National has reinforced its capacity to surprise, but also its capacity for making things up as it goes along. And to make ends meet, Key and English have done several u-turns
A closer look at Budget 2015 shows a government making it up as it goes along. While it's a clever political document, it shows National is trying to plug a lot of political holes with a diminishing amount of capital -- both fiscal and political.
Fair dues should be given to the political strategy employed. It seems now that National is determined to go a little White Queen at least once a year. Where she could believe "six impossible things before breakfast", National likes to do one impossible thing in each budget (and talk a fair bit about "jam tomorrow").
Last year it was free doctors' visits for children under 13; this year it was an increase in benefits of $25 a week. Incremental, small steps they may be, but Bill English is building a body of work that is reasonably described as "compassionate conservatism".
It's a classic example of the old political rule, that right-wing parties can get away with welfare generosity that would sink left-wing parties; and vice versa on economic reform. It also undermines the 'National is looking tired and out of ideas' line of thinking, by showing the old dog still has some fresh new tricks.
Strategically it gives National reach across the centre and shows some heart, which will help with women voters in 2017. And it undoubtedly, in its own small way, asked the middle class to carry a bit more of the burden and eased a little pain for the poorest New Zealanders. Look at the big picture and you see those who were asked to sacrifice a bit more are those who can afford to travel and to save. Even a few dollars a week were taken from those at the top end of Working for Families.
While it seems a long way from the party of Ruth Richardson and Don Brash, let's not get carried away with the idea that this is the birth of 'New National'. Bill English says "National is still National". The sceptic might say it gives National a softer mask it can wear when it turns to tax cuts and other rewards for its base in 2017. We'll have to wait to judge.
So yes, this looks more tactical than strategic. It rattles Labour for a while and buys National some political time. But, when you think about it, it also looks not a little desperate.
This was a patch-up job of a budget; a bits and bobs affair which ticked a lot of boxes and defused a few bombs (for now). Something on Auckland housing, something on poverty, something on a surplus and tax cuts tomorrow. Tick, tick, tick. (Yet also tick, tick, tick in terms of the bomb still ticking!).
I'd also note the irony that you could call this a bureacrats budget; having asked the public sector to do more with less for seven years now, it seems National has recognised some threads of the public net are fraying and much of the big spending was on more customs officers and tax inspectors, with money put aside for public sector pay increases.
All those little somethings do add up to more than you'd expect in a post-election budget by a government determined to get to surplus soon.
But it was limited by this government's own lack of imagination (and refusal to borrow and build, even when borrowing is as cheap as chips). And it did little to address the big and deep issues facing New Zealand. Good politics, only fair economics.
But the point I wanted to make was that is showed a government making it up as it goes along, and one not afraid to flip-flop to make political and economic ends meet. Look at these examples:
In 2013 Bill English told parliament:
"further extension of the current tax on capital gains is likely to have high compliance costs and that is a conclusion that three tax inquiries and several governments have come to over the last 20 years. If it excludes the family home, it will not raise [sic] much difference, it will not raise much revenue, and it becomes effectively a tax on successful businesses. In overseas jurisdictions is has not improved housing affordability."
Despite that scornful analysis, he extended the current tax this week and on The Nation admitted he did so still with no idea whether it would work or not. As Fairfax's Tracy Watkins pointed out, there was no detail on their housing package in the budget proper, so they clearly came up with the idea late (presumably after the Reserve Bank's Grant Spencer made his unprecedented plea) and as a way of patching a growing hole.
It takes the pressure off for now, but even if it works it won't make much difference for several years. The problem remains.
Then there's the benefits increase. Few would damn the decision, but it is another u-turn.
John Key rejected benefit increases on The Nation in October, saying, "if it was just as simple as a bit more cash and that was the heart of the problem, I would strongly suggest government would have fixed it in the past".
You can add to that the "no new taxes" promises. As well as the TCG, we got a new tax on arrivals and departures at airports. English calls it a levy, but won't commit to spending it all on border control. If it goes into the consolidated fund, then it's really a tax.
Want another? What about the 2008 promise that "KiwiSaver members will keep their current KiwiSaver entitlements".
Apart from the dishonesty, which voters seems relatively relaxed about if it doesn't cost them, it smacks of a government lacking a firm plan. Arguably this isn't news. But it does reinforce the notion that National is nimble and an effective manager, but is not committed to a clear or consistent vision.
They're a bit all over the place. Because patches only last so long; and looking at the cuts in real terms to health, education, the police and more you wonder whether this government's approach is starting to wear a little thin.