Labour MPs can't seem to land a glove on the government, even given the ACC beat-up and the disappointment that is the nine-day fortnight. Perhaps the miners will put some steel in their spines

Labour party MPs head down to the West Coast to find themselves this week. That tells us where the Labour party is, but doesn't answer the more pertinent political question: where on earth is the Opposition?

Labour has not only struggled to land a punch since the election, it doesn't even seem to be in a fighter's crouch or on the balls of its feet, ready to jab when it sees an opening. The party's still in shock after National took its title belt.

National's win in November was convincing and its disciplined adherence to its 100-day plan over its first three months in power left little for Labour to criticise. The government had a mandate and it was enacting the will of the majority. Labour needed to show a little grace in that period.

But that honeymoon period ended three weeks ago and it's as if Labour hasn't noticed. The most strident critique of the government's approach to the global recession has come from National's own coalition partner, in the form of grumpy old Sir Roger Douglas. Like an old Spandau Ballet fan, he's still singing the hits of the 80s that he loves so much. While the rest of the world has gone all indy and Idol, Sir Roger's keeping the faith by clinging to the economic equivalent of floppy hair and flouncy shirts.

Given that deregulation destroyed the value of many US banks and family homes and ignited this economic disaster, his demand for even more free market reform is horribly out of tune. But at least he's offering a different point of view. Labour hasn't been able to articulate a coherent alternative to the government's approach, even though it only has to look across the Tasman to find one.

Clayton Cosgrove has probably been the best of a bad lot, with Darren Hughes nipping in where he can. But the party's heavyweights, especially leader Phil Goff and finance spokesman David Cunliffe, have been M.I.A. With Helen Clark's focus having turned towards New York and Michael Cullen seemingly already choosing the drapes for his retirement home, the party seems adrift, the next generation unprepared.

The first few months of the Key administration feels a lot like the start of the Blair government in Britain, and National is using more than a few Blairite tricks, including carefully orchestrated leaks. Having been out of power for so long, National has a lot of tinkering to do. Like a child with a new electronic toy, it's pushing buttons and turning knobs just because it can. What happens if you push the 'review' button over and over? How about this 'call in the state sector CEOs' knob?

From a media management point of view, that creates a lot of headlines. And that's a good thing, so far at least. National's large and little changes give lots for journalists to write about, leaving little room left for the Opposition to gain traction. By the time Labour is ready to debate an issue, National's on to the next one.

Or so it has been. That has changed in the past fortnight as a couple of stories have emerged that have run and run.

First, there was ACC. This has probably elicited Labour's best response thus far, but it was slow, and "Look out, privatisation" should be the opening of a debate, not the whole argument.

When Nick Smith released the PriceWaterhouse report on March 4 with a press release saying that "significant changes" were required, the quickest glimpse would have showed how the new ACC minister was over-egging it. Smith said it was "deeply concerning" that the ACC's liabilities has risen by $2.5 billion. That's a big number and the media duly reported it.

But I had a look at that report the day after it came out. It was, after all, helpfully attached to the bottom of Smith's press release. Even the Summary of Results undermined the minister's interpretation of the numbers. Look at just the first few pars:

2.1 At the 30 June 2008 Review (the “Previous Review”), the projected provision at 30 June 2009 (including risk margin) was $19.295 billion. Our revised provision as at 30 June 2009, based on data to 31 December 2008 is $21.875 billion, an increase of $2.581 billion.

2.2 This increase is comprised of:
(a) $0.461 billion increase due to claims experience and modelling,
(b) $1.830 billion increase due to changes in economic assumptions, and
(c) $0.291 billion increase due to the risk margin.

2.3 The liability has increased by $1.830 billion due to the impact of revised economic assumptions, most notably revised discount rate assumptions. The global financial crisis has seen a large fall in forecast yields across most economies, with New Zealand having experienced an average 1.3% drop in yields over the 6 months to 31 December 2008. Due to the long term nature of ACC’s liabilities, even a small reduction in yields leads to a large increase in the liability. The change in economic assumptions is discussed further in section 5.

Modelling? Changes in economic assumptions? These are examples of accounting changes, not incompetence. Hardly reasons to sack a board. The report's author Keith McLea goes into further details, perhaps the most telling being that $1.6b of this $2.5b liabilities "blowout" was due to falling yields on New Zealand government bonds. Not much ACC could do about that.

Yet the Prime Minister was able to get away with statements undermining the scheme and maligning its board, such as, "What we've got is a situation where there has been a very significant blowout in the liabilities for ACC" and "...the second thing is having a competent board that can actually run ACC in the way we want it to be run."

So if I could smell a beat up immediately – and I said as much on my weekly Newstalk ZB spot with Larry Williams on March 6 – why couldn't Labour? Why was it left to Brian Fallow (here) and Rod Oram (here) to expose the spin a week later?

Next came the revised nine-day fortnight. It started as a bold idea to improve training in the workplace and ended up as wage cut for already low-paid workers. John Key, the man famously ambitious for New Zealand, who has spoken endlessly about his goals to increase wages and improve productivity, is pushing a scheme that lowers wages and reduces productivity.

A fair commentator would argue that that could well be better than losing your job altogether. He or she would also point out that there are genuine (if less sensational) questions to be asked about the ACC's growing number of claims and falling return-to-work rate. But an Opposition doesn't get paid to be fair. It's job is to challenge and probe the government. Perhaps Labour has felt castrated by the unions' buy-in to the scheme. If so, it needs to, well, man up.

A trip to the rugged West Coast may be just the thing. Labour desperately needs to find some steel, so a trip to the iron sands sounds about right. The miners need to remind the MPs not just where they come from, but where they need to be going.

Comments (11)

by Don Donovan on March 16, 2009
Don Donovan

It's too early for Labour to be an effective opposition. The moment Goff or any of his musty colleagues appear on television I shout them down and refuse to listen to them. They'll have to wait; six months? A year?..

by Tim Watkin on March 16, 2009
Tim Watkin

That long, Don? I understand the gut reaction you're expressing and that many people will feel that way. But does the government really get a free run for six or 12 months? In that time they could have enacted all sorts of controversial measures - three strikes, private prisons, ACC reform... Who holds the powerful accountable in the meantime?

by Serum on March 16, 2009

The Labour Party’s depurative trip to the West Coast in an attempt to cast out the toxicants absorbed under the last administration and hoping to develop a cast iron spine will have as much luck as to finding any substantive steel in the diminutive deposits of South Island iron sands.

by Claire Browning on March 17, 2009
Claire Browning

You might be both right. 

Neither of the two approaches tried so far is worth listening to, because neither has been backed by any substance - (1) we disagree, because it's not what we'd already decided, and (2) saying silly populist things. My response, like Don's, can be briefly put - two words would probably do.

There are two other approaches that I'd like to hear, starting yesterday - (1) facilitating a proper substantive debate in the interests of us all (not self-serving interests), which I think is what you're wanting Tim, and (2) demonstrating an alternative vision, or any vision really, since the government still hasn't told us theirs (but not just rehearsing what voters rejected on Nov 8).

(2) might take some time, and (1) could get a bit ticklish, if one suspected that the government might in any respects be right ...

by George Darroch on March 17, 2009
George Darroch

There's a lot of reactive emotion against Labour, as Don and Serum have demonstrated, and a lot of cynical/tired disinterest too (which also seems to pervade the press galery).

I think what we're seeing now is a reaction to the failure of their negative spin on the Key campaign pre-election, and trying other strategies. The difficulty for them is that they might be seen to be crying wolf - far better to keep their powder dry and let the Government create some of its own problems.

As Mallard noted the other day, this Government is quickly creating/highlighting (take your pick) problems, presenting solutions, and then moving on to the next issue. It's hard to hit a target moving that fast...

by Serum on March 17, 2009

Describing the present situation as a consequence of the “failure of their negative spin on the Key campaign pre-election” is notification of an ear that had been deaf to the tumultuous roar of popular discontent for a multi-term government that had become cavalier with the bourgeoisie and imposing onto it a philosophy of Political Correctness or better described as Cultural Marxism, culminating in a convincing electoral defeat with the protagonists running for cover.

by Claire Browning on March 18, 2009
Claire Browning


I can't compete with that, but just thought I would pop back in briefly to say: I had thought Steve Maharey and Trevor Mallard might start contributing to Pundit, and I was looking forward to it - assuming we'd get something human, not just party spin. I saw something from Trevor on the discussion thread of a different blog the other day, and I thought: why did he never say sensible interesting things like that when he was a Minister? But they seem to have gone away again.

by Marian Hobbs on March 21, 2009
Marian Hobbs

Tim, I cannot comment on Labour's reaction to ACC debacle, because I am too distant from the fray. But I do want to comment on how a party regroups. It does not do this through press releases or have it confined to set piece battles in the House. It examines carefully who did not vote and tries to establish why. That is an initial part of the reconnection. And this must be done face to face and not through the media channels. And then it has to work out the manner of the battle. Journalists may enjoy the battle of interviews and question time. People battling with bills and the cost of work injuries and threats or reality of unemployment, dismiss politics as inane and irrelevant. The political speeches that count for them are the ones that express what they want to say. And to do that effectively takes time away from the limelight and spin.

The further away I am from political life I can see how irrelevant and superficial it appears, and yet the decisions made in there affect us all. I look at the threats to NZAID and despair. I hear that they may weaken the air quality standards and I bet they weaken the ways forward to safeguard water quality in Lake Taupo.

So Labour has  to avoid the superficial engagement and focus on slower and deeper engagement to enable it to speak with the confidence that it is speaking for its support base. 

by Adolf Fiinkensein on March 22, 2009
Adolf Fiinkensein

Labour will not land any punches or be taken seriously by the general public until it replaces ALL the characters associated with the dubious regime which retrospectively legalised its own theft of public money, wasted two years trying to legislate to steal more public money, campaigned on trust when clearly it was untrustworthy, tried to make ordinary parents criminals, propped up the most egregious liar we have ever seen in politics and tried desperately to besmirch the character of a person who obviously is of good character.

They will remain impotent until they get some people up front who can demonstrate genuine moral fibre.  Curently they have none.

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