Labour’s satisfactory first year

THE passing of the oneyear mark by the coalition Government has provided opportunities to assess its performance. Generally, these reviews have been positive, and we agree with these opinions.

While there are plenty of clouds on the horizon, the outlook for much of the past year has been sunny. Led by the relentlessly upbeat Jacinda Ardern as Prime Minister, Labour, the Greens and New Zealand First will be feeling more optimistic about a second term.

It was almost as if Labour did not expect to be in charge. Much of its policy was not properly formed and, therefore, a plethora of working groups are examining the details of policy specifics. So be it. It is better to take some time than rush and bungle, and the sudden banning of new oil and gas exploration was questionable.

Ms Ardern has bitten her tongue on the blockages thrown down by New Zealand First, the likes of the threestrike law, the refugee quota and industrial relations law. Crafty Winston Peters knows, as a junior coalition partner, his party must stay prominent and make its mark.

Nevertheless, New Zealand First could prove to be a key reason for electorate support for Labour. He is, effectively, pulling the Government back towards the middle. That brake on some of Labour’s liberal and leftish policies is comforting to many voters.

Mr Peters, himself, handled his weeks in charge during Ms Ardern’s maternity leave with skill and aplomb. Although he remains a populist focused on what will win support rather than on discernable longterm prin ciples, he rose to the occasion. His charm and humour takes him a long way.

The Government and capable Finance Minister Grant Robertson were fortunate to inherit a strong and strengthening fiscal position, even if this has raised state servant pay expectations further. Too much largesse with taxpayers’ money will soon dent any surplus, and longterm structural cost increases have been, and will be, embedded for years to come. If growth falls so will expected tax revenues, and the squeeze will come on.

Already, the rise in the cost of living is accelerating, notably because of petrol prices. As the effect of higher minimum wages and other costs flow through, pressure will go on the likes of takeaway prices. Retail and hospitality will also be pinched.

Population increases and the high cost of building are amplifying housing shortages. If Labour can really make a go of KiwiBuild — and it does not just divert building resources — that could be a real marker of success. If housing supply can be increased enough to prevent the relentless increase in house prices and in rents, that will be something on which Labour proudly can build its brand.

Labour must still be smiling about the decision just before last year’s election to gamble with a new leader in Ms Ardern. She has proved to be intelligent and personable. She is to Labour what John Key was to National, the captain who wins over a sizeable number of swing voters. The ‘‘stardust’’ epithet has lost much of its power.

National’s JamiLee Ross’ own goal certainly has come at a useful time, and National looks increasingly isolated without a support partner. Last week’s opinion poll even showed Labour and the Greens could govern together, without NZ First.

But, when all is said and done, the Government will flourish or flounder on economic conditions. If the lack of business confidence is reflected in employment and growth, if changed industrial laws affect competitiveness, if New Zealand becomes too expensive and less efficient as it is in danger of becoming then Labour will suffer.

Just as the strong United States economy has helped add a layer to President Donald Trump’s support, so Labour’s success will depend on the economy and ongoing effects of Labour’s policies on people’s monetary wellbeing. So far so good. Labour and its coalition have navigated the first year satisfactorily.