Photo: RNZ / Angus Dreaver
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Analysis: Labour's campaign strategy of stinginess has started to take shape, as it rolled out tax and welfare policies this week.
Labour's big reveals - taking the GST off fruit and vegetables and increasing in-work tax credits by $25/week in 2024 - also pulled back the curtain on how it hopes to steal the election from National and ACT. While a big fuss was made of the details of the GST policy in particular - and its rejection by tax and health experts - this week's Caucus podcast discussed the politics behind the policy.
The design flaws have been well traversed and Finance Minister Grant Robertson's discomfort with the policy couldn't be clearer, as was Jacinda Ardern's, David Cunliffe's and David Shearer's in previous iterations of Labour. It's a tortured political manoeuvre for Robertson, who clearly is no fan of the policy. He told the Auckland Business Chamber last March that it would make no sense take the GST off fresh beetroot and leave it on tinned beetroot if you wanted to help low income New Zealanders, yet that's exactly what he's just promised to do.
He has to argue the new Grocery Commissioner will ensure that GST-savings will be passed to the consumer, when reports in Britain have shown the removal of the 5% VAT from period products led to just a 1% cut in prices. You know who also has a Grocery Commissioner (or a Grocery Code Adjudicator)? Britain. As Guyon Espiner mentions in the podcast, it's also a tough sell for Labour as a party that likes to pride itself on backing evidence-based policy, as seen during its pandemic response.
But this is a different Labour Party with a different leader. And Chris Hipkins' Labour is pitching itself as a careful economic manager, a safe pair of hands during a cost of living crisis, a party led by a working-class lad who knows times are tough and is reining in those big-spending lefties in his ranks. It's determined to give National no scope to use its usual 'typical tax and spend Labour' charge. Indeed, this week it looks like Labour is trying to turn the tables on National. It has been proudly stingy with these big announcements that, frankly, weren't that big.
Photo: RNZ / Angus Dreaver
Where Dunedinite Robertson is looking to be true to himself this campaign, it's in allowing his inner Presbyterian to come through. 'There's not room at this election for big promises,' he declared. Trust Labour to 'be careful with the government's books'. Labour is making a virtue of frugality and is turning National's traditional attack lines back on them. National's Nicola Willis this week called Labour's policy 'miserly'. And Labour probably doesn't mind that as they try to paint themselves as stingy and proud of it. They hope that they can give a little here and there and that voters will do the maths - $4.25/week off fruit and veges, $5 off prescriptions, cheaper public transport... every little helps. And that will stand on contrast to National's tax cuts and Willis' promise that voters will 'get more out of us than they’ll ever get out of Labour'.
On the flip side, National is looking to present a warmer, more accessible face to the same voters. Where Labour typically tries to paint National as heartless Scrooges, the blue team is being careful to empathise with people during these tough times, rather than telling them to cut costs and pull themselves up by their own bootstraps. Deputy leader Willis is key to that. In a rare move she's on National's billboards beside leader Christopher Luxon. Polls show New Zealanders are struggling to trust Luxon, so Willis is the trust factor. Together they are the yin and yang for National, showing that not only are they more competent economic managers than Labour, they get you as well.
Nicola Willis. Photo: Marika Khabazi / RNZ
When Robertson lost his cool this week and accused Willis of lying over a mistake in Labour's policies, she just said he was stressed and needed a break ... and she was happy to give him one. Mic drop, as Lisa Owen says in the podcast.
Given the lack of big budget policies this election, the emphasis looks like to be on each major party warning us off the other. In other words, the fear factor will be big this year. Coalition of chaos or coalition of cuts? Labour has leaned into it this week, rolling out the lines that National MPs are in it for themselves, are looking after their millionaire mates, not ordinary New Zealanders. Warning against a return of prescription charges, foreign home buyers, full-fare public transport... the list goes on.
Forget the big spending this election or promises of a brave new world. Both main parties know there's no money. Instead, look for lots of warnings about how bad the other lot will be.
* Tim Watkin is a founder of political news website Pundit, has a long career in journalism and broadcasting, and now runs the Podcast team at RNZ.
Join Caucus every week as Guyon Espiner, Lisa Owen, Julian Wilcox and Tim Watkin countdown to Election 2023. The podcast is out every Thursday afternoon and plays on RNZ National at 6pm each Sunday. You can listen and follow Caucus on Apple Podcasts, Spotify, iHeart or any podcast app.
