The Post: The honeymoon’s over, but a hangover’s just kicking in

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The received wisdom is that this government never got a honeymoon – and, like much received wisdom, it’s almost certainly wrong.

Sure, the coalition parties didn’t see the usual polling bump immediately post taking office. But, according to at least one pollster I interviewed early last year, focus group participants were giving the government the benefit of the doubt.

Some things made them uneasy. Voters had sympathy for public servants losing their jobs, and sensed something slightly savage in the cuts to spending. They were also turned off by the more aggressive anti-Māori policies.

But, like all fair-minded Kiwi folk, they felt a new government deserved a chance to prove itself. That leeway – a honeymoon of sorts – was duly extended. Hence the coalition’s polling held up for much of last year.

The problem facing the government is that it has now thoroughly burnt through that goodwill. Casey Costello’s pro-tobacco shenanigans, the anti-environmental Fast-Track Bill, the relentlessly negative unwinding of Labour’s agenda: that’s quite some way to torch your honeymoon.

The divisive Treaty ‘Principles’ Bill, meanwhile, may have slightly boosted ACT’s ratings, but at the expense of driving moderate voters towards Labour and radical ones towards Te Pāti Māori. Between the 2023 election and the last five polls pre-Christmas, National’s vote slumped from 38.1% to 32.9%.

On the other side of the ledger, Chris Hipkins’ party rose from 26.9% to 29.4%, and support for the Māori radicals jumped from 3.1% to 6.5%. All of which leaves the governing parties just two percentage points ahead of the opposition.

While ACT and NZ First seem unconcerned, National’s leading lights can sense danger, and in a series of interviews late last year signalled a shift towards a more “positive”, forward-focused agenda. The problem is that it’s not clear what that would actually look like, nor if it could undo the reputational damage already done.

While National was well within its rights to reprioritise low-value spending and tackle things like the bloating of government comms teams, the mindless haste of the state staffing cuts – which could total 7000 on current estimates – seems to have registered with the public.

In infrastructure, the same story pertains. National could have sought efficiencies at the homes and communities agency, Kāinga Ora, and gradually increased the building capacity of NGO providers. Instead it has brought construction to a near-standstill, feeding its ideological animosity to state provision at the expense of actual on-the-ground progress.

The public sector and infrastructure cuts, both of which slow spending and investment, have only weakened an economy already struggling under Labour. On a per-person basis, we are experiencing a worse recession than that which followed the GFC.

This is why National so fervently insists it got inflation “under control” by cutting spending. It’s the party’s sole economic claim to fame.

But even that is bogus. Inflation has fallen only because the Reserve Bank had hiked interest rates sky-high.

Labour’s pandemic-era spending was, in any case, never a major contributor to inflation. A 2023 report showed increased corporate profits were responsible for more than half the post-pandemic spike. This chimes with global research blaming factors largely outside governments’ control, in particular corporate profit margins, but also disruptions to supply chains and oil price increases.

Post-GFC, conservative governments worldwide – notably in Britain – successfully sold the lie that the financial crisis had been caused by excessive state spending (as opposed to the actual culprit, weak regulation). But if Labour can push back against the latest lie – and all the signs are that the public isn’t swallowing it – then Hipkins and co have a greater opportunity to be heard than parties usually do after being turfed from office.

Labour’s problem, of course, is that last time round it left too large a gap between ambitious promise and underwhelming delivery. Over the next 18 months, the party will have to tread a fine line, simultaneously offering voters something positive while acknowledging – more strongly than it has so far – the mistakes made in office.

Pledges of sweeping change are unlikely to sit well with a public now sceptical that big dreams will come true. Even the 2023 promise of free dental care for under-30s, a relatively unambitious policy, was – I’m told – met with disbelief that it would ever be delivered. Some kind of mid-range change – not minute incrementalism, but tangible improvements people can see in their daily lives and their communities – may offer Labour its best hope of victory.

If, as predicted, the economy does recover by mid-2026, with growth rising and unemployment falling, National will still be favourite to win another term. The cuts may then be long-forgotten, the coalition’s tone shifted from vengeance to positivity, the approach less ideological, more practical.

And economic fundamentals matter: they are, ultimately, what cost Democrats the presidency in the US last year. But, thanks to the coalition’s failings, the political door is more open to Labour than it would normally be.