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.