John Armstrong: Labour dreadnought refitted but rust remains

Ignore the quips about deckchairs and Titanics.

By her cautious standards, Helen Clark's Cabinet reshuffle is titanic. But her new Cabinet is better likened to an ageing battle-cruiser about to leave port following a partial refit.

There is still plenty of firepower on board, but much work remains to get Labour fighting-fit for the 2008 election.

This reshuffle is as much about Labour's renewal as the Government's. It is all about managing succession. It is the first of a two-part reshuffle.

A clue lies in Phil Goff becoming an Associate Finance Minister, alongside the Defence and Trade portfolios given him to keep tabs on Winston Peters' handling of Foreign Affairs.

The expectation is this term will be the last for Finance Minister Michael Cullen - as it will be for other ministers.

That sets the stage for a further reshuffle, possibly either at the beginning of 2007 when Dr Cullen comes up for reconfirmation as Labour's deputy leader or following that year's Budget.

The new Finance Minister will want at least one Budget before the 2008 election.

Yesterday's reshuffle readies the contenders for the job.

Mr Goff becomes a member of Dr Cullen's new "razor gang" scrutinising departmental spending.

The other contender, Trevor Mallard, now holds the Economic Development portfolio. He will drive the Prime Minister's plan to re-invigorate Labour's "growth and innovation" strategy, thereby showing that six years on, Labour still has fresh ideas.

Helen Clark has long shunned radical reshuffles because those promoted believe it was only their due, those ignored resent it, and anyone demoted can be found in the kitchen sharpening the cutlery.

But she could tinker no longer. A major revamp was essential to show Labour was, in her words, "renewing and refreshing" for its third term.

Not only has she twisted arms to get resignations so she could have six new ministers in the Cabinet, she has also engineered the biggest portfolio swap in her 12 years as Labour leader.

However, the pressure for change has produced an element of change for change's sake. There seem to be some square pegs in round holes.

Jim Anderton, for example, ends up with Agriculture when he wanted Education. Steve Maharey will be happy enough getting Education, but would surely have been equally happy keeping Social Development. That portfolio goes to David Benson-Pope, who was destined for the education job before the allegations that he cruelly punished students during his teaching career.

This game of "pass the portfolio" was made more difficult for the Prime Minister by Mr Peters' securing Foreign Affairs. There were fewer prized jobs to go round.

The potential for unhappiness may be why Helen Clark has not touched ministers' rankings in terms of seniority.

But the result is Parekura Horomia moves onto the front bench to replace the retiring Jim Sutton purely because the Maori Affairs Minister is next in line.

Bringing the likes of Lianne Dalziel, Ruth Dyson or Mr Benson-Pope forward would have given a fresh edge to Labour's performance in Parliament. But there are no other vacancies.

The front bench is effectively Labour's shop window to the world, but Helen Clark cannot revitalise it because the incumbents - Dr Cullen, Mr Anderton, Mr Maharey, Mr Goff, Annette King, Mr Mallard and Pete Hodgson - are way more competent and authoritative than second-tier ministers who should be snapping at their heels.

That is why so much fresh talent has been injected into the back end of the Cabinet - with more to come.

In the meantime, while the Prime Minister talks of rejuvenation, the risk for Labour is that the public sees only the familiar, increasingly battle-scarred faces wearing different hats.