‘We didn't help ourselves’: Labour’s ‘woeful’ campaign laid bare

Saturday, 21 October 2023

National Affairs Editor Andrea Vance tells the complete story of the 2023 election. With extensive interviews and exclusive access, this is the inside story of what brought down the most popular government in recent history. Read part two in tomorrow’s Sunday Star Times and on The Post.

The signs were there. Or, rather they weren’t – and that was the problem.

One weekend in early August, a senior Labour MP drove into Whanganui. It was a chilly morning. But, standing by the side of a busy main route into town, was National’s candidate Carl Bates, grinning, surrounded by 10volunteers enthusiastically thrusting placards at passing motorists.

It was nine weeks to polling day, the way-point at which candidates are officially allowed to erect their hoardings. Often, that’s a lively event, marking the start of election fever with drill-and-hammer photos.

But neither Steph Lewis, the local Labour MP, nor her red-trimmed hoardings, were in sight. The MP’s heart sank: “There is a rule of thumb that overturning a majority of 8000 is nearly impossible to do.” Lewis won the seat in 2020 by an 8,191 margin. “But, the Nats were highly energised. And at that point, I thought Whanganui might slip.”

Up and down the country, a similar picture was unfolding. A forest of blue, printed corflute sprang up, as National aggressively wooed voters.

In the digital age, awkwardly posed-election posters seems like an expensive and ineffectual way to contest a general election. After all, signs don’t vote. But billboards are still a key part of modern-day campaigns: well-resourced, visible party branding sends a signal to constituents that a party is hungry for their vote.

National’s volunteers erected 18,000 signs – and they were all pointing to Labour’s catastrophic defeat last weekend.

‘We kind of expected it’

Christopher Luxon’s party seized 45 electorate seats, to Labour’s 17, although half a dozen seats are too close to call as the country awaits the counting of special votes by November 3.

Chris Hipkins – prime minister for only 263 days – delivered his party’s second-worst result since 1928. At 26.9%, the party’s support virtually halved from the 2020 election, and voters deserted Labour in their traditional “red wall” Auckland seats.

The pummelling was underlined by the success of minor parties to its Left: four of the seven Māori fell to Te Pāti Māori, which also virtually doubled its share of the party vote on 2020 election results. The Green Party closed in on its highest ever result (in 2011), swiping Rongotai and Wellington Central.

“The party vote? We kind of expected that,” the senior MP mused after last weekend’s thrashing. “But, all those seats? In the end, it was worse than my worst-case scenario. It was woeful.”

With almost half the caucus either out of a job, or facing a nervous wait for the final results, the party is dazed with shock, struggling to come to terms with what was the biggest swing ever recorded against a ruling party.

The Post spoke to a range of insiders, most on the condition of anonymity, about what lead to what one MP described as a “humiliating” defeat.

For some, the crushing loss was inevitable, the electorate’s desire for change was too strong after six cruel years, dominated by the Covid-19 pandemic and global economic shock.

But others say the party must take responsibility for a litany of mistakes and raise soul-searching questions about Labour’s appeal, and future direction.

A narrow path to victory

The majority of those The Post spoke to believe the result was set in stone some time ago. It’s only the turning point that is the subject of debate.

For some, it was a minute-to-midnight on August 17, 2021 when a single case of Covid-19 plunged the city and its surrounds into a joyless 107-day lockdown. “Turning Auckland into a sort of Covid Gaza was ridiculous,” a long-time member and now former staffer said. “The prolonged siege of Parliament grounds was the other thing that cost us the election. It made the whole Government look weak when they should have just gone in and cleared the tents.”

For others, it was the murder of dairy worker Janak Patel, whose death outside Sandringham’s Rose Cottage Superette crystallised a growing sense of fear that retail crime was out of control. “Crime really hurt us, particularly in Auckland,” a disillusioned ex-minister said.

“We were behind in Auckland for about two years, and never recovered,” a key party insider says. “Add to that, crime was being served up to people on a daily basis by the Nats. And then there were fuel taxes.”

Some blame Jacinda Ardern’s “selfish” decision to quit, robbing Labour of her star power. “I don’t accept why she stood down. She had a good chance of beating Luxon. And they certainly wouldn't have lost the number of seats they lost,” the ex-staffer said.

But another senior Government insider rejects this: “I think that’s just one of the stages of grief. She would have lost too. There was this deep hatred towards her.”

Whatever the reason, the trend of decline started in early November 2021. By June, the following year, it picked up a head of steam. For much of the year, the polls indicated most people believed the country was headed in the wrong direction – and by polling day the overall mood was for change.

When the electorate tires of a ruling party, this dynamic is almost impossible to turn around.

But the sudden jolt of Ardern’s resignation offered a slim prospect: if the public was hankering for change, Labour could offer it, with a fresh face and new agenda.

January 19, the first day of Labour’s annual caucus retreat, dawned cloudy. Before the Christmas break, Ardern had begun to express doubts to her inner circle – sources say just Grant Robertson, and Hipkins. Robertson tried to talk her down.

Ahead of the caucus gathering, Ardern summoned her Cabinet to Napier War Memorial Centre for a 7.30am meeting. One attendee recalled an oddly cavernous hall for such a small grouping. It was assumed to be a gathering to tick off some Government business. And then she dropped a bombshell.

“I distinctly remember her saying she hadn’t got the drive to take this forward and do another three years. I was really sad,” the attendee said.

“I thought Jacinda could win, there was a constituency there. But I got it. Then Grant said he wasn’t going to put his name forward – and it became clear Chris was.”

Events moved quickly. This new leadership wasn’t presented as a fait accompli – but it was pretty close, the source says. Hipkins immediately began asking colleagues for support. This gave no opportunity for alternative candidates – like Michael Wood or Kiri Allan – to organise.

“There wasn’t even time to digest it,” the insider said. “At the [later] caucus meeting there was a big debate about how long nominations would be open for. Some, including Kelvin [Davis] wanted it sorted out that afternoon. If there was a competition, I would say Chippy would have won. But there was no time to even think about that.”

The handover of power was completed in under a week. Swiftly, came a reshuffle, promoting Wood, Allan, Jan Tinetti, Ayesha Verrall, and Willie Jackson, and demoting stalwarts Nanaia Mahuta and Andrew Little.

Ardern’s Government had become bogged down in a series of complicated, contentious reforms. “We had so many fish to fry,” a senior Beehive source said. “And we didn't push through stronger things on climate change and child poverty – areas where we would have leeway from the public to go further. But, we were burning capital and bandwidth in other areas.

“We ended up dying in the ditch over things like water reforms, media mergers. Are those the kinds of social reforms that Labour governments want to achieve?”

This confusion had opened up a line of attack for National. “It made it very easy for the Opposition to say we couldn’t deliver – and that we weren't focused on the things that mattered. We were quite sluggish in 2022 with the emerging problems with cost of living, health, education and crime. Those are bread and butter issues for Labour governments.”

Bread and butter was what Hipkins served up, with a promise that tacking inflation would be the top priority of his Ministers’ slimmed-down work programme.

“It was a narrow path to victory,” the party insider said of the reset. “And then we got bogged down in the cyclone.”

Heavy weather

On Valentine’s Day, Cyclone Gabrielle lashed the East Coast, with gale-force winds and record rainfall, killing 11 and devastating Gisborne and Hawke’s Bay. There was extensive flooding across Northland and Auckland, still recovering from earlier summer storms.

“It was the most expensive, natural weather events in New Zealand's history, and it was a huge distraction for Government. I think that is understated,” the Beehive source said. “For the first part of the year, normally a government tries to take the initiative and set a plan. We were not only going through a change at the top, but immediately dealing with the recovery.”

At first, none of this hurt. Chippy’s frankness and rough edges were a refreshing change from Ardern’s polish, and the public warmed to him. From February-early May, National was again trailing Labour in the public polls.

The party’s qualitative research was signalling they were saying all the right things. Voters appreciated the new emphasis on household cost pressures. The public liked Hipkins – and more importantly, felt that he understood their worries. But there was an underlying caveat: let's see if he actually does anything about it.

The May 18 Budget was the Government’s opportunity to answer that question. For well over a year, officials had been working on a tax package for Finance Minister Grant Robertson and Revenue Minister David Parker.

The idea was to spread the burden more fairly – and the Government flirted with both a wealth tax (on assets, excluding the family home, above $5 million) that would fund a tax-free zone giving every wage earner an extra $20 a week, and a capital gains tax.

Opinion was divided among ministers. One told The Post that while they supported CGT, a wealth tax was “a f….g nutty idea.”

Another firmly believed the wealth levy was a necessary, structural change. “One of the good phrases in politics is the old John Howard one, that good policy makes good politics. And a lot of us believed that about [the wealth tax].”

After months of discussion, Hipkins alone made the decision: he killed “the experiment” ahead of the Budget. Parker reacted badly, quitting his revenue portfolio two weeks later, earning the ire of many of his colleagues. “He needs to take the hint [and leave],” the Government insider said. “It was the way he acted afterwards which was what got people. Whether it was low EQ, or whether he was doing it on purpose, it is fair to say there a few who were f….d off.”

But others backed him – and some candidates publicly – and unhelpfully – expressed their support for a wealth tax during the campaign.

The Government resisted intense pressure to put more money in voters’ pockets, and went for a ‘no frills’ Budget that put $1.2 billion into early childhood education and scrapped a $5 prescription charge.

“Undoubtedly, it harmed any chance that we had of presenting a clear, well articulated alternative to National,” the wealth-tax supporting ex-minister said. “It was the progressive alternative, worked out by our two leading financial ministers with the support of every other minister who had a financial delegation.

“The call was made on the wrong assumption that we could avoid a debate about tax, which is never the case in an election. We ended up arguing against National’s tax cut plan, instead of arguing for what we would do. That's a weak position to go into a contested campaign.”

The move “demotivated many of our own people and humiliated and created a sense of division with Grant and David, who had honourably been going about the work. It was probably the most significant call of the campaign and damaged us significantly.”

Sources close to Hipkins take a different view. “Our problems were way bigger than a wealth tax,” the Government insider said.

The Beehive source agreed “The wealth tax wasn’t the right thing for us. But I do think we missed the Zeitgeist, which was for more, something bigger.

“The challenge was that anything big spending would be inflationary. He took, both to the Budget and the election, very Helen Clark/Tony Blair-style policies which are targeted, discrete kind of policies.

“And while it’s clear now that people were wanting something more substantive, it’s not immediately obvious what that was.”

The Budget hadn’t delivered relief to stretched household budgets. And there was no plan B: the party was out of ideas. Ministers and their staff were exhausted by the pandemic response and economic crisis. Ardern’s resignation had hollowed the prime minister’s office of experienced staff – a problem that would later haunt the campaign.

Support began to drop again. The resignation of immigration minister Michael Wood, over a conflict of interest, quickly followed the sacking of Stuart Nash, and defection of Meka Whaitiri to Te Pāti Māori.

The final nail in the coffin was the arrest of Justice Minister Kiri Allan after she crashed her ministerial car into a parked vehicle and failed a breath alcohol test.

Labour’s polling plunged into the 20s, a death zone from which it would never recover.

“In the last five years, we had focused on carrying out all these legacy reforms, which wasn't what voters wanted to hear about,” the party insider said. “They were looking to the Government to help them out with the cost of living, or at least do something that looked like it was going to get better.

“And then we had four ministers f… up. We were focused on ourselves, and we looked like we were focused on anything but the voters.”

Hipkins kickstarted the clawback to power with a rousing campaign launch in Auckland on September 2. It had all the flavour of Labour – the promise of free dental care – but none of the sugar. A new commitment to spending restraint and a workforce shortage would see it apply just to under 30s.

This, a pledge to extend 20-hours of free nursery education to two-year-olds, and removing GST from fruit and vegetables were the splashiest items on Labour’s manifesto to tackle the cost of living crisis.

There were 10points to this recovery plan. It was a “laundry list” that was too complicated to communicate to voters, a former minister said. Even Hipkins struggled to remember what had been announced, and had to be prodded to sell it.

“You’d talk to someone who was concerned about the cost of living: would you get the ECE? Maybe not,” the minister said. “Would you get the extra Working For Families? Maybe. Do you use public transport? It was bitsy. There was no central unifying thing, and it was really hard for us to get cut through at ground level.

“There was no clear mission and purpose for what we were doing.”

An experienced organiser attributes the loss of safe Labour seats – such as Wellington Central and Rongotai – to this absence of vision. Votes slid to the Greens – and Labour’s traditional base stayed home.

“The Labour Party has effectively surrendered between the Terrace tunnel and the airport. There is this policy of unrequited deference to the Greens, almost this sense that the Greens are better than us, purer or more virtuous.

“The Labour Party are acting like the handmaiden of the Greens. They all go weak at the knees for [Wellington mayor] Tory Whanau, and they continue to be apologists for her in office.

“We have not even attempted to give the Green-curious demographic – Gen Z, urban, younger voters – a reason to vote Labour over Green. We don't even try to mount the case as to why Labour is a better choice for a young person living in Wellington.”

In the end, what ideas Labour did offer up couldn’t compete with National’s pledge to offer tax cuts – and Hipkins spent much of the campaign talking about his rival’s central policy plank. “Some of us felt we were playing on their turf. And that was never going to be an easy place for us to win,” the ex-minister said.

The outgoing prime minister had what the party insider describes as “a campaign of two halves.” In the beginning, Hipkins appeared awkward in public, and lacklustre.

It’s difficult for an incumbent to shift from office to campaign mode. And in the first few days, Labour was winded by a series of polls, beginning with The Post/Freshwater Strategy survey, which saw them dip to new lows.

“The Opposition is set up to be on a campaign footing, and they go with a bang,” the Government insider said. “And those guys [National], they did a great job, came up with some great events, and the right kind of visuals every day.”

Protests by anti-vaxxers “spooked” the campaign team. “That lead us down the direction of more low-energy, but safe, events. And, in the first week, there were a lot of business events, which looked a bit corporate and boring.”

One outgoing MP blamed Hipkins for being distracted by his new love, former staffer Toni Grace, and their habit of keeping in touch with online Scrabble games. “He was always on his phone. He didn’t look like he wanted to be there.”

But the Beehive source dismisses that. “I don’t think that’s fair. All Prime Ministers need something away from the job, and it's easier if you have got family and kids. I actually think the relationship helped. Without it he would have been very lonely and possibly quite isolated.

“He wasn’t distracted – he was learning as he went. He wasn’t a natural, and as he said, it’s hard coming in after Jacinda.”

There were moments of levity – usually involving plates of his favourite savoury pastries. “He was eating heaps just because he likes to eat sausage rolls,” the Government insider revealed. “People would make him sausage rolls – and so you have to eat one.

“We noticed that for the first two weeks, Luxon wasn’t touching food. And then, suddenly, he was licking ice creams and eating quite a bit. I reckon they looked at us and thought: ‘there’s something in this eating. They’ve got some research, we’ve got to get onto it.’ When in reality we were trying to tone it down.”

Whether it was meat-filled crusts, or just sheer grit, Hipkins found his mojo after clashing with Luxon in the second televised leaders debate. “That was such a turning point. It was go-down-on-our-knees or go out swinging, and maybe have a chance of winning this thing.”

Ultimately, they couldn’t. The story of the election can be framed with one important indicator: retail petrol prices. In early 2022, refilling the tank was really starting to sting, with fuel inching close to $3 a litre.

Although this was mainly due to external factors: the Russia/Ukraine conflict, weak supply, global demand at an all time high, the Government introduced a popular subsidy on excise duty and road user charges.

Fifteen weeks out from polling day, Robertson removed the relief which pushed up the price at the pump by almost 30 cents a litre. Seven weeks out from election day, Labour unwrapped a transport policy package that would hike petrol prices by a further 12 cents.

“It is fair to say we didn't help ourselves,” one party insider sighed.