained rise in its political fortunes, it will need to win the argument about where the country goes from here.

The Government certainly didn’t get everything right on Covid but from a slow start we’ve ended up with one of the highest vaccination rates in the world, our health system hasn’t been overwhelmed like we’ve seen overseas, we’ve had record low numbers of hospitalisations and deaths, and we’ve seen off Alpha, Delta and the now the worst of Omicron’s first wave.

But for all of that, the days of Covid being a boon for incumbent governments is over – a pandemic-weary populace, a global wave of inflation and the war in Ukraine have seen to that. That’s why you see incumbents in Australia, the UK and the US all struggling in the polls.

That’s because voters fundamentally care about the future only when they’re making their political choices.

And right now, the future looks pretty stormy, especially for the next few months – the cost of living is rising, the economic outlook is wobbly, and the long-term problems that dog our economy haven’t vanished just because we’ve all been focused on the pandemic.

That last point was highlighted by reports from the Treasury and the International Monetary Fund this week that showed we have a $100 billion infrastructure deficit and that ballooning housing debt is now a threat to our economic stability.

So what can a government looking to get back on the front foot do in the face of all of this?

First, they will obviously need to get on top of the cost of living issue. The decision to cut fuel taxes and public transport fares was a good start, however, much more needs to be done.

But the second thing is to remember that when people actually go to cast their votes, they aren’t just voting in a referendum on the current government – they’re making a choice between two different sets of policies and priorities.

And across all the tough issues the country is facing at the moment, the Government can argue that while it certainly hasn’t solved all the problems, it is at least making a concerted effort, whereas the policies put forward by the Opposition will actively make things worse.

Take housing and infrastructure for example, the issues the IMF and Treasury raised this week.

On housing, yes progress is still slow but the Government’s policies are beginning to yield results – New Zealand is building more new houses right now than at any time in history and the IMF says the decision to close tax loopholes on speculators has helped to stop the runaway rises in house prices we’ve seen in previous years.

By contrast, National’s $3 billion a year tax cut policy would see loopholes restored for property speculators that would only rekindle house price inflation.

On infrastructure, the Government has booked $57 billion in new infrastructure spending over the next few years to build the roads, trains, schools and hospitals we need. Something we will never be able to afford to do if we are shovelling money into tax breaks for those already doing well.

In fact, because National’s tax plan gives someone on $45,000 just $2.15 a week while giving someone in Christopher Luxon’s position a whopping $18,000 per year, the Government can argue the Opposition is prioritising tax cuts for those who don’t need them over fixing the big problems that affect us all.

By focusing on the future – and showing clearly the contrast in policy priorities and what they mean for the country – the Government will give itself its best chance of calming voters who are nervous about the future and who have already banked the wins of the Covid response.

Source: Read Full Article