Two days into the new Government and National already has three bush fires that threaten to extinguish any good will that a new Government can normally expect to have following an election win.
The first is its extraordinary decision to consider the roll back of smoke free reforms. There will be some money earned through tobacco excise tax increases but greater levels of cancer and in the medium to long term increased pressure on the health system.
As said by Bernard Hickey:
The newly sworn-in Cabinet will today consider how to quickly unwind anti-smoking changes legislated at the end of last year in order to save hundreds of millions of dollars a year in tobacco taxes so it can go ahead with its income tax cuts.
But the cost to the taxpayers and citizens in purely financial terms, let alone the estimated loss of 580,000 Health Adjusted Life Years (HALYs), is set to surpass $10 billion. For every dollar in tax cuts delivered to landlords and salary earners by pushing tobacco taxes back up, Treasury has estimated health and lost productivity costs of up to 20 dollars.
The second is news that low income families will be hit by a decision to abandoning the promised Working for Families abatement adjustment. The original promise by National was to increase the abatement level from $42,000 to $50,000 meaning that those within that bracket would receive more. But this has been reversed.
As pointed out by Susan St John at the Daily Blog:
There were two promises in National’s original plan for Working for Families: an extra $25 a week from the In Work Tax Credit (IWTC) from 1 April at an annual cost of $190m; and a lift in the abatement threshold from $42,700 to $50,000 though not until 2026 with an eventual annual cost of $250m.
But their promise of a lift in the threshold was far too little, far too late. It is absolutely critical that the massive disincentives to earn more faced by low-income families are addressed immediately.
Instead, the visionless incoming Coalition government will save money to help pay for promised tax cuts by abandoning abatement threshold increase, saving $550m in total over 4 years to 2027/28. The $25 increase in IWTC remains from 1 July 2024.
An increase in lung cancer rates and a decrease in the amount that working families receive so that tax credits for landlords can be put in place tells you everything you need to know about the priorities of this Government. Your blood should be boiling by this stage and it is only two days in.
But it is the style of Government that should be causing the most concern.
Because Winston Peters is picking fights with the media in a style that has been perfected by Donald Trump. And his targets include organisations who I would class as normally tending to be very helpful for the right. Like Newshub:
These attacks on the poor and culture wars on Te Reo are going to become weary very quickly.
And Peters’ statements are gross distortions also known as lies and are being called out by none other than Jenna Lynch. Her anger in the clip above was palpable.
The Public Interest Journalism Fund was an urgent measure introduced during the Covid lockdowns to keep media going. And it succeeded. As for claims that it made media more sympathetic to the Government I am still waiting to see any evidence of this.
And the Government plans to give Wellington a Christmas present of mass redundancies of public servants.
This is no John Key style hog the centre and sell off a few power companies style National. It feels more like Ruth Richardson mixed with a helping of Donald Trump.
This is going to tax Christopher Luxon’s leadership skills. I get the feeling he will be found wanting.
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