Poll serves government an unwelcome entrée to the Budget

Winston Peters might not give a 'rat’s derriere' about last night’s poll, but it revealed the unusual absence of a honeymoon period and little payoff for the government's action plan approach

Mōrena, and welcome to The Bulletin for Tuesday, April 30.

In today’s edition: Pharmac funding boost won’t stretch to new medicines; disability support system not fit for purpose; James Shaw recalls his most horrible moment and greatest privilege; but first, a new poll presents an unusual result for a first term government

Poll: Labour, the Greens and Te Pāti Māori could govern

Last night’s 1NewsVerian poll showed Labour could return to power if an election were held now. Support for National and Act has fallen, while NZ First has dropped below the 5% threshold. Labour is back up to 30% for the first time in nine months, and the Greens are on 14%. Te Pāti Māori is holding steady at 4%. They also hold six electorate seats, a position that would be pretty consequential at the next election should support for NZ First remain where it is (defying Peters’ comeback king form), and the party’s streak of not winning any electorate seat continues. The poll would give Labour, the Greens and Te Pāti Māori 64 seats, while NZ First would be out. National and Act would have a total of 57 seats.

Peters right about rat’s bum, but result will still baffle government

As the Herald’s Claire Trevett notes (paywalled), an election is a long way off, and Winston Peters is probably right to say he couldn’t give a “rat’s derriere” about the poll. Trevett suggests the result will be a bit baffling for prime minister Christopher Luxon. As Trevett writes, “all those 100-day plans and three-month action plans appear to have got him precisely nowhere in the polls.” While Luxon received plaudits for his swift dispatch of underperforming ministers Melissa Lee and Penny Simmonds, RNZ’s Jo Moir notes he would have had trouble dealing with this so cleanly if it was an Act or New Zealand First minister at fault. Act leader David Seymour said yesterday morning that the prime minister “unilaterally” sacking an Act minister would breach the coalition agreement between the two parties, confirming that managing coalition government remains a delicate art. 

Winter and economic gloom to blame — Seymour

Seymour pointed to the gloomy economic conditions and winter as the reason the government hadn’t done better. He might be somewhat right about that. While the rate of cost of living increases is slowing, yesterday’s household living-costs price index figures from Stats NZ show the cost of living still rose by 6.2% in the 12 months to the March 2024 quarter. Brad Olsen from Infometrics told RNZ’s Morning Report,  that inflation is not falling as quickly as economists expected and suggested interest rate cuts may not arrive until 2025. The average cost of a litre of 91 has risen by 26c this year. Public transport subsidies for many come to an end today.  Seymour will be hoping that any allusions to the winter of our discontent are read in the full context of the Richard III soliloquy and that sunnier days will be upon us and the government soon.  While Seymour said he was happy with Act’s poll result, given where the party has come from, 7% falls a bit short of the ambitious 20% he was talking about in June last year.

Unusual result for first term government

Gloomy winter aside, the poll results also suggest the government that if the government got any kind of post-election honeymoon phase, it’s now over. That’s a bit unusual. Previous governments have only experienced this kind of result in the months following an election in their third term. If you cast back to another comparably gloomy economic time in the wake of the Global Financial Crisis, National was still riding high after its 2008 election win, on 57% in an April 2009 poll. More recent history suggests something of an incumbency curse may be at play. As Henry Cooke writes, the “last few years have been a terrible time for serving governments the world over”, and Luxon may have caught “something of the incumbency curse himself.” With a month to Budget day, there’s plenty of expectation about what it will deliver for New Zealanders, and now a bit more pressure on its role in turning sentiment towards the government around. At the same time, as this interview with The Post’s Luke Malpass yesterday demonstrates, finance minister Nicola Willis is also clearly managing expectations about how much can be done and how long recovery might take.

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Pharmac funding boost won’t stretch to new medicines

Associate health minister David Seymour announced yesterday that the government will boost Pharmac’s budget by more than $1.7b over the next four years, increasing the entity’s overall budget to almost $6.3b. As RNZ’s Ruth Hill reports, Pharmac chief executive Sarah Fitt said the boost would give it “certainty” over its funding but it would not stretch to new medicines. Seymour wasn’t able to confirm whether the Budget would include more money for medicines, including the new cancer treatments the coalition had committed to funding. Seymour said the government had “inherited a fiscal cliff where we have to save the furniture. This is real. Pharmac would have been basically choosing not which new things to fund, but which things people were currently getting that they would have to take away.” After a bit of prodding yesterday, prime minister Christopher Luxon confirmed all programmes in the Budget would be fully funded for four years.

Disability support system not fit for purpose

There is more news from the health sector, with the Herald’s Issac Davison reporting that a confidential briefing shows that Whaikaha, the Ministry of Disabled People, was not equipped to manage the huge financial risks taken during its hurried establishment. A briefing to the former finance minister Grant Robertson showed that officials flagged a number of problems. The Department of Prime Minister and Cabinet described multiple operational systems and functions as “not fit for purpose.” Davidson also reports that the government is expected to confirm a review of the ministry today, just two years after it was set up as part of the previous government’s health reforms.

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