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Dr Oliver Hartwich - Even mediocre would be easier to bear: how NZ lost its mojo

“We have lost clarity of how we add value, why we are here, what we exist for.”


That was among the findings in an internal review prepared by the New Zealand Transport Authority (NZTA), obtained by Radio New Zealand (RNZ).


But that statement could equally apply to New Zealand as a whole. The country has lost its mojo after a decade of feeling good about itself.


For many years, pollsters Roy Morgan and Curia have been asking New Zealanders whether the country is heading in the right direction. Apart from a few months around the Global Financial Crisis in 2008, large majorities of Kiwis have always responded “Yes”.


During the first Covid lockdown, in April 2020, the highest positive value was 77 per cent for ‘right direction’. This figure has now dropped to 36 per cent, while 50 per cent of New Zealanders believe their country is going in the wrong direction.


That is quite a mood swing, and there are reasons for it.


The biggest contributor to New Zealanders’ grumpiness is the discrepancy between political promises and reality. Without constant promises of world-class performance, even mediocre results would be easier to bear.


The aforementioned NZTA review is a good example. With a depressingly high road toll, the government has embarked on a “Road to Zero” campaign. Its ambitious goal: no more deaths or serious injuries by 2050. The promotional awareness campaign will cost $15 million over three years.


Yet, as RNZ found out, since 2018 NZTA has installed less than a fifth of the road-safety barriers due by 2024.


On these numbers, the “Road to Zero” could be a long one.


But it will also be a costly one because the transport bureaucracy has mushroomed in recent years.


As of June 2021, NZTA employed about 2,081 staff. That figure was 1,372 only four years earlier.


Staff growth at NZTA did not mainly take place on the frontline. HR workers went from 57 to 122 full-time equivalents; managers from 214 to 456; accountants from 44 to 66; admin staff from 307 to 485; and communications officers from 32 to 88. None of those mentioned above will ever install a bollard, put up a road sign, or fix a pothole.


NZTA is symptomatic of a much wider problem in New Zealand, even though it is only a small puzzle piece. Faced with a serious problem, the government sets an ambitious long-term goal. It then launches massive public relations campaigns. Following that, it blows up the bureaucracy but fails on deliverables.


It is the same story in practically every major policy area.


Housing was one of the big issues in the 2017 election campaign. At the time, Labour promised to fix the housing market, reduce homelessness, and build 100,000 affordable KiwiBuild homes over the next decade.


The results after five years? New Zealand house prices have grown by almost 8.7 per annum on average. Emergency Housing Grants, which were below $10 million per quarter in 2017, now exceed $100 million. And KiwiBuild, so far, has delivered just over 1,300 homes – with only 98,700 to go.


New Zealanders used to be proud of their education system, which was considered world-class.


Today, the only measure by which New Zealand schools lead the world is in declining standards.


Reading and literacy have dropped dramatically in the OECD’s PISA rankings. The mathematics skills of New Zealand’s 15-year-olds are only as good as those of 13.5-year-olds 20 years ago. Despite an increase in education spending per student, more than 40 per cent of school leavers are functionally illiterate or innumerate.


Aside from such big policy failures, New Zealanders are bombarded with worrying news daily. There are GPs reportedly seeing more than 60 patients per day. Patients are treated in corridors at some hospitals’ A & E departments, where waiting times now often exceed ten hours.


As gang numbers have grown, gun crime has also become a regular feature in news headlines. Ram raids, where youths steal cars and crash them into small shops, have become common.


Rather than dealing with these and many other issues, the government appears determined to add new challenges to doing business. It is about to introduce collective bargaining in the labour market and an extra tax on income to fund unemployment insurance.


And these are just the big-ticket items. Practically every industry can tell its own stories about new complex regulations, usually rushed through with minimal consultation, if any.


Furthermore, there is growing unease about the government’s move towards co-governance. It sounds harmless but it would radically alter how democracy operates in New Zealand and undermine basic principles of democratic participation.


All in all, the picture that emerges is that of a country in precipitous decline. That would be alarming enough. What makes it even more so is a perception that the core private and public institutions lack the understanding of the severity of the crisis or the ability to counteract it.


Some notable exceptions aside, the New Zealand media is underfunded and not performing the functions of the Fourth Estate properly.


Despite the vast expansion in public service numbers, it lacks quality and focuses on trendy issues rather than its core functions. In particular, the Reserve Bank and the Productivity Commission need a reset. And across the political spectrum, again with notable exceptions, the political parties lack parliamentarians with the qualifications and experience necessary for a turnaround job.


New Zealand needs to be careful not to turn into a failed state. That does not mean it should expect civil unrest, but a period of prolonged and seemingly unstoppable decline across all areas of public life.


The only way to reverse this process would be for New Zealand to regain its mojo: its mojo for serious economic and social reform. It has happened before. And it must happen again.


Dr Oliver Hartwich is the Executive Director of The New Zealand Initiative

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