Prime Minister Chris Hipkins has burned several more schemes on his policy bonfire and splashed more cash in a welfare boost as his popularity continues to increase in the latest poll.
However, Mr Hipkins’ second big policy reprioritisation, particularly in the transport sector, has ruffled the feathers of Labour’s political ally the Green Party, which claims it will only make the country’s future climate targets harder to achieve.
Several policies have either been cut, refocused or delayed to help free up the capital for the Government’s bid to reduce the cost of living, and Mr Hipkins is not ruling out more former priorities being torched.
Yesterday, he tossed the $568 million clean-car upgrade scheme that allowed people to scrap old cars to gain a grant for a more environmentally friendly vehicle, staggered the rollout of Auckland light rail, narrowed the speed reduction programme, stopped the social leasing car scheme and refocused public transport goals in Auckland, Hamilton, Tauranga, Wellington and Christchurch.
Speaking to reporters at his post-Cabinet press conference, Mr Hipkins defended his policy shift, saying the initiatives were not sizeable or highly efficient contributors to the Government’s efforts to reduce emissions and that more policies would be announced in due course that would help New Zealand meet its climate targets.
Greens co-leader and Climate Change Minister James Shaw said he would have argued against cutting back on climate actions that would assist low-income families.
"The clean-car upgrade would have provided households with more low-emissions choices about how to get around," he said.
"This doesn’t sit well on top of the previous extension to the fossil fuel subsidies, which we know benefits the highest earners most," he said.
He believed climate action was a "bread and butter issue" for many, especially those impacted by Cyclone Gabrielle.
"Every time we kick climate action into the future, we make it harder for ourselves to meet those targets."
National leader Christopher Luxon cited rising food prices and high inflation in his criticism of the Government’s reprioritisation, while restating his call for inflation-adjusted tax thresholds.
"My message to Chris Hipkins is stop spending and cut taxes," he said.
"[Yesterday’s] moves are no more than a rounding error - pocket change in Labour’s grand scheme to spend, spend, spend with nothing to show for it except Kiwis struggling to feed their families with food prices spiralling."
Act New Zealand leader David Seymour also doubted the value of the Government’s policy shift.
"New Zealanders need real change. Hipkins U-turning on a tiny handful of policies isn’t fooling anyone."
Outside of transport, Cabinet also agreed to delay advice on alcohol pricing, sponsorship and advertising reform to April next year, chose not to introduce legislation to lower the voting age to 16 for general elections, deferred work on the container return scheme and pushed back public consultation on a new test to determine the difference between a contractor and an employee.
This tranche of reprioritisation, along with Mr Hipkins’ first round of cuts, would give the Government more than $1 billion to be redirected to measures to reduce the cost of living.
Auckland’s light rail survived the cut but would be staged. The first stage was expected to be confirmed by the middle of the year.
"Staging the rollout will align it with other critical transport investments, particularly the second Waitematā Harbour crossing," Mr Hipkins said.
Speed limit changes, which had been intended to apply to 20%-30% of state highways in the next five years, would now be focused on the most dangerous 1% of roads and where local communities supported the change.
Neither the prime minister nor Waka Kotahi NZ Transport Agency could provide The New Zealand Herald with a list of what roads would be chosen, the latter saying its state highway speed management plan would be reviewed in light of yesterday’s announcement.
Alongside the policy reprioritisation, Mr Hipkins announced the annual adjustment of benefits, superannuation and other financial support in a $2 billion package that would result in the incomes of about 1.4 million New Zealanders staying in line with inflation.
The annual adjustments included an extra $311million to be spent over the next four years that allowed main benefits to be increased in line with inflation — 7.22% — rather than the average wage rise as previously planned, which was costed at about $1.7 billion.
Planned policy changes
• Reduced speed limits to focus on the most dangerous 1% of state highways.
• Goal of improving public transport as alternative to driving refocused on five main centres.
• A $2 billion welfare package to offset inflation.
• Increases to superannuation.
• Lower voting age for council elections only.
• Clean-car upgrade scheme ditched.
• Delayed reform of alcohol advertising in sports.
• Work on a container return scheme deferred.
• Auckland light rail project to be staged.
