Politics: Crunch time for National

There is rule: government is defined by its first year of its second term. That’s what National bosses believe. The pressure is on John Key and his cabinet.
Key made that point by implication when appointing his cabinet in December: he was looking for results and would judge his ministers accordingly.
By results he meant changes that voters will recognise, approve and credit to him and his cabinet – enough to get National third term in office.
The changes have to be felt at the micro level – household finances, opportunity, direct experience of public services and the like – and sensed broadly, in more secure economic and social environment.
The Key government was very busy in its first term. That included weathering the global financial crisis and making some public services changes pointing to modestly smaller state.
It also included making some modestly more business-friendly regulatory changes – plus high-profile but essentially rhetorical law-and-order changes.
That signalled direction but did not amount to plan or vision. This is the year for stronger sense of purpose.
High on the list is “better public services” initiative. The Advisory Group’s report went to Key in December, with decisions to be announced in January (after this column was written) or this month.
The aim is to define better what each public service is intended to achieve and devise new ways of delivering those outcomes. This is five- to seven-year project. It is not just more efficiency.
It involves agencies thinking and acting more collaboratively with others, including non-government bodies, to get coherent results instead of just sticking to their turf.
It includes customising services to public increasingly attuned to doing things online or through their mobile phones and expecting personalised responses.
The result, if successful, will be much more blurred line between public and private action. Charter schools will be test case.
A second big initiative also blurs public and private: selling 49 percent of Mighty River Power. If done successfully, Key and Bill English will have begun to detoxify privatisation.
Huge majorities in pre-election opinion polls opposing the partial sales were legacy of the mishandled 1980s/’90s fire sales, some of which went badly wrong for variety of reasons.
Part of the Government’s present-ational difficulty even now will be perception that the sales owe more to ideology than to pragmatic analysis.
A third area due for rapid action this year is to loosen regulation without ending up with “anything-goes” – the sort of environment where Telecom was able to extract monopoly rents, builders used shonky materials in leaky homes and mine was not made properly safe. Resource management reform and the labour market will be the main deregulatory focuses.
More and faster oil and minerals exploration and exploitation will also test public attitudes. By moving this year, the Government aims to shift the public debate by 2014 past the “whether” – essentially an environmental argument – to the “how” (to get richer).
The Government also wants to be able by 2014 to point to lower benefit numbers. At one level, this is easily winnable: bashing beneficiaries is popular. But that just pushes costs onto the justice and health systems, which is counter to the better-outcomes ambition of the “better public services” initiative.
Instead, the Government started last year applying more rigorous actuarial-plus-investment analysis to identify the value of more productive interventions.
Next challenge is to apply more science to such issues. Whether the Government will start doing that this year is unclear. So, too, is whether it will translate into action past hints of more resources into science and innovation generally.
But results from more innovation spending would not be evident to voters in 2014. Some parts of defining government in the first year of its second term deliver results only in third term. M

Colin James is New Zealand’s leading political commentator and NZ Management’s regular political columnist. [email protected]

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