Q + A
Panel Discussion 1
Hosted by Susan Wood
In response to John Key Interview

SUSAN Welcome to the panel this morning – political scientist Dr Bryce Edwards from Otago University, former Labour Party board member Kate Sutton, and political commentator Matthew Hooton. Good morning to you all. Matthew, just discussing – it’s good to know National – not a dictatorship under John Key?

MATTHEW HOOTON – Political Commentator
No, just like Labour wasn’t a dictatorship under Helen Clark as well.

SUSAN Interesting, though. What did you think, Kate? He talked a lot about Fonterra, and we’ll just touch on it briefly now because we have Theo Spierings on shortly. A ministerial inquiry – certainly he’s promising accountability on this.

KATE SUTTON – Former Labour Party Board Member
I think— I didn’t see much from John Key on this. I think he’s constantly selling us a false choice. He’s saying it’s either market intervention or no market intervention and saying, ‘We’re hands-off. We’re free and easy.’ The reality is that from Key we’re shifting from crisis to crisis to crisis. I mean, Fonterra’s just part of it. He’s relaxed. He still seemed pretty relaxed then. He was pretty hands-off when it came to Fonterra, and I think that we really, you know, from my perspective, I like a government that puts in place good rules. What we’ve seen is, what, a $26 million cut in the funding for food safety for MPI under the National Government. So for me it’s all still way too hands-off. And the reality is that Key ends up intervening, getting involved when there’s a crisis. It’s just not sitting with me.

SUSAN Is it too hands-off from this government, Matthew?

MATTHEW Well, they sent in government officials into Fonterra to sit at their desks, so it’s pretty hands-on—

KATE In a crisis.

MATTHEW …given they’ve given $30 million to Meridian— to Rio Tinto.

KATE To Rio Tinto in a crisis.

MATTHEW There’s all sort of interventions by the Government. Look, I think he does need to have a very thorough investigation with the power to compel witnesses. I think it needs to be very very tough. Fonterra and the dairy industry in New Zealand are masters of the cover-up. You go back to the EU customs case. You go to Powdergate. You go to the Iraq thing.

DR BRYCE EDWARDS – Political Scientist
Speaking from experience.

MATTHEW And there is no way that you can trust that company to investigate itself. We need someone like Michael Michael Stiassny, backed up by Professor Gluckman, backed up by a Supreme Court judge to go in there with the power to compel and get to the bottom of it. And it’s not about a dirty pipe; it’s about the culture of that company. They do not seem to understand that in the food business safety scares happen, they happen often, and they have to be managed. Nestle has a product recall somewhere in the world pretty much at any given time. Yet in this particular company, they just don’t seem to know how to deal with these inevitable problems that will always come up.

SUSAN Bryce?

BRYCE A ministerial inquiry is really needed in this case for National’s own survival, because they looked tough last week, and that was to their benefit, so it’s the terms of reference we should be looking at on Monday to see how strong they are. In that particular interview, yes, John Key was quite soft on Fonterra. I think he needs to be tougher because— I mean, actually, the whole interview was quite lacklustre, I thought. John Key seemed quite soft and mild, and it kind of speaks to where National’s at at the moment. There was actually a really interesting—

SUSAN He was feeling the love in Nelson was what was going on.

BRYCE Maybe.

SUSAN Surrounded by the party faithful.

BRYCE But I think National is in trouble at the moment, and there was a really interesting report in The Herald yesterday – The Weekend Herald – where John Armstrong and Audrey Young rated all the ministers – their annual report card. John Key got six out of 10, and that’s quite astounding—

MATTHEW Well, that was ridiculous.

BRYCE Well, maybe it’s ridiculous.

MATTHEW The idea that the Prime Minister is six out of 10 is absurd. Maybe his handling of his particular portfolio of the spy agency is six out of 10.

KATE He hasn’t had a good six months, though.

MATTHEW But as Prime Minister, the party has gone up in the polls dramatically and is sitting at 50% again, so that’s 10 out of 10 by any rational—

BRYCE We can quibble over the marks. What is important, though, is showing that the press gallery have turned against Key. This is indicative— This shows that John Key has picked his fights with the media – it’s a bad idea. And often there’s a lag – the public downfall comes after the media turning against the Prime Minister. We saw that with Helen Clark in about 2007. I think this is a turning point for John Key. I think that he’s looking lacklustre. He has to, you know, be quite strong on this Fonterra issue. He seems to have lost his mojo.

SUSAN Let’s talk about housing. Just a few hints there, Kate. Nothing particularly much – it’ll work better in Auckland and it’s some sort of KiwiSaver, obviously, and they’re probably going to up the limits, I’m thinking.

KATE Well, for a few thousand people, I don’t think it’s really enough. I mean, again, it’s great that he’s willing to give $30 million to Rio Tinto, but he’s not willing to do something for ordinary Kiwis who can’t afford to buy a house. And I think that what we really need is, you know, good policy, and this is what I’ve been talking about. Let’s put in place good political foundations. So for me, you know, capital-gains tax – these kind of market changes need to happen so that we can shift and make sure that we’ve got Kiwis into the houses. That didn’t seem like much at all.

SUSAN Matthew— Well, we don’t know yet. He was pulling his punches because he’s announcing it in about five or 10 minutes’ time. But National is vulnerable on housing, Matthew?

MATTHEW Well, both main parties are obviously seeing the same sort of thing in their polls. The Labour Party made housing a major theme of their conference, and now National has done again. I think that both parties need to be very careful on this issue. In New Zealand, there are 1.4 million households that are owner-occupied and 400,000 that are rental properties, roughly speaking. Now, that means there is a huge constituency who have an interest in at least some modest house price inflation. And, you know, if you hit too hit on this affordable-housing issue, let’s say Labour really went hard on the issue, National could run billboards saying, ‘Labour will cut the value of the family home. Vote National,’ or vice-versa. So it is a careful balance. You’ve got to get supply and demand operating together. You certainly don’t want to see deflation in house prices. That’s what caused the global financial crisis in the United States. So it’s a very careful thing for the two parties.

SUSAN And interesting line – if we talk about the partners in the last bit, Bryce, and there was, I think, what did Key call it? A grisly outlook. I don’t think he was referring to Winston in that, but, yeah— And he’s not ruling out Winston now. The language has changed.

BRYCE No, they are in quite a difficult situation. They’re still talking about the Conservatives as a possible white knight coming over the hills, but, no, they’re in trouble. I think National, despite what I said about Key losing his mojo, probably have a better case, a better chance of going for that 48 per cent, 49 per cent and, you know, actually being able to govern alone. Relying on Winston Peters is not a good position to be in.

SUSAN I think the panel would probably all agree on that. He certainly had his challenges.

KATE He did say— He said, ‘I don’t want to— I won’t work with Winston Peters. It’s a matter of principle, not politics,’ so let’s continue to remind him of that.

SUSAN Yeah, right. We will leave it there, panel. Thank you.

ENDS

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