History is re-written by the victors

New governments struggle not to make things up about their opponents’ legacy.

This National-led coalition is not one to break with tradition.

As part of convincing the country that the policy medicine it is promising is essential – because the economic and societal disease we have is worse than first thought – it is exaggerating even its own previous diagnoses.

Numbers with lots of zeroes are flying around, like drones hanging over fiscal cliffs, all allegedly mis-spent or under-budgeted by Labour over the past six years.

Many of the numbers make great headlines but not a lot of sense.

In his state of the nation speech, National leader Christopher Luxon claimed his ministers had discovered Labour under-budgeted future transport projects by – wait for it – $200 billion. Luxon said in subsequent comments Labour had failed to cost in projects like a second Waitematā Harbour crossing and light rail from the city to Māngere, among many others.

The number National chose to roll up and use for this purpose is both astronomical and naive.

Sure, funding for a second harbour crossing is not yet in the Crown’s books. But that’s because it is no more real than a bridge across Cook Strait, or a tunnel across the Tasman. It has been discussed for 50 years and even if a decision could be made on one option (a tunnel, say) within the next decade, it would be decades more before it was an actual thing.

Cost alternatives vary wildly and no detailed business case is on the horizon, let alone complete.

Similarly, how would any government, of any persuasion, cost into its books the light rail project, which had a business case cost of around $14 billion but was estimated by the Treasury to have a total associated cost of up to $30b.

National itself backs a second harbour crossing, but as a questioner pointed out to Luxon after his speech, it doesn’t seem to have costed that into its pre-election spending promises. The point being, it should not have, and a government ought not to have, before any real cost becomes known and any timing associated with a project becomes clear.

As projects are confirmed, total and annualised forecast spending is allocated by governments in their Budgets to cover the cost. Often, they account for them in three-to-four-year forecast periods.

Politically, however, these big numbers of up to 11 zeroes are thought to be compelling evidence, to a public with little understanding of government finances, of recklessly bad budgeting by the former administration.

Luxon also castigated Homes and Communities (the agency formerly known as Kainga Ora, once it abides by this Government’s diktat on losing te reo names if not the primary focus of its role) for operating in a manner that could see its debt balloon to $29 billion by 2033.

Sounds bad. Very bad. But that figure will need context once an independent review led by former Prime Minister Sir Bill English lands by the end of March. Kainga Ora has been tasked with a vast house-building programme. If that is the reason for the expected growth in debt, National could cut the borrowing by cutting the building. But is that politically saleable?

The numbers game plays out in other ways when new governments paint their predecessors in the worst possible light.

Luxon and Social Development Minister Louise Upston announced more stringent application of sanctions for those on the jobseeker benefit who fail to meet requirements.

In part, they justified the enforcement of these existing sanctions by arguing the number of people on jobseeker benefits had risen by 70,000 since Labour came to power in 2017 – and the number of sanction actions had dropped 57 percent over that time.

Asked repeatedly if those numbers were statistically related, or made sense together, both answered that it was pretty obvious to them that 1+1 = benefit abuse.

Statisticians could almost be heard muttering about correlation and causation. However, politicians entertain no such distinction when their common sense and party ideology demand otherwise.

Luxon also tapped away at his calculator to claim in his state of the nation speech that the coalition had already identified $7b in cuts to Labour’s spending programmes.

He went further, actually claiming the so-called ‘mini-mini Budget’ from Finance Minister Nicola Willis before Christmas had “delivered more than $7b in savings”. Not only would that have been one of the biggest budget impacts of recent years, it might also have been a surprise to Willis, who had downplayed the impact of that limited financial statement.

Again, the number was unexplained, but it is likely to involving cutting programmes or commitments Labour had made and, for now, ignoring whatever the new Government will have to spend in their place.

These gross figures, without line-by-line explanations and real time-frames and without netting out what will still need to be spent, are almost meaningless, but no less concerning.

National and Luxon are far from the first to round up, hype up, tally up and make up numbers to kick their vanquished opponents’ policy butts as they go out the door. Labour’s tiresome “nine years of neglect” mantra levelled at the Key-English government ran for almost five years and became a tedious broad brush.

Labour plainly spent way, way more than previous governments or even its own original intentions, and would cite the pandemic and economic downturn as justification for much of what was a substantial outlay of taxpayer funds. It was already trying desperately to cut back its own spending, with a multi-billion-dollar reduction order to the public service in mid-2023.

Public policy specialists, academics and journalists must probe carefully any numbers now being ascribed by the new Government to those spend-ups and overspends.

Luxon is selling himself as the leader who will tell it like it is and not shy from delivering the facts to voters. There is and will be plenty to criticise from his policy perspective in Labour’s choice and method of spending.

Luxon put it this way: “It is worth being straight with each other about the size of the challenge.”

It would be good if he can rein in his more hot-blooded ministers, advisers and speech writers and give us numbers that mean something rather than spook the public without context.

There’s no need for political clickbait. And as he pointed out, we’re all a little fragile right now.

*Awkwardly, after this column was first published, the NZ Herald disclosed NZTA had secretly estimated last November that National’s own transport projects could be underfunded by as much as $24 billion – and by an average estimate of around $16b. Big numbers can swing both ways.