Fran O'Sullivan: Time to front up and make changes

Will John Key leap at the chance to position New Zealand as the "lucky country" for the 21st century?

Or will he saunter down the ruinous populist path that led to the collapse of one of the 20th century's lucky countries - Argentina?

Will he be cocksure enough to entreat with vested interests, like the five Maori iwi with whom he made a sweetheart deal to get National's signature emissions trading scheme through Parliament, but wilfully blind to the fact that this scheme will not make many inroads into reducing New Zealand's overall greenhouse gas emissions and just throw the bill to subsequent generations?

Is he too mindful also of his own pride, his party's dogma and potential votes to break his absurd promise not to raise the age of entitlement for national superannuation (over time) so that subsequent taxpayers are not overly burdened?

Or is he mustering the political courage to do what is right to save this country from a slow decline into economic irrelevance?

These are the questions that should be top of mind on Monday when Don Brash releases the first report of the 2025 taskforce which has been charged with closing the gap with Australia.

Brash is sitting tight on the taskforce's prime recommendations. But he gave an insight into its thinking when he stood in for acting prime minister Bill English - who had been laid low with back problems - as the guest speaker at this week's Deloitte/Management Top 200 awards.

Brash was adamant there was no way the gap would be closed on New Zealand's current track. "That is absolutely clear and a very great deal hangs on us not following that track."

The taskforce will not mince words. Its prime political sponsors, Finance Minister Bill English and Act leader Rodney Hide, hand-picked a no-nonsense team: Brash (chairman), former Labour finance minister David Caygill, Icebreaker chief executive Jeremy Moon, Australian Productivity Commission member Judith Sloan, and Capital Economics director Bryce Wilkinson.

Their recommendations fall in four areas: the Government as spender, tax collector, owner of assets and law maker and regulator.

Brash clearly has no time for the myths which lazy politicians trot out as excuses for avoiding change.

Key often points out that Australia's mineral wealth gives it a big economic advantage over New Zealand. But Brash contends many of the richest countries like Singapore and Switzerland are virtually devoid of mineral wealth. His arsenal includes a World Bank study which ranks New Zealand at number two on natural resources per capita - just below Saudi Arabia.

These are natural resources the world wants: pastoral land, forests, thermal and hydro-power generation, fresh water, large lignite stores, major saltwater fisheries.

Other excuses, like New Zealand's distance from markets, will get short shrift. New Zealand is indeed distant from markets. But so is Australia.

Gen X bleats about housing investment. But this country invests far less on housing as a fraction of GDP than Australia and other developed countries.

We have big pluses like stable government and well-educated people (but a growing tail of underachievers).What we don't have is a strong collective sense of national purpose.

In truth, New Zealand hasn't a hope of Hades on catching up with Australian wages, or, for that matter, Australian living standards by 2025 unless our political leaders man up and make significant change.

Australia's GDP per capita is already 35 per cent higher than ours. There are only 16 years left to reach the 2025 target - or five elections.

Helen Clark's government announced a laudable target to get New Zealand back into the top half of the OECD but shied away whenever anyone tried to get them to commit to measurable goals.

The major issue facing New Zealand is how to make the switch from an over-reliance on consumption and welfarism to a society of people who invests in their own future and stands on their own feet.

We are not alone in this. Barack Obama faces a similar challenge in the US. But unlike Asian countries like Malaysia - which is blessed with a charismatic Prime Minister who embraces change - a mindset has taken hold here that New Zealanders are reform-shy.

If any myth needs puncturing, this one does. The mere fact that 260,000 New Zealanders (on a net basis) have left this country for good in search of a better life suggests we are a resourceful lot.

What we lack is the political leadership to ensure we burst through the economic cul de sac in which we are parked. When Brash took the stage on Thursday he quipped, "I think this is the second time I've taken Bill English's place."

The sly reference to the 2003 coup he mounted to oust English from the National Party's leadership wasn't lost on his audience.

If Key and English do not rise to the challenges the taskforce will pose on Monday, it will not be long before a groundswell gets under way to get another straight-shooter back into Parliament to chart the way.