Bill English's legacy; The contenders; Defence's budget cuts

Bill English talks with Newsroom three hours after his resignation announcement. Photo by Lynn Grieveson

In today's email we looked at the legacy of Bill English, the morning after yet another surprise leadership change.

1. And another leader goes

Bill English capped off an extraordinary 14 months of political leadership changes yesterday with his unexpected resignation as National Party leader and MP, effective February 27.

There were murmurings he might go last week, but it's clear he is leaving on his own terms without any concerted push from within the caucus to remove him, largely because there is no clear leader-in-waiting and National's polling position around 44 percent) and English's personal popularity is still strong.

We reported on Newsroom Pro shortly after a strange mid-morning stand-up that he was expected to resign later in the morning. English was uncharacteristically late for his usual pre-caucus news conference and vague about his leadership before walking away from further questions and into the meeting to announce his resignation to colleagues.

He didn't need to go now and he made clear it was a personal decision to leave political life for the sake of his family. English had a good election campaign and looked like the winner on election night, but the loss of his Maori Party and United Future partners before and during the election sealed National's fate, given Winston Peters never appeared likely (in retrospect) to choose to govern with English, Paula Bennett and Steven Joyce.

The importance of the bitterness Peters felt personally towards the three National Party leaders played a key role in who is in Government now. The day before the election Peters filed papers alleging they personally breached his privacy by allegedly leaking details of his superannuation over-payments. As recently as yesterday, Tim Murphy reported on Newsroom that English, Joyce and Bennett were pursuing Peters for costs in the case, showing the bad blood is running deep in a relationship that needs to be repaired if National are ever going to form a coalition Government again with New Zealand.

That consideration of the need for generational change in National's leadership to give it more options for partnerships with other parties under MMP will play out over the next two weeks.

Peters reinforced that bitterness about English personally, and with Joyce and Bennett, in his reaction to English's resignation. Whereas others, including Jacinda Ardern and James Shaw were magnanimous in wishing English the best for the future and saluting his 27 years of public service, Peters pulled few punches.

"I don't think he wants to know about sympathy or otherwise. He's a big, grown, aged man, so to speak, and he's always known how rough this game is because he's been part of it, and [been] in fact inside coups, and sooner or later it will come to haunt you..." Peters told reporters in Parliament.

"He's the person that stabilised things under a very flighty leader called John Key. He did the hard yards, so to speak, but in the end, if you look at the concretisation of wealth in so fewer hands in that period of time, this cannot be regarded as a period of success economically."

See Sam Sachdeva's full coverage of the resignation announcement, which was up from 11 am yesterday on Newsroom Pro, including some surprisingly emotional moments when English talked about his family

It's clear Winston Peters has never really forgiven English for his role in seconding the motion to eject Peters from the National Party Caucus. Peters also believed English was involved in the coup that saw National grab New Zealand First MPs from under Peters in the 1996-99 coalition Government. The dramas over the leaked pension details aggravated already poor relations.

Ultimately that personal emnity sealed the fate of the last National Government and Peters chose to go with Labour. 'No mates' National now faces a tough road back towards finding new leaders and approaches that would allow it to partner up with other parties that are either in the Parliament now or may arise in future.

2. A legacy of compassionate conservatism

Now is as good a time as any to try to assess Bill English's legacy. I see him as a compassionate conservative who managed New Zealand's Government and economy well through the Global Financial Crisis, but who had only just started social housing reforms and rolling out his big social investment idea.

He himself told me yesterday in an exit interview he wished he had been able to get those going faster and been able to complete them. Some of those reforms will now be rolled back under Labour.

It's worth trying to explain the compassionate side to Bill English's conservatisim.

It's only now I can feel I can tell this story safely of a night in 2009 when Bill English quietly dripped tears onto a lecturn in front of an audience of ACT-supporting Aucklanders as he explained why he got into politics. His speech that night about his rural upbringing and his Samoan in-laws was quietly electrifying and changed my view of him, as I'm sure it did many in that audience.

Back in 2009 I was a grizzled economics journalist with low expectations of New Zealand's current crop of politicians. I grew up during the amazing era of Robert Muldoon vs David Lange in the 1980s when politicians were larger than life and the 'vision thing' was even bigger. There was cut and thrust in the debates and the oratory flew as high and as wide as the economic reforms enacted by 'we won, you lost, eat that' Governments that dominated Parliament with a minority of the vote. But by 2009, MMP appeared to have rolled the verve and style and vision out of politics. Politicians were centre-hugging pragmatists who looked down on 'the vision thing' and sought to stay one step behind their median voters. Fair enough. MMP achieved its aim of making Government more representative and reducing the wild swings in policy, but it also stripped some of the inspiration and big ideas out.

Helen Clark and John Key were seen as clever political managers able to maintain party discipline and keep their parties close to the mainstream, and preferably just behind public opinion. Their role was to hold together a coalition as much as to enact reforms. You never got a strong sense, particularly with Key, that they were conviction politicians who wanted to transform the country. Neither could give a speech to save themselves, but in one-on-one settings they were both charming, briefed to the eyeballs and as sharp as hell. But both were clearly political animals where the power was just as important as the policies, especially for Key. I never expected to be surprised by inspired by their ideas or turn of phrase when I listened to their speeches, although it's also my job to be a professional sceptic rather than a believer, so that's not too shocking.

Back before that night in 2009, my view of English was set from a long distance. I saw him as a fiscal and social conservative who had failed as an Opposition leader, but was a capable wing man for John Key. The Southlander seemed a typical MMP politician from a provincial National Party background who would serve his time competently without changing much. Back then. after less than a year in Government, I wondered whether he would be able to give Key some strategic and moral backbone, but it was still early days.

I went to the Formosa Resort that evening expecting a technocratic speech about the economy and the Governments finances in the midst of the Global Financial Crisis. But the organisers did something interesting. They asked English to talk about what had inspired him to become a politician and what motivated him. It's not an easy question for anyone to answer honestly in front of an audience of hundreds of voters and quite a few journalists, although the speech was off the record.

One of English's strengths and weaknesses is he cannot fudge or tell a lie to save himself. He tends to address questions head on and respectfully. He loves to get down into the details of the policy and the political arguments, rather than dodge and weave through a news conference to give little for an opponent to attack. As an example, his rabbit-in-the-headlights performance during the Todd Barclay affair was a political low point as Prime Minister, and he never adopted Key's breezy and evasive style -- to English's credit. So when he was asked to reflect on his political motivations in 2009, he did exactly that.

I didn't take notes, but recall how he almost immediately had the room in the palm of his hand with his personal reminiscences about his family life and his connections to both his wife Mary's Samoan family and the personal connections National had built up with the Maori Party.

He talked of his admiration for his father-in-law's family ethos and hard work in raising a big family in Wellington, despite the struggles of arriving with little from Samoa in an unfamiliar city. He also talked about a quiet chat he had with a kaumatua on a marae about the problems of Maori youth, and the need for strong communities with their own resources. His point was that he admired the self-reliance and quiet conservatism of family and community life. He saw his role as helping those communities and pulling Government out of the way to let them get on with it. It wasn't an ugly or dry form of libertarian scorched-earth politics. It was a deeply humane and thoughtful approach where Government was supposed to treat people with empathy and dignity and as individuals, rather than as just another beneficiary locked into welfare for life. His views on helping to lift people out of poverty were a precursor to his championing of the social investment approach, which he was only just starting to roll out through the Government as Labour returned to power in late October.

As he spoke about his in-laws and his wife and the dignity and self-reliance of those conservative Samoan and Maori communities, he stopped for a few moments. The tears rolled down his nose and splashed onto the lecturn. You could hear a pin drop. The audience was with him though. English's story was utterly authentic and thoughtful and showed a depth of humility and humanity that struck a chord that night. He got a standing ovation when he finished.

Since then I've listened to English give countless speeches off the cuff that connect with audiences of all types up and down the land. Some thought he was a dry policy wonk who would struggle on the campaign trail, but I was sure he would connect if he was able to make his case on his feet in debates and in interviews, rather than in scripted speeches. He has an intellectual heft and a thoughtful approach which distinguished him from Key and the rest of the cabinet. He also showed his moral fibre when criticising Judith Collins openly during the Dirty Politics affair. English emerged with a lot more credit from that episode than both Collins and Key.

Both a policy wonk and a retail politician

English proved to be a formidable campaigner last year who connected with millions of voters in the televised debates with his social investment ideas and his earnest and believable approach to addressing poverty. His announcement of a doubled target of child poverty reduction surprised many who might have previously seen him as a fiscal dry and policy wonk, but those who have listened closely to English over the years would not have been surprised at both his policy approach and his ability to do retail politics. He was the key driver in Key's various measures to outflank Labour on the left with free doctor's visits for kids, the first real benefit increases in 30 years. He added his own flourish with last year's ambitious budget to reduce child poverty by increasing working for family and accommodation supplements.

English categorised himself as a policy wonk in an exit interview he gave me on the day of his resignation, but was confident he could connect with the broader public when he got the chance again in last year's election.

"You get seen or portrayed according to how you're defined. If you're the Minister of Finance, they're not looking for you to do retail politics, but I've always done a lot of retail politics. They're not looking for your ability to connect to a wider audience," he said.

As a policy wonk, he cited policy wins both large and small as things he is proud of.

"One thing I'm particularly proud of is down south we managed to get the rural health services out from under the DHB 20 years ago, and they've been stable and non-controversial and viable," he said, pointing to the relative failure of Queenstown's services, which stayed in the DHB.

"That's a lasting benefit, that stability."

In the news conference he even pointed to his reforms of Treasury's approach to asset management as a lasting win that had helped the Government identify and then improve dilapidated school property.

He had a good GFC

He also cites his stable and smooth partnership with Prime Minister John Key for eight of the nine years that National was in power.

"The bit I'm most pleased about was getting through that difficult period in 2009/10 in a way that gave people confidence, in particular the most vulnerable, and got us to where there was a hangover of debt -- which we can manage because it's not that large -- but the kind of solutions that were put into place were accumulated into a lasting sustainable position for the government and the economy -- compared to even Australia, which is still trying to resolve things that weren't that well managed during the GFC."

"The key to it was the cohesion between myself and the Prime Minister."

English said there was never any question of slashing spending or using the crisis to shrink the size of Government, as some other conservative governments chose to do with austerity budgets during the GFC -- with disastrous effects.

Instead, he and Key maintained benefits and spent heavily to support the economy and the vulnerable at a time when it was needed. They were able to because they inherited a strong balance sheet, but a chaotic or mean Government could have done some real damage.

His essential conservativeness often shines through, particularly on macro-economic issues and in challenging the good intentions of public servants.

"Whatever the fashions, sound economics matter. They might be a bit boring, but if you stick to them that's what works. People are always trying to find shortcuts and leapfrogs and I've seen most of them come to grief," he said.

He said he had learned that the effects of the public sector on the economy and peoples lives were often under-estimated, and often negatively.

"Good intentions are not enough. They're not even a start, because there's been a lot of money wasted and lives wrecked on the basis of good intentions expressed through public services," he said.

English made the point in his exit interview of saying he wanted to leave on good terms when his party wanted more of him, rather than less.

A good legacy

The man from Southland who can read a literary novel as quickly as a Treasury document is a real loss to New Zealand politics at the age of 56. But he has served 27 years and deserved his choice of leaving when the public and his party wanted more. He could have chosen to leave when his own colleagues didn't want him in 2003 after he led his party to its worst electoral defeat in history.

Instead, he kept his head down and chose to serve with both Don Brash and Bill English as a senior colleague. His phlegmatic and disciplined approach eventually bore greater dividends with Key as Prime Minister. He made Key a better Prime Minister and put a moral and policy backbone into the cabinet that served National well.

Now he leaves with his reputation and popularity on a relative high. Most politicians don't get a second chance. He took his and made his party and the country better for it, many would argue.

English had his flaws. His inability to sidestep questions weakened him as a politician on occasion, but it also served to underscore his authenticity. His judgement on some people was sometimes poor (Todd Barclay comes to mind) and his inability to be ruthless with colleagues may have cost him over the years.

But the Bill English I saw that night in 2009 was as genuine and as thoughtful a politician as I've seen in New Zealand, who was able to turn that decency into some policy wins and an economy that has mostly served the nation well.

Some may blame him for the housing crisis that Labour inherits, which is responsible for most of the inequality and disfunction in New Zealand society.

But English was held back by Key's inability to think strategically on housing between 2009 and 2012, and by home-owning voters' own reluctance to kick their habits of tax-free capital gains and restricting investment in new housing developments because it changed the environment and increased council rates.

English is retiring with dignity and can have a third act of sorts with his family and new career. Most will wish him well. I certainly do.

3. A cast of candidates

Now the fun and games begin. This will be the first leadership contest for the National caucus where a clear leading candidate is not known.

That lack of clarity creates a risk of a series of leaders bashing their heads against a brick wall of Jacinda Ardern's popularity, similar to that seen when Phil Goff, David Shearer, David Cunliffe, David Parker and Andrew Little did the same against John Key.

The purely political calculations are that English's departure and the impending fight for the top job could see National's reputation for discipline and competence erode in the face of a so-far competent and disciplined Labour-led coalition Government. Labour is expected to jump ahead of National in the polls.

Newsroom's Co-Editor Tim Murphy has taken his own look at the list of contenders and the history of leadership changes in Opposition. The history is not pretty.

Last time National was expelled from government, it ran through Jenny Shipley, English, Don Brash and finally John Key before seizing back the Treasury benches. When Helen Clark walked on election night 2008, Labour tried Phil Goff, David Shearer, David Cunliffe and Andrew Little before the Hail Mary pass to Ardern two months before the election.

In the more patient 1990s, Labour needed only two leaders before regaining power, although it had to bear with Clark's stubbornly low public appeal for a long time before she shone. In the 1980s, National's first leadership change after Robert Muldoon lost power was a hospital pass for Jim McLay. Jim Bolger, stolid and adequate, was the right person at the right time and took the party to a landslide win on the back of Labour's historic implosion.

Let's get real: the chances of anyone now leading National to victory in two and a half years are low. New Zealand hasn't tipped out a government after one term for 43 years, when the oil shocks and death of a Prime Minister undid the Third Labour Government in the face of Muldoon's belligerence.

National's big caucus could change that, giving them a base camp from which to clamber back to the summit earlier than others have managed.
But its caucus has to anticipate what kind of government this coalition will be for the next three or six years. If in their hearts the blue MPs believe the Labour-led coalition will self-destruct because of tensions from the historically volatile New Zealand First and the stand-on-principle Greens, then a capable and televisual journeywoman or man could carry National back across the debris in 2020 or 2023.

But if Ardern can keep the coalition together and Winston Peters can keep himself and his caucus together then National will need something else. Someone unorthodox, with a twinkle in their eye and a touch of warrior. Someone who will be populist and unafraid of controversy. Someone who can embody Muhammad Ali's old line of: "Don't go to any trouble ... because I'm bringing it with me."

The party will need to seduce or destroy New Zealand First, prove Labour to be unstable and incompetent or both, and short circuit the New Zealand electorate's tolerance of a government from its nine-year run-rate to six or even three. If the Labour-led Government doesn't fall, it will need a push.

Who does National have who could be bold and up-end the chess board? Putting aside Steven Joyce, possibly the most competent of all but whose time has passed and will no doubt follow English out the door, the names being touted since the election include:

Simon Bridges
He may not be all Brylcreem and Kayway accent but to this point that's his public image. He's youngish (41), a lawyer and has held the Tauranga seat for nine years, been a minister of economic development, transport and communications. While pleasantly combative in the House, rattling Labour on the first day of this Parliament by imperilling its choice of Speaker, he lacks command and is not feared. He presents well and would be an orthodox choice.

Judith Collins
Unorthodox, politically naughty, empathy-challenged and despite herself possibly the kind of leader National needs if it wants to shorten its wait in Opposition. Older (at 58) than English and 21 years senior to Ardern, she is hardly generational change. Also a lawyer, smart and unafraid, she would be full throttle in Parliament and on the road. Collins has held Papakura or Clevedon since 2002 and been Minister of Revenue, Energy and Resources, Accident Compensation, Police, Justice and Corrections. Infamous for her association with Chinese investment company Oravida and her role identified in the Nicky Hager book Dirty Politics, she has been followed by controversy and resigned from Cabinet after allegations of a Trump-like hounding of the Serious Fraud Office chief. The question for National: When they go high, do we go low?

Nikki Kaye
Her main credentials could be that she has twice taken on Ardern and defeated her in the Auckland Central electorate. Young (she turned 38 on Sunday), Kaye has degrees in genetics and law, is a social liberal who has secured the urban stronghold and was an early choice from her cohort to be promoted to the cabinet by Key, taking Civil Defence, ACC, Youth Affairs, Food Safety, Associate Immigration and finally Education. A competitive distance athlete, Kaye took leave from late 2016 until early last year after a breast cancer diagnosis. She impressed speaking at the National Party's campaign launch last year, outshining deputy leader Paula Bennett. Her similarities to Ardern in age, time in Parliament, outgoing personality and liberal outlook could appeal as a way of sharing the stardust, but might also pale in direct comparison.

Amy Adams
Adams was increasingly prominent in the last National government, rising to be ranked seventh, just after Bridges and ahead of another leadership possibility Jonathan Coleman. Aged 46, she was also elected in 2008 and spent two terms in Cabinet handling Internal Affairs, Communications, Environment, Justice, Associate Finance, Social Investment and Housing roles. Another lawyer, Adams debates stridently in the House, most recently against the New Zealand First-inspired waka-jumping bill. She and her husband own three farms and she perhaps suffers in the public eye from being viewed as landed gentry, posh accent to boot. She would be a competent, safe choice but is that enough?

Paula Bennett
With Collins, Bennett is the best-known of the possibles. Bubbling with self-confidence and oozing with awe and pride in the Key-English government, the 48-year-old Bennett has a non-traditional National backstory, a solo mother on benefits who got herself educated (B.A in social work), worked in student welfare before ending up working for the National Party grandee Murray McCully and into the House on the party list in 2005 before winning west Auckland electorates from 2008 and joining the cabinet. Bennett has been minister of State Services, Women, Police, Tourism and Climate Change and deputy Prime Minister to English. She is the current party deputy leader but has controversy in her past, personally and politically, and would be a risk.

Jonathan Coleman
A former Auckland Grammar School head boy, medical doctor and MP for Northcote since 2005, Coleman (51) has been Minister of Health, Sport and Recreation, Defence and State Services. A straight-laced type who is said to be bright, he successfully mimicked over time Key's way of speaking and was a contender in late 2016 for the party leadership before withdrawing. A Coleman candidacy would suffer from his sameness in age and style to National's past two leaders and from a dismissive and impatient attitude to a series of problems that built up in his health portfolio. Maybe he could be deputy.

Mark Mitchell
The drums beat early for some politicians. Mark Mitchell is one of those. A former police dog handler who ended up in 'security' roles in Iraq before taking former National speaker Lockwood Smith's safe Rodney seat in 2011, Mitchell (49) has long been discussed in the party as one to watch. He served as Minister of Defence, Land Information and Statistics after being promoted by English to the Cabinet in late 2016 and impressed. Married twice and now the partner of Peggy Bourne, the widow of late rally driver Possum Bourne, Mitchell has an affability and a 'command presence' much liked within National. He is currently ranked 21st in the caucus and is an outsider. But there would be freshness, vitality and unpredictability for the other side.

4. Judith is in. Simon joining soon.

Newsroom's Sam Sachdeva reports this morning that Judith Collins has already put her hat in the ring and that Simon Bridges is expected to announce later today he will stand for the National leadership.

Collins, a former Police and Corrections Minister from the right of the party, revealed her leadership bid in a post on Twitter.

“I’m announcing my candidacy for Leader of the NZ National Party. We’re going to need strong & decisive leadership if we’re going to win in 2020. I’m that person.”

Collins also mounted a bid after John Key stepped down in December 2016, although she eventually withdrew her bid and endorsed English.

The 58-year-old has been the subject of controversy in the past, resigning from Cabinet in 2014 following allegations she had undermined the head of the Serious Fraud Office (she was later cleared of wrongdoing).

She is believed to have cultivated strong relationships with some of the party’s backbenchers, although it is unclear how many MPs would back her run.

Collins’ announcement came as Bridges told media he had been talking to colleagues about his own plans.

"I am talking to colleagues, and look it may well be that later today I have something more to say,” Stuff reported him as saying.

Bridges ran for the deputy leadership in 2016, losing out to Paula Bennett, and has been one of the party’s more high-profile MPs in opposition.

5. Defence cuts in the offing

Newsroom's Foreign Affairs, Trade and Defence Editor Sam Sachdeva has uncovered a memo sent from the chief of the defence forces to staff outlining planned budget tightenings under the new Government.

Defence Minister Ron Mark says the message from NZDF chief Lieutenant General Tim Keating to staff is merely part of “routine” budget changes.

In a senior leader message seen by Newsroom, Keating said the NZDF senior leadership team had recently “[taken] decisions to ensure that we are prepared to adequately resource the priorities” as part of its Strategy 2025 plan (an acceleration of the Future35 plan for an integrated Defence Force by 2035).

“We’ve got to be smart with our resources in order to deliver today and over the next four years. We’ve got to prioritise carefully, and not simply keep taking on more and more.”

Keating said the NZDF leadership team had agreed to “reprioritise resources [in 2018/19] to best enable us to deliver on our strategy and our commitments to Government”.

See Sam's story here on Newsroom Pro, where it was first published yesterday.

6. Maori MPs stand firm on charter schools

Newsroom Thomas Coughlan covered yesterday's news conference by Kelvin Davis, Peeni Henare and Willie Jackson over the standoff between charter schools and the Government.

The Government wants to pull the schools into the state system, which would strip them of their bulk funding and the non-standard teaching contracts which the schools say are absolutely necessary for them to remain different.

It's worth keeping an eye on this one, given the sensitivities within the Labour caucus and between the Government and iwi.

The MPs and Minister of Education, Chris Hipkins, were forced to tread a difficult line, saying that the changes were minor enough that students at the soon to be ex-charter schools would notice no difference to their education, whilst at the same time maintaining that the charter school model was broken and led to poor quality education.

The stakes were high for several of the MPs, including Kelvin Davis, the caucus' co-leader and the deputy leader of the Labour Party, who had promised to resign if the two charter schools in his Te Tai Tokerau electorate were closed.

He was joined by Peeni Henare, whose family is closely involved with the schools, and Willie Jackson. Jackson's wife Tania Rangiheuea is a tumuaki (principal) of Te Kura Maori o Waatea in Manakau.

Here's Thomas' full piece on Newsroom Pro, where it was first published yesterday.

7. One fun thing...

This is a good local giggle from last night on Twitter, via Andrew:

"Who wore it better? Westpac Stadium pitch or Trump"

8. This morning's political links

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