Labour needs sense of urgency

TRACY WATKINS
Last updated 05:00 03/04/2014

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OPINION: It speaks volumes about David Cunliffe's bad week that on the day John Key delivered his pre-Budget speech, it was the Labour leader who copped it on the street over the Government's failure to make a big dent in unemployment.

Key's speech to a much friendlier audience across town in Aucland was less of a pre-Budget missive than a stump speech aimed at setting the parameters for the election campaign around National's well-rehearsed narrative that any spending promises by Labour would herald out-of-control debt and spiralling interest rates.

This sparked the usual war of words between Labour and National over who would leave behind the worst economic legacy. But Labour's headache, six years on, is that National has been hugely effective at painting the Clark-Cullen years as a decade of tax and spend, compared with its own narrative of scrimping and fiscal prudence.

The reality, of course, is not quite as straightforward - despite the "zero" Budgets, government spending has continued to rise each year under National. But there is no dispute that when it came to power, the country was staring down the barrel at a decade of deficits and skyrocketing debt.

The May Budget will show that National has done a remarkable job of turning that around by bringing forward the return to surplus by some years and lowering the debt trajectory.

That it has done so by reining in spending, rather than slashing and burning and introducing austerity measures as seen in Europe and elsewhere, makes that feat even more remarkable. Even those programmes to which National is ideologically opposed, such as KiwiSaver, interest-free student loans and Working for Families, have been tweaked, rather than savaged.

But the counterfactual - that a Labour government would not have responded to the global financial crisis in a similar fashion - can never be proven or disproven.

National has even succeeded in framing the debate around policies such as raising the pension age or a capital gains tax.

Raising the pension age has turned into a story about making hard-working Kiwis work longer so a Labour government can spend more of their hard-earned taxes, according to National's narrative.

Meanwhile, a capital gains tax is another piece of tax-and-spend accounting.

Labour's economic counter so far under Cunliffe has been low-key and delivered largely from the regions. A promised rolling maul of economic policies is in the wind.

The latest round of bad polls this week should give Labour a sense of urgency about rolling them out sooner rather than later.

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- The Dominion Post

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