Lost in Opposition: Where's Labour's mojo gone?

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.