Labour stumbles back into the sunshine of policy land

Saturday, 25 October 2025

Luke Malpass is politics, business and economics editor

OPINION: As former prime minister Jim Bolger was farewelled at Our Lady of Kāpiti Parish in the midst of some truly biblical weather on Thursday, there was a phrase used by one of his sons.

“My name is Matt. I'm number eight,” of the nine Bolger children, he introduced himself. He is also a former pro-vice-chancellor at Waikato University and currently sits on the Fonterra executive.

He talked about how many books his dad read and of their varied subjects, from politics to science, religion and technology.

He also talked about his father’s deep but ultimately pragmatic faith. But then he turned his attention to leading.

“Oddly, given his chosen profession, I have never met anyone as unconcerned with what people think of him as long as he was comfortable that he was doing the right thing.

“Now, in the face of opposition, we all know the confidence that you are doing the right thing does not, of course, always mean that you’re doing the right thing. There's judgment involved in all of this.

“But luckily, JB tempered his confidence with an incredible appetite for learning, for reading, for questioning, for listening, for understanding where other people are coming from, and finding a way to bring people together.”

The funeral was a reminder that the political landscape has changed, but also that the gifts needed for political leaders to succeed were fundamentally different in Bolger’s day than they are today. He was very comfortable in town halls, rugby clubrooms, boardrooms and RSAs up and down the country. Today, that isn’t how you win votes.

MMP has also made elections fundamentally national with a side of local issues. Back in Bolger’s day that was also different. And obviously both TV, then the internet, and then social media have changed the game yet again.

But the point Matt Bolger made - about sticking to doing the right thing, but also being aware that it could be the wrong thing - lodged in my mind. As did the bit about Bolger tempering his own confidence - which was not wilting - with plenty of reading.

Inevitably when these events happen, one is drawn to comparisons with the current era and personalities.

One of the current Government’s biggest problems - exemplified by the Prime Minister’s approach in particular - is a seemingly unshakeable belief in the rightness (as in the correctness) of what they are doing. He has the plan, the plan is working, and we will all see it soon.

This is an assessment shared by few outside the ninth floor of the Beehive - within the coalition most believe in the general direction of travel, but as for the plan working politically, views are less charitable.

While changing the whole direction of travel would be disastrous, a course correction is definitely needed. Most senior ministers know it, the smaller coalition partners know it. It is so. Having the wisdom to recognise and act on that, however, is a different thing.

However, it was not the Prime Minister making much of the political running this week, but the Labour Party - first with a deliberately released policy on Monday and then with a not-deliberately released one on Tuesday.

The deliberate policy - the NZ Future Fund - was pitched at fertile political ground but was pretty average, while the accidentally released one, an independent body to fix GP funding, looked really quite good.

The NZ Future Fund (presumably named after an Australian fund of the same name) was a mongrel of a thing. It looked like it was probably a reasonable policy when first conceived, but too many cooks in the kitchen served up a mess with poor problem definition and too many unanswered questions to have any decisive political effect.

The basic idea was reasonable - that Labour wants the Government to invest in New Zealand businesses and profit from doing so. But it doesn’t want ministers doing the investment, so it would set up a fund, run by NZ Super, to do it instead.

If this had been where the idea started and ended, it would have been fine. Essentially it would have been a side fund, run by the guardians of the Super Fund, with a mandate to invest in New Zealand firms and maximise returns within that mandate.

That would have been a clean argument for it and would have given the fund one set of incentives: maximise profitability off NZ investments. Agree or disagree with it, it is clear what it is.

The current Government is certainly not against this sort of thinking, as Nicola Willis tipped $100 million into the Elevate venture capital fund at the May Budget - some from the Government’s NZ Super contribution and some from its Budget capital allowance.

But then it got messy. Labour said it was going to put some existing government-owned companies in the fund, but wouldn’t say which ones, and it would help provide capital to the fund - but not really, because they probably couldn’t be sold.

Again, perhaps the germ of a good idea. It might well be sensible for the Government to have some sort of arm’s-length holding company or investment vehicle to manage the commercial assets it owns.

In the end, it was all trying to do too much. There seemed to be vague and competing objectives and, because they couldn’t or wouldn’t be specific about which companies would go into the Future Fund, it all just looked poorly thought through - even though thought had clearly gone into it.

There’s definitely a political market for these sorts of policies, and around the world government investment in private companies is in vogue (even in the US!) - but it was poorly executed.

And now, assuming Labour takes this policy into the election, when it comes to drawing up a fiscal plan some time next year it will have to account for the reliable dividends that these companies contribute to general revenue from this move. That’s $700m from the main government-owned companies, including Transpower, assuming Labour doesn’t want to reveal which companies it plans to put in the fund.

It would have been better to announce the policy and say it would tip a specific amount of money in that it would find prior to the election - which it will now effectively have to do anyway.

The second policy - which was accidentally released and which Hipkins was blindsided by - for an independent health pricing authority was a good one. A technocratic thing and not necessarily a huge vote winner, but a very sensible policy. But again, the politics were poorly managed.

In a smaller announcement Labour also said it would support the gaming industry with more subsidies than the Government currently dishes out to it. In common with the film industry, gaming development and talent follow tax breaks and incentives. If the New Zealand government wants a big industry here, more and bigger subsidies are probably the price of entry.

Nevertheless, all this showed that Labour clearly has to rebuild a bit of muscle memory around how best to design and announce these things, and, at a more basic level, what policies work in opposition.

At the end of the day the only thing oppositions really have is rhetoric. So either the policy has to be simple, or it has to be able to be boiled down.

The successful strategy so far of saying little and letting Luxon’s unpopularity do the rest is now coming to an end. And if Labour is going to be the first one-term opposition since the National Party in the early 1970s, improvement will be needed.

And while the ninth floor was clearly buoyed by Labour’s first policy out of the gate, it probably shouldn’t be. The policies aren’t some crazy out there thing, and one would expect Labour will get better at these as it goes along. The problem for Christopher Luxon is that he hasn’t.

The Prime Minister heads abroad on Sunday to Apec, while next week Parliament is in recess. After a hectic three weeks, there will be a lot of taking stock - on both sides of the aisle.