Where National lost control of the budget spin

Written By: - Date published: 7:04 am, May 24th, 2012 - 18 comments
Categories: budget2012, spin - Tags:

This year’s budget has been quite unlike any others. Coming off a nightmare few months for the government of Nick Smith, asset sales hikois, SkyCity scandals, rising unemployment, John Banks etc etc their pre-budget announcements were greeted with anger at what they’re cutting, not approval of where the money’s been re-directed. National picked the wrong targets.

In it’s first term, before its political instincts deserted it, National targeted large cuts at a relatively small number of people on society’s margins.

The cuts to the Tertiary Incentive Allowance are case in point. It was devastating to solo mums trying to get a qualification and get a better chance at life for themselves and their children, but it affected relatively few people and the bulk of people displayed no sympathy for them.

Even something like cuts to ECE funding directly affects a relatively small number (about 160,000) families at a time.

Contrast that with increasing prescription charges, increasing class sizes, upping student loan repayments. Now, they’re targeting really big sectors of the population – half a million families with school age kids, 600,000 people with student loans, millions who get prescriptions every year.

And think about who is hit by all 3 of those – young couple, middle New Zealand, in their early 30s with a kid or two and still paying off their student loans – that’s the very constituency National has won so effectively in the past.

It’s all very well for John Armstrong to spin that the outcry over these cuts has been muted but, outside the beltway, the reaction is very different. Everyone is talking about the higher prescription charges. It’s a classic hip-pocket issue because it’s very real to a family every time they get medicine. The total added costs might be relatively small compared to, say, Working for Families or the GST hike but this is a lot more direct, a lot more visceral. And it’ll be an irritant every time those 20 million or so prescriptions per year get filled.

On the other side, the Opposition has run a far more aggressive strategy this Budget. The Greens’ BERL report, and Labour’s website and speeches from Shearer and Parker, and columns by Parker and Norman have pre-framed this Budget in a way that didn’t happen before. National seemed caught out by the way the Greens and Labour front-footed their attack, perhaps complacent after the past three years. There has been little response from National to the Opposition salvos, and the ‘zero budget, zero growth, zero vision’ meme has taken off (David Cunliffe, for example, was devastating using that rhetoric on Backbenches last night).

In part, the Opposition’s aggressiveness is allowed by the fact that we know what is in this Budget – more user pays, no dramatic new investments, closing a few tax loopholes, over-optimistic growth assumptions, and a track to surplus in 2014/15.

And those pesky facts have made the going harder for National too. The unexpected jump in unemployment, the pathetic growth figures, the record emigration to Australia all point to a government that’s doing a shitty job running the economy. Their ‘it’s all someone else’s fault’ spin is now being answered with ‘well, if you can’t do anything about it, what’s the point of having you in charge?’

Does National have any rabbits to pull out of the hat today? It would be surprising if they don’t have something up their sleeve, they’re not so stupid as to give the media no new news hooks and leave a void to be filled by the Opposition. But it’s hard to see how it could be on the scale of the surprise drop in the 21% tax rate to 17.5% in 2010. Vernon Small speculates they might forecast a small surplus in 2013/14 but that would actually just open up more criticism of the stupid, otherwordly rosiness of their forecasts. A workman-like budget will leave much more media space for critique than a budget full of big changes.

Poor political choices, lazy spin management, a succession of statistics highlighting National’s poor management of the economy, a much more active Opposition, and, let’s not forget, a much less friendly media ever since the teapot tapes have combined to make this the first budget that has hurt National, rather than bolstered it.

18 comments on “Where National lost control of the budget spin ”

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  1. Tom Gould 1
    24 May 2012 at 8:09 am

    The craven media have again demonstrated their ability to give their Tory masters clear air for their big day. Watch the TV tonight, it will be like an unpaid party political broadcast for the Tories. The chooks still love their Johnny, even if he did have to scold them. They know it was for the best.

  2. ad 2
    24 May 2012 at 8:21 am

    Good writing. This budget will be an exceedingly fine one between ausetrity and all those global resonances of that word and public sector debt. Perhaps Hollande will today start to tilt against austerity and in doing so change the global language away from cut and kill, and so in turn change our own language.

    Truly looking forward to national dropping 3% nio the next poll as a result of these measures. Any bets people on the degree of drop?

    Very helpful too for the progressive end of the country that Len Brown defeated the right last night to get a reasonably expansive budget passed, without selling assets other than tradeable land, and of course pushing enough stimulus in transport and the waterfront to get Auckland – New Zealand’s only population and economic growth region – primed again.

    Always made me wonder what it would look like if the Mayors of Auckland and Christchurch did pre-Government Budget conferences and really asked for what they wanted.

    I loved the Greens’ set piece. Did anyone go to that University of Aukcland “alternative budget” evening? I so wanted to go. First Party to sponsor that event gets a free media framing.

    • Carol 2.1
      24 May 2012 at 9:00 am

      The news about last night’s decisions by Auckland Council are not to be found now on the main pages of Stuff or NZ Herald online – they’ve been hustled away from the view of the majority of the public. And the lead paragraph is a criticism of it by Christine Fletcher on NZH:

      http://www.nzherald.co.nz/politics/news/article.cfm?c_id=280&objectid=10808028

      This budget is just taking the public too far and too fast Christine Fletcher

      Auckland Mayor Len Brown has triumphed over his “naysayers” to deliver a $58 billion budget for the Super City over the next 10 years.

      After a nine-hour marathon meeting yesterday, Mr Brown yesterday won approval to proceed with the $2.86 billion city rail loop and fix the overall rates increase at 3.6 per cent from July.

      An alternative, cost-cutting budget put forward by eight right-leaning councillors for a 2.6 per cent rates increase was defeated by 15 votes to eight at the strategy and finance committee.

      Stuff Auckland has 2 articles, headlining rates rises and free swimming pools for children (with a photo of a grumpy looking Len Brown):

      http://www.stuff.co.nz/auckland/local-news/6973364/Free-pool-access-for-under-16s

      http://www.stuff.co.nz/auckland/local-news/6976148/Auckland-rates-to-rise

      TV3 and TVNZ have headlined the rates increases.

      • Robert Glennie 2.1.1
        24 May 2012 at 11:45 am

        Given the probability of at least one severe thunderstorm inducing flash flooding in Auckland this coming summer is pretty high, Len’s budget has its priorities wrong. Now that its known Auckland has hundreds of kilometres of storm water drains that are not fit for purpose, someone – i.e. Auckland Council – has to take ownership of the problem and say: “I’ll fix it”.

        • tc 2.1.1.1
          24 May 2012 at 12:02 pm

          ‘its known Auckland has hundreds of kilometres of storm water drains that are not fit for purpose… ‘ has been known for years, apparently up to a $4 Billion job to rectify.

          Who would be responsible for the state of akl’s drainage, isn’t it Watercare who under Mark Ford’s stewardship have done nothing except let it deteriorate even more whilst paying dividends to council rather than re-investing on the network.

          The north shore is expecially screwed with over devlopment and is known as the inverted concrete bowl and we all know what happens when you pour water on one of those.

    • yeshe 2.2
      24 May 2012 at 10:35 am

      5% or more is my wishing bet ….

  3. Kotahi Tane Huna 3
    24 May 2012 at 8:47 am

    “doing a shitty job running the economy.”

    You spelt ruining wrong 😉

    • James N 3.1
      24 May 2012 at 9:09 am

      Quite the contrary, they’re doing an excellent job of ruining the economy.

  4. The Baron 4
    24 May 2012 at 9:09 am

    Eddie uses her crystal ball to predict coverage in tomorrow’s papers of a budget that hasn’t even been read yet.

    Lets just wait and see how much this budget hurts huh – you could well be right, but right now, this is just another episode of wishful thinking from another fanboi.

  5. Hilary 5
    24 May 2012 at 9:27 am

    Governments lose because they become arrogant and out of touch. In the DomPost today there is a list of the vast property portfolios of many of the National Party MPs (other parties only have one MP each on the list). This shows that the Party is unlikely ever to support a redistributive capital gains tax. However, it also shows that they can never understand the daily financial struggles and resulting stress of an increasing number of NZ individuals and families, when every unexpected bill can be a crisis.

    • Carol 5.1
      24 May 2012 at 10:56 am

      Yes, it’s being out of touch, but also the intersection of various factors.

      NAct was strongly focused on the spin generally in their first term, and that was JK’s main role. Now the gloves are off so they are trying to reap the benefits of the accumulated spin in terms of radical neoliberal policy. This stretches the veneer of spin to its limits, and the mask is slipping, revealing more of the sneering JK’s underlying face.

      At the same time we have the neoliberal-instigated, western system of finance and economic structure unravelling.

      Out of touch NAct is being revealed? So they attempt more spin.

      They have put all the blame on their failure to deliver any progress for the majority of Kiwis, as being due to the GFC and Christchurch quake. The opposition have called them on this. National’s response, as seen in the House yesterday, was to hide even further behind their out of touch bubble – they repeatedly claimed that on “Planet Labour” no GFC or Christchurch quake happened. This is a gross distortion of the opposition arguments. They haven’t denied they happened and have had an impact, just argued that NAct can’t blame everything on those two events.

      Rob Salmond dissects the NAct stance on these two events well:

      http://www.pundit.co.nz/content/gdp-growth-further-nonsense-from-government-ministers

      The government makes plenty of excuses for New Zealand’s poor recent GDP growth. Unfortunately for its excuses, data exist.

      National’s economic team has made an artform of making excuses. They are earnest and self-confident and mocking of those who dare disagree. But the economic ground they stand on is made of quicksand. Eventually, their excuses will swallow them as New Zealanders come to realize they are being conned.

      The two most often cited excuses from National for New Zealand’s woeful economic performance – average growth of only 0.5% per year since taking office – are the Global Financial Crisis and the Christchurch earthquakes. Let’s take them in turn.
      […]
      National Ministers obviously expect to be able to keep up this charade for the next two-and-a-half years. I think they are mistaken. New Zealanders are not so stupid as National appears to believe.

  6. CrosbyTextor 6
    24 May 2012 at 10:08 am

    CONFIDENTIAL

    Memo

    TO: John Key, Bill English

    FROM: HQ

    SUBJECT: New Zealand Government Budget

    Changes as discussed at last meeting in Korea have now been approved by network partners and incorporated into text. You may release the Budget as planned.

    Lynton.

    • tc 6.1
      24 May 2012 at 12:06 pm

      email from JKEY to CT:

      ackshully Bell relashes it, I just shit and grin inannely till it’s time to jump up, read those lines about ‘sea change, tough economic global conditions etc’ shake his hands and buga off for a well earned wine or 3.

      Cheers
      JK
      PS: can I mention diminic environment again or is that still banned by you?

      • McFlock 6.1.1
        24 May 2012 at 2:31 pm

        To: JK
        From: JB

        Can you tell me where my office is? I’ve forgotten. By the way, this really cool guy in a nice suit just, like, gave me this money because he liked me. I told him to write it out in $25k cheques so that when I banked them I wouldn’t know who they came from – smart, right? Can’t say I haven’t learnt my lesson – I’ll be sure to bank the cheques myself so I can be sure I don’t know how they got in my account.

        Anyway, gtg – I’m going on a mystery trip this afternoon. It’s a surprise, and I won’t know where I’m going, who I’m seeing or how I got there – even after the trip. It’s the latest thing, you should try it.

        You’re so lucky to have a coalition partner like me to support your nuttiest policies, what would you do without me?

        John.
        PS: Hey, did you notice we’ve got the same first name? Ha! That’s soooo funny!

      • Hami Shearlie 6.1.2
        24 May 2012 at 2:36 pm

        P.P.S – And then I’ll do my impression of a whirling dervish – useful to practice that for all the “spinning” I ‘ll have to do in the days ahead! And to top it all off, guess what? – I’m still “ass-pirational” too!

  7. Dr Terry 7
    24 May 2012 at 2:36 pm

    Where National has for long offered the Christchurch situation as an excuse for just about everything, now the tune is changing and they are crowing that the Christchurch rebuild will save us!! I hope Christchurch residents are enjoying the manner in which this government has been, and still is, using them.
    Whatever the budget outcome, we must prepare ourselves through patience and long-suffering, to await any really beneficial changes for the better in our country. Just hang in there, never despair. One day Key (and Christine Fletcher) will simply become bad memories.

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