No budget rules or 'teal deal', say leadership bidders

Green co-leadership contenders Marama Davidson and Julie Anne Genter. Photos and montage by Lynn Grieveson.

The battle for the Green Party co-leadership has exposed tensions within the Greens and with Labour over their debt reduction pact. Both candidates oppose the plan. Thomas Coughlan reports.

It’s less than a week until the Green Party elects its new female co-leader and contenders Marama Davidson and Julie Anne Genter have revealed they oppose the Budget Responsibility Rules that are restricting the coalition Government's ability to deal with massive infrastructure deficits revealed upon gaining office.

The Government’s budget rules about running surpluses and reducing debt may be on the block next election after both Green Party co-leader candidates said they did not support them.

Green Party Leader James Shaw signed up to the rules last year. They commit Labour and the Greens to budgets that generate surpluses and keep government spending at historic levels relative to the overall size of the economy. The rules commit the coalition to paying down debt to 20 percent of GDP and keeping government spending at roughly 30 percent of GDP, the historic average of the last 20 years.

Both candidates opposed keeping the budget rules after the 2020 election, but Davidson and Genter confirmed, as far as they could given caucus confidentiality, that they were both critical of the initial proposal.

“I didn’t agree with it at the time,” said Genter. “When you’ve been in opposition for a long time you don’t realise how a campaign tool might constrain you in government."

Genter later contacted Newsroom to clarify that it was specifically the debt track and the ratio of Government spending to GDP that she did not agree with.

Davidson said that she did not believe the rules would help the party win votes.

“I don’t want to break caucus confidentiality, but generally I raised my concerns from the start,” Davidson said.

“I don’t, didn’t, believe that the Greens needed to spend energy appealing to the business roundtable who would never vote for us,” she said, “The arbitrary targets of reducing net core crown debt to 20 percent made no sense when we need to uphold a charter based on our values”.

Genter took aim at the requirement to keep spending below 30 percent of GDP.

“I don’t think that’s such an integral number,” she said. “There are countries that get much better outcomes than New Zealand that have much higher percentages of GDP as government spending, like Sweden and the Nordic countries.” 

Both Genter and Davidson said that one solution to the problem would be raising extra revenue through new taxes. 

“The constraint isn’t the budget responsibility rules, it’s the inability to raise new revenue, which the Greens never agreed to,” Genter said.

New revenue means new taxes, something Genter is already facing criticism for following the Government's proposal to increase fuel taxes to fund additional transport expenditure.

Genter hopes that being in government will help the party make its case to voters. 

“In government there’s a lot more scope to talk about the positive benefits to talk to all the people in the country from investment in long-term infrastructure that’s going to bring down climate pollution and decrease inequality,” she said. 

The rules are known to be unpopular in the party, but co-Leader James Shaw supported them to demonstrate the Labour-Green bloc’s commitment to fiscal responsibility. With both co-leadership candidates opposed, this is a potential fault line heading into the 2020 election. 

Teal deal no go 

Last election was notable for repeated pressure from some commentators for the Green Party to pivot right and do a deal with National in a so-called ‘teal deal’. The benefits were said to be manifold. It would stop the haemorrhaging of 'Blue-Green' voters to Gareth Morgan’s The Opportunities Party and it would give National the chance to offload some of its more difficult environmental portfolios to another party and let them take a share of the political risks with contentious issues like water quality and environmental standards.

The Greens would stand to benefit most. Proving they could work with both National and Labour would place them in ‘kingmaker’ position in future elections, the spot Winston Peters holds now. They could choose the government and take a disproportionate share of portfolios and policies while they were at it. 

But neither Davidson nor Genter think the idea has any merit. Neither explicitly ruled out a teal deal, but both said National would have to cease to be the party it is today for the deal to work.

“If National had a completely different policy program, sure,” said Genter. 

“But they’ve got a track record of going the opposite direction to where the Greens want to go on the environment. National is fundamentally attached to an environmental policy that is fundamentally based on increasing pollution,” she said. 

“The invitation is open to them to join the 21st century. There are centre-right governments in Europe who are fundamentally implementing Green party policy,” she said. 

Davidson did not see any merit in pursuing either Blue-Green votes or the Teal Deal.

“Blue Greens just want to have clean rivers and don’t want to fix the economic system,” she said. 

Davidson said that she could not do a deal with National unless it fundamentally changed its approach to the economy.

“I would want to see from them an economic model and narrative that seeks to measure the wider social economic and environmental outcomes and which has a more holistic attitude to communities,” she said.

She admitted the outlook for this type of National Party was dim.

“They have made the most damaging environmental and climate policies a government could ever make. I wouldn’t be able to accept that they could ever work with us without us being tarred by their brush,” she said. 

Davidson has previously voted for the Maori Party, which was a member of three National-led governments from 2008 until its demise in 2017.

“I was really impressed with the Maori Party’s initial Memorandum of Understanding when they first formed the government. It was quite groundbreaking the way they managed to get confidence and supply, no surprises the ability to maintain an independent voice, it was genius,” she said. 

“But I don’t think the Maori Party made enough of a difference to stop the oppressive agenda of the National Party,” she said, “and that ended up being their downfall”.

In or out 

One issue of contention in the campaign is whether or not it makes sense to have one co-leader in the executive and one leader outside and therefore free to criticise the Government. Ministers like Genter and co-leader leader James Shaw are forced to follow the Government line, while MPs outside the executive have a freer, more independent voice. 

This is often talked up by supporters of Davidson as a way of saving the Green party from the polling curse that often befalls minor parties after their first term in government. Most see a poll slump and fall out of Parliament. But Genter doesn’t see the logic in this argument.

“It didn’t save the Maori Party, did it?” she said, “I think almost certainly there is no advantage”.

Davidson would not be drawn on whether she would seek an executive position after the next election. 

“In this first term as a smaller party in a coalition agreement it is absolutely vital to maintain our independent voice,” she said. 

But ultimately she said that the decision would rest with party members who would vote on whether or not to continue having one leader in the executive and one outside.

“We may feel like we have established the differentiation enough to have both co-leaders ministers,” she said.

But Davidson herself is not opposed to membership of the executive. Asked whether she would accept the role of Deputy Prime Minister in the event of a Green landslide, Davidson said unflinchingly, “that’d be cool!” 

Genter is unambiguous on this point. Although the extreme democracy of internal Green Party organisation means that she too will have to appeal to party members if she wants to resume her role in the executive in the event of a Green victory in 2020.

“Having leaders in the executive is what most parties do. You get a lot more resource, more opportunity to speak to the electorate and you’re in the same position as the leaders you’re negotiating with, both in government and post-election, which is important,” she said. 

Genter was quick to say that an internal party committee had recommended several times under advice from caucus that both co-leaders should be members of the executive, before both the 2014 and 2017 elections. Had former co-leader Metiria Turei survived the fallout from her benefit scandal, she might have become a member of the executive too. 

Polling for the election closes this Saturday, with the winner announced on Sunday. 

Corrected to clarify Julie Anne Genter's stance on Budget Responsibility Rules