Christopher Luxon, the newest National Party leader, is yet to show how he might reform policy. Photo / Warren Buckland
Christopher Luxon, the newest National Party leader, is yet to show how he might reform policy. Photo / Warren Buckland
Opinion by Simon Wilson
Simon Wilson is an award-winning senior writer covering politics, the climate crisis, transport, housing, urban design and social issues. He joined the Herald in 2018.
Enough with the Luxon love. Has he done anything yet to deserve it?
National's newest leader Christopher Luxon gets so much admiration beamed his way, you'd think he'd already transformed his party and its policies. Some commentators even seem to think election success next year is almost a formality.
There are many long weeks in politics to go before that makes a lick of sense.
Still, he now has a "higher approval rating" than Jacinda Ardern, which is a measure of how many people approve of him minus those who don't. Ardern has more fans, but Luxon scores higher because he has fewer enemies. It's entirely predictable for someone who hasn't had time to annoy many people yet. Hardly a reliable measure, or a high bar.
Instead, he's still at the stage of confident assurance. "We cannot be an old crusty National Party," he said at his MPs' retreat in Queenstown last week. "We have to reinvent this party.''
True that. And yet he gave no sign of what he means. No proposals to reform the party structure, or candidate selection, or key personnel, all of which have failed National so badly in recent years.
No sign either of how he might want to reform policy, to make the party fit to govern in the third decade of the 21st century. Pandemics, the climate crisis, brittle community cohesion and the growing gap between rich and poor: they're the challenges everything has to be filtered through now.
Instead, he said: "We care deeply about people. That's why we're here."
Jolly good. But is he even facing the right way to be able to do that? In his short time at the top, when policy issues have come up Luxon has headed straight back to the mid-1980s.
Christopher Luxon: "We care about people." Photo / Mark Mitchell
He supported transport spokesman Simeon Brown advocating two more motorways instead of light rail. And when the Government's new income insurance scheme was announced, Luxon came out strongly against.
The scheme will provide 80 per cent income for up to seven months, for most workers who lose their jobs through no fault of their own. It has its problems (see below), but the basic premise is sound: in an uncertain world, income security is good for workers and for the economy as a whole.
Luxon complained that the scheme would be an extra cost on business. But income insurance is not anti-business. When citizens believe their financial position is precarious, they're cautious spenders. When they're confident, they're more likely to spend.
Income security is now a bedrock issue. In a world that threatens to pitch us from one crisis to the next, either we strengthen our safety net or we don't. Luxon said we don't.
Still, the scheme does have a major weakness: its benefits will not fall fairly.
"Those who stand to benefit most … are in regular, full-time, well-paid work, without dependent children," says Professor Mike O'Brien from the Child Poverty Action Group.
"Those who are in precarious, part-time, irregular and low-paid work - disproportionately Māori, Pacific and/or women, particularly caregivers - will either qualify for a low rate of payment … or will not be eligible at all."
Instead of opposing the scheme, Luxon could be advocating to make it better for those who need it most. But will he do that?
He brings an unusual perspective to income security, having left his own job at Air New Zealand, as the highest-paid CEO of a listed company, with a farewell gift of almost half a million dollars.
The payout, said the company, was in lieu of the bonus he would have received if he'd stayed until bonus payout time.
But when a bonus has a date on it, isn't that designed to encourage the executive to stay, at least until then?
Some will say it's inappropriate to talk about Luxon's income. It's his business. But it plays directly to the perspective he brings to financial matters affecting ordinary citizens. It's our business too.
Also revealed last week, by the financial journalist Bernard Hickey: In the 21 months since the pandemic began, payments of almost a trillion dollars to business and homeowners have fuelled massive property inflation and a surging sharemarket, as those who already owned assets were able to buy more.
"But," Hickey told RNZ, "those people who are renters and who don't have assets, they're now significantly worse off, because the Government didn't give them much more cash at all, only an extra $48 million in special cash payments."
It's been the biggest transfer of wealth from the struggling to the well off and from the young to the old ever seen in this country.
As Hickey also noted, last Christmas the Government rejected appeals to increase benefits by $50 "because they were worried that it would increase the Government debt".
Crisis has geared our economy to reward the comfortable at the expense of the vulnerable.
I'd like to think the news of this was so distressing to the Prime Minister and her Cabinet, they convened urgently to begin the task of repairing the damage. It does not seem this happened.
I'd like to think it was distressing to the National leadership, too. No sign of that yet, either.
Does it mean property prices should fall? Both Luxon and Ardern have made it clear they do not want that to happen. Yet even if property values declined by 25 per cent, they would revert to where they were only a year ago.
Both leaders would prefer to see prices "stabilise". To put that in context, if houses stop becoming more expensive right now, it will still take another 40 years before wage growth makes buying a first home a reasonable proposition for the average income earner.
Luxon's deputy Nicola Willis said recently, "I want to see that there are more affordable homes available, and that it costs less to buy a house in the future. New Zealand can't be in a situation where house prices keep rising at this rate. It's absolutely dreadful for our communities and our society."
Christopher Luxon with his deputy, Nicola Willis. How tough will they be on the causes of the housing crisis? Photo / Mark Mitchell
True that too. But the solutions are obvious enough. Tax capital gains and all other income equitably. Supercharge the national capacity to build good homes quickly. Regulate construction costs. Introduce a solid raft of financial measures to help first-home buyers.
Will it happen? Most MPs own investment properties and therefore have a conflict of interest. Perhaps they should recuse themselves from voting on this.
Again, Luxon brings an unusual perspective. He owns seven properties – the most of any MP – and last year they made him $4.3 million richer. That was slightly more than his most recent full-year salary at Air New Zealand – $4.2 million – although he paid tax on the salary, unlike the property windfall, so it's a lot more really.
People often say reform – of the economy, for climate change, whatever – has to go on hold in a crisis. But that implies the age of crisis is going to end some time soon. Who would bet on that?
We have to learn how to put our response to big social and economic issues at the heart of crisis management.
That's the challenge for political leaders today. Luxon has a state of the nation address coming up soon. Let's hear him tell us how he proposes to do it.
