Labour’s Chris Hipkins has defended the lack of costings for his party’s first major economic policy amid an attack by National’s Christopher Luxon, who says the Opposition party has only delivered “dribble” and is unable to answer “basic questions”.

The policy involves creating an independent fund containing a select number of Crown assets, with their dividends redirected from the Crown to supporting New Zealand businesses. A capital contribution from the Government would kickstart it.

But questions hanging over the policy include what assets would be included in it, the potential scale of dividends that would be invested in Kiwi businesses, and how the party would fill any resulting hole in the coffers – money the Prime Minister says could go to the likes of health and education.

Labour has defended its approach of not sharing these details by saying there are commercial sensitivities with giving away what assets will be included. Without knowing the assets, it’s therefore difficult to pinpoint how much money they would contribute via dividends.

The party also plans to release a fiscal plan before the election which would highlight to the public how it would make all its policies add up. These typically don’t get released until the final weeks of an election campaign.

Under questioning on Tuesday over why Labour didn’t include figures in its policy document, sent out prior to the announcement, Hipkins went as far as to suggest journalists were “lazy” for expecting that.

“Don’t be so lazy. We are not going to provide everything to you in advance and have you not bother to show up to the announcement.”

When Hipkins and Labour finance spokeswoman Barbara Edmonds did hold a press conference on Monday, which the Herald livestreamed, the only specific figure they could share was that the upfront capital contribution would be $200 million.

Labour leader Chris Hipkins defended the lack of costings attached to the policy. Photo / Mark Mitchell
Labour leader Chris Hipkins defended the lack of costings attached to the policy. Photo / Mark Mitchell

Labour’s “New Zealand Future Fund” was announced on Monday as the party’s first major economic policy, designed with the intent of channeling money from Crown assets into New Zealand businesses and creating new jobs here.

While the fund would be independently operated by the Guardians of the Super Fund, Labour has suggested it could invest in the likes of renewable energy or high-tech start-ups. The party says this investment would secure jobs and keep talent in New Zealand.

But Luxon, speaking to reporters on Tuesday morning, said that without details, he couldn’t figure out “what the policy actually is”.

“It’s got a title, but we’re not clear which companies are in it,” Luxon said.

“We’re not clear with what’s happening with the dividends that those companies produce. Where does the $600 to $800 million of dividends that’s produced [go]?”

That dollar range comes from totalling up the recent dividends of the Mixed Ownership Model companies, like the gentailers, Air New Zealand and Transpower. The Mixed Ownership Model companies are publicly listed.

As the dividends would be redirected from the Crown to this new fund, Luxon questioned how Labour would fill a resulting hole. That money could currently be going to health and education, the Prime Minister suggested.

“Are we taking on more debt? Does that mean the deficit gets blown out? What does that mean for credit ratings and interest rates that we pay the world ... there are so many different questions around it. It is not a serious policy.”

Luxon also rubbished the suggestion that sharing what assets could be included would be commercially sensitive, as Labour has claimed.

“Let’s just be clear about that. They are two words that Chris Hipkins has discovered that actually cover up a lack of detail. I know about commercial sensitivity and I can tell you there is nothing in their proposal that is commercially sensitive by listing the companies. Just list the companies.”

Prime Minister Christopher Luxon questioned the lack of detail. Photo / Mark Mitchell
Prime Minister Christopher Luxon questioned the lack of detail. Photo / Mark Mitchell

Asked for details about the scale of his proposed fund, Hipkins said it would be “significant” but couldn’t provide anything more specific.

“There’s billions of dollars’ worth of commercial assets that the Government already owns that can be moved into the fund, The dividends from those can be quite significant,” he said.

“But there will also be new opportunities as well, opportunities for the fund to invest in other productive investments in New Zealand that will also generate returns for the public.”

As for how Labour would fill any resulting hole in the books, Hipkins said his party would set that out in its fiscal plan before the election. He said that would show the “different choices we will make to the current Government”.

“They gave away $3 billion worth of tax cuts for landlords, hundreds of millions of dollars to a tobacco company, hundreds of millions of dollars to tech giants like Facebook and Google. We will make different choices.”

He wouldn’t say if it would lead a future Labour Government to take on more debt or that a potential new tax would need to cover it, again pointing to a future fiscal plan that would spell that out.

“You don’t have a hole if you haven’t set out a plan, and we haven’t set out our fiscal plan, but we certainly will do that before the election,” he said.

Hipkins said the $200m capital contribution wasn’t “radical” and was “certainly doable within the existing confines of Government capital expenditure”.

Asked why Labour’s press release and policy document didn’t include the $200m figure, Hipkins said the party had wanted to focus on “selling the policy”.

“I think in the editing process, it was certainly in earlier material, so I think it was just simply an oversight that it wasn’t contained in the press statement. Barbara mentioned it in her introductory remarks, so it was clearly part of the announcement.”

Pressed by the Herald on whether it would help “selling the policy” to have numbers attached to the fund, Hipkins responded, “It was in the announcement”, referring to the press conference.

“Don’t be so lazy. We are not going to provide everything to you in advance and have you not bother to show up to the announcement.”

The Herald was given the dollar figure of the capital contribution before the press conference by a party spokeswoman, but it wasn’t in any material issued prior.

Flanked by Labour's finance spokeswoman, Barbara Edmonds, party leader Chris Hipkins unveils the New Zealand Future Fund policy. Photo / NZME
Flanked by Labour's finance spokeswoman, Barbara Edmonds, party leader Chris Hipkins unveils the New Zealand Future Fund policy. Photo / NZME

In response to Luxon’s claim that there were no commercial sensitivities involved in sharing what assets may be included, Hipkins said Labour had “taken the position it would be better not to name companies where there could be a shareholder impact”.

“In the case of the Mixed Ownership Model companies, they’re publicly listed companies that can have an impact on their share price.”

He said the party had a “fair idea” of what assets it wanted included in the fund.

Labour is trying to position the policy in contrast to what it says is a reliance by the current coalition Government on overseas investment. It says while New Zealand has talent, it lacks domestic backing, leading Kiwis and their ideas to head offshore.

“New Zealanders have a clear choice: an economy going backwards because of National’s short-term thinking, or one built by New Zealanders, for New Zealanders. Labour is backing a future made in New Zealand,” Hipkins said on Monday.

Edmonds said the fund would “turn innovation into real businesses and real jobs here at home”.

“The Future Fund is how we back ourselves as a country – so jobs, opportunity, and wealth is made here and stays here,” she said.

“The fund will invest in New Zealand for the benefit of everyone, building infrastructure and backing innovative businesses to create secure, well-paid jobs and grow wealth in every region.”

It’s unclear what scale of investment is expected from this fund, but Labour has pointed to other countries which it says have “built wealth by backing their own potential” and “New Zealand must do the same”.

“Singapore’s Temasek began modestly in 1974 with S$354 million. Today it is worth more than $434 billion. Australia’s superannuation has grown to A$4.2 trillion, helping drive investment in its people and industries. They succeeded because they set direction, took the long view, and were willing to invest.”

Labour said while New Zealand’s Super Fund is worth $85 billion, only 11% of that is invested in New Zealand.

“That’s part of the problem: too little of our own capital backs our own ideas. The result is low productivity, flat wages, and missed opportunities.”

Jamie Ensor is a senior political reporter in the NZ Herald press gallery team based at Parliament. He was previously a TV reporter and digital producer in the Newshub press gallery office. He was a finalist this year for Political Journalist of the Year at the Voyager Media Awards.