Calls to spend won’t find traction with Govt on diet
WITHIN the first month of taking office, Finance Minister Grant Robertson and Prime Minister Jacinda Ardern have been adopted as the Not So Secret Santa by many.
Among them, astonishingly, is former prime minister Helen Clark, who has taken an early lead among those lobbying the Government.
After years of silence, partly because Clark was bound by her role as head of the UN Development Programme but also because there was a National government, Clark is now full of ideas for what Labour can spend money on.
First Clark decided it would be a good idea for Ardern to introduce free dental health care, at least for lowincome households.
She tweeted about this with some vigour and took care to tag Ardern and NZ First leader Winston Peters in.
Health Minister David Clark was left to reject Clark’s idea — pointing out that this Labour Government could not do it for the same reasons the last one did not: money.
Undaunted, Clark followed up with a tweet expressing horror at a junk food being marketed as a ‘‘lunch pack’’ and New Zealand’s obesity problem. ‘‘Public health action please!’’
There is an air of the Sermon from the Mount about these tweets from Clark, who clearly has some unfinished business she expects Ardern to pick up.
Admittedly, Ardern is a Clark protege and is being helped by Clark’s own staffers, Heather Simpson, Mike Munro and Gordon Jon Thompson.
She is also in Government with Clark’s own former coalition partner Winston Peters, so Clark could be forgiven for taking liberties.
But Clark was not alone.
For nine years there was a National government and now those who traditionally back Labour have some high expectations.
Perhaps the most brazen was the request from the Post Primary Teachers’ Association for an immediate 5% pay increase.
Budget processes be damned — they assured the Government this would solve the teachers’ shortage in time for the start of school next year.
When this was predictably knocked back, the union had the cheek to issue a press statement saying it showed the Government was not taking the issue seriously enough and ‘‘children are going to be the losers here’’.
These requests have tended to bring to mind the old saying ‘‘with friends like these, who needs enemies?’’
Labour is on a strict fiscal diet, having pledged to dine on only gruel with an occasional sultana tossed in to sweeten the mix.
It already has significant spending pledges to get on with and a limited pool of money to do it with.
Robertson knows blowing the Budget is not an option. He has staked too much of his own credibility — and the Labour Government’s — on being able to meet the fiscal commitments Labour signed up to during the election campaign.
He has since been acutely sensitive to any suggestion that he might fail to meet those commitments.
So if Labour does not meet its commitments to pay down debt and return ‘‘genuine’’ surpluses each year, Robertson will be held to account for it.
As well as Clark, the past month has seen the return of Sir Michael Cullen.
Cullen will head the Tax Working Group charged with coming up with recommendations for the tax system for Labour to consider — and campaign on next election.
That appointment was criticised by National as a ‘‘biased’’ appointment and an 18monthlong rubber stamp for a capital gains tax.
The second may well prove to be true, but Cullen’s job is effectively to come up with a Labour tax policy and there could be nobody better qualified to do this.
The sounder criticisms of the Tax Working Group’s work came from Act leader David Seymour and the Public Services Association — although for very different reasons.
The PSA argued Labour had restricted the working group’s ability to look at reforms that might have addressed the wealth gap by excluding income tax from the group’s remit.
Seymour argued it ruled out so many options it was effectively meaningless. It had ruled out the working group even glancing at the areas of inheritance tax, any tax on the family home or the land it was on or a GST increase.
While things such as water and pollution taxes can be considered, Labour has committed not to pursue a water tax at the behest of NZ First.
It is not a review of the ‘‘system’’ if those taxes cannot be considered.
Labour excluded them as a political necessity during the campaign to try to blunt National’s attack line that Labour would increase taxes.
Nor can it back away from that, having criticised National for reversing its pledge not to increase GST during the 2008 election — a pledge it promptly dropped after the Tax Working Group of 2010 recommended the ‘‘switch’’ of increasing GST to compensate for dropping income tax.
The result of all that political necessity means Labour has ruled out many measures to increase the tax take to help it meet all its commitments — and some of Clark’s wishlist.
Perversely, much of what the working group has left to look at may well amount to tax cuts — such as tax incentives for companies with good environmental practices, exemptions on GST for some goods (highly unlikely) and lower tax rates for small companies to help them establish.
Robertson’s ultimate goal is a
‘‘fairer’’ tax system.
That means a tax system in which people pay for what they own as well as for what they earn.
He spoke of workers who ‘‘look across the driveway at somebody selling their third or fourth rental property and not paying tax on the capital gain from that’’.
The capital gains tax has long been viewed by the left as the elixir for closing the wealth gap and most effective mechanism to tax the rich.
The group is also looking at the current tax on trusts — another bogeyman for the left.
There is another final echo from the old Clark government to bedevil the Ardern Government.
That is National’s cries of ‘‘nanny state’’.
The nanny state line has been rolled out twice so far. The first was when Labour opposed National’s amendment to allow a mother and father to take paid parental leave at the same time if they wish.
The second was reversing National’s changes to allow parents at some schools to enrol their children up to eight weeks before they turned 5 rather than wait for a new term.
The shock of losing has clearly seen selective amnesia set in for National.
It has forgotten it oversaw measures such as massive hikes in tobacco taxes, plain packaging, a lowering of the drinkdriving limit and lifting the driving age.
AHerald
The New Zealand