Prime Minister and Labour leader Chris Hipkins. Photo / Alex Cairns
When Chris Hipkins replaced Jacinda Ardern as prime minister in late January it was initially seen as an election game-changer for Labour.
Hipkins was quickly out of the stalls, injecting new purpose into a Cabinet that had become moribund after a torrid three years combating the target="_blank">Covid pandemic, surging inflation and the cost of living crisis.
There was his policy bonfire. The cosying up to Auckland business. Meetings with Australian Prime Minister Anthony Albanese. The Auckland floods and Cyclone Gabrielle which provided an opportunity to demonstrated leadership. But his Cabinet reshuffle turned bad when two ministers he promoted had to resign their warrants within months.
“At the beginning, it looked like a good option to refresh the Labour leadership, but Chris Hipkins didn’t maintain the momentum,” said Jarden’s co-head of investment banking Silvana Schenone.
But in reality, observed the New Zealand Initiative’s Roger Partridge, “Hipkins really brought more of the same. He was the architect of the Ardern-led government’s reforms to education, the public service and the Covid policy.
“The changes introduced by the so-called bonfire were superficial and did not address the government’s anti-growth, anti-accountability approach, nor its fiscal ill-discipline.”
“It looked like a game-changer, but I reckon his politics were dominating from late 2022 anyway,” said NZ Rural Land chair Rob Campbell. “I think he is a caretaker and avoider of the real issues.” An investment chair agreed, “it is hard to see how Chris Hipkins has materially changed Labour’s chances even after his bonfire. As a Minister, he was at the heart of the many problems. Health, education and law and order.”
CEOs responding to the Herald’s Mood of the Boardroom Election 2023 Survey were asked if they thought the leadership shuffle had been an election game-changer for Labour. Some 27 per cent agreed. But the majority, 59 per cent said “No”. and 14 per cent were “Unsure.”
Contact Energy chief executive Michael Fuge said Hipkins started well and he couldn’t fault his instincts and energy levels. “But the levels of idiocy within his own caucus outside Woods and Robertson beggars belief.”
Realpolitik is also at play. Some observed that the shuffle prevented a certain loss. But the ministerial chaos robbed Hipkins of his chance.
“It made Labour more competitive and gives it a fighting chance now. Chris Hipkins has done a good job, or at least as best as could be done, in the circumstances, of moving his party from the progressive left to the centre. National has had to try harder and be more visible because of Hipkins. Prior to him it was winning just by doing nothing,” said an Auckland-based CEO. “He is the most experienced and able person to lead Labour right now. In that regard, he has much more political experience than Christopher Luxon.
“Regrettably though for Hipkins his bench strength is poor, and his Finance Minister Grant Robertson had his head out of the game for much of this year. Business’ preference for a centre-right government will be very strong this election but at the very top Hipkins is the stronger leader even if his basic team and policy prescriptions aren’t very attractive. This year it really is a choice at the elections of who and which you dislike overall least — a punch in the arm or a kick in the leg.”
CEOs were asked to rank Hipkins and Luxon on who has the best attributes to lead New Zealand through challenging times as our next prime minister. The National leader was clearly ahead with an average score of 3.49/5 to the Labour leader’s score of 2.95/5. Hipkins was ahead on just one attribute — political management: 3.04/5 to Luxon’s 2.76/5.
An advertising chief: “great politician. But that’s what he is — everything is politics. Can’t see much in him beyond winning the game of politics — our country deserves better.”
Another observer said, “Chris Hipkins has done better than anyone else in the current Parliament could have with the (lack of) cards he has been dealt. Issues around ministers and other messy features aren’t so much his fault as a legacy from Jacinda Ardern’s time which he’s dealt with much more sure-footedly and decisively than she would have.
“He also seems to have more of a coherent sense of what Labour is about. Under her, much of what seemed to matter was the emotion the announcement elicited, whereas his announcements seem to hang together better. That said, his is still not a pro-business government by any stretch, even if he’s more willing to genuinely engage and negotiate with business than Ardern was. At least he turns up and listens even if the answers aren’t often what we want from him.”
From an investment banking head, “this is the worst government ever. We have ballooning national debt, civil service costs are up 44 per cent since 2017, yet everything is worse; everything — health, education, cost of living, infrastructure, mental health, inequality, crime.” Others pointed to Labour’s lack of delivery on key policies — Three Waters, KiwiBuild, Auck Light Rail, Health reorganisation, broadcasting reorganisation. Not all of which can be laid at Hipkins’ door given his short prime ministership.
Luxon ahead
CEOs responding to the Herald’s survey rated National’s Chris Luxon ahead of Hipkins on all key attributes apart from political management.
His three highest ratings were for economic management, 3.99/5; courage to make the right calls, 3.64/5 and integrity, 3.58/5. “Chris’ political skills appear to be growing and is leading a more united team,” said Beca executive chair David Carter. “Courage to make the right calls on behalf of a nation as opposed to politicking is both a matter of opinion and can only be judged in time.”
He was praised for having an 100-day plan of action — policies to implement if he is in a position to form a government after the October 14 election.
“Do not underestimate CML, his vision for NZ and his discipline and execution bias. He delivers what he commits to,” said a CEO who had worked with Luxon when he was chief executive of Air New Zealand.
Others pointed to tensions ahead: “Working with Act will be his challenge as they will hold National accountable on every corner.”
A chair warned: “We can never anticipate the challenges an incoming government will have to face — think Covid and the Christchurch earthquake. We desperately need a government that has the judgement and experience to develop mitigation strategies and be able to execute them.
“If at this stage it is the most likely outcome — Christopher Luxon becomes Prime Minister, he’ll have had the quickest ascendancy to the top ever, by nearly the least experienced politician imaginable,” said an Auckland-based CEO. “This lack of experience shows especially so in his inability to make difficult decisions and calls. As a result, we have less knowledge of what a Luxon-led government will really be like than ever before.
“So far all we really hear is the current government is hopeless (which is true) and we will be better (which wouldn’t be too hard). How much better though is anyone’s guess, and given the lack of bold policy announcements one could suspect Luxon thinks the mere fact of him as PM will make things much better without the need for a lot of change, which is naive.
“Does Luxon have a substantive economic reform agenda? If so let’s see it. Without seeing it, it’s tempting to think he may be a centre-right version of Jacinda Ardern, save without the personal popularity early on.”
Craig Stobo, Precinct Properties
Anger is in the air. Anger at job mandates. Anger at racial privilege. Anger at the cost of living. Leaders would listen, acknowledge, respect and apologise to enable forums for reconciliation to emerge.
Taxation policy follows our expenditure decisions. Government expenditures during lockdowns went into operating cashflows not capital expenditures. We are left with a parabolic gross public debt profile, rising interest costs and a diminishing buffer for natural disasters.
The experiment to further centralise the delivery of government services is not meeting expectations. Constrained fiscal circumstances require a rethink of delivery, including asking business to help.
Mike Horne, Deloitte
A lack of a coherent, competitive education system to equip our young people with the skills they need. This is fundamental to equity and to long-term prosperity as a nation. Somewhat of a return to basics, elevation of the importance of STEM, and rewarding educational performance and outcomes.
Poor track record of long-term investment and politicisation of infrastructure. We need clear, coherent long-term plans with cross-party support, public/ private partnerships and deliberate choices that focus on productivity enhancement.
We need to re-engage with the world on all fronts. We have turned increasingly insular and yet need to take the opposite approach while also showing some real fiscal restraint. We don’t have a tax problem — we have a spending one.
Greg Foran, Air NZ
We need to increase productivity by creating better jobs so New Zealanders can embrace, not fear, automation and digital disruption. This involves sharing the gains with employees and creating rewarding and engaging work. Lift the standard of education, so we have a workforce capable of contributing to an increasingly productive economy.
Many business leaders rate the Opposition Finance Spokesperson highly.