John Key’s first 100 days are starting with a hiss and a roar – but a pause for breath and is in order, especially if he wants to avoid ACT building its influence to his right
They called him the Prime Minister-in-waiting. What a misnomer. Key produced a 27 point action plan for his first 100 days before the election. He scrambled his coalition government and his new cabinet together in just eight days – record time for the era of MMP.
With some of the debris still falling, he is off to meet with political and business leaders from 21 nations at the APEC conference in Peru – a conference that also may be attended by President-elect Barak Obama.
From Peru, he will rip on to London to meet the architect of the new European financial order, Gordon Brown, then whip home for a fortnight before another rapid trip to Thailand for the East Asia Summit.
Sour observers warn Key that he looks like turning into the Prime Tourminister. They miss the point.
Key needs to get his finger on the international political pulse as quickly as possible. He may know how international money markets work, but, currently, they are not working well enough.
The new prime minister has an early opportunity to measure the mood of major world leaders and their determination to reform institutions like the World Bank and International Monetary Fund, their approach to regulating their globally significant finance sectors and to stimulating their own economies, and their sincerity about liberalizing world trade.
These are all critical issues for New Zealand’s trade dependent economy with its heavy offshore debt exposures.
None of the broad-brush decisions taken at the current round of international summit meetings are going to produce miracle cures – but they are signaling a major wind-shift in global economic thought.
A new government that is advancing a programme of fiscal stimulus through tax cuts, expenditure caps, accelerated investment in growth-supporting infrastructure development, and increasing deficits had better introduce itself quick smart to political and business leaders around the world and start building its reputation for responsible management. We’re going to need their money.
That said, John Key needs to be alert to the fact that all will not be quiet on the home front while he is away.
It would be surprising if the sidelined seniors in his own party stay silent for long. Once the meat-hungry media has come to the obvious conclusion that his new cabinet ministers are going to put their feet under their desks before putting them anywhere near their mouths, they will begin courting the disgruntled for their tales of disappointment.
Key has provided some financial and political incentive to keep Maurice Williamson, John Carter, Lockwood Smith and Richard Worth on his sidelines, and he appears to have enough support in his parliamentary team and in the broader National Party organization to deal with any serious dissent.
However, he should not underestimate the ability of ACT to build its influence in the coalition and a few National-held electorates by reeling in the disaffected members he has left sitting on the outer fringes of his cabinet.
He also needs to untangle the labyrinth that could be created by ACT’s proposals for:
- Task forces with private sector chairs and representatives to carry out “fundamental reviews of all base government spending in identified sectors”;
- A Leadership Council to consult on “major strategic elements of the government’s programme”;
- A Productivity Commission to “support the goals of higher productivity growth and improvements in the quality of regulation”; and
- A Special Parliamentary Select Committee to consider climate change and review the emissions trading scheme legislation.
Maori Party co-leader Tariana Turia was quite right to bridle at the idea of an ACT-driven, private sector-led task force running its ruler over some critical areas of social service delivery that she has identified for a “value for money” line review to improve outcomes for the constituency she represents.
There is a case to be made for private sector involvement in the review of policies and performance in areas that particularly affect the private sector’s ability for contributing to economic growth.
John Key should take the time to fine-tune the structures and processes suggested by ACT to define precisely where they are appropriate, how they would be appointed, and how long they should last.
He is right to call on public service chief executives to carry out an immediate line-by-line review of their spending – but that is not going to tell him how to get more of that spending to the front-lines of their activity.
Objective cost-benefit analysts should be hired to help the coalition government to make its public expenditure reallocation decisions, on a transparent and purely advisory basis.
There is a case for broader inclusion of relevant private sector advice into the policy development process – but there should be no rush to create elaborate structures that could enable ACT or its private sector acolytes to exercise undue influence over public policy implementation.