Act’s first parliamentary caucus was by no means a homogenous group of Rogernomes. Ironically, due to the diverse range of opinions in the new Act caucus, the identity and policies of the party were narrowed and moderated. This was because, to function effectively and gain consensus, the party had to adopt a lowest common-dominator platform. Thus the caucus had to ‘agree to disagree’ on many matters and not raise contentious or unresolved issues as Act policy. [Read more below]
Richard Prebble defined what the caucus could now agree on: ‘We all agree on privatisation, free trade, the Reserve Bank Act, the Employment Contracts Act and the rule of law’ (Prebble, 1997: p.19). Unfortunately for Act, this was hardly a well-defined party identity, nor an identity that differed in substance with that of the National Party. Even when Prebble elaborated on the Act identity, it sounded rather woolly:
Act's basic principles are that the state ought not to do for people what they can do for themselves, and that individuals should have the maximum choice in the way they run their lives. We firmly believe in the rule of law and property rights, and free enterprise, and rewarding the virtues of hard work, thrift and taking responsibility for your own family (Prebble, 1997: p.47).
As it became apparent that Act was unlikely to ever have a majority of seats in Parliament, the party was also forced to confront the issue of how they would implement their programme. According to Prebble the intrinsic ‘weakness’ of the Act manifesto was that ‘because the programme depends on each of its parts, in practical terms it's an all-or-nothing option’ (Prebble, 1997: p.47). As a result, the party programme was subjected to further moderation, and so by 1998 Prebble was stating that the caucus and board ‘are in the process of re-examining our policies to see what we can realistically put forward as our contribution to some future coalition’ (Prebble, 1997: p.47).
Act’s dilemma was somewhat akin to that of socialists in earlier times who had to confront the issue of choosing whether to advance their socialist programme by reform or revolution. In the modern right-wing case, Act chose the reform option, with Prebble noting that, ‘This means that we have to go back and re-examine how our ideas could be implemented incrementally rather than by the original Big Bang theory’ (Prebble, 1997: p.47).
However, the reform option did not necessarily solve Act’s problems. As long as the party remained unpopular and always on the right flank of a rightwing coalition, its programme, Colin James pointed out, was likely to ‘remain either unimplemented or implemented in such watered-down form as to discredit it’ (James, 11 Nov 1994: p.15).
Yet, as National moved further into the centre of the political spectrum, Act too gave up more of its radical neoliberal position. When, in 1998, it released its alternative budget policy statement, it omitted unpopular measures such as cuts in social spending, instead advocating only a few asset sales and a tax cut of three cents across the board (Laugesen, 1998f: p.C2). The National Business Review commented that Act’s extremes had been considerably tempered:
Gone is the spiritual call to arms of massive spending cuts and a revolutionary social programme in the health and education sectors. Instead a round of asset sales… tax cuts and the modest target of paring back future unallocated spending to fund them…. A document which at first glance looks macho is actually a major revision of the party’s position and a revision towards compromise at that. Where were the vitriolic attacks on the profligate spending in the coalition agreement? Replaced with an acceptance of current (previously lunatic) spending commitments (Molesworth, 1998c: p.19).
Another of Act’s founding policies was axed in 1998 when Prebble abandoned its compulsory savings proposal for superannuation, following a public referendum that showed a very similar policy to be clearly unpopular. (In the referendum, 91.8% of voters said ‘no’ to the question: ‘Do you support the proposed Compulsory Retirement Savings Scheme?’. The official turn-out was 80.3%)
Then in January 1999 Act released its three-point plan for the economy, recommending a cut in the tax rate of three cents, the sale of three SOEs, and the cancellation of all unallocated spending. Ruth Laugesen commented that ‘for Act, this is mild stuff. With Act striving not to frighten the voters before the election’ (Laugesen, 1999a: p.C2).
Additionally, the party dropped its demand for National to cut taxes as the price for Act’s support of its next Budget. Act’s alternative budget of that year also differed little from that of the National Government in terms of taxation and expenditure levels. While the government planned to collect $42,100 million and spend $40,900 million, Act stated that if it was the government, it would collect $39,419 million and spend $38,409 million – hardly a radical difference (Edlin, 17 Nov 1999: p.6). Furthermore, in pledging to cut taxes yet spend more money on certain areas of health, education, welfare and law and order, Prebble had trouble pointing to where cuts would be made to bring about the necessary resources, except to say that ‘the money would come from reprioritising department spending’ (Graeme Peters, 1999a: p.2).
Next blog post: Factions and intra-party MP relations
