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Insights 40: 23 October 2026
Newsroom: Dr Oliver Hartwich on why Australia stopped reforming and what might restart it
 
Podcast: Free to Disagree with Dr Oliver Hartwich & Damien Grant on Luxon's poor ratings
 
NZ Herald: Dr Bryce Wilkinson on why subsidised prices cannot fix the cost of living

Judged by their peers
Dr Oliver Hartwich | Executive Director | oliver.hartwich@nzinitiative.org.nz
The Herald's 'Mood of the Boardroom' survey has become a fixture in New Zealand's media calendar. Once a year, the chief executives and chairs of the country's largest companies deliver their verdict on political leaders.

What has made the past years different is that they are passing judgement on a government led by one of their former peers. National's leader Christopher Luxon was CEO of Air New Zealand, and his deputy, Finance Minister Nicola Willis, was a senior Fonterra executive before they entered politics.

This combination made the 2026 survey, launched at a large business breakfast in Auckland on Thursday, a remarkable affair. After three years under two former business leaders, the relationship between them and their former colleagues is not what one might expect.

Rather than cheerleading for the National leadership, the business community gave them a mixed, even lukewarm, evaluation.

Luxon does his best work when he is out of the country. He scored 4.31 out of five for promoting New Zealand business abroad. But the Prime Minister managed only 2.31 for political management and 2.12 for uniting the country. One director put it down to his not being 'a natural communicator'.

Willis did somewhat better. Three in four consider her a credible Finance Minister and her handling of the fuel crisis drew praise.

But the same chairperson who credited her fuel response said Willis' 'beating up on the banks, gentailers, Foodstuffs and other successful New Zealand businesses is cheap politics'. Her plan to explore splitting Foodstuffs scored 1.83. That the Greens' state-owned KiwiMart scored even lower at 1.15 is hardly a consolation.

Crucially, Willis has not tamed spending. Anne Gaze of the Gaze Foundation noted the core public service still employs about 63,000 staff and core spending sits above 32 percent of GDP, against Willis' 30 percent target. 'Debt continues to increase,' said Greg Gent of Dairy Holdings.

Three years ago, business had a fraught relationship with the Labour-led government. Under National, led by two former peers, it is strained again.

Yet business is not biased against government. It recognises good leadership when it sees it. Erica Stanford again topped the ministerial rankings at 4.38 for her education reforms. Todd McClay scored 4.12 for securing the India deal, and Mark Mitchell 4.00 for restoring law and order.

More ministers like them and fewer anti-business policies would earn the next government better marks next year, whoever leads it.

Stay the course with maths reforms
Dr Michael Johnston | Senior Fellow | michael.johnston@nzinitiative.org.nz
The Reserve Bank adjusts interest rates to keep inflation under control. This does not work with perfect precision, but it works. There is one measure, one lever and a well-understood relationship between the two.

Not every policy goal is like that. Education Minister Erica Stanford took office promising to reverse a decades-long decline in New Zealand school education, especially in literacy and mathematics.

Stanford was faced with many potential levers, including curriculum, teacher training and school regulation. She decided to use as many of those levers as she could. She has reformed the curriculum, provided professional development for teachers, mandated an hour per day of reading, writing and mathematics for primary students and more.

Last week, the New Zealand Council for Educational Research reported on data from its Progressive Achievement Tests (PATs). PATs are widely used in New Zealand's primary schools to measure reading and mathematics learning.

The report includes data gathered over 15 years, from 2012 to 2026, from more than 1,300 schools and nearly 650,000 Years 4-8 students. Between 2012 and 2018 the mathematics data didn't change.

Scores slipped slightly in 2019 and 2020 and then dipped further during the pandemic. By 2023, when Stanford took office, they had recovered to pre-covid levels. In 2025 there was a lift, and a bigger one in 2026. Now, PAT mathematics attainment sits about a third of an average year's learning higher than in 2024.

Is the lift attributable to Stanford's reforms or to something else?

The compulsory hour per day was implemented for the 2024 school year. The new mathematics curriculum was published in late 2024 and mandated from Term 1, 2025. Throughout, primary teachers were given professional development in teaching maths, which a 2021 report from the Royal Society Te Apārangi had shown to be a weakness.

Other factors may be in play too. On the back of the Royal Society report, the Ministry of Education implemented a new strategy in 2022.

The mathematics PAT was refreshed in 2024, so the later results are not completely comparable with earlier ones. But the big gains in 2025 and 2026 are both on the new version.

The evidence in favour of Stanford's reforms is as good as it gets this soon after implementation. The timing fits, even if other potential causes can't be cleanly separated in the data.

Whoever is education minister after November's election should stay the course.

Localism: best enjoyed in opposition
Nick Clark | Senior Fellow | nick.clark@nzinitiative.org.nz
Localism is a wonderful thing. I recommend it to any politician in opposition. It draws applause and offers a chance to accuse one's opponents of being control freaks.
 
Last week, at the annual Local Government New Zealand (LGNZ) conference, I watched Labour, Green and Opportunity politicians champion partnership with councils. 'Communities deserve respect,' they said. 'Ministers should listen. The Coalition Government is getting everything wrong.'
 
Then Local Government Minister Simon Watts came along with a less appealing message. Watts favours amalgamations and rates capping, a 'partnership' in which one partner (central government) decides how much the other (local councils) may spend and says that costs it pushes down to them are 'investments'.
 
I had seen this show before, with the same actors but in different roles.
 
Three years ago, Labour was pushing ahead with water reforms to transfer council water services to larger entities. Then National defended local control and objected to Labour's enthusiasm for centralisation.
 
Now Labour has rediscovered the council chamber, while National has become the party wanting to run everything from the Beehive.
 
Perhaps ministerial offices should come with a warning: prolonged exposure may erode faith in local democracy.
 
Before taking office, politicians see councils as the authentic voices of their communities. Afterwards, they discover councils are fragmented, inefficient and alarmingly inclined to make decisions ministers dislike.
 
I am being unfair, of course. Ministers face real problems. Rates rises hurt. Some councils spend lavishly on nice-to-haves while failing at core functions, like fixing water leaks, preventing wastewater spills or processing consents quickly. Nobody should have to pretend otherwise to qualify as a localist.
 
But opposition politicians know about those problems too. What changes when they win government is their access to the levers of power.
 
Giving communities power sounds splendid when it means somebody else surrenders it. The proposition becomes less attractive when you are the one surrendering it.
 
At its next conference, LGNZ should consider inviting each party to deliver two speeches, one that it would give in opposition and another it would give in government. Speakers could be given five minutes between speeches to change jackets.
 
Better still, LGNZ could ask each party which decisions it would leave with local voters, even when they might choose something the party dislikes.
 
Meanwhile, councils should simply enjoy the declarations of affection from opposition parties. But they should bear in mind that by next year, their keenest suitor at this year's conference might be lining them up for a merger.

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