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March 13, 2017 | by  | in Politics |
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Political Round-Up

Jacinda Ardern

No sooner had Labour’s Andrew Little finished hosing down talk of a deputy-leadership challenge than he was standing next to Jacinda Ardern, emphatically backing her to take the post.

Whether Annette King jumped or was pushed will long be a matter for speculation, but the result is the same. With no challengers and the backing of both Little and King, Ardern easily won the caucus vote and stepped up to the job.

For Labour, it’s hard to see this as anything but a positive. Ardern has the kind of name recognition most politicians dream of. She also has solid bases in Auckland and among young voters, both areas that Labour was found sorely lacking in at the last election.

Though Little’s about-face was a surprise, it was even more astounding to see such a clean change in Labour’s top ranks. The divisions within the party have been on display for the last few months, but King’s decision to step aside gracefully gives Labour a much needed fresh start to the 2017 campaign.

Outside of Labour, the political response has been revealingly quiet. Many bid a fond farewell to King, but few offered much in the way of a response to Ardern. Prime Minister Bill English labeled her “untested”, but in doing so managed to sum up her appeal to many voters.

Many commentators have speculated that Labour would be even better off with Ardern at the top of the ticket. The suggestion is that as Ardern’s profile continues to grow it will inevitably create friction between her and Little, leading to another fraught leadership contest.

Given Ardern’s rapid rise to the deputy-leadership, that is certainly a possibility. But for now, Little seems happy to bask in some much needed reflected glow.

 

Superannuation

As this past week has demonstrated, few things get New Zealanders as unanimously riled up as changes to superannuation. For older voters, the fear of having their hard won pensions stripped away is very real. Meanwhile, for younger voters, the suggestion of having to shoulder more of an already huge burden is equally as abhorrent.

As a result, the topic has slowly simmered under the surface for the past three terms, carefully buried under John Key’s pledge to resign rather than make any changes. In the meantime, however, a lot has changed.

New Zealand’s population is ageing, fast. The number of people aged 65 and over has doubled since 1980, and looks likely to double again by 2036. These population bubbles are going to be expensive, and while the New Zealand super fund is performing well, it simply can’t keep up with that rate of change. Something has to give.

So it was that after a morning of vague hints to media, Bill English made the announcement that he would raise the entitlement age to 67 if re-elected. Acknowledging the difficulty of swallowing that pill, the policy puts off changes from beginning until 2037.

The announcement was met with almost unanimous criticism from other parties, with even faithful cohorts like United Future and ACT wanting no part in this hottest of hot potatoes.

Labour restated its relatively new policy of maintaining the current age of eligibility, a lesson hard learned from previous unpopular calls for change.

The Māori Party called for a reduction in the age for Māori and Pasifika peoples who, as a result of lower life expectancies, shoulder a larger part of the burden with less of the benefit.

Naturally, the announcement was a boon for Winston Peters, who had long called bluff on Key’s promise. Peters took the opportunity to question the evidence of the current programme’s unaffordability while also blaming said unaffordability on National’s decision to cut government payments to the fund.

Economists have long been warning of the growing gap between New Zealand’s fund and the cost of a universal weekly income for the elderly. Just last year, Retirement Commissioner Diane Maxwell called on the government to raise the age of eligibility to 67 over the next ten years. While that makes fiscal sense, it looked unlikely to make any dent in policy under Key’s leadership.

But unlike Key, English does care that things make economic sense. His policy announcement came with the quite reasonable explanation that this was simply a change that had to happen, that ignoring the problem would simply leave an even heavier burden for the next generation.

On that he may well be correct, but the collective anxiety with which the announcement has been met shows that superannuation’s political cost could be even higher.

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