It was always going to be only a matter of time before any semblance of a bi-partisan approach to dealing with the recession disappeared.

Labour was initially prepared for "constructive engagement" with the Government as it looked for ways to soften the impact of the global economic downturn, but has now decided strategies aren't working.

Last week's fierce attack from the opposition benches set an agenda Labour is likely to maintain in Parliament this week.

It forced ministers to defend the Government's actions -- or inactions, as Labour sees it, and shifted the political focus firmly onto job creation, or the lack of it.

Using disturbing figures that are easily understood, Labour was able to cite ministerial confirmation that the number of people on the dole was growing by more than 1000 a week.

It was able to contrast this with the 377 jobs that it says have been saved through initiatives emerging from the Jobs Summit in February.

Simple and effective, and difficult to counter.

Against the tirade led by Phil Goff, Prime Minister John Key told Parliament: "We've done a load of other things including bringing forward nearly $500 million of capital spending on roads, housing and school buildings, introducing a tax assistance package for small and medium-sized businesses and avoiding a credit downgrade."

The difficulty the Government has is that the impact of these measures are difficult to quantify. No one knows how much worse the situation would be if it hadn't acted in the way it has.

That doesn't worry Labour, which is dealing with the reality of known job losses and the sure thing that there are going to be a lot more before New Zealand comes out of a recession that has now lasted for five consecutive quarters.

Key's strongest point is the relative strength of the economy.

New Zealand's 5 percent unemployment rate compares with 5.7 percent in Australia, 7.2 percent in the United Kingdom, 9.2 percent in European Union countries and 9.4 percent in the United States.

"This shows that we are doing a good job in New Zealand holding down the growth in unemployment, despite this being the worst recession since 1930," says Key.

When the Jobs Summit is thrown at ministers as evidence of failure, defence becomes more difficult.

Of the numerous ideas that came from it, only the nine-day fortnight and the cycle track have emerged as realities.

The nine-day fortnight is where the 377 saves jobs comes from, so it has achieved something.

But the cycle track is beset with uncertainties, not least how much it would cost, and has become more of a long range project than a recession-fighting initiative.

Perhaps Key oversold the summit by saying before it was held that it wasn't going to be just a talkfest and he expected real gains to come from it.

All the same, it was a politically brave move and it brought together movers and shakers from all sectors who must now have a better idea of how the different interest groups see the situation.

While the Government and Labour were arguing in the debating chamber last week, Social Development and Employment Minister Paula Bennett was briefing a cross-party select committee.

In what was one of the most lucid explanations of unemployment so far delivered, Bennett explained that forecasts ranged from the Treasury's gloomy downside scenario of 9.8 percent in the second half of next year to the Institute of Economic Research's

The average across all the forecasting agencies was 7.2 percent.

Bennett compared 115,000 people out of work (5 percent) with 217,000 (9.8 percent) and 176,000 (7.8 percent).

And she was frank about future trends, saying while there were signs that economic activity would start rising later this year there was a lag before employment figures reacted.

"The labour market will continue to ease until 2010," she said.

Bennett told the committee increased labour productivity was vital if New Zealand was to come out of the recession stronger than it went into it.

With job losses increasing and output falling, increasing productivity seems to be a distant and unlikely achievement.

Bennett didn't pull any punches.

"Productivity will have to rise to around 3.2 percent a year to catch up with income levels in Australia by 2025, assuming Australia grows at the average of the last 10 years, which was 1.7 percent."

That explained the enormity of the task, because New Zealand's productivity hasn't been near 1.7 percent for the last 10 years.

Rodney Hide, an eternal optimist who believes anything is possible with the right policies, has gained the Government's agreement to set up a special taskforce to figure out how to catch up with Australia.

It will be called the 2025 Taskforce, and its mission will be to report on what New Zealand needs to do to reach the target.

Hide says he has already chosen a chairman and the taskforce will report by the end of this year and annually after that. It will also chart progress towards the parity goal.

The ACT leader's original deadline to catch up with Australia was 2020. He extended it because of the recession and admits it is still "a big stretch".

It will be interesting to see whether it comes up with anything remotely likely to work, or capable of being undertaken, without politically the introduction of politically unacceptable measures.