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Peter Wilson: Government Reaps The Benefit Of Economic Recovery

Peter Wilson
Peter Wilson

If the impact of the international recession on New Zealand's economy was more severe now than a year ago, or even if it was the same, the Government would have a problem.

It isn't, and in terms of public perception the Government clearly doesn't have a problem.

The world is coming out of the recession, export markets are opening up again and house prices have started rising after a severe decline.

Unemployment, predicted in worst-case scenarios to reach 11 percent, looks like peaking at around 7 percent.

This situation is a huge relief to those who feared they would suffer from the downturn, and the Government is reaping the benefit.

An opinion poll published on Saturday showed nearly 80 percent of respondents rated the Government's handling of the recession as good, very good or excellent.

The New Zealand Herald survey also showed National continuing to hold a commanding 25 point lead over Labour -- 57 percent compared with 32 percent.

What the poll also showed was that big issues matter while those that so often transfix Parliament and the political media don't.

The poll was taken while Prime Minister John Key and several of his ministers were embroiled in the fiasco over television coverage of the Rugby World Cup.

At the same time, ACC Minister Nick Smith was struggling to get the numbers for his bill that raises levies and cuts entitlements.

He achieved that by signing up the ACT Party through a deal that will almost certainly see ACC's work account opened to private competition some time next year.

It is obvious from the poll results that these issues, heavily reported while the Government was under fierce criticism from the Labour Party, were insignificant in the eyes of voters.

Blunders by governments, particularly more than one during a short period, are usually considered to have an inevitable impact on popularity ratings.

This isn't happening. The recession, and now the recovery, is still the big picture issue that dominates voters' minds and opinions of the political parties.

That makes life hard for Labour and its leader Phil Goff. The latest poll shows Labour's support is holding up well at 32 percent, just two points below the party's election night 34 percent.

The Government is mainly taking votes from the small parties, who are being sidelined amid the focus on the economy and the policies that influence it.

The Greens, for example, are now in dangerous territory -- below the 5 percent threshold, a level of support which in a general election would see them disappear from Parliament.

Labour can take some comfort from the fact that it's core support is as high as it is. Party sources say its own private polling indicates a slightly higher level than shown in published surveys with ratings around the same level as election night.

But it is struggling to get traction as it fights government decisions which could usually be expected to run very much in the opposition's favour.

Opening ACC to competition, which Labour describes as privatisation, should have given it a platform from which it could arouse considerable discontent.

Previous tests of public opinion have shown a majority of voters don't want ACC opened to competition, and Labour issues reminders of this.

It isn't working to anything like the extent Labour had hoped for. Maybe it will in time, when it actually happens, but right now it seems to be in the "so what?" basket.

Key attributes the poll results to the Government's focus on "issues that matter".

That basically means the economy, even though circumstances mostly outside the Government's control are driving the recovery.

Tagging along, however, is law and order.

Police Minister Judith Collins, who Labour thinks is a self-promoter with a big mouth, is obviously doing something right.

A hard line on boy racers -- which Labour says isn't enough although it had its chances before the election -- must be good for the Government because most people detest the nuisance and danger they pose.

And late last week Collins announced the formation of a special police unit set up to seize the assets of those who are running organised crime rackets.

Justice Minister Simon Power has put bills through Parliament which get tough on gangs. Labour points out they were mostly carried over from the previous government, but that usually gets lost when the legislation is reported.

So add up a recovering economy, strong law and order policies and a very popular prime minister and what do you get? Poll ratings nudging 60 percent which would give National a clear majority in its own right if an election was held now.

Labour knows that isn't going to happen and, if anything, time is on its side. Goff and his front bench have no intention of reacting by coming out with hard policy so early in the game.

Claiming to have all the answers now, just a year after losing an election which followed nine years in office, would almost certainly be counter-productive.

Labour won't show its hand until well into 2011, by which time it hopes the cycle will have turned and voters will be more critical of the Government and its actions.

National's poll ratings aren't likely to hold up around the 60 percent mark. If they do, the results of the referendum on MMP will be announced just as a single-party majority government takes office.

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