Ruth Dyson not standing again in 2020

Labour MP Ruth Dyson has announced she will not stand for re-election in 2020.

She first became an MP in 1993 so that will make it 27 years in Parliament, but her political history dates back to 1979, forty years ago. She was Labour Party president from 1988-1993, a very challenging time for her and the party as the Labour Government flew to bits over Rogernomics.

Wikipedia:

Dyson joined the Labour Party in Westport in 1979, and worked as a campaign organiser for Labour MP Kerry Burke in the 1981 and 1984 election. In 1985, she moved to Wellington, where she worked with Labour MP Fran Wilde on the Homosexual Law Reform Bill. She worked for Wilde’s re-election campaign in the 1987 election, and later held a number of senior offices in the Labour Party, including that of president.

Dyson didn’t rise to great heights in the Clarke government, being a Minister for ACC and Minister for Senior Citizens.

She is currently ranked above Trevor Mallard (the Speaker) only on the Labour website. She is Senior Whip for Labour.

So this decision is not surprising. She looks to be little more than a place holder in Parliament.

RNZ:  Ruth Dyson will not seek re-election after 27 years in Parliament

“I truly love my job and adore my electorate and constituents,” Ms Dyson said in a media statement.

“This has not been an easy decision to make, but it is one that has been made considerably easier by the fact that I am leaving at a time when Labour is strong and united, with a clear plan to deliver the policies that I have worked hard to develop.”

But Ms Dyson promises that “there are no undisclosed reasons for this decision – it’s just the right time.”

The right time may have been a term or three ago.

I don’t support term limits for MPs, some long standing MPs contribute a lot of experience and keep doing good jobs, but Dyson has had a low profile and has had a limited impact on Parliament for some time.

Tax Working Group, CGT – PR and promises

Through the week there has been a lot written about the released tax Working Group report, in particular about to CGT or not to CGT.

It looks very Labour. The scope of Michael Cuilen’s report was limited by Labour, but includes significant Labour terminology, like fairness and wellbeing.

But I get the impression  that Labour is backing off  introducing a CGT, either because they know they can’t get NZ First support, or they know it is too electorally toxic. Perhaps both.

Or else we are being played.  It proposes a high rate of tax, and includes farms and businesses. This could be an old trick of threatening something more harsh than is intended so the real aim looks acceptable in comparison. There is plenty of scope for  Labour and NZ First to come out with lower tax and a farm and small business exemption and claim they have listened to concerns.

NZ Herald Editorial: Pity if capital gains tax too hot for Labour to handle

If the Labour Party had any illusions about the fight it will face to bring in a capital gains tax, it knows now. Within 24 hours of the public receiving the recommendations of Sir Michael Cullen’s tax working group the hostility was almost drowning out support for the proposal.

The governing parties had the report weeks ago — plenty of time to time to form a response for announcement with the report’s release as often happens. But only the Greens greeted it enthusiastically.

The week before the report was released Green co-leader made a statement (in parliament) – he said that if the Government didn’t introduce a CGT they didn’t deserve to be re-elected. Labour didn’t seem to prepare, and didn’t seem to have a response organised – unless they deliberately left it open to National to attack the proposals.

Heather du Plessis-Allan: Big tax shake-up or big PR job?

It’s been dubbed the biggest tax shake-up in a generation. But it’s all talk. There’s no chance it’s going to happen. At least not to the full extent the Tax Working Group is recommending.

Some of the shake-up will happen. Maybe enough to qualify as a low-level tremor. Maybe it will include capital gains taxes, maybe it won’t. Yup, maybe none at all.

It’s all too early to say. And that’s for three reasons: Winston Peters, us and Labour’s own self-interest.

A CGT was a Labour election promise. It’s all about making the tax system fairer. It’s a Government looking after the poorest Kiwis. Robertson and Ardern have both spent too much time repeating that message to now walk away from their one chance to fix the system.

This is where Peters comes in. If he continues to oppose a capital gains tax, he might be their get-out-of-jail card. They might be able to happily drop a CGT and blame it on him. They could trot out the old you-win-some-you-lose-some argument. They’ve used it before.

It’s of course true that coalition governments require compromise.

But will the Peters excuse be good enough? Ardern and Robertson will have to use all their charm and communications skills to sell that message.

Either this will be the biggest tax shake-up of a generation, or the most convincing PR campaign to explain why it never happened.

We will have to wait a couple of months for the Labour-NZ First decision making and the PR to reveal which way this is going to go.

It’s hard to see how NZ First would support the introduction of a CGT. Winston Peters has condemned it in the past, notably during the last election campaign. The future of his party is at stake, and u-turning on a CGT could be a big nail in NZ Firt’s coffin.

I think Labour have created a dilemma for themselves here.

If they manage to get CGT legislation passed in time for the election they are at major risk of being thrashed by voters.

If they backtrack and pull the plug on CGT they will annoy core left wing support who have bought the promise.

 

Conservative and Labour MPs resign from parties in UK

Two days ago seven MPs in the UK announced they were resigning from the Labour Party: ‘We have all now resigned’: seven Labour MPs quit party – video

A small group of MPs have resigned from the Labour party in order to sit as an independent group in parliament. The MPs delivered an attack on Jeremy Corbyn’s leadership and the party for being ‘institutionally racist’ and betraying its members over Brexit

More from the Guardian – Labour: Watson tells Corbyn he must change direction to stop party splitting

Labour’s deputy leader, Tom Watson, has told Jeremy Corbyn that he must change direction or face a worsening Labour split after seven MPs quit to form a new movement in the party’s biggest schism in nearly 40 years.

Watson’s emotional intervention came as a number of Labour MPs were poised to follow the founders of the new Independent Group – and after reports on Monday night that some Conservatives were also ready to defect.

Saying that he sometimes “no longer recognises” his own party, Watson urged Corbyn to ensure Labour remains a broad church and reshuffle his shadow cabinet to reflect a wider balance of MPs.

The announcement of the group founded by Luciana Berger and Chuka Umunna represented the most significant challenge to party unity since the “gang of four” senior figures quit to form the Social Democratic party in 1981.

But on a day of drama, recrimination and occasional chaos, Corbyn loyalists derided the MPs as fringe figures who were out of touch with the public.

Now another Labour MP has split from Labour, and also three Conservative MPs have joined them. Missy comments:

This morning three Conservative MPs resigned from the party to join the new Independent Group of MPs. It will be interesting as to how these MPs work together, essentially the only thing they all have in common is that they want to stop Brexit, and want the public to have a second referendum now we know more about Brexit, and have seen how things have changed.

Interestingly they don’t want their constituents to have a second vote now things have changed and they are no longer in their party, many vote for party regardless of the candidate, however, these MPs who want to give the electorate the opportunity to change their minds on Brexit aren’t so keen to give their constituents the opportunity to change their minds on their MP.

Guardian:  Eighth Labour MP quits party to join breakaway Independent Group

Joan Ryan has become the eighth Labour MP to resign and join the breakaway Independent Group, claiming Jeremy Corbyn’s party has become “infected with the scourge of anti-Jewish racism”.

Ryan, the MP for Enfield North, said she had been a member for four decades but could no longer remain as a Labour MP.

Echoing Luciana Berger, the Jewish MP for Liverpool Wavertree, Ryan blamed what she claimed was the Labour leadership’s “dereliction of duty” in the face of the “evil” of antisemitism, for her decision to resign.

In a stinging resignation letter, she said: “I cannot remain a member of the Labour party while this requires me to suggest that I believe Jeremy Corbyn – a man who has presided over the culture of anti-Jewish racism and hatred of Israel that now afflicts my former party – is fit to be prime minister of this country. He is not.”

BBC:  Three MPs quit Tory party to join Independent Group

Anna Soubry, Sarah Wollaston and Heidi Allen wrote a joint letter to Theresa May to confirm their departure.

The three held a press conference, criticising the government for letting the “hard-line anti-EU awkward squad” take over the party.

At a press conference on Wednesday, Ms Soubry criticised Theresa May for being “in the grip” of the Democratic Unionist Party and the pro-Leave European Research Group, and allowing Brexit to “define and shape” the Conservative Party.

She said: “The battle is over, the other side has won.

“The right wing, the hard-line anti-EU awkward squad that have destroyed every leader for the last 40 years are now running the Conservative Party from top to toe. They are the Conservative Party.”

The pro-Remain trio will join the new Independent Group – made up of eight Labour MPs who resigned from their party over its handling of Brexit and anti-Semitism – saying it represented “the centre ground of British politics”.

The PM said she was “saddened”, but her party would “always offer… decent, moderate and patriotic politics”.

Brexit continues to split parties in the UK.

Greens versus NZ First and Labour conservatism

Does Labour use NZ First as an excuse to be conservative on economic and other policies to avoid being linked to Green radicalism? They do use the Budget Responsibility Rules to be conservative. They are an agreement with the Green Party to allay fears of a swing too far left in the last election campaign, but there is disagreement over having the Rules within the Green Party.

I have seen dismay expressed from the the left that the Government is nowwhere near progressive enough,.

Henry Cooke (Stuff):  The Greens are looking forward to 2020 already, and the possibility of a world without Winston

At their annual conference last year, a prominent Green Party member gave a speech which called for the party to tear up a central tenet of their partnership with Labour.

He received a standing ovation. Most of the Green MPs present, who had signed off the policy, were in the room. Several agreed with him.

The policy was the Budget Responsibility Rules a set of tight government spending guidelines Labour and the Greens agreed to ahead of the 2017 election. They have gone on to play a huge role in how the parties have governed.

The idea was to blunt the attacks from the right that a Labour-Green government would blow up the surplus and destroy the economy.

Ever since Green supporters and some MPs have been agitating for the party to get rid of the rules. In the last week this began. A “review” of those budgetary constraints has been launched, but this is just a procedural step on the way to either scrapping them or modifying them before the 2020 election.

There always seemed a likelihood that Labour and the Greens would need NZ First to give them any chance of getting into Government last election, and so it turned out.

It’s a long way from the election but there appears to be a greater chance that NZ First won’t make the threshold next year. This would give the Greens more influence over Labour, depending on how many seats they get. If Greens recovered back up to ten to fifteen seats, and were in Cabinet with Labour, they should get significantly more say and sway.

In the same week, co-leader James Shaw made the most forceful argument for a capital gains tax anyone has in years, saying the Government wouldn’t deserve to be re-elected if they didn’t implement one.

That was a big play from Shaw, mostly to his party wanting more reform from Government.

​The election is next year, and the Greens are getting ready by staking out positions on the left. At the same time, some in the party are daring to look forward to a world without Winston Peters.

Fixing this requires not just talking up wins in Government but very clearly pushing left on tax – an issue likely to dominate through this year and into the next thanks to the tax working group – as well as balancing the books. These might seem like small bore issues but they are very important to that core of committed supporters.

NZ First are likely to try to distance themselves from relying on Labour next year to try to fool voters and Labour negotiators into thinking they could go either way.

So Labour+Green will be an important consideration for voters.

Many Greens see Peters and NZ First as the reactionary laggard keeping this Government from truly transforming the country. But it has long been useful for centrist Labour MPs to blame NZ First for their own conservatism. Labour will be extremely conscious of how scared the wider public might feel about a radical Labour-Green government in 2020.

Keeping the budget deal in place might well be Ardern’s plan to placate those fears.

For Labour, yes. And possibly for Shaw. But what about green supporters disappointed with the lack of progress leftwards this term, and impatient for more radical reforms?

Possibly one of the most significant decisions for the next election will be what the Green party decides to do about the Rules, that some see as a brick wall in front of progress and real progressivism.

One thing that may make it easier for Greens pulling Labour left is the conservatism of Simon Bridges pulling National further right.

Unless the Sustainability Party gets some support in the centre.

James Shaw slams tax timidity, calls on Labour, NZ First to be bold with CGT

In his opening speech for the year in parliament yesterday Green co-leader James Shaw slammed timid tinkering with tax, and, confronting pontification about whether the current Government can “politically afford to do what no other Government before it has done” and introduce a Capital Gains Tax asks “Can we afford not to?”

That must be aimed at Labour and NZ First, who have to agree with Greens on any tax changes following the Tax Working Group process.

First Shaw illustrated the tax disparity issue wit no tax on the capital gains of property.

Karen is a renter. She’s got a career, and she earns roughly the median wage. Over the last 10 years, she’s earned about $450,000 and she’s paid, roughly, $70,000 in tax. She budgets well, she can manage the rent, and she can manage the other expenses, but she can’t quite have enough left over to save.

And then there’s Paul. Paul also earns the median wage. He’s a bit older than Karen, and Paul got lucky and managed to buy some rental property before house prices really started rocketing—about the time that Karen came into the workforce, about the time that John Key became Prime Minister. On the day that Paul sells that rental property, he makes as much as Karen has in the last 10 years, and he pays zero tax on that income

Now, what does Paul do? He uses that as a deposit to buy two more houses. That is the rational thing to do. And what does Karen do? Well, Karen keeps renting because there is no way on God’s green earth that she’s going to be able to scrape together a deposit on $45,000 a year.

And that, in a nutshell, is why we have a large and growing wealth gap in this country, and it is undermining our ability to pay for the public services that we all rely on, including Karen—including Paul.

There is something missing from this illustration.The implication here is that ‘Paul’ paid no tax, but ‘Paul’ must be earning something to live on for the ten years before scoring a capital gain, and after reinvesting capital gains on more property, so could have been paying some tax.

Now, the Green Party has long been calling for that fundamental imbalance to be addressed, and every single expert working group in living memory has agreed with us, but no Government—no Government—has been bold enough to actually do it. But if we are to be the Government of change that New Zealanders wanted and elected, we must be bold.

The crises that we face on multiple fronts—the wealth gap, climate change, the housing crisis—we cannot solve without fundamental reform. These crises have been allowed to metastasise because generations of politicians have timidly tinkered rather than actually cut to the core of the problem.

And the consequences of that timidity—the consequences of that timidity—are being felt by Karen and by hundreds of thousands of New Zealanders just like her, trapped in “Generation Rent”. So when the commentators pontificate about whether this Government can politically afford to do what no other Government before it has done, I ask “Can we afford not to?”

Can we afford not to?

We were elected on the promise of change. If we want to reduce the wealth gap, if we want to fix the housing crisis and to build a productive high-wage economy, we need to tax income from capital the same way that we tax income from work.

The very last question that we should be asking ourselves is: can we be re-elected if we do this? The only question we really ought to be asking ourselves is: do we deserve to be re-elected if we don’t?

Shaw is effectively throwing down the tax gauntlet to Labour and NZ First, suggesting they don’t deserve to be re-elected unless they introduce a CGT.

I have to say, boldness is needed everywhere, everywhere.

That is a challenge to the other parties in Government with the Greens. The re-election comment is particularly pertinent for NZ First, who were well under the threshold in the latest poll.

Bridges urges RMA reform now, but National blew it while in Government

Simon Bridges has joined the chorus singing for RMA reform, but Peter Dunne has given a timely reminder that National were off key and blew their chances of reform while in Government.

RNZ: National leader Simon Bridges urges RMA reform over $100m for Māori land ownership

Yesterday Prime Minister Jacinda Ardern and Regional Economic Development Minister Shane Jones announced that the government’s Provincial Growth Fund would spend $100 million on supporting Māori landowners to make better use of their land.

Today Mr Bridges told Morning Report the government was just throwing money at the issue and although $100 million sounded like a lot of money it would just “scratch the surface” for a select few.

“It may be a bit harsh but I think it’s a waste of money. You’re throwing it at a select few but you’re not actually going to help Māori.”

Mr Bridges said he would instead help Māori land ownership through law reform.

At yesterday’s announcement Ms Ardern said 80 percent of Māori freehold land was under-utilised and unproductive because the special status of some land made getting loans difficult.

Mr Bridges said the government was making the same mistake as it had with KiwiBuild.

“The one thing that is required is Te Ture Whenua Māori land reform. That’s what’s got to happen because the complex legal intricacies of multiple owners mean it’s always going to be incredibly difficult to do this unless you get that law reform. It’s not a question of the financing.”

“They think if they splash some cash at something there’s good politics in it. But just as with Kiwibuild what you actually have to do is hard law reform around the Resource Management Act,” he said.

Fair point. It is widely known that the Resource Management Act generally is stifling development.

Last month Dave Cull, president of Local Government New Zealand, said RMA ‘broken’, not fit for purpose for local government

To build at scale, the Government is looking to give the UDA the power of compulsory acquisition to assemble large parcels of land and the ability to shortcut the onerous public consultation processes required under the Resource Management Act (RMA).

It is an acknowledgment that the RMA is too consultative and encourages a tragedy of the anti-commons. This is where everyone gets a say in a development, not just affected parties, and as a result many worthwhile projects never get off the ground.

The RMA’s consultation requirements also vastly complicate the already fiendishly difficult matter of assembling land for urban development.

The current Government is trying to work around the RMA with new Urban Development Authority (UDA), responsible for delivering on the Government’s KiwiBuild programme.

The Government is also going try to fix the RMA: Two-step RMA reform to start by fixing the previous government’s blunders

The changes are separate from the legislation to set up an Urban Development Authority to fast-track housing and urban development projects.

“The Resource Management Act is underperforming in some critical areas and needs fixing,” David Parker said.

Stage One will reverse some objectionable changes made by the previous government in 2017 that were widely criticised.

For example, the Bill would repeal measures that prevent public notification and appeals by applicants and submitters in residential and subdivision consent applications.

Another change, recommended by Regional Councils, is the ability to upgrade groups of consents in line with updated standards. This will help speed the cleaning up of our rivers, which otherwise can be delayed for decades.

A Bill addressing changes that can be made straight away will be introduced to Parliament early next year.

It will address particular issues with resource consenting, and monitoring and enforcement processes in the RMA.

Stage Two will be a more comprehensive review of the resource management system. It will build on current Government work priorities across urban development, climate change, and freshwater, and wider projects being led by various external groups. Stage Two is currently being scoped and is expected to start in 2019.

Good luck with getting agreement with both the Greens and NZ First on meaningful reform. This could take some time.

National tried to reform the RMA while in Government, but failed. Now National blames MMP, minor parties for housing crisis

A National MP has blamed the former Government’s partners for his party’s failure to stop house prices rising beyond the reach of many Kiwis.

“We did a lot in housing – we did a lot of work around the Resource Management Act (RMA). The problem with MMP is we had a partner that actually wouldn’t allow us to make the changes that we wanted to make.”

National actually did poorly in addressing the growing housing problem. This was a significant reason why they failed to retain power in 2017.

RMA changes passed into law in April 2017 after changes were made to satisfy minor partner the Māori Party, while United Future and ACT voted against.

Bridges has also blamed ACT and United Future for National’s failure to reform the RMA

David Seymour has been scathing – ‘Promise. Win. Fail. Apologise’: David Seymour rips into National’s ‘failure’ in Government

On Thursday, National Party leader Simon Bridges expressed regret at his party’s failure to reform the Resource Management Act (RMA), and said it was getting a new RMA reform bill ready.

“The reality is, we should have [reformed the RMA] in the first term,” Mr Bridges said, blaming later support partners for failing to allow changes to be passed.

“The reality is though, by second and third terms we were reliant on partners whether it was the Māori Party, whether it was Peter Dunne – they weren’t up for changes there.”

However ACT Party leader David Seymour says he’s heard similar promises before – but National has always failed to deliver.

“They promise action in Opposition, win Government, fail to do what they said they would, and then apologise after New Zealanders boot them out.

“The four stages of the National Party political cycle are: Promise. Win. Fail. Apologise.”

Mr Seymour says part of the blame of that cycle is down to National’s governance style, which he claims operates “from the left” despite the party “campaigning from the right”.

“Only ACT has been consistent on fundamental RMA reform. The next Government will need a stronger ACT to get National back on track,” he said.

Peter Dunne has explained why National failed to get the support of United Future and ACT in Peter Dunne looks at the challenges for a possible ‘blue-green’ party and the National Party’s quest to get the numbers to allow it to govern:

There is also the delicious irony of National‘s excitement at the prospect of such a party emerging occurring the same week that it blamed previous support partners, UnitedFuture and Act, for the current housing crisis because they would let it gut the Resource Management Act the way it wanted.

National’s approach then was all or nothing – I well recall their Minister telling me he was only prepared to negotiate about the RMA if I gave him an assurance in advance that we would reach an agreement. On another occasion, that same Minister told me he was unwilling to talk further because he suspected (correctly) that I was also consulting with Sir Geoffrey Palmer, the architect of the RMA, and he did not want that.

I think that minister was Nick Smith. He was probably National’s biggest problem with failing RMA reform and letting the housing problems escalate.

Yet, all the while, right up to the eleventh hour, UnitedFuture and Act were putting up separate proposals to the Government for possible changes to streamline the way the RMA operated, and to remove perceived procedural roadblocks. UnitedFuture even suggested bringing the provision of affordable housing into the objectives of the RMA but that was rejected because we would not agree to National’s planned watering down of the RMA’s principles and objectives.

Ideally with something as important as the RMA both Labour and National should work together to sort out it’s weaknesses while retaining important environmental protections.

But National, with a near majority Government, could not work out decent RMA reform with two one MP parties, and still blames them for their own failure.

The Government is trying to throw money at Maori land development, and it’s fair for National to question that approach. They can’t undo their reform blunder while in Government, but they could put petty politics aside and work with Labour on lasting RMA reform.

 

Small minority to make crucual decisions on ‘fair pay’ agreements

Fair Pay Agreements “would set minimum standards to lift wages and conditions across an industry or occupation”, but could be initiated by a small minority of workers – just 10%, or less (1,000 workers). Is that fair? A minority in, say Auckland, could effectively end up imposing ‘fair pay’ across an industry across the country.

This is what the Fair Pay Agreement Working Group has recommended. The Government will now consider what they do – this may not be straight forward, with Labour and Greens requiring the support of another minority, NZ First.

Heather du Plessis Allan: Time to fast-forward to the past

Business is collectively losing its mind over the working group’s recommendations. It’s calling it a return to the national awards of the 1970s.

Business hates that the negotiations can be triggered by as little 10 per cent of the industry’s workforce. Business hates that the contract agreements would be compulsory for all employers in that industry. Business hates paying employees more than it has to.

Business has a few fair points. We can’t expect the cafe owner in Balclutha to pay staff exactly the same wage as the Auckland cafe owner making a killing thanks to the money and foot traffic a city delivers. There should be concessions to regional variance.

These recommendations probably won’t all be accepted by the Government. Labour’s coalition partner New Zealand First might challenge many of them, if not all. Winston Peters’ party has already temporarily pulled its support on Labour’s employment law once before.

So it is far from a done deal at this stage.

But, the motivation behind these recommendations is on the money. Kiwis are underpaid.

That’s debatable. In the private sector we are generally paid what companies can afford to pay and stay in business.

Audrey Young:  Coalition Government lining up smorgasbord of targets for National

The same goes for the fair pay agreements outlined in the Jim Bolger report delivered to the Government this week.

But given New Zealand First’s track record in diluting union-backed legislation, it is hard to imagine the party agreeing to a trigger as low as 10 per cent for workers to force employers to the table for compulsory sector-wide bargaining.

The trouble is that the higher the trigger goes, the less happy the unions will be. A true compromise may result in deeply unhappy unions and employers.

Dominion Post editorial: Why back to the future on pay might not work

Many of this country’s lowest paid and most vulnerable workers have every right to look back in anger at the steady, inexorable fall in the value of their wages, the undermining of working conditions and the perceived out-of-proportion rewards for their employers and many others in the business community.

Bolger’s group was assembled to address such inequities, and its report released this week suggests we go back to the future.

It recommends the creation of fair-pay agreements, a new version of the old collective bargaining that critics have labelled as “compulsory unionism by stealth”.

There is some sympathy for that argument because the proposal, if adopted, would mean that an entire industry would have to negotiate new minimum pay and working conditions if just 10 per cent or 1000 workers in that industry, whichever is fewer, asked for it.

That creates the potential for major upheaval in businesses that have long moved on from the days of compulsory unionism and the environment that went with it.

The reforms are targeted at the country’s low-paid and most exploited workers.

But there is still the potential for major uncertainty, confusion and disruption for everyone within the complicated ecosystem that is our national economy.

For many, the amount they are paid remains the main measure of their perceived value, from the employer and within society. Work conditions are important, but pay is so often the principal point of anger and agitation.

If employers followed a number of local bodies and now Westpac bank in taking on a living wage for their employees, it would go a long way towards quelling that anger, and possibly even lift productivity.

But local bodies can just put up rates to pay for bigger wage bills. Ratepayers have to pay. If companies put up prices customers can choose not to pay.

This too, of course, is a blunt tool, and would not come without cost. But in conjunction with sensible legislation to protect workers’ rights and conditions, as happened when zero-hour contracts were deemed illegal, it could address many concerns without creating widespread disruption and a threat to the economy.

This working group is right to address inequities on behalf of the country’s workers, but it should be careful not to throw out the businesses with the bathwater.

A minority in Government, NZ First, look to be the deciding factor in whether a minority of workers could enable (or force) ‘fair pay’ on a whole industry, which could put a larger number of workers and their jobs at risk.

Another point  – Labour may think it was a master stroke recruiting ex-National MP Jim Bolger to head the Working Group, but why an ageing retired politician? One who is a long way from knowing what ordinary workers feel and experience. Surely there are younger people around who may have a better appreciation of work in the modern world.

Government blurb on the Working Group report:

The bracket creep ‘stealth tax’

Increasing tax through inflation and a creep up the tax brackets has long been a bone of contention, with successive governments largely letting it happen to presumably get more tax without having to announce tax increases, It hasn’t just happened.

This week National pledged to adjust the brackets for inflation every three years – see National announces policy to address tax bracket creep.

How much more tax do we pay? Tax brackets were last adjusted in 2010 – so according to a NZ Herald calculator:

  • if you earn $30,000 bracket creep would have cost you about $86 per year
  • if you earn $50,000 bracket creep would have cost you about $336 per year
  • if you earn $70,000 bracket creep would have cost you about $614 per year
  • if you earn $70,000 bracket creep would have cost you about $799 per year

NZ Herald:  The $1.7bn ‘stealth’ tax grab – work out how much ‘extra’ tax you have been paying?

Wage and salary earners paid out $1.7 billion in “stealth” tax last year after inflation increases pushed workers and their pay packets into higher tax brackets, according to advice to the Tax Working Group.

Officials have warned the public could see the money as having come through a stealth tax and Government may want to change it as a “value judgment”.

They have also said if the Government did change tax rates it would increase transparency and account for inflation but money would need to be found to pay for public services.

The extra tax was scooped up after the former government left tax brackets largely unchanged during its time in office, with the highest tax bracket fixed to kick in at $70,000.

I have seen criticism of this Herald article as a promotion of National’s policy, but bracket creep has been grizzled about for a long time – Michael Cullen was slammed for allowing it and that contributed to Labour losing the 2008 election.

National under John Key allowed it while they ran Government but they did adjust thresholds in 2010 and also legislated to adjust them again in 2018, but those were overturned before they happened by the incoming Labour led government.

Tax, especially increasing tax, is always a contentious issue.

Tax reform and capital gains tax still unresolved

According to media claims the Cabinet has received copies of the Tax Working Group recommendations, but it could take some time to find out what they are going to decide to run with. – or what the are allowed to run with by Winston Peters.

Group chairman Michael Cullen has suggested that tax changes could be decided in Parliament this term ready to come into effect in April 2021 providing Labour gets a mandate in next year’s election. But Grant Robertson has warned that it could take some time to work through the recommendations with Labour’s partner parties in Government.

Audrey Young (in Major challenges for ‘exasperated’ Ardern):

Robertson played Robin to her Batman at the post-Cabinet presser, initially fronting on the Government response to the insurance industry inquiry.

The subject quickly changed to the final report of the Tax Working Group and its promised capital gains tax which is due to be handed to the Government this week.

Robertson patiently continued his mission to change the language over the tax by calling it a “capital income tax” rather than a “capital gains tax” — an attempt to equate it to all other income.

Ardern became impatient when questions turned to the undisputed veto that NZ First will have on any capital gains tax — the Greens have been unequivocal supporters and NZ First longstanding opponents.

Apparently a capital gains tax is just like every other issue the Government debates, and requires the agreement of all three parties.

Not just apparently. Tax reform is far from a done deal. It is a Labour only promise, but with no public agreement with either NZ First or the Greens.

Stuff:  Decision on capital gains tax will take a wee while, Grant Robertson warns

There will be no quick decision from the Government on whether to implement a capital gains tax, Finance Minister Grant Robertson has signalled – noting Labour would have to work that through with its coalition partners.

The Tax Working Group (TWG) chaired by Sir Michael Cullen is understood to have completed its report for the Government, with a “clear majority” favouring subjecting capital gains from the sale of property, shares and businesses to income tax.

But Robertson told RNZ the Government would need to take its time to read the TWG’s report “work through the details of it and work out what package we can agree to as a coalition government”.

Remarkably the Labour-NZ First coalition agreement did not mention the Tax Working Group, nor CGT, and neither did Labour-Green Confidence & Supply Agreement, so the recommendations of the TWG and what Labour would like to do will all need to be negotiated with Winston Peters and NZ First, as well as with the Greens. This alone is likely to take time.

Inland Revenue said on Tuesday morning that the report had not yet been delivered to the Government, and no date has been set for it to be made public, but sources said the report was being read in the Beehive.

Robertson said he expected to get the report by the end of the week but he and Prime Minister Jacinda Ardern did not rule out a coalition partner vetoing any legislation.

“There is a wee ways to go before the final decisions about this report will be made,” Robertson said.

“As we do with all these reports, we will take a look at it and put it out with a few interim comments from us,” he said.

So it could be some time even before the report is made public. Labour want to work out how to try to sell it before they advertise it.

Cullen said in December that he believed Parliament would have time to pass legislation paving the way for any proposed tax changes before the election, so those changes could take effect from April 2021.

Theoretically Parliament may have time, but Labour won’t want to take any tax changes to Parliament without agreement from NZ First, and the Greens.

Politik: And now the hard part; getting Winston to agree to a capital gains tax

Prime Minister Jacinda Ardern confirmed yesterday that iot was still the government’s intention to bring forward legislation for any tax changes before the end of its current twerm though those changes would not come into effect until after the enxt election.

But whether it will propose a capital gains tax will now depend on whether it can persuade NZ First to agree.

Ardern and Finance Minister Grant Robertson were coy yesterday on whether they thought they could win that derbate.

Meanwhile NZ First Leader, Winston Peters, is not saying much beyond repeating his 2017 assertion that we already had a capital gains tax.

“What i tried to point out then was that we had a cpaital ghaimn tax and that we had had one for a long time,” he told POLITIK last night.

“Now the question is are you talking about broadening it.

“The position of New Zealand First is that we will wait for the report, we will evaluate it and then we will give our view.”

Tax reform has already limited by Labour in their terms of reference for the TWG. They will presumably also want any changes to fit within their wellbeing agenda.

It will only happen if it also fits with the electoral wellbeing of Winston Peters and NZ First

‘Preliminary discussions’ on Blue-Green party

National’s lack of partner parties is a real problem for them under MMP. They either have to take a punt that they can become a single party government, something that has never been allowed by voters under MMP. Or they can hope that a new party starts up that can either be anchored by an electorate MP, or can get 5% (also something never achieved by a new party under MMP).

There has been talk of a more business friendly environmental party for years. The Green Party has often been criticised for it’s fairly extreme social stances, and this limits it’s support from b=voters who want a strong environmental voice in Parliament. Co-leaders like Metiria Turei and Marama Davidson are well supported on the left, but deter more moderately minded environmentalist leaning voters.

Lucy Bennett reports that Blue-Greens movement could be National’s answer to toppling Ardern

Talk of a new centrist green political party which could potentially partner with National in a future government coalition is starting to become more than just speculation.

It is understood preliminary discussions among interested parties have already been held on creating a party that combines economic and environmental credentials, filling a demand not already taken up by existing political parties.

It is also understood former Green Party leadership contender and one-time National candidate hopeful Vernon Tava is the front-runner to lead the party.

James Shaw probably wouldn’t be out of place in a Blue-Green party but I doubt that he would jump the Green ship – unless a Blue-Green startup looked like cannibalising Green party support to the extent that they were at risk of missing the 5% cut?

Tava told the Herald on Sunday a party that had the environment at its heart was missing from the political landscape and it was a great idea. He would consider leading such a party.

“It’s certainly something I would take seriously,” he said.

“I’ve always said it’s a great idea and what we need.”

Despite his Green Party origins, Tava has close links to National Party figures and was campaign chair for National MP Erica Stanford, who holds Murray McCully’s old seat of East Coast Bays.

There has been talk for some time about the possibility of other small parties to bolster National, but National will want to ensure any such party does not carve into its own vote.

National leader Simon Bridges said it was no secret National wanted to see new parties emerge this year.

“What would be most pleasing to see is parties that are additional to National’s support base. Not just for the National Party, but for the public, a genuine green party and an indigenous Māori movement are two reasonably likely scenarios this year,” he said.

Of course National would love to see partner party options for them. But would a Blue-Green party help National take over power from Labour?

I’d certainly be interested in some sort of Blue-Green party. I have voted Greens in the past but have concerns over their strong social/socialist stances. I have concerns about how far left a Labour-Green coalition might go.

But I would be most likely to support a Blue-Green party that was independent and would be willing to partner either National or Labour (or Labour-Greens).

If a Blue-Green party looked to be largely a National puppet party I would be disappointed and I think many other potential supporters would be too. I doubt that it would succeed. If National jacked up an electorate for a Blue-Green party I suspect that wouldn’t go down well with many voters.

I could easily get enthusiastic about genuine independent Blue-Green party as long as it would sit in the middle-ish and drive the best deal it could get out of any other parties who were voted into Parliament.