It’s only one poll

October 14, 2019

The slide has started:

The age of Jacindamania is over. Brand Ardern has taken its biggest knock yet – and when Labour’s magic weapon loses its power, the party does too.

The latest Newshub-Reid Research Poll shows just how wounded Prime Minister Jacinda Ardern and Labour have been after the string of crises that have beset them.

Labour was the only party to lose support in Newshub’s poll. It’s now on 41.6 percent – smacked down by 9.2 percent.

Most of that went to National, which is on 43.9 percent – up 6.5. This is enough to overtake Labour, and that’s manna from heaven for the Nats and leader Simon Bridges. . .

It’s only one poll,  has a margin of error of 3.1%, and remember the last Newshub-Reid Research Poll, had National much lower and Labour much higher than the TV One poll that came out the same night.

On this result Labour and the Green Party could still form a government and National and Act would be a couple of seats short.

But while Party support ebbs and flows the trend is more significant, and this echoes other polls which show Labour losing support.

And support for the Prime Minister tends to peak and then fall.

Personality matters but it doesn’t pay the bills and while warm words are well received they can’t counter the fact that the year of delivery has been one of disappointments.


Politics changed, facts haven’t

March 28, 2019

Sir Michael Cullen is being paid $1000 to sell the capital gains tax.

It’s a task made more difficult by records of his views on a CGT  which the parliamentary library holds from his time as an MP:

Stuff reported that although the chairman of the Tax Working Group once called a capital gains tax “extreme, socially unacceptable and economically unnecessary”, he has since changed his mind.

New documents compiled by the Parliamentary Library for the ACT party reveal just how far he shifted since leaving Government in 2008.

The 84 pages of research included every reference Cullen ever made in the House in reference to a CGT between 1987 and 2008. . . 

They include:

. . . “I think it is extremely hard to make that connection between a capital gains tax and the affordability of housing, insofar as there has never been a theoretical argument put forward about a capital gains tax on housing. It is more in the direction of a level playing field around investment; it is not around the notion that it will make houses cheaper. Indeed, it is very hard to see how it would necessarily make houses cheaper,” Cullen said at the time.

On June 20, 2007, when Bill English asked Cullen about explicitly ruling out a capital gains tax, he responded saying: “One of the problems with a capital gains tax – apart from the fact that if it were done, it should apply to all asset classes—is that countries overseas that have capital gains taxes have significant inflation in house prices on occasion”.

Then on June 21, 2007, he was asked about the possibility of combining ring-fencing with a capital gains tax on all investments except the family home, and more Government investment in low-cost rental housing.

He responded saying: “I think it is fair to say that, if one was looking at a capital gains tax, which I am certainly not, it would apply to all asset classes. I think the arguments in favour of such a tax, which probably 20 years ago were quite strong, become much, much less strong in the intervening period of time, for a whole host of reasons. So I think that that is actually not a very worthwhile avenue to explore, not least because it comes, in effect, at the end of a process, rather than trying to address the over-investment at the start of the process”. . . 

He says he was Finance Minister at the time and following the government line.

When asked why he changed his mind, he quoted John Maynard Keynes: “When the facts change, I change my mind”.

What facts have changed? It wasn’t a good idea then and it still isn’t, for the same reasons.

As Robin Oliver, former deputy head of Inland Revenue, former Treasury advisor, an expert on the tax system, and one of three dissenters on the Tax Working Group said:

There’s a strong argument for taxing capital gains, as you put it, in theory, the problem is the practicality and of making it work. . .

Kathryn Ryan asked him if, all things being equal and as a tax expert would it be good to do it and her replied:

In the actuality of what you have to do to get such a tax in place, no.

Most of the arguments in favour of a CGT are theoretical ones based on a notion of fairness, whatever that is.

Most of the arguments against it are practical based on facts including that it has done nothing to rein in house prices elsewhere and has led to overinvestment in housing, underinvestment in business, and acts as a handbrake on succession.

The politics have changed but the facts haven’t.

A CGT with exceptions as recommended by the TWG would be expensive to administer, contain loopholes which would only provide work for lawyers and accountants, promote over-investment in housing, stifle investment in productive assets, and result in lower tax revenue in tough times when capital gains fall.


Only one poll

December 2, 2018

It’s only one poll, but the latest one from One News Colmar Brunton is a very good one for National as the political year draws to a close:

National up 3% to 46% support, Labour down 3 to 43%, Green Party down 2 to 5%, NZ First dropping 1 to 4%, the Maori Party on 1% and Act on 1%.

It’s the party vote that counts and this result matters more – at least so far as one poll matters at all – than the preferred PM poll in which National’s leader Simon Bridges is still in single figures.

The changes are in margin of error territory but the trend still has National ahead of Labour.

That isn’t enough to govern under MMP, but it shows National support is solid and that the leader’s stardust isn’t enough to make Labour sparkle too.

Under MMP it’s not enough to have the most support, a party has to get to 61 seats by itself or with at least one support partner.

But at this stage of the political cycle, and given, the rough waters National has had to negotiate in recent months that’s a lesser concern than voter support which is still very strong.


2/4 for Act’s plan

August 13, 2018

Act wants fewer MPs a smaller executive and no Maori seats:

ACT is drawing a line in the sand on the size of government with a new bill aimed at rolling back the state.

Party Leader David Seymour today revealed his Smaller Government Bill which will reduce the size of Parliament to 100 MPs, limit the size of the Executive to 20 Ministers, and remove the Maori seats.

“The growth in government over the past two decades has not delivered better outcomes for New Zealand. We need smaller, smarter government”, says Mr Seymour.

“New Zealand has too many politicians for its size. Our Government costs more and delivers less than it did 20 years ago.

“The Smaller Government Bill will cut the size of Parliament 100 MPs, bringing us into line with other developed countries.

The number of electorates is determined after each census.

The General electoral population is the ordinarily resident population shown in the last census less the Māori electoral population.

All electorates must have about the same population size.   The number of South Island General electorates is fixed at 16 by the Electoral Act 1993.  To calculate the number of electorates the Government Statistician:­

  • divides the South Island General electoral population by 16 (this result provides the average electoral population for South Island electorates and is referred to as the South Island quota)
  • divides the Māori electoral population by the South Island quota to work out the number of Māori electorates, and
  • divides the North Island General electoral population by the South Island quota to work out the number of General electorates for the North Island.  . .

If the number of MPs was reduced the size of electorates would have to increase and rural electorates are already far too big.

Clutha Southland covers an area of 37,378 square kilometres, West Coast Tasman is a little smaller and Waitaki covers an area of around 34,000 kilometres.  It doesn’t matter how hard, smart and effectively  MPs representing these electorates work, it is impossible for them to give the same level of service to constituents spread over these huge area as the MP for Epsom, the smallest electorate, which covers an area just under 20 square kilometres.

“It will also restrict the number of high-paid Ministers to 20. Our Executive is far too big – currently standing at 31 people.

“Almost half of the Government MPs hold a position in the Executive. We have too many pointless ministerial portfolios. They are not improving the lives of New Zealanders and this bill will do away with them.

Quality rather than quantity should be the rule for the executive.

Fewer, more able ministers would serve the country better, and at a lower cost, than the over-populated and under-talented one we have now.

“The bill will also remove the Maori seats. New Zealand is a modern, diverse democracy. There is simply no longer a place for one group of people to be treated differently under the law.

“We now have 27 Maori MPs, 20 of whom were elected through the general roll. Even without the seven Maori seats, Maori would still be proportionately represented in Parliament.

The problem of size in rural general electorates is even worse in Maori seats.

Te Tai Tonga, the largest, covers an area of 153,671 square kilometres and is nearly four times as big as Clutha Southland. It covers the whole of the South Island, Stewart Island, the Chatham Islands, and extends into the lower North Island as far as the Hutt Valley.

It isn’t humanly possible to service an area that big effectively which means constituents are getting inferior representation.

In 2008 then-Maori Party leader Tariana Turia said:*

I think what our people are starting to realise though is that when they voted Maori people into Labour they never got a Maori voice, they got a Labour voice and that was the difference, and they’ve only begun to realise it since the Maori Party came into parliament, because it is the first time that they have heard significant Maori issues raised on a daily basis.

The seats by themselves didn’t give Maori a voice. They have also often given them inferior representation, sometimes because of the MPs and always because of their size.

The Royal Commission on MMP said there would be no need for Maori seats under this system, but that was ignored.

Its prediction that MMP would bring more Maori into parliament anyway has been proved right.

Getting rid of Maori seats is National Party policy. It was set aside in negotiations with the Maori Party after the 2008, 2011 and 2014 elections. It is New Zealand First policy and is now Act policy. That could mean a majority of parliament supports this part of Seymour’s Bill should it be drawn from the ballot.

Maori choose whether they are on the general or Maori roll every six years.

If the greater number of people switching from the Maori roll to the general one in the first month continues it will result in one fewer Maori electorate.  If that trend continued the seats would eventually disappear by attrition any way.

“Our plan would also require all parliamentary candidates to stand in an electorate, and all elected list MPs would be required to open an office in the electorate in which they stood.

“List MPs serve an important function in our democracy, but they should be required to serve New Zealanders and solve real problems, not just collect a salary and spend their time in a Wellington office. . . 

The requirement to serve New Zealanders and solve real problems should apply to all MPs but I wouldn’t go as far as requiring all of them to stand in an electorate.

Some MPs might be more effective if they serviced a nationwide constituency, for example an ethnic community, than a single electorate.

I give Act’s plan a rating of 2/4.

Seymour’s plan to reduce the size of the executive and get rid of Maori seats has merit.

But reducing the number of MPs is simply populism that would make already over-sized electorates even bigger and requiring all MPs to stand in electorates is a blunt instrument that wouldn’t necessarily improve performance.

* Dame Turiana’s quote was made on Agenda. The only record I can find is on a blog post I wrote here  where the link to the quote no longer works.


National in drag difficult sell

May 30, 2018

Two polls this week show the National Party still ahead of Labour with about 45% support.

That is encouraging for National and worrying for Labour.

But the latter has two support parties, although New Zealand First is registering below the 5% and the Green Party is hovering close enough  to the threshold to make it possible it might not make it back into parliament and we’d return to a two-party system in spite of MMP.

Possible isn’t probable and in spite of being the most popular party, National lacks any allies with sufficient support to enable it to form a government with more than 50% of the vote.

Act could gain another MP or two, but it hasn’t managed to do that in recent elections and would have to do so without taking votes from National to make a positive difference.

The Maori Party might win back a seat or two, but that too is more possible than probable.

Finding another party which could either win a seat or cross the 5% threshold would not be easy.

Some are suggesting a National MP leaves the party to form another one. But National in drag would be a very difficult sell for party members and other voters, and would only help if it got votes from the left and not the centre-right.

Tariana Turia managed to win a seat when she left Labour and formed the Maori Party; Winston Peters did it with NZ First; Peter Dunne held his seat under several manifestations of what eventually became United Future and former Labour MP Richard Prebble won a seat for Act but they are the exceptions. Any other MPs that I can recall who left a party and formed another failed to hold their seats.

The other option is standing back and making an accommodation to let a new party, which would take votes from Labour, NZ First and/or the Greens, take a National-held seat.

But that would be very difficult to do and would be entering very dubious territory.

National voters gave electorate votes to Dunne but he was a sitting MP when he formed his own party. Act voters opted for Rodney Hide of their own volition and not because National made an accommodation. They supported him and subsequently David Seymour but didn’t have to vote against a sitting National electorate MP to do so.

Trying to persuade National voters to swap support from an MP they voted in for someone from a new party would be a very different matter.

National is a victim of its own success and any attempt to help another party is likely to backfire and sabotage its own support.

It’s also a victim of the failure of MMP to give us a party in the middle that stands for something and could go centre-right but what can it do about without endangering its own support?


It’s only one poll

April 16, 2018

Labour’s honeymoon is over for now.

National is back in front of Labour but the three parties in the coalition are still comfortably ahead of National and Act.


Satire or serious?

November 29, 2017

Act’s newsletter Free Press says it’s learned from a usually reliable source what’s in the secret coalition document:

First Things First: Why is it Secret?
It is very damaging in a democracy for Jacinda Ardern to keep secret what the Government has pledged to its coalition partner. Why the secrecy? There are significant new extra spending promises. Labour does not want the Treasury to know or the extra spending will be added to the Treasury forecasts due to be published shortly.

Running out of Other People’s Money
Already the treasury forecast will show Labour’s election spending promises were understated and there is a blow out. Add the new secret spending promises and New Zealand’s credit rating is at risk. A credit rating decline means everyone’s mortgage payments go up.

Second
There are or were 38 pages to the Labour-New Zealand First agreement. As the PM has almost admitted it has been edited down to 33 pages and Labour is trying to get it lower. The missing five pages are still part of the coalition agreement but both governing parties have conceded it will be very damaging if they are ever published.

The Two Governments Agreement
What is in the agreement? In effect the document creates two governments, A Labour/Green government and a New Zealand First government. Winston Peters is granted a veto over the Labour/Green government but in the New Zealand First government his powers are untrammelled.

Labour/Green Government
The government budget must be submitted to NZ First (Winston) for approval
Labour has agreed to a 10 percent a year increase in the Foreign Affairs budget.
Labour has agreed that NZ First manifesto promises will have priority. The Northland port and railway, for examples
New Zealand First nominations will be approved. For example to the port inquiry.
No concessions can be made to the Greens without prior approval from New Zealand First, think Kermadecs
No new policy not contained in the coalition agreement can be advanced by Labour Ministers without NZ First approval.
All government appointments must be approved by NZ First
New Zealand First Government
Foreign Affairs budget to be increased and Mr. Peter’s Foreign Affairs budget requests cannot be vetoed. Mr Peters can spend his budget how he chooses.
All budget requests from New Zealand First Ministers that have been approved by Mr Peters must get priority.
As Minister of Foreign Affairs Mr Peters has the sole right to nominate all Ambassadors and other diplomatic posts not just Washington and London but he cannot be stopped from appointing his mates to be consuls as he tried with Owen Glenn.
As Minister of SOEs Mr Peter’s has the sole power to appoint all the chair and directors of every SOE. Dozens of appointments.
New Zealand First can nominate, over three years, six people to be knights (or, theoretically, Dames) and its nominations will be favourably considered for other honours.
New Zealand First will appoint the next Chief of Defense
A provision requires all Ministers to refer any request from or to a New Zealand First Minister to go through Mr Peters office.
The PM has agreed that she will not dismiss any New Zealand First Minister, MP or appointee without Mr Peter’s approval and the PM has also agreed to dismiss any NZ First minister, MP or appointee if asked to by Winston Peters.
Unbridled Power
No previous Prime Minister has had the power and patronage that Winston Peters has been given. He can appoint his cronies to be Ambassadors, SOE chair and directors and he can give them knighthoods. He has an iron grip over his party. Winston in effect controls the government budget and can spend billions of dollars on his pet projects while vetoing the plans of both Labour and the Greens.

Snookered
No wonder the Prime Minister, who foolishly thought none of this would become known, is desperate to keep it secret. We suspect that at some stage some of the document will have to be released but as the PM is now denying even the existence of five pages of the secret deal it may be years before we know.

We Need Some Responsible Adults Here
The Secretary of the Treasury should demand to see the full 38 pages. If the government will not let the Treasury see the full secret coalition agreement then the Secretary of the Treasury must tag the Government accounts saying that the Treasury had asked and been denied access to the full coalition agreement and future spending may be significantly greater than the forecast.

For the country’s sake I hope this is satire, but I think it’s serious.

We’d know which it is if the document was released to the public as Peters said it would be but Jacinda Ardern is refusing to do.


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