So convoluted has Labour’s GST-free policy become that the Prime Minister only lasted one day before reaching for something easier to talk about, writes political editor Jo Moir
Comment: What better time to celebrate paid parental leave extensions and the end of Covid-19 than 24 hours after being hammered by economists, commentators, and even former and current Labour MPs on an unworkable tax policy.
Labour’s pledge to remove GST from fresh and frozen fruit and vegetables as of April 1 next year has already lived up to every imaginable pitfall.
On Monday the Prime Minister could say garlic and chopped up coriander would be exempt from GST but was left stumped on basil growing in a pot and vacuum-packed peeled cloves of garlic.
The taskforce that gets the arduous task of defining what is and isn’t exempt would be just as well pulling the answer from a hat than devising a workable formula that can be explained to people in the produce aisle at the supermarket.
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Asked how much weight Labour had put on focus groups in deciding to push ahead with a policy hated just three months ago by its Finance Minister (who described it as a "boondoggle"), the evading of the question answered it.
Chris Hipkins told Newsroom his Government had been focused on “practical cost-of-living measures” and had continued to look at policies in addition to those already announced, and that was what Labour had based its decision on.
Following on from free prescriptions, cheaper transport and increased free early childhood care, Labour has reached further and decided a $4 a week average saving for households that will more than likely be sucked up by supermarket giants was the next “practical” step.
But, based on Labour's predictions, it won’t land for another eight months when the cost-of-living crisis will still be dominating, which should be the biggest and most terrifying takeaway from Sunday’s announcement.
Credit where credit is due, Labour has three very clever political operatives running the election strategy in Hipkins, Robertson, and campaign chair Megan Woods.
The trio can sniff a sounds-good-if-you-don’t-read-the-fine-print policy from a mile away.
Ask people on the street if they like the idea of taking GST off fruit and vegetables and, shock horror, they mostly say yes.
That’s because most people assume it means their produce at the local shop will be 15 percent cheaper (news flash: it won’t).
As for the new Grocery Commissioner, whose job it will be to police the supermarkets, give the guy a knighthood already because so powerful and effective he will be at stopping these giants, which collect $1 million a day in excess profits, that he’s made Robertson a convert to the policy.
So, while the Labour campaign strategists sell this as the next step in keeping money in New Zealanders' back pockets, the realists – including former Labour ministers and even current MPs spoken to by Newsroom – cover their faces at the idea.
Given Willis had already announced Labour’s GST-free policy it could hardly let her have a win on paid parental leave as well – there’s an election in two months after all.
Roll on Monday and Cabinet decided that before winter officially ends is a good time to wave goodbye to the pandemic's lasting reminders.
If you don’t want to spend the next week in Parliament answering questions about what is and isn’t a fresh or frozen fruit or vegetable, you need a distraction. Or even better – two of them.
So it was that Hipkins and his Health Minister Ayesha Verrall officially killed Covid and told everyone it’s business as usual.
But wait, there's more.
New extensions to paid parental leave scheduled to land in the coming weeks have been brought forward.
From July next year partners of those on parental leave who currently get two weeks' unpaid leave will get an additional two weeks’ paid leave, which will extend to three weeks in 2025 and then four weeks in 2026, bringing a partner’s leave to a total of six weeks (two unpaid).
That leave could be taken concurrently, or consecutively with the primary carer’s leave, allowing both parents to be home together – a change not dissimilar to the one put forward by National’s Nicola Willis via a member’s bill in Parliament two weeks ago, which Labour killed.
Given Willis had already announced Labour’s GST-free policy it could hardly let her have a win on paid parental leave as well – there’s an election in two months after all.
Labour’s paid parental leave policy goes further than what Willis proposed, and it is good policy that will make a meaningful difference to parents.
That policy should be the start of what Hipkins calls “his Government” given most of the policy programmes he’s fronted to date have been continuations of Jacinda Ardern’s leadership.
Yet, given the chance to hit the go button on his own Government with a practical and compassionate policy that will fundamentally change the lives of families, Hipkins told Newsroom he was claiming the GST policy and Auckland’s Waitemata harbour crossing as his too.
Turns out every prime minister loves an impossible infrastructure project to sell.
