Kerre Woodham: It's concerning if this is the best Labour can do

Labour released some policies yesterday. Very late in the piece, and you can kind of see why. Just like that, we're back to 2017 with a cut and paste of lofty rhetoric, promises to spend lots of money, and little to no detail. It's a dud, I think it's fair to say. And it's not just me saying that. Oh, we'd expect you to say that, you hate Labour. No, I don't hate Labour. I just hate really, really dumb ideas. I hate the fact that they think that we're all idiots. I hate the fact that they're relying on the fact we have short memories. I hate the fact that apparently, they have been working on this idea since 2017, and this is all they can come up with. When you have Radio New Zealand's political analysts calling it a flop, it’s a flop. You know, they are about as sympathetic as you can possibly get.

Basically, if you missed it yesterday, it was the announcement of a Future Fund. The Future Fund will sit alongside and be operated by the New Zealand Super Fund, with the Minister of Finance acting as the sole shareholder. Chris Hipkins (and this terrifies me), Chris Hipkins said the policy would be one of the cornerstones of the next Labour government.

We want to back New Zealand businesses and invest in New Zealand. We need to see more of our wealth being invested back here in New Zealand rather than flowing overseas. So by using some of our existing public assets, our existing state assets, putting them into a Future Fund, using the returns from them to reinvest in growing New Zealand businesses, we can create jobs and keep more wealth here at home.

You're putting in $200 million in cash. Are you also putting in assets?

That's right. So we're not being specific right now on which companies, which, you know, existing companies would go in because there are market disclosure issues and so on. Some of those are pub, you know, partially publicly listed companies. But we'll set all of that out in government. 

Set all of that out in government. Just trust us. We're not going to give you any detail. We'll just trust us to fix it in government. There is so much wrong with this thought bubble policy, I don't know where to start, so I'll let Chris Bishop do it.

I thought it was a bit of a brain fart put to paper. I mean, honestly, like I had a read of it. Like my like there's more detail on my Uber Eats order than there is in what they've put in their document. I mean, honestly, it's just it's 11 pages - three of them are photos. One of them is like something that you take out of a clip art manual and chuck on the front page. I mean, honestly, it's there's nothing there.

No, there's not. As Nat Rad said, Labour is most vulnerable to the criticism around the thin details, as it feeds National's well-established attack line that Labour is all slogans, no substance.

 
The policy documents came with no figures and no list of assets. And that glib Chris Hipkins, ‘I will fix that in government’, really? How did that work out last time? Not so well. To think that Grant Robertson began work on the Future Fund in 2017. Even allowing for the COVID years, that is the best they can do.

Another concern is, as the PM pointed out, those crown assets provide profits that fund health and education. If the money is being diverted to the fund, where will the shortfall in funding come from? Probably increased taxation.

 And that's fine, but give us the details so that we can then make an assessment on it. If you're going to get the extra funding through a capital gains tax or through raising income tax or whatever - tell us, and then we can decide whether that's where we want the money to go. Is there even a need for this fund to back New Zealand businesses? What is this trope that, plucky little New Zealanders have to have a stake in amazingly successful New Zealand businesses?

The CEO of Icehouse was on with Mike this morning, and he pointed out that capital investors are always available for good ideas. There is no shortage of professional investors awash with money who know a good idea when they see one and will pay for it. Is it the government's business to be picking winners when it comes to SMEs?

Didn't work with the DFC, which was created in the 60s, the Development Finance Corporation, to support industrial development in New Zealand through loans and equity. It failed spectacularly in the late 80s, costing the country billions.  

Pattrick Smellie from BusinessDesk says Labour's claim that their future fund is comparable to Singapore's state investment house Temasek is completely and utterly unsustainable. Temasek has a mandate to trade in its assets and to invest offshore. Labour's proposal doesn't contemplate, he says, either of those things.

He writes, the party remains wedded to an approach to public ownership that traps New Zealand in restricted choices about capital deployment, constrained returns, and a strategic straitjacket that says if the state already owns something, it should automatically continue to do so.

The real concern here is that Labour is not worried about what informed commentators, like Pattrick Smellie, have to say about its policies. They don't care. Because they know that the vast majority of the voting public don't care.

They're backing on people having short memories of its complete and utter ineptitude and failure to deliver on almost every metric the last time it was in government. All people know right now is that they're hurting. They're still hurting. This coalition government isn't setting them a fire. This coalition government promised a lot and really has yet to deliver.

And I, you know, I know it's going to take time. But Labour is quite right to back on the fact that the vast majority of people just don't care. They won't read the detail. They won't even know that there is detail to look for. They won't even know that there is no detail.

I think Pattrick Smellie put it brilliantly too. “The Labour proposal of the Future Fund suggests either that the party is economically illiterate or that its target audience is presumed to be”. Which is so true. The Future Fund criticises New Zealand Super Fund for only investing 11% of its assets in New Zealand.

As Pattrick Smellie points out, the reason for that, and you know and I know, but the vast majority don't, is that the Super Fund's job is to fund pensions and get the best possible results from its investable capital, which means not overexposing itself to a small, vulnerable economy like New Zealand's. It is basic risk management.

But no, this cornerstone of the next Labour government criticises the Super Fund for not investing all of the funds in New Zealand.  

It is really concerning if this is the best they can do. They know that everybody who cares has been waiting to hear what its policy is going to be so we can compare and contrast. The coalition government has not set us on fire -okay, let's see what Labour can do. Wow. That's it. That is simply not good enough, and it is quite frankly, for those of us who care, terrifying. 

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