Date posted: 7/10/2020 4 min read

NZ election 2020 – many political goals but where’s the plan?

"A goal without a plan is just a wish.”  Antoine de Saint-Exupery hit the nail on the head in ‘The Little Prince’ in 1943. 

Although we are living in very unusual and challenging times, the policies emerging in the 2020 election campaign look very much like ‘business as usual’ – lots of goals but no overall plan.

So far this campaign feels more like a traditional lolly scramble than a commitment to delivering the coherent, fair and sustainable plan the country needs.

Cases in point would be the tax policies announced by the two main parties.

Labour’s proposal of a 39 percent marginal tax rate for 2 percent of kiwis brings in some useful additional revenue but falls completely short of addressing the issues highlighted by the Tax Working Group last year related to the taxation of capital.

Some of the 2 percent of kiwi wage and salary earners affected by the proposal will be happy to contribute more, but may be disappointed that high wealth individuals not earning a salary, but making significant capital gains, will not also contribute.

National’s proposed temporary tax cuts will stimulate the economy for 16 months but the policy also falls short of addressing the issues with the fairness and coherence of our tax system. It will give all taxpayers extra money, including those who don’t need it and would prefer that the funds are spent on health and education and targeted Covid-19 support.

In the past political parties have got away with, electorally at least, this type of politically driven, sometimes mish-mash of policy initiatives through a combination of good luck and good management. Lofty aspirations have been enough.

But that approach will not work at a time of unprecedented stress on the economy, businesses and the lives of New Zealanders. COVID-19 has not only blown out Government debt, it has highlighted long-standing issues of inequality and with the state of our health system and our environment.

The next Government faces once-in-a-lifetime challenges … and opportunities.

Now, more than ever, we need a big, hairy plan.

And that plan must be supported by a coherent evidenced based portfolio of policies which together support sustainable long-term prosperity, a productive and competitive economy, and intergenerational equity.

Policies must:

  • Collectively enhance long-term shared prosperity, looking to the next 30 years, not just the next three
  • Be fair to both current and future generations of New Zealanders
  • Promote sustainability, recognising that the economy and the environment are inextricably linked
  • Provide clarity, certainty and coherence  
  • Be evidence-based and  
  • Be fiscally robust and costed in a transparent and measurable way.  

Policies should also be framed to support the four pillars that drive shared prosperity:

  • Fiscal and environmental sustainability 
  • International competitiveness
  • Enhanced productivity and
  • Stability of New Zealand’s financial markets

Plans also need to be SMART – specific, measurable, achievable, relevant and time bound.

Politicians – “But we do have a plan”

Of course, political parties will all say “we do have a plan” and that plan is SMART, fair, sustainable, costed, coherent and so on.

But they are not plans in the sense that most individuals, businesses and organisations are familiar with. Good plans impose discipline on choices.

Individual policies and promises, untethered from a coherent plan, often seek to scratch political itches rather than provide any deeper long-lasting solutions.

As mentioned, the tax policies of the two main parties are good examples of the political approach to planning.

“Neither party seems to be thinking about the long-term pressures on the tax base. They also do not appear to be linking tax and welfare settings.”
Peter Vial FCA

If there were ever a time for bold reforms to tax and welfare it is now.

Boosting funding for the SFO seems sensible, but how does that sit within a wider plan for dealing with fraud and white-collar crime?

Additional funding to cover DHB debt is hard to argue with, but where is the plan from any of the parties for 21st century health infrastructure.

Similarly, the proposed education policies seem piecemeal and not part of a bold plan for delivering 21st century education outcomes for pre-schoolers, primary, secondary and tertiary students; and vocational training.

What we need across all portfolios – whether they be revenue or expenditure focussed - are sound policies that stack up against our six principles and knit together to form a plan.

That plan needs to be visionary.

Where’s the vision? In a throwback to a phrase that emerged from the last election, the political parties seem to be offering us a “modified status quo”.

Where are the big bold radical ideas? Are our political parties too nervous of losing ground to be visionary?

CA ANZ supports independent costings of promises

A Parliamentary Budget Office, not due till 2021, will help voters sort out fact from fiction.

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