Transformation within a tempest: A very stormy budget day

2019-05-30 20:04:42

COMMENT: The sun barely rose in Wellington on Thursday, but before it even peeked out behind from Mount Victoria the public sector was in a flurry.

After almost 24 hours of radio silence, Treasury Secretary Gabriel Makhlouf sent out a somewhat sheepish statement about the Budget "hack" at the very civilised time of 5.05am.

His statement finally laid out how exactly the National Party had got its hands on a bunch of boring but confidential Budget figures four days before the much-anticipated "Wellbeing Budget".

It turned out that the 2000 "unauthorised attempts" to get Budget materials were in fact people using Treasury's own search engine in a somewhat tricky way. A National staffer  had stumbled upon the fact that the search engine had indexed a boatload of supposed-to-be-confidentialBudget figures already, and while you couldn't click through to get details, you could get some figures in the previewed search snippet.

This is not what most people consider "hacking". It was definitely not something the police saw as criminal, and they had told Treasury as much - hence the sheepish release.

The 5am press release seemed timed to steal National leader Simon Bridges' breakfast. Bridges had promised to reveal all just before 9am - itself a clear attempt to steal Finance Minister Grant Robertson's thunder as he delivered his first Wellbeing Budget later in the day.

Luckily there was plenty of thunder going around. So much in fact that ACT leader David Seymour's plane was unable to get into Wellington for the biggest political day of the year.

Bridges was fired up as he addressed media at the morning standup, calling on not just Makhlouf but also Robertson to resign. Bridges said Robertson did not "have the authority" to deliver that day's Budget and called bull on the statements from Treasury and Robertson that the decision to call the cops happened before Makhlouf had even told the minister about the "hack".

"Did you come down in the last shower? I didn't," he noted to a reporter asking how he knew Robertson was lying, as an actual rain shower poured down outside.

Things were a bit more light-hearted across the bridge in the Beehive, where Prime Minister Jacinda Ardern was filming a pre-Budget livestream with Robertson. Ardern handed him some cheese rolls flown in from Dunedin - a very carbon-intensive tradition in its second year - and a solidly boring red and blue tie. The cheese rolls were controversial last year for their condiment - this year, the fact half of them were prepared with rye bread brought on similar conniptions.

With all the "hack" excitement it felt like the day had peaked early, even before journalists had entered the marathon Budget "lockup" - usually the highlight of a political reporter's very sad year.

At these lockups, hundreds of reporters, analysts, and Treasury staff stuff themselves into the Beehive banquet hall for three-and-a-half hours to go over the Budget documents in detail before they become public at 2pm.

It's called a "lockup" because once you go in you can't go out, either with a digital signal or a physical presence. Indeed, even emergencies don't end "lockup" conditions: as he set out the rules, a staffer from Robertson's office drolly noted that just this once people with medical emergencies should not call 111 but instead a security staffer, and if there was an earthquake we were already in the safest building in Wellington.

As journalists got their hands on the documents, it was clear that National had not quite managed to spoil the Budget after all.

There was a lot there. New spending of $25.6 billion over the next four years in fact, thanks to a sizeable bump in the amount of money the Government is letting itself spend.

Mental health was the winner on the day with a $1.9b package that includes a brand-new universal frontline service for $455 million. The Government's focus groups have apparently delivered quite a strong message about just how popular spending on mental health will be, and the Opposition's focus groups must be saying the same thing, because Bridges didn't even attempt to criticise the centrepiece of the budget in his post-budget speech.

But it wasn't all for mental health. Oranga Tamariki, Dunedin Hospital, and KiwiRail both got a boost in the $1b range. Money was poured into education - but not teacher pay - with a very wide-appeal push to abolish school donations for all decile 1-7 schools.

One of the more "transformational" changes was not so expensive. From next year all main benefits - that's Jobseekers, Supported Living, and Sole Parent Support - will have their rates indexed to wage growth, not inflation. This is the way Super is currently calculated and fulfils one of the main recommendations from the mostly-ignored Welfare Expert Advisory Group.

In the first instance this doesn't actually result in that much new money: between $10 and $17 extra dollars a week in 2023 more than regular inflationary rises would have delivered. But the bridge this builds between the poorest in our society and those in work will be very important as the years go on. It acknowledges that poverty is often relative not only to the cost of a small bundle of goods but also to the amount the family next door make.

If you want an example of the kind of power this indexation has, just look at superannuation - the largest single thing the Government spends money on, with $15.2b going to it in the next fiscal year, about three times the amount that goes to the main benefits affected.

But the lockup was not free of the storm clouds gathered outside the ceiling-height windows. The second question to the finance minister asked why the Treasury secretary was not in the room (he was), and there was a breach of the rules when a group of reporters followed him out of the room when he left early.

Whether or not this Budget was really so different to other ones was not quite clear. Sure, the spending was in different areas to where Bill English might have put it, but was it really so different to the places Michael Cullen might have put it?

This provided plenty to talk about in the queue for lunch. Once again Treasury had prepared lamingtons in the three colours of the Government parties: Red with a rasberry for Labour, black with some dark chocolate for NZ First, and green with Kiwifruit for the Greens. The lunch table also comes with more standard fare: horrible-looking sandwiches, a dripping fruit platter, and some kind of salad boat with pickles.

The prime minister herself stays out of the lockup, as this is the one day a year the finance minister is more important than her. You might hope that means she gets some better lunch, but according to one well-placed source she didn't manage to eat all day, other than popping a few Throaties as she is getting over the cold going around and at least one bite of the blasphemous cheese rolls.

Also out of the main lockup is the opposition. After a complaint about how many staff they were allowed to take into their much-smaller lockup room on Wednesday night, National was allowed 16 people into the opposition's hour-long lockup. Also in the room was Jami-Lee Ross and staff for the absent Seymour, along with the normal army of Treasury people, who apparently weren't too upset with the party who had spent the week pointing out their incompetence.

The National MPs and staff divvied up the booklet and got to work, updating half-drafted press releases and speeches right up until 2pm. The decision had been made, given the mess of the "hack", to go with "botched Budget" as the opposition nickname for the Budget. Other options thrown around included "well-meaning Budget" and "bungling Budget".

At 2pm, the embargo lifted and everyone pressed go at once. Robertson strolled into the house and slowly handed the Budget around the seats.

While he unrolled his speech, his side did the requisite cheering and the other side got their reading glasses out to peer over the Budget in more detail.

Despite the promise to do things differently, Robertson's speech was full of the usual things a Budget speech is full of - numbers and outcomes. Bridges' speech in reply was also fairly typical of an opposition speech: an attack on the state of economy and the governments books, some jokes that worked, some jokes that didn't, and the bold proclamation that this budget wouldn't just not help Kiwis, it would actively hurt them.

"Grant Robertson, he's like that Shaggy song on the economy - It Wasn't Me," stammered out Bridges, a reference to a song that would be old enough to drink in New Zealand.

It was Ardern who broke the mold somewhat, spending most of her speech linking policies to various anecdotes from her trails around the country, coming close to tears at one point.

"She's just telling stories," complained one backbench National MP.

But it was a simple story that provided some of the best news for National of the day. It turned out the smiling woman on the cover of the Wellbeing Budget was actually no-longer in the country: she had upped sticks and moved to Australia, thanks to rising living costs. The press release basically writes itself.

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