Assessing the Policies of the New Government

Can they change the old neo-liberalism? 

By Prue Hyman

Now comes the hard part

Well, we got the Labour/NZ First/Greens government I was, with some trepidation, hoping for, with a 63/57 majority perfectly viable to implement its policies.

Now comes the difficult process of major legislative and attitudinal change.

I think they’ve got off to a reasonable start, with both Jacinda Ardern and Winston Peters talking about the bad consequences of the neo-liberal economic policies of the last decades.

However, this is more rhetoric than reality: neither party has indicated any intention to make the major changes in fiscal, monetary and trade policies which would really challenge neo-liberalism.

Stopping foreign house buying a good move

Good to stop the foreign housing speculation

As Brian Easton has said, neoliberal assumptions “need to be replaced by something which is both closer to economic reality and more consistent with the human condition. If that does not happen, many will conclude in three years’ time that the new government is still a foe rather than a friend.”

But some small steps are better than nothing. Preventing non-residents or non-citizens apart from Australians from purchasing existing residential dwellings is one small step towards calming the housing market and reclaiming control over our own economy.

Hopefully, classifying existing housing as ‘sensitive’ under the Overseas Investment Act will indeed achieve this as well as being consistent with existing New Zealand trade deals (apart from Singapore).

Doing this fast is important to Labour to enable it to have that provision available before The Trans Pacific Partnership Agreement (TPPA), is approved by the remaining 11 countries.

Worries over TPPA

A big worry

The TPPA is regarded as vital by many businesses, and Labour has long wanted to be seen as a free trade oriented party. Refusing to sign would be anathema to the Labour leadership although they used stronger language against some of its provisions at earlier stages than they do now.

They are still rightly expressing concerns about the ISDS (investor-state dispute settlement) clauses in the proposed agreement, which confer greater rights on multi-national companies investing in New Zealand than a New Zealand company has.

These clauses would allow foreign investors the right to take our government to international arbitration, claiming compensation for any regulations they claim to have reduced the value of their investment. Jacinda Ahern talked of doing ‘our utmost to amend those provisions’ but stopped short of saying it was a bottom line.

TTPA would not be good for NZ

Pharmac is likely to be adversely affected by TTPA

But this is all that Labour now appears to be concerned about. Yes the TPPA’s aims include, for little return to NZ, the removal of our rules and restrictions in many areas.

These include the sale, manufacture and labelling of genetically modified organisms and foods, parallel importing, especially for music and computer programmes, intellectual property protection in the digital media and pharmaceuticals, tobacco marketing, changes to the Pharmac scheme which cuts prices for drugs, and voluntary local content quotas for broadcasting.

TPPA would still make it harder for the New Zealand government to look after our environment, promote health, protect workers and consumers, and promote the public interest. It may well work against the increased employment and decreased income inequality aims of government.

The supposed gains for agricultural producers are small compared to fluctuations in commodity prices and exchange rates.

Maori not considered in TTPA provisions

Maori not considered in TTPA?

Further, government would be forced to guarantee rights to foreign firms that they refuse to recognise even for Maori under the Treaty of Waitangi.

The mention of the Treaty in the TPPA agreement fails to give adequate protection, and there was little real attempt to engage with Maori before or during the TPPA negotiations.

The underlying economic model is based on trade liberalisation, monopoly rights to exploit intellectual property, and privileged rights for foreign investors, and will not serve a future Maori economic development agenda built around core Maori values, commitment to environmental sustainability, and tino rangatiratanga.

Whether Labour’s large Maori caucus is really happy with TPPA is an interesting question.

Positive announcements

Turning to more positive aspects of Labour’s announcements, I welcome the intention to scrap the three strikes law and National supposed pay equity legislation, which was actually intended to make it more difficult for women to claim equal pay for work of equal value.

There are some promising signs within education, with charter schools likely to be brought into the state system, abolition of national standards in favour of less standardized, more real feedback, and improved funding for tertiary students.

There are hopes of real improvements elsewhere, including higher pay for teachers (who have fallen far below relativities to other pay – including that of MPs) and even more so for lower paid teacher aides and other support staff.

The health sector too has many low paid groups – the aged care workers settlement has not dealt with all of these and there are reports that some employers cannot or will not fully honour this settlement, with hours or numbers of employees being cut.

Funding from government has to be adjusted where necessary to deal with these issues. But all this is expensive and ruling out tax increases in these three years has tied the government’s hands too much on the revenue side.

Need for action on climate change

Climate change: a big issue

What about the government responses to climate change? The UN Climate Change Conference in Bonn this month is the next step for governments to implement the Paris Climate Change Agreement and accelerate the transformation to sustainable, resilient and climate-safe development.

With it being chaired by Fiji, the Pacific will be prominent. A group called the Pacific Climate Warriors have drawn up a declaration calling for world leaders to commit to building a better, more just world for ourselves and for generations to come (

Climate change is real and impacting now, and it’s imperative that we stand up for the Pacific, and the global community, and act now to avoid further climate catastrophe. This COP should be about the people, not the profits and the polluters. We call on the world to:

  • End the era of fossil fuels and move to 100% renewable energy.
  • Support the immediate delivery of finance needed for countries already facing irreversible loss and damage.
  • Kick the big polluters out of the climate talks.
  • Do what is needed to limit warming to 1.5°C.”
Green leader James Shaw is the Minister

It would be great if New Zealand supported this – with Greens co-leader James Shaw as Minister for Climate Change Issues, hopefully he will be able to strengthen the government’s arm on both rhetoric and action in this area.

Here, as elsewhere, the verdict on the new government will gradually emerge, and civil society will need to hold it to account.