We need to talk about Colin (Craig)

Rachel MacGregor's resignation will raise doubts in the swing voters giving the Conservatives a hard look, but what about its top policies? Do its numbers add up?

Colin Craig has stolen the headlines at the business end of the campaign for all the wrong reasons; the mystery of the disappearing press secretary adds to the stress he must be under when he looks at the polls. While he's had momentum, it is yet to get him over five percent in a single poll. And then there are his fiscals.

Craig has often said that he got to 2.7 percent in 2011 after just a few months campaigning, so this time he was sure he'd get over the five percent threshold. But knowing someone more does not always mean liking someone more. I've always felt there was a constituency for a conservative party, but when National is riding high and given New Zealand First's rebirth in recent years, it always seemed that the gap between three percent and five percent was a mighty challenge.

Craig is very,very close and Craig is very, very confident that he's there already; polls have often under-cooked him. But which polls? The 3News-Reid Research poll has always been the most generous, but even in that his high-water 4.9 percent isn't enough. In our Poll of Polls he's still under four.

Frankly, it's too close to call. Losing his right-hand woman today (who has been with him every time I have met him and is his closest adviser) must raise doubts in the minds of those who were considering his party; why would his closest ally call him "manipulative"? What's really going on?

But he could end up as the second largest party in a John Key-led government, and with limited analysis of his core policies. If he makes it, he's earnt it. National has given him no help, with Key this week even clearly urging people not to strategically support his potential partner. But he's flown somewhat under the radar of Dirty Politics and Glenn Greenwald.

The funny thing is, if he does make it you can all-but lock in a National-led government. It's hard to imagine a final count with the Conservatives over five percent that doesn't give National power, with ACT and United Future in tow.

So what would it mean if the Conservatives make it? Of course we'd get the MP who thinks not smacking your kids leads to suicide.

But what about economics? ThGlenn Greenwald stole the news oxygen over the weekend, but check out Craig's interview with Lisa Owen on The Nation. The Conservatives have a tax plan that has been mocked by everyone from ACT to the Greens. While the party backs a continuation of reasonable sized government, it wants to cut its revenue dramatically. It wants a tax-free zone under $20,000 and a flat tax of 25% after that.

Owen asked for costing on his total package, and he replied, as he has before, that the $20,000 tax-free threshold would cost about $4 billion. Now that's debatable, but what about the cost of the flat tax as well? He doesn't know. Here's the exchange:

I want the bill, Mr Craig. How much is it going to cost?

In terms of the 20,000 tax-free threshold, ultimately that is costed at a bit over $4 billion. $4.2 billion. We are not saying—

Your total. Can I have a total?

That’s the total for that.

For your entire--? No, I want a total for your entire tax policy. What is it?

No, we haven’t costed the rest of the tax policy, and I expect to—

We have. So let me talk you through it.


We’ve done it. We’ve got two independent costings. One from a top economist and one from a top  tax expert. Both come out at approximately $7 billion.

And that would probably—

How are you going to pay for that?

Look, that would probably be right if you look at the whole package and where we would want to end up.

How are you going to pay for it?

Where we start is we start with a tax-free threshold. That means that people can earn money and take it home without paying tax—

That’s not an explanation of how you’re going to pay for it. Could you give me an answer to that question?

Yes, I am. This is about a smaller, more efficient government. So the sorts of things that save us money. Number one – overwhelmingly, the voters in this country wanted to reduce the size of our government. They wanted less MPs. That would be less staff. That’s less of a bureaucracy.  I’ve talked about the ministry—

$7 billion you’ve got to pay for.

Remember, the first step for us is to bring in that tax-free threshold. The bill of the tax-free threshold is not $7 billion. And this is about starting the progress towards where people can take home $20,000 without paying tax. Of course that’s going to cost money. But this is about a smaller, more efficient government. The second example that I will give you is the Ministry of Education. That doesn’t teach anybody, but it gets well over $800 million in a year.

So the Conservatives' central ecnomic policy is uncosted and we did the numbers for him, with a tax expert and an economist. How's he going to cover the costs? Fewer MPs and cutting the Ministry of Education in half. Apart from what might do to our schools, it doesn't get close to saving $7 billion. His defence is that the policy would come in over time, but he's got no plan as to how even pay for this "first step" let alone how long it would take to introduce the rest of his plan and what would be cut to pay for it.

This is a party that could be National's dominant coalition partner.

And if you say, hey, National will never let that happen, consider binding referenda, which Craig has said is his top priority. Currently citizen initiated referenda require 10 percent of the voting age population to get off the ground; Craig wants to lower that to five percent. So only around 150,000 would be needed to call a referendum. If, as in the last one on state assets, 45% of voters bother to vote, that would mean we could have law changes forced through with the support of 30% of the voting public.

And with such a low threshold, who's to say how many referenda we might end up having, at $9 million a pop.

And if you want to know what referenda can do, ask California. They've had referenda which has required lower taxes, but then one after another other referenda have required the state spend money on this policy and that. The result? Higher costs, lower revenue and all sorts of financial trouble.

So while Craig is surging on the back of doubt about the trustworthiness of other parties, it's important for voters to stop and look closely at the policies the Conservatives are promoting and ask whether the numbers add up.