A closer look at how Jacinda Ardern has divvied up the government's roles and responsibilities

A closer look at how Jacinda Ardern has divvied up the government's roles and responsibilities
Jacinda Ardern. Image from Labour Party.

Labour’s majority in government has resulted in a hefty shake-up of ministerial roles.

Here’s a rundown of some of the key changes in areas interest.co.nz will be following closely:

Finance

Grant Robertson has, and will continue to, carry a heavy load in this term of government as Finance Minister.

He will need to consider how to keep the domestic economy buoyed, with the borders closed for the foreseeable future and the Reserve Bank’s economic revival strategy contributing to bubble-like asset price inflation.

Given the new role of Infrastructure, Robertson will become the Government’s de facto ‘Minister of Delivery’.

Speaking on RNZ’s Morning Report, he said Prime Minister Jacinda Ardern had specifically asked him to ensure the government delivered on what it has promised. It’s no secret Labour’s weakness in the previous term of government was under-delivering on a couple of ambitious promises - KiwiBuild and the Auckland light rail.

Upgrading housing, transport and water infrastructure are of course vital to ensuring people have roofs over their heads, traffic doesn’t curb productivity and ageing water infrastructure doesn’t make us sick.

But front-loading infrastructure projects in the pipeline is central to the government’s medium to long-term Covid-19 economic recovery plan.

In some respects, Robertson had the easy task of issuing debt and allocating billions of dollars to various projects. The hard part is ahead, ensuring New Zealand has the capability and capacity to pull these projects off.

It’s no longer just a matter of getting people to the airport faster. It’s a matter of creating jobs and ensuring the debt being issued is stimulatory and spent wisely.

While other ministers will oversee individual projects, Robertson will be responsible for the big picture.

There's no room for under-delivery in the current environment. The pressure’s on Robertson.

Housing

Megan Woods retains the Housing portfolio, taken off Phil Twyford in 2019.

One of her key focuses will be ensuring a new underwrite of housing developments successfully helps increase the supply of housing.

Woods is concerned risk-averse banks will stymie development, so is putting the Crown up to buy houses developers struggle to sell. A similar underwrite is key to the KiwiBuild programme.

However, with Twyford’s Urban Development portfolio disestablished, there’s a question mark over what will come of the work he set in motion.

The National Policy Statement on Urban Development, which he was responsible for, took effect on August 30. This is a powerful document that sets the objectives and policies for urban development under the Resource Management Act. Local councils must give effect to it. The statement will enable more densification.

While Twyford’s work here is done, Woods will need to get schooled up on the wide-ranging and powerful new tools Twyford gave the housing agency he set up, Kāinga Ora.

Twyford’s Urban Development Act sets out a new streamlined process for large-scale public or private urban development projects to go through. It gives Kāinga Ora a range of powers to make it easier for approved projects to get funded, consented and acquire privately-owned land if necessary.

Meanwhile Twyford’s Infrastructure Funding and Financing Act creates a user-pays infrastructure financing model based on a pilot used at the Milldale subdivision in Auckland. This enables developers to levy property owners over several years, making them cover some of the cost of the infrastructure they use.

While both of these pieces of legislation were enacted in August, neither the Government nor private developers have committed to using the powers they provide.

Their architect is arguably needed to help bring them to life.

But with Twyford kicked out of Cabinet, either Ardern doesn’t have faith in what he has done, and/or she believes he’s too politically toxic to front key pieces of work.  

Woods, when interviewed by interest.co.nz before the election, showed little interest in the Urban Development Act.

Robertson referenced the Infrastructure Funding and Financing Act when talking to media on Monday, so could take over work in this area.

But it will be interesting to see how much weight both he and Woods put on the building blocks for development that Twyford spent three years creating.

Transport

Twyford lost his Transport portfolio too. The role is a big one for his successor, Michael Wood, who was Senior Whip in the last term of government.

Living in Mt Roskill and having worked for Auckland Council, he might be well-placed to lead the Auckland light rail project.

With Robertson actively overseeing infrastructure, the Cabinet newbie presumably won’t be left entirely to his own devices.

Economic/business portfolios bundled

Ardern has bundled up a number of the other economic and business-related portfolios and given them to Stuart Nash and David Clark.

Nash keeps Small Business, through which he’ll continue to oversee the Small Business Cashflow Loan Scheme. This could evolve and be a vehicle through which the Robertson provides businesses with further support, should it be necessary.

Nash also gets Economic and Regional Development, Tourism and Forestry. He loses Police and Revenue.

As for Clark - the former Health Minister - he gets Commerce and Consumer Affairs, State Owned Enterprises, Statistics, the Earthquake Commission, and a new portfolio - Digital Economy and Communications.

These portfolios might be better suited to the former Treasury analyst than Health was.

Through his Commerce and Consumer Affairs role, Clark will be responsible for following through on Labour’s pledge to regulate merchant fees charged to retailers and other small businesses by their banks.

He will also have an opportunity to put pressure on banks to push ahead more quickly with open banking and open data.

With conduct and culture reviews into banking and insurance wrapped up, Clark will need to ensure new conduct regulation is adhered to, particularly at a time banks’ margins are squeezed and investors in search of yield increase their risk appetites.

RMA

As for the Minister for the Environment, David Parker’s role repealing and replacing the Resource Management Act (RMA) will be crucial.

Labour has committed, on a high level, to implementing the Randerson review recommendations to replace with the RMA with a Natural and Built Environments Act and Strategic Planning Act, and introduce a Managed Retreat and Climate Change Adaptation Act.

With Parker losing Trade and Export Growth, he is well-placed to focus on this complex body of work.

While he gets Revenue, this portfolio will carry a lighter workload with major tax reform off the agenda.

Health  

Ardern has created a new role - Minister for Covid-19 Response - given to Chris Hipkins. Hipkins took on the Health portfolio when Clark came under fire over a lack of testing at the border. He has proven to be a safe pair of hands.

The role will see Hipkins take responsibility of managed isolation facilities from Woods. Border management and flights will also fall under his remit, as will testing.

Separating out the Covid-19 response will free up the new Health Minister, Andrew Little, to focus on the enormous task of improving the system across the board, as per the recommendations of the Heather Simpson review.

Infectious diseases expert, Ayesha Verrall, has also been thrust into Cabinet as Associate Health Minister before she’s been sworn in as an MP. Having someone with her expertise in Cabinet during a global pandemic can only be a good thing.

Foreign Affairs and Trade 

Nanaia Mahuta will take over Foreign Affairs from Winston Peters. Mahuta is an experienced politician who Ardern has credited for being an effective consensus builder.

Tensions between China and the US, protectionism, the Pacific's health and economic vulnerabilities in the face of Covid-19, and access to vaccines will be on Mahuta’s agenda.

Ardern’s high profile on the world stage may also see her play a greater role in foreign affairs.

As for the Trade and Export Growth portfolio, this has gone to Damien O’Connor.

It fits in with his other portfolios - Agriculture, Biosecurity, Land Information and Rural Communities.

Minimising disruptions to supply chains, and maintaining and building new relationships with suppliers and clients offshore without travel will be among the issues O’Connor will have to contend with.

Social Development

The Social Development portfolio remains with Carmel Sepuloni.

All eyes will be on the extent to which she implements Welfare Expert Advisory Group recommendations made in the previous term of government, particularly as unemployment and inequality are expected to increase.

Climate 

With Parker remaining Environment Minister, he'll be able to see through the implementation of major water reforms - particularly affecting the agricultural sector - made in the last term of government. 

Likewise, with James Shaw keeping Climate Change, he'll be able to build on the work he got in motion via the Climate Change Response (Zero Carbon) Amendment Act, which saw the establishment of the Climate Change Commission in 2019. 

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

19 Comments

Kiwi build again.

Focussing on their wokeness.
With minimal media challenges.
Nationalise/centralise as many entities as possible: hospitals, Polytechs, schools, a few lockdowns by brief breaches, keep the QE going,

They are yet another caretaker government. So expect to be disappointed, they simply won't change anything of consequence and all the current issues we have will continue to go unresolved until the next popularity contest comes around in 3 years.

11
up

So... the way to fix house prices is to underwrite house prices for developers "struggling" to sell.

You couldn't make this crap up. Labour don't have a clue.

Yip - but I wouldn't limit to either political party. Both as bad as the other.

Given that nobody appears to be able to stop house prices rises, why anyone would think they can stop them from falling if they start falling could be kidding themselves. Its like an untamed wild animal - and that animal is our human animal spirit....(its our psychology....lack of rational thought)

The problem is unless developers are wanting to build standalone dwellings the banks aren't massively keen to fund. In many of our cities the need and demand is for more intensive developments that the banks don't want to take the capital risk on. Having the government underwrite developers helps de-risk construction and allow the development sector to deliver the types of houses that the country actually needs.

This govt. with more of manifold problems magnitude such as volcanic erupt+Covid19, clearly be seen to outshine the previous govt. with it's shambolic more than 10yrs of GFC+Earth quake recovery process. So more to encourage CB stimulus, loan deferral, printing money apart from grant, subsidy & be kind. Let's do this, let's keep moving, our F.I.R.E economic flame has got more assurances, as beacon in the dark world. The 5million team, hard sacrifice showing results of beating this virus, vaccine is near now, treatment are better, more+quick, accurate testing have been developed to replace the frail human lab workers, we used Lab automation. Economic malaise has clearly been avoided by printing more money into servicing current Banks loan appetite for the housing market. So? for those potential FHBs & Investors - your massive contribution here will be rewarded by the new govt. - a lot of noises in the Beehive now, to secure backup bail out mechanism for this massive decision by most Kiwis, so.. sort out your finance! execute that loan quickly, get the lands or land+house - the more the better, as this is a critical stabilising variable in NZ economy.

I think this is a bot

Well? this bot apparently have stupendous AI, because first thing related to the new cabinet? you can spot the miscalculation by the new govt. that is to 'ignore completely' NZ third largest ethnicity... by 2018 census, is actually Asians, NZ & OZ lives among/surrounded by 10 ASEAN nations, then Indian sub continent, then China & subs too, not a significant proportional business ties to be forged amongst Asians by the new Lab govt. with their current moves, but yet? visit all your favorites grocery needs, almost all our mixed primary & secondary needs are sourced from there, It's about time that Asians ethnicity start to wake up with all these imbalances of country policies/educational/jobs towards them.

No dedicated housing minister, but five different people with housing-related portfolios, many of which have other duties to tend to? Call me cynical, but that's not the mark of a Government intending on doing much about housing.

Megan Woods is Housing Minister.

Apologies Jenée, perhaps 'dedicated' is the wrong word here. Megan Woods is still also the Energy Minister, which will be no small task if we are serious about transitioning to 100% renewable energy - a Minister of Housing whose sole focus is housing was what I was getting at :)

Sorry, I see what you mean. Yea, Megan Woods has a lot on her plate!

Megan Woods has dropped the Greater Christchurch Regeneration Ministership - as the portfolio had been disbanded - job done. Hipkins is picking all of Covid health response - so Megan doesn't have that part of her previous workload either. Megan has picked up Associate Finance.
I think this is a reduction in workload in quite disparate Ministries. Megan given her skills should be able to attend to those housing areas Jenee highlighted in the main article without too much difficulty.
I also think it is clear expectation from Ardern of a more coordinated approach between the Ministers of Finance, Infrastructure, Housing, Transport, Environment, Energy, Research, and Economic & Regional Development i.e. Robertson, Woods, Wood, Parker and Nash. A kind of team within the team - 'the tight five' - although Robertson, Ardern's trusted right-hand man is clearly the leader of the sub-team.

Especially pies.

"so is putting the Crown up to buy houses developers struggle to sell"
I laugh at this statement. What it really should say is the developers are unable to sell at the price they are asking.

Free market strictly not allowed.

I rather like the developer underwrite system, even though it appears a bit daft on the surface. Usually in a recession building pretty much stops, so if the government keeps it going we should end up with more houses and a more skilled workforce.

The price issues are probably largely separate to the supply issues. Price is mainly pushed by excess available credit meeting restricted supply and increasing demand. There are three issues, not one.

Restricted supply seems to be due to two main reasons, over-regulation and not training enough builders.

Excess demand seems to be mainly due to insane levels of immigration and tourism.

Excess credit availablility seems to be due to ultra loose monetary policy to compensate for a lack of productivity growth.

Lack of productivity growth seems to be to do with China entering the WTO and causing a hollowing out of the industrial base. We became a nation of shoppers spending borrowed money. The money is borrowed to bid up the prices of each other's houses, thus putting a steady stream of currency into circulation.

The logic of putting more and more currency into circulation appears to be that it devalues the currency over time, and when our wages are lower than Chinese wages we will become competitive again. Maybe there is no alternative, but it seems a bit of a limp sort of a plan.

First the Warehouse, then Briscoes then many others (unlisted) and today is Fulton Hogan:
https://www.stuff.co.nz/business/123297060/fulton-hogan-makes-222m-profi...
Pay dividend to share holder, due to the profit - amazing kindness showed by Lab team with subsidy, I even changed my voting view.. away from those profiteering, selfish Blue team to this lot, keep on moving Red, we're still waiting for more/renew wages subsidy, we knew you have to look being prudent, then stop the scheme recently. But hey, it's 2021 coming, with more QEs/LSAP, FLPs & negative OCR by RBNZ - we hope you put a new/rename scheme of this wages subsidy and for longer period, say at least until 2024. Give it a new dignified scheme title. This subsidy clearly showing an impact for business upward profit report and have been shown in Queenstown to pull up the rental market which average drop by $150 from $750 to $600 (initial Covid impact), thanks to the immediate subsidy... it can be maintain up again to $700 - so for continue expectation of $800 rental income, is for certain that in the 2021 - the new govt. should devise a new wage subsidy scheme. Keep this up! - The main reasons we all voted for you Red, don't disappoint us please.