Newsroom Pro's coalition agreement special: The tail didn't wag the dog. It barely wiggled; How MMP moderated perfectly; The quirks in Winston's deal

Now that we've seen the details of the two agreements struck to form a Government we can see just how much of their policy platforms were retained. Photo by Lynn Grieveson

Today's email is a special round up of the main points out of the coalition agreements signed and released yesterday.

1. The tail didn't wag the dog

Now that we've seen the details of the two agreements struck to form a Government we can see just how much of their policy platforms were retained, and where the 'triangulation' of this MMP process landed.

For those that missed the detail, have a look back in your email trail for the Government formation special email we put out last night. This morning we carry analysis from myself, Newsroom's National Affairs Shane Cowlishaw, Newsroom's Foreign Affairs Editor Sam Sachdeva and Newsroom's Tim Murphy. We also have reports from Newsroom's David Williams and Teuila Fuatai.

In my analysis published first this morning on Newsroom Pro, I write the deals signed yesterday and the final makeup of the Government show MMP did its job to stop the tail wagging the dog and to deliver the policy platform that more than 50 percent of voters wanted.

MMP got a bad rap over the last month's prevarications and brinksmanship.

It seemed as if a thrice-rejected 72 year-old politician with just 7.2 percent of the vote was holding an entire nation to ransom. Many worried his policy prescription to destroy migration and wreck our clean system for Goods and Services Taxes would cause economic and budget chaos.

The apparently endless uncertainty and the days-on-end of waiting for said 72 year-old to harangue the press, grin cheshire cat-like and then wander off for a Vietnamese lunch down the road sapped the nation's confidence and patience. There was much wailing and gnashing of op-eds about the unfairness and indecisiveness of MMP. Many hankered for the good old days when the largest party that won on the night could then form a Government by itself.

And yet the deals revealed on Tuesday showed he did not hold anyone to ransom and that the Mixed Member Proportional system of electing our Governments is working just fine.

New Zealand voted in 1993 to stop giving any one party the power to enact an entire agenda the day after they won an election, or even worse, enact an agenda they had not told anyone about before the election.

Since 1996, we've broadly had Governments that stuck to the centre and had their rougher instincts smoothed out by either the central pull of MMP or the policies of the smaller parties they needed help from to govern.

That means we've had Governments that generally follow the public's view, rather than dragging voters along behind them in their rough wake. Policies have changed in an incrementalist fashion over time. The last Government even promoted this policy incrementalism as a feature rather than a bug of MMP when it was advising its trans-Tasman brothers-in-arms about how to do change and still win elections.

And so it is this with this latest change of Government.

The agreements show the new Government's policies are broadly supported by most of the electorate, even if the single largest party isn't. The smaller parties got one or two small policy wins that neither knocked the major party off its main track nor have shocked the public and the financial gatekeepers with their extremism.

The moves to introduce a Climate Commission and a Carbon Act to target a carbon neutral country by 2050 was an established policy agreed by New Zealand First, the Greens and Labour.

The move to soften the blow of the introduction of agriculture into the Emissions Trading Scheme (by increasing the exemption from Labour’s 90 percent to New Zealand First’s 95 percent) has calmed some of the nerves of farmers.

New Zealand First was also able to remove the threat of a water tax and to secure the existing irrigation scheme investments. This was MMP working at its best to soften the impact of a change of Government.

The same can be said of New Zealand First’s own radicalism with monetary policy and migration people policy. The end result was a shift to a Reserve Bank Act that actually brings New Zealand into line with the orthodoxy practiced for decades in Australia, the United States and Britain. The change means our Reserve Bank will have a dual mandate of low inflation and full employment. No foreign investor or currency trader will bat an eyelid at that.

Winston Peters’ proposal to move to a Singaporean-style system of targeting currency values rather than interest rates would have been radical, but was not adopted. Another quiet victory for the moderating force of MMP.

The same can be said on migration. Peters’ plan to slash net migration by 60,000 would have been virtually impossible without completely shutting down international education and imposing severe restrictions on the recruitment of temporary migrant workers in the aged care, hospitality, agriculture, horticulture and tourism sectors. The disruption and injustice would have been damaging to both our guests and the economy.

MMP also did a great job protecting the government’s finances. New Zealand First’s proposals to take GST off food and share GST receipts from tourism with local councils would have massively undermined a clean and effective consumption tax. Protecting New Zealand’s broad-based and low rate tax system is a good thing.

Peters’ gains with the $1 billion regional development fund and the Greens’ $100 million green investment bank have not blown the bank either. Labour already had a plan to build a $200 million regional fund. The net effects of the two policies was $900 million of capital, which was well within Labour’s contingency set when it released its alternative budget just before the election.

Again, there is nothing in this slightly tweaked budget to freak the markets or change the outlook for ongoing surpluses and a gradual reduction in the Government’s already low debt ratios.

More than 50 percent of voters got the foreign buyers’ ban they wanted and the massive increase in state-backed building of more affordable housing that they wanted and New Zealand needed.

Neither minor party was able to wag the dog of the biggest governing party and the majority of voters got the policies they voted for. The rough edges of the toughest of those policies were knocked off in the MMP process.

Job done, and let’s hope that’s the end of the whole whinging and moaning about MMP for at least another three years.

2. Not such a big migration shock


Shane Cowlishaw writes in detail
about the deal struck on migration and how it might effect various sectors of the economy.

He reports Winston Peters seemed happy in the end to accept Labour's more limited plan to cut migration by 20,000 to 30,000 a year, not the 60,000-plus New Zealand First wanted.

Throughout the campaign, New Zealand First leader Winston Peters railed against immigration. He wanted a massive reduction in net migration, from about 73,000 to 10,000, to stem the tide of people escaping from their “hell hole” to Aotearoa.

“It's not a sign of our staggering success,” he said during the campaign.

"It's a sign of the lax and loose policies we've employed that's allowed so many people to come here."

The problem was, whenever he was asked how he would make such drastic cuts, there was no detail.

Many business leaders warned that turning off the immigration tap would slow economic growth.

Perhaps because of this, New Zealand First’s leader appears satisfied with a far more moderate immigration policy.

Peters’ demurring to Labour’s more modest immigration policy was done with barely a murmur. Prime Minister-designate Jacinda Ardern was firm last week in stating Labour would be sticking with its own immigration plan of reducing net migration by 20,000 to 30,000, and repeated it in the announcement of Labour's deal with New Zealand First.

“We had a conversation which demonstrated we shared the concern of exploitation, particularly in our export education sector, the need to strengthen those labour market tests, we’ve referenced that policy in the agreement, and of course that policy came with an estimate of the reduction of net migration would bring so that’s entirely consistent with our policy and nothing in that regard has changed.”

In a rare moment, Peters then accepted that he had not gotten exactly what he wanted, but was not too fussed.

“We’re happy to accept that resolution in the way the Labour party has framed it, and it just so happens there’s an enormous amount of public controversy about those two issues right now carried by you in the media and carried by experts, so maybe it will work out.”

Peters may not have got exactly what he wanted, but immigration numbers are still set to drop.

Labour’s plan

Labour’s pre-election Immigration policy was an attempt to find the ‘Goldilocks’ space between New Zealand First’s dramatic cuts and National’s tweaking.

It aimed for a reduction of net migration by 20,000 to 30,000, largely accomplished through a tightening of rules around international students.

The crack-down on low-quality private training institutions that have plagued the industry will continue and visas only issued for courses below a bachelor’s degree that had been assessed as being of high quality.

Currently, students are able to work 20 hours a week while studying, but this would be restricted to those studying at bachelor-level or higher unless the work was an approved part of a course.

Work visas for those who have completed study would also be tougher to get, available only to those who have studied at bachelor-level or higher in an attempt to reduce the amount of people using low-value study as a path to residency.

In April the National Government announced its own tweaks aimed at culling low-skilled migrants.

It introduced salary bands for both skilled migrants applying for residency and people applying for a temporary essential skills visa.
The lower band, set at the median income of $48,859, would see those earning less unable to claim points towards residency and only be eligible for a maximum three-year visa, followed by a stand-down of one year outside the country.

The higher threshold of $73,299 would mean anyone earning more was automatically classified as highly skilled.

Rules regarding lower-skilled families were also introduced, meaning partners and children would no longer be able to work and study in New Zealand.

Following strong feedback from industry lobby groups, the Government pumped the brake a few months later, the lower salary band was dropped to $41,538.

While there is room for change in the international education market, Labour is facing a huge task in building 100,000 homes under its KiwiBuild policy and will need workers to do so.

Alongside the usual construction work visas a new KiwiBuild visa will be introduced to allow a skilled tradesperson to be hired on a three-year work visa without meeting the labour market test, as long as an apprentice is hired alongside that worker.

An exception skills visa will also be introduced, allowing people with significant experience or qualifications to bring their families.
What impact will the changes have?

Professor Paul Spoonley of Massey University said the idea of reducing net migration to 10,000 was unworkable.

“I don’t think New Zealand First’s plan was ever explained in sufficient detail and second, I don’t think it would have been workable. It would have been too drastic a handbrake on the New Zealand economy," Spoonley said.

There was room to move in reducing net migration, however, and Labour’s estimate that the changes around international education would remove $250m from the economy was “about right”.

Spoonley said the 1,500 KiwiBuild visas seemed light to build 100,000 homes, even when added to current immigration levels.

Local, skilled workers would be needed, but they could not be created immediately.

“My question is whether 1,500 construction workers is going to meet Auckland and Christchurch demand, quite apart from the country’s.”

The international education effect

While the tightening of rules will have some impact on the international education market in New Zealand and on some recruiters overseas, many in the industry were expecting the move.

Terry McGrath, acting-president of the International Education Association, said the National Government had already changed direction and begun focusing on quality over quantity.

Both the outgoing and incoming Education Ministers had signalled this at a recent conference, and weeding out private training institutions that were exploiting students was welcomed.

“It’s not so much a surprise. It’s more a collective sigh of relief that there’s nothing extreme being put forward,” McGrath said.

Many in the industry had become quite concerned about some of the low-level providers alongside the exploitation of students by workers, so it was also welcome to hear that the number of labour inspectors would be increased, he said.

Labour campaigned to double the number of labour inspectors to 110.

3. A change of tack on trade and foreign affairs

Sam Sachdeva writes that New Zealand's foreign and trade policies could be set to shift, with the Labour-led government handing over key international portfolios to New Zealand First and fighting for changes to the TPP.

With the election over and coalition deals ceremonially signed, Prime Minister-designate Jacinda Ardern and her incoming government must begin to navigate the possible pitfalls of an uncertain global climate.

North Korea, Donald Trump, and tackling trade negotiations are among the challenges Ardern and her team must face. So what changes can we expect after nine years of National leading on the world stage?

Strikingly, it will be junior coalition partner New Zealand First rather than Labour largely tasked with setting forth the country’s position.
The coalition agreement between the two parties allocates three international affairs positions to New Zealand First: foreign affairs, defence, and an undersecretary for foreign affairs.

David Capie, the director of Victoria University’s Centre for Strategic Studies, said it was “a surprise” to see New Zealand First hold three foreign-focused spots - although he suggested Ardern’s foreign policy views could hold more weight.

“That's striking [the number of positions] but it's also worth remembering that in practice New Zealand's international interests are pressed primarily by the Prime Minister.

“That was certainly the case the last time [Winston] Peters was Foreign Minister and Helen Clark was PM.”

Peters, Mark set for big roles

As for the people who will fill those roles, Peters is expected to be confirmed as Foreign Minister on Wednesday, although he was coy when asked at the signing ceremony for the agreement.

Ron Mark, a former soldier, seems certain to become Defence Minister, while the undersecretary role could fall to either Fletcher Tabuteau or Shane Jones (although the latter would be highly disappointed not to pick up a Cabinet position).

Peters served as Foreign Minister from 2005 to 2008 under the last Labour government, and is widely regarded to have performed well in the role while securing welcome funding for MFAT.

He has already secured a minor victory, with Labour agreeing to record a Cabinet minute about the “lack of process followed” before the National government’s sponsorship of a UN Security Council resolution condemning Israel over its settlements.

Labour supported the resolution at the time, and Ardern said the Cabinet minute would refer to only the decision not to bring the matter before Cabinet for sign-off.

“Our view is for significant issues, of course you would and should under normal circumstances involve the executive in that decision.”

Mark has been outspoken about a perceived lack of investment in the Defence Force, and New Zealand First has secured a commitment to re-examine the previous government’s procurement programme “within the context of the 2016 Defence Capability Plan budget”.

Peters said there had been “so much in the recent history of procurement which is highly suspect”, and his party wanted to review whether it could get better results for the same amount of money.

Capie said re-examining the procurement process would “buy the incoming government some time to think through the big-ticket items that were foreshadowed in the last White Paper”.

“That involves billions in new defence spending, never likely to be decisions a new government would rush to make straight after an election fought around issues like child poverty and homelessness.”

Clock ticking on TPP

Trade is perhaps the most pressing issue for the new government, with just over a fortnight until the TPP trade deal is meant to be finalised on the sidelines of APEC in Vietnam.

Ardern confirmed the Government would push ahead with a ban on the purchase of existing houses by non-resident foreigners - a policy which would require a renegotiation of the TPP, along with the existing South Korea trade deal.

Ardern said Labour and New Zealand First had “a huge amount of consensus” when it came to the TPP, particularly over the foreign buyers ban and concerns about the Investor State Dispute Settlement (ISDS) mechanism, and would enter negotiations with that stance in mind.

However, she would not comment on whether New Zealand would pull out of the deal if it could not win concessions from the other TPP partners, saying she did not want to compromise the Government’s negotiating position.

Stephen Jacobi, executive director of the NZ International Business Forum, said he was hopeful New Zealand could sign off on the TPP, depending on how the Government chose to deal with the foreign buyers ban and the ISDS concerns.

Ardern had been “suitably discreet” about the Government’s negotiating plans, while the TPP itself was not mentioned in the coalition agreement.

Jacobi said there was “plenty of scope” to stop foreign buyers without a legislated ban, such as through a stamp duty. While Peters dismissed the idea of a stamp duty on Tuesday, saying it had not succeeded in Vancouver, Jacobi argued it had “worked wonders in Singapore”.

Winning changes to the ISDS clause would be difficult, he said.
“It’s about the strength of their resolve isn’t it - how far they want to go?”

Jacobi said he was “a bit puzzled” by the inclusion of a coalition agreement clause to work towards an FTA with the Russia-Belarus-Kazakhstan Customs Union.

Peters said he wanted to explore why the previous government had scrapped its free trade talks with Russia and try to get a deal across the line.

“Here comes a glorious opportunity to put ourselves into a trading market with Belarus and Kazakhstan and Russia, and give ourselves an opportunity to enter the second-biggest dairy and beef importer in the world.”

Turning inward, or looking outward?

More broadly, the new Government may bring with it a change of approach to the outside world, with both Peters and Ardern having expressed reservations about globalisation in the past.

Outgoing Prime Minister Bill English expressed some concerns about a potential change of tack, suggesting New Zealand’s foreign affairs and defence ministers presented “the face of New Zealand to the world” with the Prime Minister.

“New Zealand has been able to represent itself for the last decade as an outward-looking, globally competitive economy that’s succeeded where other countries have failed or have found it hard...

“Now there’s spokesmanships there that have gone to a party that has quite a different view, that is it’s pretty hostile about the global economy, it is trying to constrain significantly the people and investment that come across our border.”

English said it was important that New Zealand was represented as “an open, confident economy and not in the way that it was represented by the Deputy Prime Minister last night in his speech, which was a country that's now scared of what might happen to it.”

However, Ardern provided what Jacobi described as “balancing language” when she insisted she and Peters were committed to free trade despite their concerns about the TPP.

“At the same time, we both support increasing exports and export growth for New Zealand, and representing those who are exporting to the best of our abilities in these negotiations.”

With Ardern and Peters set to meet Donald Trump, Justin Trudeau and many others at Apec, they will soon have the chance to clarify the new government’s approach to the outside world.

4. Searching for Winston's legacy

Tim Murphy writes for Newsroom this morning that The National Party must have been pretty stingy in its negotiations with Winston Peters and New Zealand First.

National came up short, as we know - but on the evidence of yesterday's coalition agreement announcement, Labour didn't have to do a whole lot on policy to win the 7 percent party over to its camp.

It was certainly generous in giving away portfolios for New Zealand First ministers; their four nominees take 11 portfolios plus three associate roles and the responsibilities are ones that matter - State Owned Enterprises, Regional Economic Development, Infrastructure, Forestry and Foreign Affairs are the headline acts.

All parties to the coalition talks kept saying the discussions were rigorously focused on policy. If so, the Labour Party focused hardest.
Many commentators said New Zealand First leader Winston Peters was looking for a legacy from the negotiations. If so, what could it be?

Labour has allowed him an extra $800 million towards their shared Regional Development Fund. It is unclear what that money represents, other than some funding for regional rail and planting of 100 million trees (something other parties had been advocating). It will raise the minimum wage more than it had publicly promised - to a figure Peters had nominated in the campaign, $20 an hour by the end of the 2020-2021 financial year.

Either of those things are policy wins. The total of $1 billion on regional development a year sounds impressive on the surface but needs detail to discern what would have occurred anyway under either Labour or a status quo National-led government.

Neither big policy ticks are legacies in the order of Michael Cullen's Kiwisaver, Cullen Fund or Working for Families, Jim Anderton's Kiwibank or even Bill English's successful stewardship of a vulnerable economy through the Global Financial Crisis.

Labour has agreed to sacrifice its water levy on most farmers, agreeing to NZ First's desire for a royalty on bottle water exports only. And it has increased the exemption for agriculture upon entering the Emissions Trading Scheme to 95 percent, from its target of 90 percent. But New Zealand First opposes the ETS in any case, favouring a system of carbon charging.

Surely Peters' legacy could be found in the section on immigration.

Twenty plus years of campaigning against free range immigration had little or no effect in the coalition negotiations. Labour will keep to its policy of reducing the net migration target by up to 30,000, although even then no figure is listed in the document. NZ First gets promised that work visas will reflect genuine skills shortages and that low value international education courses will no longer qualify. But way back in Andrew Little's day as Labour leader that was the red party's stance.

So there is little in the policy bag that would seem to have taken the best part of two weeks of talks and then New Zealand First Board talks about talks. Perhaps that's why the board and caucus took so long working over the proposed coalition offering. National's must have been lowball on policy to have lost out to this deal. Labour's was high on portfolios and what Peters has derisively called the baubles of power but limited on the biggest policy pledges Peters took to the electorate.

Labour will have fewer policy portfolios to distribute to its ministers outside the cabinet than might have been expected but it has absorbed the New Zealand First changes and those from the Greens with little collateral damage.

There's no Singapore-style change to monetary policy, just a review of the Reserve Bank Act, possibly along the lines Labour had intended independently of NZ First.

Immigration will be Labour's policy.

The "feasibility study" on "the options" for moving the Ports of Auckland doesn't even focus on shifting it to Northport in Whangarei as New Zealand First had pledged. The northward option will only be given "serious consideration". In bureaucratic speak that is often where ideas go to die.

There will be an ETS, not a scrapping of the ETS and a carbon charge as Peters' party advocated.

A NZ Forestry Service will be re-established; but while Peters got there first some time ago, Labour had taken that policy as its own during the campaign and well in advance of the coalition policy negotiations.

In many ways the agreement released yesterday indicates New Zealand First's effect on this government will be a "modifying" rather than
revolutionising one.

It would be churlish to criticise that. The party won just seven votes in every 100. Had it wagged the dog in these policy concessions, as it did in orchestrating the weeks of negotiations, it would have been upbraided for having claimed inordinate influence.

There are a grab bag of political peccadilloes. Labour has agreed to Peters' wish for a Waka Jumping Bill to stop members of parties changing party allegiances mid term. That is a defensive move after a previous New Zealand First grouping in Parliament fractured. The new government will build a museum at Waitangi to commemorate the Māori Battalion. It will also "record a cabinet minute" about what the parties say was a lack of process when New Zealand helped pass a UN Security Council resolution critical of Israel.

Labour will be the real change. Its signature health, education, monetary policy, migration, housing and environment policies stand. It will have fewer policy portfolios to distribute to its 16 full ministers and five ministers outside the cabinet than might have been expected but it has absorbed the New Zealand First changes and those from the Greens with little collateral damage.

The Greens' agreement, largely leaked days earlier, will see that party score the Climate Change portfolio for leader James Shaw and its plan for a $100 million Green development fund initiated.

Shaw told Rachel Smalley on NewstalkZB that the fact the Climate Change responsibility would be outside the cabinet would not matter - the parties had agreed to form a new cabinet committee on climate change and the environment, which Green ministers could attend to thrash out detail before a cabinet sign-off.

It will get its Zero Carbon Act and an independent Climate Commission and a set of environmental, social and economic indicators which the Government will mark itself against.

Where New Zealand First gets an enhanced, smart Super Gold Card for its superannuitant constituency, the Greens win an investigation into a Green Transport Card for low income people and those on benefits.

The Greens have negotiated changes to the way welfare authorities impose sanctions on beneficiaries - a legacy of former leader Metiria Turei's fateful campaign - and its already publicised referendum on legalising the personal use of cannabis.

Among the portfolios the Greens have secured is Land Information, one central to ultimate approvals of foreign purchases of farm or sensitive land.

The identities of ministers are announced late on Wednesday morning and the new ministry will be signed in by the Governor General tomorrow.

One, last, piece in the collegial puzzle has occurred. On Tuesday evening Peters finally deigned to meet Shaw - at the Green leader's office. No whisky was consumed. But Shaw says he gave Peters a bottle of the amber stuff. Deal. Sealed.

5. Watering down the water tax

Newsroom's new South Island reporter David Williams (he started yesterday in Christchurch) has written the battle over the water tax is over, but the debate about irrigation-fueled dairying will rage on.

As expected, the new Government confirmed a watered-down version of Labour’s proposed water tax. A royalty on exports of bottled water will be introduced, but irrigators are in the clear.

In National Party parlance, it might have been one tax too far.

At least fearmongering about $18 cabbages can now be dug into the garden of election misinformation. The Government’s other big water policy announcement yesterday seems like a win for the Greens.

It will honour existing commitments for Crown Irrigation – an up-to-$400 million fund set up to seed investments into water projects. But once that money’s spent, that’s it.

Prime Minister designate Jacinda Ardern told the media yesterday afternoon, the policy means: “We will honour existing agreements and commitments but not continuing on with future subsidies.”

Or as the Labour-Green agreement puts it “winding down Government support for irrigation”.

The Greens had called for Crown Irrigation Ltd to be dismantled, so that’s a win. But it also wanted to halt all new big irrigation projects, of which there’s no sign.

Killing the water tax, for now, is a win for New Zealand First.
Charging irrigators for water might play well as an issue in the cities – where many Labour-Green voters come from – but for New Zealand First it’s an important ingredient of the regional economy.

New Zealand First's pre-election policy was to support water-efficient irrigation and economically viable water storage.

Now, IrrigationNZ seems to be making a pitch straight at Peters.

IrrigationNZ chief executive Andrew Curtis told Newsroom regional economic development studies for east coast regions, and many others, highlight the importance of water, because of climate change.
Scientists predict the country will get warmer and drier, and rain events more intense, making it harder for farmers, particularly in the east.

“It does imply the need for some form of water infrastructure and storage is going to be fairly paramount for New Zealand.”

Curtis says the economic development strategy for Northland – Peters’ old electorate, coincidentally – has water “front and centre”.
Water is critical to the development of Māori land and high-value horticultural production, he says.

Curtis expects Crown Irrigation funding to fall well short of the initially earmarked upper limit of $400m.

He says existing projects with confirmed Crown Irrigation funding are dotted all over the country, from Northland to Central Otago, as well as the North Island’s east coast and a few in the irrigation powerhouse of Canterbury. (Almost two-thirds of the country’s irrigated land is in Canterbury.)

Some areas of Canterbury are over-allocated – more water can be taken than is healthy for groundwater, rivers and lakes.

Without storage, consents might have to be clawed back, he says, and “businesses become less profitable and less benefits flow into local towns like Timaru”.

IrrigationNZ is open to ensuring irrigation is done within environmental limits, he says.

And perhaps given the difficulty of pushing through massive projects, like the now-dead Ruataniwha Dam proposal in the Hawke’s Bay, he says there are modern ways to build effective, smaller schemes.

“It’s not just about big dams everywhere.”

The Greens might be buoyed by the coalition’s focus on water quality, which might force the hand of irrigators if pollution in rivers and lakes can be pinned to certain farms.

But it was the Labour’s intention to charge large irrigators – that’s farmers – for using water that pushed the debate to a different level.
In August, water spokesman David Parker said a charge of two cents per 1000 litres would raise about $100 million across the country in a year. But by then, the “water tax” label had stuck.

Some saw it as a straight-out attack on farmers, culminating a made-for-TV protest in Morrinsville (Jacinda Ardern’s hometown) last month at which a rugby jersey-wearing bloke sported a “She’s a pretty communist” sign.

National leapt on the water tax with a torrent of attack ads focused on potential taxes, some of it misinformed or untrue.

Farm lobby group Federated Farmers called the proposal “ugly”. President Katie Milne said they’d told Labour “they don’t appreciate that irrigation is not just used by dairy farmers and is not the evil polluter they’ve been convinced it is”. She added: “A water tax simply won’t solve the problems.”

Now the water tax has floated away, the Feds’ line is it’s “ready to engage”.

Milne: “The primary sector is the backbone of the New Zealand economy so we anticipate the new government will be mindful of that when formulating policy.”

Environmental groups might point out an economic argument won’t wash if that “backbone” is slowly polluting the country’s rivers and lakes.

6. A focus on mental health and drugs

Newsroom's Teuila Fuatai reports that five years after the Mental Health Commission closed shop, New Zealand First has secured plans for its reestablishment. Alongside that, the Greens have also committed to a Government that acknowledges and treats drug-use as a genuine health issue.

More than 20 years after a galvanising series of inquiries into New Zealand’s mental health practises, which culminated in the legislation-defining Mason Report of 1996, we seem to have reached another pivotal point in our mental health landscape.

AUT professor of psychology and public health, Max Abbott - who lists founding director of the Mental Health Foundation as part of his extensive CV - said that particular point, and the current state of affairs, was indicative of the real need for a “stocktake” of mental health systems.

The re-establishment of the Mental Health Commission - announced yesterday as part of the Labour and New Zealand First coalition agreement - was an important step towards this, Abbott told Newsroom.

“I was actually in support of it [the Commission] being closed down [in 2012]...because I thought mental health was sufficiently established and strong enough that it would no longer be marginalised and sidelined as part of the Ministry of Health,” he said.

And while vast improvements in systems and treatments have occurred in the last two to three decades, it has become obvious in more recent years funding and development of mental health services have failed to keep up with demand.

That failure to keep up had resulted in unacceptable, and dangerous consequences such as “inordinate” waiting times for things like talking therapies and counselling for those requiring immediate help, as well as problems with poor access to services, Abbott said.

“While there’s a lot of good work being done, it’s not sufficient and there are definitely gaps and cracks appearing.”

When the Mental Health Commission was established in 1996, it operated as a watchdog for mental health services, independent from Government. Its job was to ensure that funding for mental health services remained in that sphere - rather being used and filtered through to other health areas, he said.

Under the current system, too many people were being failed either during, or even prior, to interaction with the mental health system. Addressing problems around access to care, in addition to the quality of care, must include an independent assessment of what is and isn’t currently working, and where the major shortfalls are, Abbott said.

An independent inquiry, which carried out that assessment, could be undertaken by the Mental Health Commission once it was reestablished. Alternatively, a Royal Commission of Inquiry, or even a Ministerial Inquiry, could be triggered, he said.

Ross Bell, executive director of the New Zealand Drug Foundation, agreed reestablishment of the Mental Health Commission was needed, and also emphasised the need for broader interaction between alcohol and drug addiction services, and drug policy.

As part of the Greens confidence and supply agreement with Labour, also released yesterday afternoon, the development of legislation which directed drug-use be treated as a health problem has been prioritised in the incoming Government’s agenda.

And while Labour had already promised to address current rules which restricted access to the cannabis, and associated products for medicinal purposes, the Greens have further advanced this area of drug reform by planning a referendum on “legalising the personal use” of the drug before the next election.

Bell, whose organisation has spent a decade advocating for a shift away from drug policy rooted in a criminal-justice model, to one that was “health-focused”, said while a public referendum wasn’t ideal, it may just be what is needed to achieve long-overdue changes to New Zealand’s drug policy.

“In terms of a referendum - it’s not perfect law-making, but it could provide the kind of cover that politicians want when it comes to drug-law reform,” he said.

“However, 2020 is a long way away for there to be referendum, and any lawmaking will occur on top of that [time period]. We want to see drug reforms happen much more quickly - and probably in areas less controversial than legalising cannabis.”

Bell pointed to a “Portugal model” of drug reform for New Zealand to explore. In 2001, the European nation decriminalised all drugs. Significant to that decriminalisation process was the simultaneous reallocation of Government resources and funding into drug and addiction prevention and treatment.

“They [Portugal] saw drug use go down, particularly drug use amongst young people - which is a good example of how you can combine investment in health services, like drug treatment, with drug law reform,” Bell said.

“What New Zealand would need is a significant investment in drug treatment to eliminate treatment waiting lists, and give people help when they need it, as well as providing more help in the community [setting]. That needs to be combined with a Portugal model of decriminalisation and health-referral, and then ultimately putting in strict regulations...around public health over things like cannabis.”

According to the Drug Foundation, 80 per cent of the what the New Zealand Government spent on dealing with drugs was dedicated to law enforcement, with the remaining 20 per cent going towards addiction treatment.

Bell said in addition to increasing support for drug-treatment, lawmakers needed to signal to police that referring people for help around drug and substance problems was preferable, and more effective, than arrest and conviction.

“Re-instating the Mental Health Commission will help in this, and shape the way we deal with mental health and addiction problems.”
Concerns raised by communities desperate for help around drug dependency and harm also needed to be properly acknowledged and addressed in any drug policy reform process, he said.

“There are some communities that don’t even have waiting lists [for drug addiction services] because they don’t have any of those services available. We’ve already been talking to the Government about this issue - how do you get more resources out to those communities now to deal with the concerns they have around methamphetamine, but also long-term cannabis dependency?” Bell said.

Feedback from school principals, parents, and mental health workers in those communities outlining the harm cannabis caused, as well as the link between the drug and mental health, had to be put in context if a genuine, national discussion around drug reform was to take place, he said.

“[We have to remember] that those real harms from cannabis exist right now, under the current approach.They are a result of successive Government’s failure to deal with the drug problem properly. Since 1975, we have been trying to fix that problem from a criminal justice approach with the Misuse of Drugs Act, and it just hasn’t worked,” he said.

“Quite often though, the harms that communities would attribute to ‘the drug’ are often the result of our failed prohibition approach. When you scratch the surface, those communities [dealing with drug harm] are actually talking about the drivers of drug problems, which is poverty, social exclusion, inequality, lack of education, lack of jobs.

“Hopefully, this Government will situate the drug problem within that larger social and economic context,” Bell said.

7. Coming up...

Jacinda Ardern will announce her full ministerial lineup and their portfolios later today. They are due to be sworn in tomorrow.

The High Court is scheduled to release its judgment on the 'Eight Mile Style v New Zealand National Party' at 3 pm tomorrow.

8. One fun thing

John Edwards PCE (The Privacy Commissioner) tweeting on this afternoon's High Court ruling on Eminem's law suit over the apparent use by The National Party of one of the rapper's songs in a 2014 campaign ad. (It's the one that Steven Joyce said was 'pretty legal'):

"I repeat my call for the registrar to say "Please Stand Up, Please Stand Up" before Cull J enters the Court to give her decision."