Contractor Politics

National politics and ministers of finance

By Peter Dunne.

In our system of government, the Prime Minister is often described as “primus inter pares”, the first among equals, or the chair of the board when it comes to leading Cabinet and the wider team of government MPs. The Minister of Finance, correspondingly, is the effective chief executive overseeing and pulling together all the strands of government to make sure the government’s objectives are achieved.

While the public focus is naturally on the Prime Minister who, in the modern environment, is expected to front for the government on everything, the Minister of Finance is never far behind. Although the Prime Minister is the public face of the government, the Minister of Finance is constantly making sure that government’s policies are properly co-ordinated and responsibly fiscally managed to its best political and economic advantage.

At Budget time each year the Minister of Finance gets to put it all on display, and it is no coincidence that Budgets are often seen as the sole work of the Minister of Finance, rather than a collaborative effort by the Prime Minister or the rest of the government.

Stereotypically, Ministers of Finance are normally expected to effortlessly quote endless financial statistics, percentages, and arcane acronyms, and always appear far more knowing and world-wise than anyone else. They invariably adopt over time a miserly persona – even more profligate ministers, like the current incumbent, like to give off the sense that it is “their” hard-earned money they are spending, not the government’s, and certainly not that provided to them by the long-suffering taxpayer.

Some  – Ministers of Finance have been mercurial – Sir Robert Muldoon liked being described as an “economic wizard”, even if his overall record suggested otherwise. Others, like Sir Roger Douglas have been bold reformers, while more steady hands like Sir Michael Cullen and Sir Bill English have achieved major changes over a longer period.

Some, like Sir Arnold Nordmeyer, are remembered for the wrong reasons (the 1958 Black Budget) while others have simply been forgotten altogether.

It goes without saying that a strong and competent Minister of Finance is a key component of a modern, successful government. Equally important is the partnership forged between a Prime Minister and Minister of Finance. The relationship between the two must be close and supportive, with each having and showing complete confidence in the work of the other.

When the partnership between David Lange and Sir Roger Douglas, which had been so successful, broke down, that government’s demise began.

Similarly, when it became clear Jim Bolger and Ruth Richardson were moving in different directions, she had to go. On the other hand, the strong relationship between Helen Clark and Sir Michael Cullen was a key component in that government’s longevity, as was the link between Sir John Key and Sir Bill English in the last National-led government.

So far, the partnership between the present Prime Minister and her Minister of Finance has looked strong and unified.

Often, although not always, the bond between the Prime Minister and the Minister of Finance is reinforced by the Minister of Finance also being the Deputy Prime Minister. That is the case at present, and applied with other long-term governments, like those of Helen Clark and Sir Michael Cullen, Sir John Key and Sir Bill English, and even back to Peter Fraser and Sir Walter Nash. However, only a handful of Ministers of Finance – Nash, Muldoon, and English – have gone on to become Prime Minister.

Against that background, the choice of Nicola Willis to be National’s new finance spokesperson to replace the departing Simon Bridges is a sensible one. Bridges’ sudden retirement is a blow to National – he was beginning to look like a potential Minister of Finance in the Cullen/English mode and will therefore be hard to replace. Nevertheless, Willis has the capacity to step up quickly and seamlessly to her new role, and she has many other advantages besides.

As National’s deputy leader since late last year, she has quickly built a close relationship with party leader Christopher Luxon, and the pairing is already becoming established in the public mind. Her elevation to finance spokesperson should reinforce that and will confirm her authority over her Caucus colleagues, which will become more important as the party goes about preparing (and costing) its election policies for next year.

Experience working for Fonterra, alongside Luxon’s own corporate background (he used to run an airline) means she will be very much at ease in the corporate boardrooms Ministers of Finance need to pay heed to.

Her time previously as a leading adviser to Sir John Key when he was Prime Minister will have given her a strong sense of the political challenges involved in running a government and implementing its policy programme. She will be able to use these skills to good advantage with her Caucus colleagues over the next year or so, as well as with Luxon who, it needs to be remembered, is still very inexperienced in such matters.

As National’s housing spokesperson, Willis demonstrated a passion for the portfolio and an ability to talk with the public in very clear and understandable terms about the issues as she saw them and the changes she would like to make. She should be able to use these skills and experiences to talk about National’s cost of living “crisis” campaign and wider approach to economic policy in a way that seems real and relatable for people. Willis is unlikely to fall into the trap most Ministers of Finance and finance spokespeople do of relying almost exclusively on arid statistics to bolster her argument.

Her clashes with the current Minister of Finance, Grant Robertson, will be fascinating. They know each other well having both stood in the Wellington Central electorate for the last two elections. Robertson is teetering on the verge of taking on the miserly persona of Ministers of Finance past, and given Willis’ unashamedly liberal credentials, is likely to find her a more difficult opponent to pigeon-hole than the much more conservative Bridges.

While the exchanges between them will be courteous, Willis is unshakeable, and Robertson will need to be careful that her “working mum with four kids” approach does not get away from him.

When Christopher Luxon became leader of the National Party there were many critics of his social conservatism who felt that would hamper his ability to present National in a modern and progressive light. So far, as the polls strongly show, he has defied that expectation, even if there is still a long way to go until the next election. His appointment of Nicola Willis as finance spokesperson continues down the path he has set.

Just as Jacinda Ardern and Grant Robertson were Labour’s political generational change, Christopher Luxon and Nicola Willis are doing likewise for National.

Luxon’s next challenge having set out National’s furniture the way he would like, is to show how he and Willis are going to use it. Their first task is to be sure none of their other colleagues decides to knock down a table or two along the way.

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