Newsroom Pro's 8 things at 8: Little talks of standing down as Labour hits 24%

Labour rules mean leader Andrew Little could be rolled without the need for a party-wide election. Photo: Lynn Grieveson

In today's email, we ask what the latest poll result might mean for Labour.

1. Little leadership in doubt

Less than eight weeks before the election, Labour Leader Andrew Little has admitted he has discussed stepping down with his colleagues because of poor poll results, opening the prospect of a shock leadership change driven by the caucus on its own.

The revelation came as TVNZ's Colmar Brunton poll showed support for Labour fell three points to 24 percent, which was the lowest result for Labour in a Colmar Brunton poll since 1995.

Meanwhile, in the wake of Metiria Turei's own revelation she claimed a domestic purposes benefit while also living with flatmates, support for the Greens rose four points to 15 percent, which was its highest level in a Colmar Brunton poll. National and New Zealand First were steady on 47 percent and 11 percent respectively, while The Opportunities Party rose one point to two percent.

Asked if he had thought about stepping aside in the interests of the party, Little told TVNZ's Corin Dann he would be lying if he said he hadn't thought about that.

"In fact, I've spoken to senior colleagues about that," he said, adding the idea had not been accepted.

"In the end, my colleagues said 'we're in this fight together. This is all of us. This is the Labour Party'," he said.

Asked if they had said no, he shouldn't step down, he said: "They said 'we want you in the fight'."

Under the Labour Party's constitution, there is a three month window before an election where the Labour Caucus can change the leader without having to have a party-wide election that takes into account the views of individual party members and affiliate unions. That would make it much easier to change leaders, potentially to either Grant Robertson or Jacinda Ardern.

Little's preferred prime minister support in the Colmar was six percent, up one and in line with Ardern on six percent.

Prime Minister Bill English highlighted the dramas on the centre-left, but also cautioned his supporters not to be complacent, given National would struggle to govern at the moment with its current support partners.

"Some of the parties are struggling a bit. The Opposition parties are behaving the way they would in Government. Three of them all over the place," English said.

"But actually it's a very tight election. When you add up the opposition parties they still have more seats in the Parliament than the current Government and that means you lose the election. We have to work very hard because, frankly, we don't have enough support yet," he told One News' Breakfast programme.

2. Focus on weak wage inflation

Politicians, voters and economists will get their last fresh figures on wages, jobs and unemployment before the election this week, with the political focus likely to be on real wage growth -- or the lack of it.

Statistics New Zealand is scheduled to publish labour force figures for the June quarter on Wednesday morning, which are expected to show real wages fell in the June quarter a year ago. This would contrast with the Government's focus on relatively solid real wage growth in the last three years and reinforce the Treasury's forecast of real wage growth of just 0.6 percent in total over the next four years.

The Labour Force Figures are expected to show unemployment edging down to 4.8 percent from 4.9 percent in the March quarter. Jobs growth is expected to ease to around 0.7 percent in the quarter from the extremely high 1.2 percent in the March quarter. That would mean jobs growth in the quarter from a year ago would still be a robust 4.0 percent.

However, the most interesting statistic is likely to be wage growth, which has been surprisingly weak into the seventh year of an economic expansion.

Economists are forecasting the private sector Labour Cost Index measure of wage costs, which takes into account promotions, to be flat at 0.4 percent for the quarter and up to an annual rate of 1.6 percent from 1.5 percent in the March quarter.

They see the Quarterly Employment Survey measure of private sector wage growth to rise around 1.2 percent for the year, which would mean real wages fell. The Consumer Price Index rose 1.7 percent in the June quarter from a year ago. That would imply real wages fell 0.5 percent over the last year.

"Despite the strengthening labour market, we expect wage pressure to have remained subdued over Q2," ASB's Nick Tuffley said.

"A key consequence of NZ’s high net migration and high labour participation is that job creation has only just outpaced the increasing labour supply," he said.

3. 'A feeling of kabuki'

Given the dramas around the centre left, we thought we'd take a look at how 'Kingmaker' Winston Peters has handled coalition negotiations in the past.

Newsroom's Sam Sachdeva writes the 2017 election is starting to bear striking similarities to the 1996 campaign, with NZ First poised to again take up a kingmaker role after polling day. Sam wonders what we can learn from the events of 21 years ago, and what may happen this time around.

I was working overseas at the time, so the details uncovered by Sam about the length of the negotiations, the details and the eventual feeling that there was no real contest were a surprise to me.

The decision also came as a surprise to some, given NZ First’s attacks on Prime Minister Jim Bolger’s National government and an election survey suggesting two-thirds of the party’s voters expected it to back Labour and the Alliance.

Yet some have argued National was an inevitability, given Peters’ enduring ties to the party despite his expulsion from Cabinet in 1991 and subsequent resignation.

In his 1998 biography, former NZ First candidate Michael Laws said Peters “was always going to lie down with National”, while former Labour Party staffer Phil Quin, who was working in Mike Moore’s office in 1996, told Sam he and others within the party never believed they were in the hunt.

“Certainly in our little neck of the woods, which was around Mike...there was a feeling at the time that it was all a bit of kabuki, that it wasn’t really as competitive as Peters pretended.”

See Sam's full story on Newsroom Pro,
where it was published first on Friday.

4. People in the news

Australia's High Commissioner to New Zealand, Peter Woolcott, was named to be Prime Minister Malcolm Turnbull's chief of staff on Friday. Woolcott had been the high commissioner in Wellington since February last year, and has previously served as the chief of staff to then foreign minister Alexander Downer. (Canberra Times)

National released its party list
on Sunday, including spots one through 21 including the current National Ministers and David Carter. There was one spot left open at 68 for the yet-to-be selected replacement for Todd Barclay in Clutha Southland.

5. Statistic of the week

Last week's Perry Report looked into the progress of real after housing cost disposable incomes for the various deciles since 1982. It shows the poorest decile (P1) income has risen slightly in the real terms after housing costs since 2006/07, but remains only slightly higher than it was in 1982. Meanwhile, the highest decile has seen real income growth of 60 percent after housing costs.

6. While you were sleeping

In yet more signs of growing geopolitical instability that could trigger financial market uncertainty, US President Donald Trump replaced his chief of staff Reince Priebus with his current Homeland Secretary John Kerry after his Republican Party failed to pass healthcare reforms in the Senate. Priebus' term was the shortest in US Presidential history.

Meanwhile, North Korea test-fired an ICBM on Saturday night that experts said could reach the continental United States. Trump blamed China in a tweet.

"They do NOTHING for us with North Korea, just talk. We will no longer allow this to continue. China could easily solve this problem!" he wrote/tweeted/ranted.

In Australia, security is being ramped up at airports after police said they foiled a plot to blow up a plane. In Russia, President Vladimir Putin ordered the expulsion of hundreds of US diplomats after the US Congress toughened sanctions on Russian oligarchs, which Trump is expected to sign into law.

7. Coming up ...

Prime Minister Bill English is scheduled to hold his weekly post-cabinet news conference in Wellington this afternoon.

Labour said it would announce a Maori housing policy at South Auckland’s Nga Whare Waatea Marae later today.

Parliament resumes on Tuesday for the second week of its final four week session of this term.

8. One fun thing

And I didn't even mention Anthony Scaramucci's absolutely extraordinary (and filthy) interview on Friday with Ryan Lizza of the New Yorker. Read it and laugh/weep.

This tweet from Josh Gondelman captured the mood:

"Anthony Scaramucci's first week at his new job has made me super confident that I could run a hedge fund."