John Armstrong: Labour is fast becoming a political cot-case

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Will Steven Joyce's first Budget do the trick and secure victory for National in September's election?

Unsurprisingly, that question has lingered in the aftermath of last Thursday's delivery of what must be one of the favourites for the world title of Mother of All Election Year Budgets.

The Labour leader told the party's election year congress speculators can avoid paying tax at the moment.

Source: 1 NEWS

To claim any direct correlation between the contents of a Budget and the outcome of an election is dubious in the extreme, however, no matter how many sweeteners have been loaded upon the former.

The most that can be said this far out from Election Day is that this year's edition makes it more unlikely that National will lose office.

In Labour's case, that document swiftly turned out to be yet another hurdle tripping up the hapless party.

To put it bluntly, the major Opposition party is in such a parlous condition that the Budget may turn out to be an irrelevance.

Source: 1 NEWS

Labour is fast becoming a political cot-case. Labour's priority at this election may well be ensuring the party emerges from the coming scrap still the major Opposition party.

To put it simply, Steven Joyce has boxed Labour into a corner"
1 NEWS Now Columnist John Armstrong

The Budget has simply served as another stage for a yet another episode of Labour's continuing Comedy of Errors.

The decision made by the Greens and New Zealand First to vote in favour of the legislation enacting the Budget's centrepiece $2 billion package of tax cuts, increases in Working for Families entitlements and major boosts in the accommodation supplement left Labour in not so splendid isolation.

It was all somewhat bizarre. Labour's intended allies pulled the rug from under Labour's criticism of a policy package which would slot comfortably into Labour's manifesto.

Joyce's Budget has been described as "Labour-lite". It would be more aptly termed as "Labour Extra Strong Special Brew".

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Sure, Joyce has enjoyed the luxury of being able to play with ever larger pots of gold in the form of expanding Budget surpluses which stretch from now until the forecasting horizon.

He has exploited that advantage of incumbency to the absolute maximum.

The scale of the tax cuts and top-ups in National's families package has reinforced National's already firm grip on the hundreds of thousands of middle-income voters who effectively determine the outcome of an election.

The enhanced payments will not start flowing into those voters' bank accounts until next April. That provides further hard-to-ignore incentive to vote National to ensure that they do so given Labour's opposition to the tax cut component of the package.

Even were Labour to win the election, the party might find it difficult to secure the numbers in the next Parliament to reverse National's tax cut.

It is even harder, however, to campaign on reinstating current tax thresholds. Throw Andrew Little's assurance made back in March that Labour will not raise taxes into the mix and you have a recipe for utter confusion.

To put it simply, Joyce has boxed Labour into a corner. Proof of Labour's muddle caused by the drastic narrowing of that party's revenue-raising options was the declining of an invitation to appear on Newshub's Saturday morning politics programme The Nation. When was the last time any Opposition party opted not to front on television following a Budget.

The answer is never.

Labour MP Grant Robertson.

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Labour came to its senses in time for Grant Robertson, the party's finance spokesman, to appear on TVNZ's Q&A programme on Sunday.

Robertson professed to be unconcerned by the contrasting responses of his party and the Greens to the key contents of the Budget.

In fermenting doubts about the strength and sustainability of the memorandum of understanding between Labour and the Greens on a matter as fundamental as tax policy, the divergence of opinion was a free gift to National in its attempts to convince voters that a centre-left coalition government would be inherently unstable.

Labour has since tried to recover lost ground by finding anomalies in the entitlements set out in Joyce's revision of Working for Families.

Lower and middle income earners will also get tax cut and more than 3 million families will get $26 extra per week.
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Joyce certainly did not help his cause by claiming the coming election had not influenced what was in the Budget.

Not even National's master of spin could get away with that.

The minor brouhaha took some of the gloss off what has otherwise been a triumph for the country's new(ish) Minister of Finance.

Deserving of special note was Joyce's attempt to allay the public's deepening anxiety with the widening inequalities in New Zealand society.

Labour argues the money set aside for tax cuts - the lion's share of the package - would be better devoted to addressing the social deficit created by National's underfunding of government services.

Joyce countered by stressing his package will lift 20,000 people out of what the OECD defined as "severe housing stress". With a further 100,000 people falling short of this mark, however, Joyce wisely accepted the Budget was only a start.

Joyce's other tactic to sideline Labour involves ensuring the coming election will be fought on National's terms - namely economic competence.

His Budget speech mentioned the words "economy" and "growing" or variants thereof more than 20 times. The message was unequivocal. If you want more tax cuts or more spending on public services, the country needs continuing and healthy levels of economic growth to produce the Budget surpluses required to fund such things. And only National can be trusted to deliver such growth.

“I think actually people are entitled every now and then to see a dividend from the government,” the Finance Minister said.
Source: 1 NEWS

Given last week's debacle, Labour may have missed seeing the one thing which was missing from the Budget.

While there was a pre-Budget announcement outlining National's target for the building of new homes, there was nothing on the big day addressing how to make it easier for first-home buyers to scrape together enough cash to secure a mortgage to enable them to purchase one of them.

It is a fair bet that National is frantically concocting some scheme to fill what is a glaring hole in the party's election strategy.

Whatever it comes up with will likely be kept on hold ready to be unveiled when English kicks off National's formal election campaign four weeks or so prior to polling day.

Make no mistake. There will be something to make a big splash. National will have no qualms about pinching something which resides far more comfortably on Labour's side of the political spectrum as long as it can be made to work to the ruling party's advantage.

National's ideological plagiarism increasingly knows no bounds. And for one very straightforward reason.

Joyce doubles as National's election campaign manager. Should National lose office in September, neither English nor Joyce intend going to their graves wondering what else they could conceivably have done to avoid defeat.

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