Budget 2021: Claire Trevett – Budget won’t be talked about for long


The answer to the question of what is in the Budget for the battlers in middle New Zealand is that in just 365 sleeps, or perhaps 730 sleeps, they will find out.

The first Budget handed down by the Labour Government will not be talked about for long.

The primary measure was a $3.3 billion package to boost benefits.

Beyond that it was boring, a collection of tweaks and moderate funding injections in pleasing areas such as Pharmac, cochlear implants and for cervical self-tests.

But there was nothing that will send the people of New Zealand to the online calculators to see whether they get any gains or losses from it.

It will not be dwelt upon for long, or talked about in the offices and shop floors.

The Budget has not necessarily made the lives or livelihoods of working New Zealand any better. But nor did it leave them worse off.

Although there was not much to celebrate, nor was there anything to get angry about.

Those voters will also have expected little from this Budget, so will not be left feeling cheated.

The Government had done its groundwork well in dampening expectations, warning that there was little money to throw around after the massive costs of the wage subsidies and Covid-19 health response. It had also made it clear it intended to use what was there on those at the bottom.

There was a lot of scrutiny around the Budget, given it was the first one handed down by Labour alone.

And it was a very Labour Budget.

For a number of reasons, the first Budget in a parliamentary term is the best one for Labour to implement the promises that were core Labour in nature.

After the election, Prime Minister Jacinda Ardern promised those who had not voted for Labour before that she would remember them.

The wishes and desires of those voters have not been cast aside– simply put on pause.

Robertson does not see the budgets of the Labour Government as three separate blockbusters – but rather as the Lord of the Rings trilogy.

His will be a trilogy of Budgets, driven by the same themes (Covid-19 recovery, addressing poverty, climate change and housing affordability).

However, there is also an obvious but unstated fifth priority for Labour. That is re-election, and maybe even re-election again as a majority Government.

That is the ring Labour is looking for in its trilogy.

That theme may not come nakedly into play until the 2023 Budget: the election year Budget.

It will be in 2022 or 2023 that middle New Zealand sees Ardern deliver on her pledge not to forget them.

Opposition parties have made much of the “battlers” of New Zealand missing out in this Budget, pointing to increasing pressure on workers’ pockets in power bills, and the cost of living.

But voters tend to bank Budget gains or get over losses fairly quickly.

A splash out now would have worn thin by 2023. And by the third Budget, those voters will have long forgotten that they missed out in the Budget of 2021.

But what will linger is the question whether the PM has delivered on her pledge to address child poverty – and herein lies the importance of the 2021 Budget.

Ardern now settles in for what could be a white-knuckle ride to find out if the extra $55 a week going into the pockets of beneficiaries with children actually makes a dent in child poverty.

Ardern needed to do the benefits increase in the first Budget because she needed time for that cash injection to make some impact.

The Families Package Labour delivered in 2017 was the big hit – but has so far had only a minor impact on child poverty: its impact muffled by the turbulence of Covid-19.

The latest boost on top of that may well answer the question about whether throwing money at a problem does, in fact, work. Ardern will be hoping that starts to show up in the statistics before the next election.

To fail on this front would only add to the line National and Act are running that the Government has failed to deliver on a long string of promises: housing, transport projects, infrastructure and, so far, child poverty.

Thus far, those have all been outweighed by the one big delivery area of Covid-19. But such narratives tend to start to grow deep roots unless they can be disproved.

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