Jacinda Ardern scores stomping win. Now she must deliver

As expected, Jacinda Ardern’s Labour Party scored a stomping election victory over the weekend and is poised to govern outright holding a majority of 64 seats in the 120-seat parliament – a feat rarely achieved under the nation’s proportional voting system.

Labour was expected to win, but not by this much. Even Jacinda Ardern was taken aback by the wave of support in her victory speech:

“New Zealand has shown the Labour Party its greatest support in at least 50 years”.

“We won seats we hoped for and many that we didn’t expect”.

Jacinda Ardern began 2020 on shaky electoral ground. Her party had failed to deliver on key election promises, most notably surrounding housing and immigration.

Promises to fix New Zealand’s chronic housing affordability problem via addressing supply and demand distortions went unfulfilled.

Labour’s promised ‘KiwiBuild’ program to build 100,000 public houses descended into a farce, with the government abandoning its building target and instead announcing a bunch of demand-side measures to inflate prices.

Labour also abandoned capital gains tax reforms and back-slid on the promise to abolish Auckland’s urban growth boundary and reform infrastructure financing.

As a result, New Zealand house prices have risen to a record high and home ownership has plunged to a 70-year low.

Turning to immigration, Labour promised to cut New Zealand’s mass immigration program by around one-third. Labour instead opened the visa sluice gates before moving belatedly in June 2020 to restrict temporary visa numbers to ensure foreign labour does not compete against unemployed New Zealanders.

Jacinda Ardern’s electoral fortunes turned around when the COVID-19 pandemic hit. She moved quickly and decisively with travel bans and united the nation to fight the virus, implementing a harsh stage 4 lockdown early alongside well-targeted fiscal support.

Ardern’s virus strategy was successful in making New Zealand the only developed nation to eradicate the virus within the community. When another virus outbreak eventually arrived, Ardern moved decisively again and quickly eradicated community transmission for a second time.

Ardern’s biggest strength is her interpersonal skills. She comes across as genuinely empathetic, caring and never condescending or arrogant. She is all about uniting rather than dividing. This strength was also evident in her behaviour after the Christchurch terrorist attacks last year which also united the nation.

Now that Jacinda Ardern has gained a stomping electoral mandate, she now needs to fulfil her promises to reform the housing market.

She once again vowed to tackle the nation’s housing crisis in the lead up to the weekend’s election.

Now Ardern must turn rhetoric into concrete action.

Unconventional Economist

Comments

  1. I hope, with such weight of public report behind them, she and her party can cut free of the lobby groups and rent-seeking parasites and really do some good for their country and people.

    • She’s a lying dog, she already had 3 years to do what she promised, instead NZ had some of the highest immigration on record and housing affordability got worse. Nothing will change, she’s only good at hugging things.

  2. Unless and until the Resource Management Act is radically reformed, NZ will never be able to build the quantity of housing required to depress prices. As Hugh has pointed out many times, it’s only because provisions of the RMA were suspended following earthquakes in Christchurch (and infrastructure funding provided) that land was able to be released for development such that it has had a material impact on the trajectory of house prices in Christchurch.

    Now that Ardern’s government has a parliamentary majority there should be no impediments to reforming the RMA. If the RMA is not reformed, that will be by design.

  3. They need to do what Australia wont do – stop the sale of NZ assets to foreign interests, double down on the competitive advantage and reform their banking system to slowly deleverage the population.

  4. Agreed…now NZ’ers will the get the opportunity to see who their PM and government are really accountable to / governing for. Good luck NZ.

  5. They should do what none OECD countries have done . Create an Infrastructure Development Bank that support its core industries, create a deposit taking institution that actually protect retail deposits of its general populance from risky leveraging by commercial banks , adopt public housing policy that provide subsidize housing to low to middle income earners, provide free / low cost health care system to all (similar to medicare) not sure if simillar thing exits currently there ? Control immigration to get its own infrastructure up to date with projected outcome for future growth.
    None of the above seems to be any problem if they actually want it but its the WILL thts missing, Sadly .
    Same goes for Australia too. Medicare being only exception here tht is already there but one party badly wants to destroy that one too.

  6. What are the New Zealanders doing by putting a human being in charge! Bring back the usual, self-interested liars to the helm, or frankly New Zealanders risk an outbreak of decency by example across the whole nation.

  7. Good luck to her and to the people of NZ. They are probably best positioned out of all Western nations to thrive post-COVID, in terms of a willing (and educated) electorate and without the scourge of a Murdoch press pushing opinion around.
    But as Leith says, time to start delivering – that popularity will wane fast if real change isn’t enacted swiftly.

    • She doesnt have to deliver and wont because there is no independant press that Aus has via murdoch. She is rubbish and has not implemented anything except for death legislation.

  8. Pine Tree paradox.

    We should really start hoping NZ runs a sustainable population and fixes its education “exports” mess given how easily folks use the shaky isles as a back door to Aus.

  9. She got a big majority for 2 reasons. The first is because she has been on TV every day for 8 months telling us we would all be dead if not for her. Half the country believed her. The second is that nobody wanted the loony Greens in power, so knowing that nothing National could do would see them gain power, a lot of people voted Labour to ensure that they got a majority and didnt have to do dirty deals with the Greens – especially on a wealth tax that the Greens said would be a bottom line for any coalition deal.

  10. Ardern’s biggest strength is her ability to fake interpersonal skills. Look at her litany of lies, failure, bullsh1t and broken promises. She’s just another in the long line of narcissistic sociopaths who govern countries all over the world, the only difference being that she presents as more personable and attractive than most. There’s not all that much difference between her and Boris.

    • 1

      But she can hug things and says vacuous sht like “empathy, kindness and compassion” over and over and think that actually means anything. Some of the people, some of the time.

      NZ is proper fkd IMO. Only positive was Peters getting the boot, the two-faced knt.

  11. greedypuppyMEMBER

    Well its a shock these days to have any leader who commands massive appeal without resorting to the ugly side of politics. The MMP electoral system is deliberately engineered to disperse power and the fact Adern pulled off a massive win under that system indicates how popular and trusted she is. From what I hear massive numbers of rural voters gave their party vote to Labour -in fact Labour won the party vote in NZ across all but 4 electorates. Even the arch Judith Collins lost the party vote in her own seat.
    To Kiwis here enjoy the victory for a few days before sliding back into spiteful if you didnt vote for her -to our aussie mates get your sh*t together and restore peoples hope that politics do make a difference-kiwis not only lead the Australia in rugby but now in popular -not populist leadership -a bit of brightness in an otherwise crazy world

  12. I am quietly confident we will see progress on housing issues going forward.

    Do consider the September update to my archival website Performance Urban Planning http://www.PerformanceUrbanPlanning.org .

    Note in particular what Urban Development Minister Phil Twyford has to say. There sure is ‘sorting out’ to do … but the foundations are in place.

    Note too Statistics NZ Building Consents releases for the months of June and August … and the re – introduction to New Zealand of the important ‘residential building consents / approvals per 1000 population per annum’ measure nationally, regionally and at territorial authority level. Across the country NZ is at 7.4 … well ahead of other countries in the English – speaking world … Australia, Canada, USA, UK and Ireland. Lets hope Leith illustrates this in the near future !

    The election result is ‘music to my ears’ !

  13. Labour’s tax policy for 2017 was to have a tax working group. The twg eventually convened and recommended a cgt. Jacinda said she agreed there should be a cgt. But jacinda said it would be too unpopular, so did not implement. Its all about brand jacinda, the msm praise her not because she is effective, its because she is weak and does their bidding. Like the msm praised her when she took a baby to the UN. Whooopdee. She is the msm’s anti-trump, and as long as she does their bidding …..

    • Brand Jacinda Manual: wear a headscarf, hug an efnic, give your kid a Maori middle name, create a ‘war’ (covid supposed ‘crisis’) and say you’re the triumphant war leader (Churchill style).

      • It amazes me how nz is considered so progressive on indigenous issues yet so many maori live in aus, (never seen an aborigine in nz apart from kurtley beale and the ellas). Kind of shows the basics of opportunity and economics are way more meaningful to most than token identitarian measures. And those that trumpet the tokenism tend to be the wealthy. Like when have the greens ever won a working class seat?

      • greedypuppyMEMBER

        there is a Maori word for you mate

        Pourangi -crazy

        There is a word in English as well -racist

  14. – KiwiBuild was a disaster from day 1.It only helped the construction industry in an already overheated (market). But the KiwiBuild house were unaffordable for the average Kiwi.
    – NZ has NOT a housing shortage, it has a housing AFFORDABILITY problem. Rents rising fast, property prices too high. All as a result of a credit bubble. Sounds familiar to one “Leith van Onselen” ???

  15. UPDATE …

    WORKING FROM HOME TRENDS … New Zealand and Australia …

    … New Zealand …

    Wanted: Bigger houses, to work from home … Colleen Hawkes … Stuff New Zealand

    https://www.stuff.co.nz/life-style/homed/real-estate/123110854/wanted-bigger-houses-to-work-from-home

    Just look around the office and it’s easy to see the whole idea of working from home has taken root.

    But while bums on seats are down, most often productivity is not. Successive Covid-19 lockdowns and level changes have acclimatised many of us to a “new norm”, and we quite like it. Or perhaps, more accurately, we really like having the flexibility to work from home or the office.

    So, it’s not unexpected to see Google trend reports showing that the term “work from home” was searched by more New Zealanders than ever during March, when the entire country went into lockdown level 4. And Google reports searches are still up on the same time last year. … read more via hyperlink above …

    • … and Australia … important public sector survey …

      APS managers won over by working from home … Judy Skatssoon …(Australian) Government News

      https://www.governmentnews.com.au/aps-employees-say-working-from-home-works/

      A survey of more than 6,000 Australian Public Service employees, including nearly 1,400 managers, has found that working from home has been an ‘overwhelmingly positive’ experience.

      The study suggests that making employees go back to the office full time could erode some significant gains, researchers say.

      They outline their findings in a report titled Working during the Pandemic: From Resistance to revolution.

      The report found that managers were highly supportive of working from home, representing a major mindset shift. … read more via hyperlink above …
      .
      .
      Working during the Pandemic:: From resistance to revolution? … University of New South Wales (Canberra) pdf

      https://www.unsw.adfa.edu.au/public-service-research-group/sites/cpsr/files/pdf/548493134 – Working From Home Report_Final (1).pdf

  16. AECOM cuts Sydney office footprint as staff work from home (behind paywall) … Michael Blebby … Australian Financiual Review

    https://www.afr.com/property/commercial/aecom-cuts-sydney-office-footprint-as-staff-work-from-home-20201019-p566fq

    AECOM has broken its lease with Investa two years early and cut two floors from the space it occupies at the landlord’s 420 George Street tower in central Sydney in response to more staff working from home. Read more via hyperlink above …

    … and in the UK …

    Corporate giant Deloitte is permanently closing 4 offices, putting 500 staff on work-from-home contracts … Reuters / Business Insider

    https://www.businessinsider.com/deloitte-offices-covid-work-from-home-remote-working-2020-10?IR=T