One Budget done and certain to pass. Two to go. That’s how to measure the life of this government: Budget by Budget till the third is passed in August 2008.
But equally important is the one after that. How does Labour get to present the 2009 Budget?
First it has to hold New Zealand First and United Future in until 2008. Then the computations get tricky.
The Greens will do as they did last term and vote against or abstain on Budgets they think not are green enough. The Maori party will probably vote against Budgets they think are not Maori enough. Both set the bar high.
So to be sure of beating off National and ACT, ministers must keep its two support parties sweet.
So Michael Cullen’s Budgets must deliver the post-election deals and give the small parties publicity for those elements.
So far he has, to the letter.
Among New Zealand First’s items: 1 per cent more on superannuation, a big racing tax cut, a start on adding 1250 more police by 2008, a focus on “elder care” in health spending, more money for the Office of Treaty Settlements and an “export year” in 2007. Add renewed waka-jumping legislation and no tolls on Tauranga’s second harbour bridge.
Accordingly, Winston Peters was all over the Budget on Thursday in the House. He hasn’t gushed like that since 1998 when he delivered the last of his two Budgets, shortly before Jenny Shipley fired him, then stole enough of his MPs to limp through the rest of her term — to defeat.
Helen Clark is a student of recent political history. She does not want a Shipley-style repeat. She treats Peters with respect and keeps in close touch, especially when there is trouble abroad.
Nor does Peters. Clark’s reward so far has been a vigorous ally in the House, with acid questions aimed to wound National.
A couple of weeks back, with the Telecom leak affair raging, Peters diverted attention with confidential Don Brash emails, of which he still has a stash, including some rather personal ones, for use at opportune times. (He was unconcerned at the collateral damage to United States sensitivities.)
But has Cullen delivered too much too soon? Would it have been better to dripfeed the post-election deals over three years?
Actually, that is what he thinks he is doing. Some items, such as the extra police, will need a full three years (though surely no government will truncate that). And there is also a large list yet to be done, not least the “seniors gold card” to identify oldies’ entitlement to public sector benefits and “negotiated commercial discounts” and a bill to at least select committee stage on Treaty of Waitangi principles.
Expect Clark and Cullen to play up New Zealand First’s role in election year.
And United Future’s. Peter Dunne is less precipitous than Peters and wants his wins mainly in 2008, to maximise impact, though he already has his business tax review under way and a discussion paper on family income splitting for tax.
Moreover, both he and Peters want a 30 per cent company tax rate. Cullen could dangle that before them for the 2008 Budget.
So there is every reason to think the two support parties will see the government through three Budgets.
But what then?
Dunne’s core Labour instincts were on show over the taxing of offshore investments last month. But he was in a National cabinet in 1996, had tea with Brash last election and will in 2008 stick with his commitment to talk first with the major party which gets the most votes.
Peters will almost certainly take the same tack. His aversion to National as a whole is much less intense than his aversion to Brash, the result of Brash’s hard line on Tauranga last year and, New Zealand First believes, his dismissal in advance of Peters as a support partner.
A change of leader might well tone down Peters’ feral attitude to National.
This poses complex calculations for Clark. New Zealand First can lose only 0.7 per cent vote share in 2008 before it goes below 5 per cent and exits Parliament.
Would Clark be better or worse off then? If New Zealand First 2005’s vote was mainly Labour-leaning and thus a plunge below 5 per cent would tip votes to Labour, that would lift her chances of out-polling National again and securing her fourth term.
But if the fallout from a sub-5 per cent plunge went National, as in 2005, she would need a stronger Green presence to give her more overall votes than National-ACT-United Future-Maori party — though most additional Green votes would likely come from Labour. Better in that event to prop up New Zealand First.
Much depends on Peters, obviously. He likes being Foreign Minister. He has prestige. By 2008 he should be more on top of his brief and look the part more. He gets on well enough with Clark. Why end a fine affair?
Why indeed? But he is an instinctive outsider, which brought adulation from other outsiders. And he has an almost self-destructive streak, which has denied him the respectability he craves.
Can even a wily Clark-Cullen 2008 Budget trump that?