Bainimarama and Ardern Heading in Opposite Directions in Political Fortunes
What’s happening in New Zealand, and to a lesser extent in Australia, should help give us a better perspective of the impact of rising cost of goods and services.
In New Zealand, its Prime Minister Jacinda Ardern and her Labour Government continue to slump in the public opinion poll as they cop a backlash over a 30-year-high in the cost of living.
In a new polling by Newshub-Reid Research Labour’s popularity dropped by 6.1 points to 38.2 per cent while Ms Ardern’s rating fell by 7 per cent to 36.3 per cent. This was her lowest result in the Reid poll since her rise to power in 2017.
The Opposition National Party lifted its rating by 9.2 per cent to 40.5 per cent. Its new leader Christopher Luxon jumped by 6.1 per cent to 23.9 per cent in the Preferred Prime Minister Stakes.
The result mirrored what happened in Fiji in the second half of last year. The borders were closed, unemployment was high and the cost of living was climbing at the height of the COVID-19 pandemic. Many people were frustrated, blamed the Government and vented their disillusionment through the Fiji Sun-Western Force Research monthly public opinion poll.
Sitiveni Rabuka and his newly registered The People’s Alliance party entered the political scene and capitalised on the growing anti-Government sentiments.
They immediately displaced Prime Minister Voreqe Bainimarama and his FijiFirst Government from the top position.
They held onto the lead for several months, even going into February this year. But the reopening of both the local and international borders and lifting of restrictions last December was the game changer.
It took three months to kick in. It brought back tourists, revitalised tourism, revived businesses, and returned thousands of workers back to work.
No amount of attacks on the Government would turn the tide of relief and jubilation just for the freedom to move around and reunite with loved ones. The bonus was the jobs. From his lowest polling since 2014, scoring 23.4 per cent in February, Mr Bainimarama and FijiFirst bounced back in March with 36 per cent.
In the April poll they recorded a small increase of 36.3 per cent to retain the lead.
But Mr Rabuka and The PA suffered a dramatic drop from 39.1 per cent in February to 34.8 per cent in March, to 20.2 per cent in April.
The border reopening sparking economic recovery and the hard work by Mr Bainimarama and his team to correct the misinformation about his Government had contributed to his fight back success. But the battle is far from over.
The next issue is the cost of living. Minister for Economy and Attorney-General Aiyaz Sayed-Khaiyum addressed this in the recent Revised Budget.
Among several concessions, he removed the Value Added Tax (VAT) from 21 essential items and raised the National Minimum Wage from $2.68 an hour to $4 an hour.
Don’t be surprised if there would be more concessions in next month’s National Budget for the 2022-2023 financial year. No doubt Mr Sayed-Khaiyum has been watching events unfolding in New Zealand and Australia and learning from their experience.
Difference between PM and Jacinda Arden
Both Mr Bainimarama and Ms Ardern have turned from the COVID-19 response to face the growing challenges of inflation and the cost of living.
The only difference is that politically, Mr Bainimarama has regained lost ground, but Ms Ardern continues to lose ground.
“These results reflect what has been a really hard time,” Ms Ardern told Newshub.
She saw this coming as 2022 has posed a deluge of disaster: the COVID-19 Omicron outbreak, the cost of living crisis and the war in Ukraine are taking their toll on her.
“It has been a really difficult period for New Zealand and then of course, by default, that makes it a difficult period to govern through,” Ms Ardern said.
“There will be from time to time tough decisions that need to be made and if that means that we take a bit of a hit in the numbers, so long as we stand by all of the decisions we’ve made - and we do - then that’s a price we’re willing to pay.”
Like other countries, both the Fiji and New Zealand economies are being affected by the flow-on effects of the war in Ukraine despite the tax relief.
The war has exacerbated the economic impact of the COVID-19 pandemic and climate change.
In Australia
In Australia, interest rates rose for the first time in 11 years. While New Zealand’s inflation level is up to 6.9 per cent, Australia is at 5.1 per cent.
Australian Prime Minister Scott Morrison has told the media that while Australians are also feeling rising costs they are lucky they aren’t living in neighbouring countries like New Zealand.
“What we have avoided in Australia is what is happening in those countries. And Australia’s economic policy shield that has seen our economy through these last two years is also what it is setting us up as we set out in the Budget for the decade ahead.
“Now, when you look around the world, there are few places that people would rather be than right here in Australia. And the reason for that is, is the way we’ve steered this country through one of our most difficult times.”
Australia, like Fiji, realised that it could not continue to close its border and impose lockdowns. New Zealand, on the other hand, has been slow on the uptake. And even now, the New Zealand border is only open to Australians and Kiwi citizens and permanent residents who live abroad.
Fijians can only travel to New Zealand purely on compassionate grounds like for medical purpose.
The policy has upset industries that rely on tourists and overseas workers for their production. It has contributed to Ms Ardern’s drop in popularity.
But in Mr Bainimarama’s case, he is heading in the opposite direction.