1. The author was an active member of the Labour Party after 1959 and a candidate at every general election from 1966 to 1987, and regularly heard observations of this kind. Robert Chapman in his ‘New Zealand Politics Since the War’, Landfall, No. 63, September 1962, p.252, says ‘the most obvious feature of New Zealand’s postwar politics’ is ‘the similarity of the two main parties’. Alan Robinson noted in 1969 that ‘ideological discussion has virtually disappeared from party competition [and] election programmes contain a great amount of common material’. See Alan Robinson, ‘Political Trends in the 60’s’, Pacific Viewpoint, Vol. 10, May 1969, p.99. Also Nigel S. Roberts, ‘Consensus and Confusion: Politics in the 1950s’, New Zealand’s Heritage, p.2583.
2. The phrase is Keith Sinclair’s, Walter Nash, p.305. It refers to those who wanted to make use of Reserve Bank credit at no interest.
3. Robert Chapman, ‘New Zealand Since the War’, p.253.
4. The Report of the Royal Commission is to be found in AJHR, 1956, B-3. The analysis of Social Credit’s submissions is to be found on pp.345-99. There are Treasury files on the Royal Commission in AALR T52/970, W3226.
5. Social Credit’s first victory was in the far north electorate of Hobson in 1966, a seat that it held for one term. It won Rangitikei in a byelection in 1978, holding it until 1984, and the seat of East Coast Bays in another by-election in 1980, retaining it until 1987. In the 1984 election Social Credit also won the Auckland seat of Pakuranga on a complex four-way split. Harold Innes comments pungently on the politics of the time in The Status Quo Seekers, Wellington, 1963.
6. There is a photo of the Standard’s billboard in Hector MacNeill, God Defend New Zealand, Wellington, 1960, back endpaper.
7. Keith Sinclair in a written comment to the author, 1992.
8. ‘Economic Survey 1958’, AJHR, 1958, B-5, pp.23-24. The situation facing the new Government is described by Keith Sinclair in Walter Nash, pp.305-7.1 am grateful to Rt Hon R. J. Tizard for discussing with me the Second Labour Government, in which he was a backbench MP. Interview, 10 June 1997.
9. There is an 85-page white paper tracing the history of the EEC and its impact on New Zealand thinking in AJHR, 1961, A-21. A Treasury file, T/1/61/5/2, contains much material about the early years of the EEC. John Marshall, Memoirs, Vol. 2, Auckland, 1989, Chapt. 6, describes the negotiations he conducted with the British. The Ten Point Plan for New Zealand is to be found in NZH, 24 June 1971, p.l.
10. Quoted in R.M. Chapman, W.K. Jackson and A.V. Mitchell, New Zealand Politics in Action: The 1960 General Election, London, 1962, p.34.
11. Chapman, Jackson and Mitchell, pp.37-47. See also AJHR, 1958, H-44, pp.9ff. Sinclair, Walter Nash, p.307.
12. The National Government allowed the department to be administered by L. A. Atkinson in an acting capacity during 1957 rather than approve Sutch, their old béte noire. Sinclair describes the controversy in Walter Nash, pp.341-2. Jack Marshall assesses the life of Sutch in his Memoirs, Vol. 2, pp.142-9. To date there has been no satisfactory answer to the criticisms Marshall makes.
13. Marshall, Memoirs, Vol. 2, p.143.
14. Standing at 296 on 31 March 1958, they rose to 330 in 1960 and to 433, including those in overseas posts, by 1962. AJHR, 1959, H-44; 1961, H-44; 1962, H-44, pp.66-70.
15. AJHR, 1958, H-44, pp.12-19.
16. AJHR, 1959, H-44, pp.20-21. Since the mid 1950s several groups had been calling for some form of industrial financial assistance, among them the Associated Chambers of Commerce. See T/1/52/655.
17. The text of the speech is in T/1/61/2/2.
18. AJHR, 1960, H-44, p.11. Sutch’s thinking is analysed by A.M. Andres, ‘The Political Economy of W.B. Sutch: Toward a Critical Appreciation’, New Zealand Economic Papers, Vol. 20, 1986. There is further material about W.B. Sutch in 93/319/1/18, ATL. See also NBR, 15 March 1982 and NZ Times, 27 November 1983, p.9.
19. WB. Sutch, ‘Programme for Growth’, speech to Industrial Development Conference, June 1960. There is a discussion of Sutch’s views in W.D. Rose, ‘Manufacturing Development Policy in New Zealand, 1958–1968’, Pacific Viewpoint, May 1969, pp.57-75.
20. Skidelsky, p.83.
21. Rosenberg was Senior Lecturer, then Reader in Economics at the University of Canterbury. A German refugee, who was educated both in Berlin and Wellington, he was secretary of the NZ Monthly Review Society and author of several pamphlets about full employment and industrialisation in New Zealand.
22. See NZPD, Vol. 322, 22 July 1960, p.840. Progress was very slow on coal. It was not until late in 1979 that significant amounts of coal began to be exported to Japan. In the financial year 1980–81 140,000 tonnes of coal were exported. See AJHR, 1981, D-11, p.3.
23. NZH, 2 April 1960, p.13.
24. Austin Mitchell, Politics and People in New Zealand, Christchurch, 1969, p.73. See also Holloway’s remarks, NZH, 1 April 1960, p.12. In a briefing for National backbenchers on 21 March 1972, the Minister of Finance, Robert Muldoon, released details of many of the schemes under active consideration by the Labour Government between 1958 and 1960. They included Alcan Industries in Auckland, an oil refinery at Marsden Point, a gin distillery in Auckland, projects for making screws, steel wire, telephone cables and sheet glass. Many of these schemes ultimately went ahead with government assistance. See Marshall Papers, MS Papers 1403/88/3, ATL.
25. The story of the origins of the cotton mill was outlined by Stanley Whitehead MP after the scheme was scrapped at the end of 1961. See NZPD, Vol. 330, 22 June 1962, pp.38 Iff. Sinclair gives many details in Walter Nash, p.344-5. There is a more detailed outline in Mitchell, Politics and People, pp.75-80. See also Holloway’s comments, NZH, 1 April 1960, p.12. There is other material about this controversy in T/1/52/761/9. For a brief summary of the issues with the mill, see Jim McAloon, Nelson: A Regional History, Queen Charlotte Sound, 1997, pp.202-5.
26. There is some detail about the smelter in Sinclair, Walter Nash, pp.343-4.
27. The development of an iron and steel industry in New Zealand has a long history dating back to government promises of ‘bonuses’ for the development of iron from sands in the Taranaki region in the 1870s and then again in 1914. The Otago Rolling Mill Co. operated as a family concern from 1886 to 1953. It is believed to have produced the first steel in New Zealand, mostly from scrap metal. In 1921 the Onekaka Iron and Steel Co.Ltd. began mining ilmenite deposits in Golden Bay, producing quality iron. Despite some government assistance in securing supplies of coal, the company struggled during the Great Depression and closed in May 1935. On the eve of the 1935 election there was talk of reviving the foundry (DOM, 20 November 1935, p.11.) The First Labour Government passed the Iron and Steel Industry Act 1937, which gave the Government power to establish a state industry for the production of iron, steel and steel products. (NZOYB, 1939, p.402.) During the war the Government attempted to evaluate the precise size of the ilmenite deposits at Onekaka and invested considerable sums in the plant. But little was produced. Eventually in April 1947 Mr Justice Blair awarded the Onekaka Iron and Steel Co Ltd.(in liquidation) £85,000 with interest at 5 per cent from the Government backdated to 15 March 1938 and Golden Bay Proprietary Ltd £41, 796 with back interest, because of their claim that the Government had not fulfilled an agreement. (EP, 3 April 1947) Clearly the reason why Onekaka was never fully developed was that the deposits of ore turned out to be much less than had originally been thought. There is information about Onekaka in T/1/47/303. See also Frank W. Fahy, ‘Onekaka Ironworks - A Part of New Zealand’s Heritage’, Transactions, Vol. 19, November 1992, pp.17-21. Also J.N.W. Newport, ‘Some Industries of Golden Bay’, Journal of the Nelson Historical Society, Vol. 13, No. 5, 1975, pp.5-26. I am greatly indebted to David Bold, a Ph.D student at the University of Auckland, for information about the history of New Zealand’s steel industry. I also benefited from a discussion with J. W. Ridley, Chief Engineer at New Zealand Steel 1965–70, on 16 June 1997.
28. There is information about the complex negotiations over steel in Selwyn Parker, Made in New Zealand: The Story of Jim Fletcher, Auckland, 1994, Chapt. 6, and in George Fraser, Both Eyes Open, Dunedin, 1990, pp.112-5. There are further files on New Zealand Steel in AALR, T/39/7, Box 73, W4446, NA. Also AALR, T39/7/8, W4446, and AALR, T39/7/8/3, W4446. ‘Think Big’ expansion files relating to steel are to be found at AALR, T/6/43 W3993. Pacific Steel’s prices were to be fixed at lower than average prices for imported products. Sales would be price controlled. The Government would use controls to protect the company from ‘unfair’ competition. If the company did not fulfil its promises then the Government reserved the right to permit imports. See R.D. Muldoon to All Government Members, 21 March 1972, Marshall Papers, MS Papers, 1404/88/3, ATL.
29. Commissioner of Works to W.B. Sutch, 12 February 1959, T/1/39/7/2. The minutes of the officials’ committees are to be found in this file.
30. NZH, 2 April 1960, p.13. George Fraser, Both Eyes Open, pp.114-5, asks questions about how the economic nationalist, Sutch, managed to come up with a consortium of Australians as the preferred partners of the Government. Historian David Bold is currently investigating Sutch’s behaviour, which seemed so out of character with his repeated declarations of New Zealand nationalism.
31. EP, 27 April 1960.
32. DOM, 28 April 1960.
33. Mitchell, Politics and People, pp.81-83.
34. EP, 27 April 1960, editorial.
35. Hawkes Bay Herald Tribune, 29 April 1960. Federated Farmers also opposed aspects of industrialisation. See Mitchell, Politics and People, p.81.
36. Freedom, 3 May 1960. Some National MPs criticised aspects of the Government’s development plans. D.J. Eyre, MP for North Shore, called them plans for ‘complete socialisation’. See NZPD, Vol. 323, 2 August 1960, p.54.
37. EP, 14 October 1960. There is more information about state factories in T/1/52/761/9.
38. NZPD, 22 January 1958, p.23.
39. NZPD, 17 June 1958, p.93.
40. NZPD, 11 June 1958, pp.17-19.
41. The Family Benefits (Home Ownership) Act passed into law on 2 October 1958 and came into force on 1 April 1959. In its first two years of operation more than £12 million was capitalised on a total of nearly 20,000 benefits. See NZOYB, 1962, p.918. In the year to March 1960 a record 21, 600 houses were constructed. See ‘Economic Survey 1960’, p.22.
42. The text of the budget is in AJHR, 1958, B-6. See also NZOYB, 1959, p.789. The top marginal tax rate had been reduced by the National Government during the early 1950s and now stood at 60 per cent.
43. ‘Economic Survey 1961’, p.26. See also budget 1961, AJHR, 1961, B-6.
44. ‘Economic Survey 1961’, pp.40-41. See AJHR, 1961, H-14, pp.26-30 and 1962, H-14.
45. Marshall, Memoirs, Vol. 2, Auckland, 1989, p.l.
46. National won three city seats, Tamaki, Wellington Central and St Albans, and four regional centres, Gisborne, Hastings, Rotorua and Palmerston North.
47. AJHR, 1961, B-6, p.6.
48. Monetary and Economic Council, Economic Growth in New Zealand, No.2, Wellington, May 1962, Chapt. 1. A referendum was held on the term of Parliament on 23 September 1967. The three-year status quo defeated a four-year term by more than 2:1. See J.O. Wilson, New Zealand Parliamentary Record, p.301.
49. See B.C. Ashwin to S.G. Holland, 14 March 1952, and E.L. Greensmith to J.T. Watts, 20 April 1956, T/1/52/880/2/2.
50. Sinclair, Walter Nash, pp.242-245, and p.351. Several newspaper editorials in 1958 are to be found in T/1/52/880/2/2.
51. ‘International Monetary Fund and World Bank’, AJHR, 1961, A-12.
52. Sinclair, Walter Nash, p.351.
53. W. Rosenberg, What Every New Zealander Should Know about the International Monetary Fund, Christchurch, 1961; What Every New Zealander Should Know about Foreign Investment in New Zealand, Christchurch, 1966.
54. Samuel Leathem, address to Auckland Manufacturers Association, January 1962, text in author’s hands.
55. NZPD, Vol. 29, 10 November 1961, pp.3508ff.
56. See S. Greenburg to H. Lake, 25 June 1964, T/1/52/761/10. Marshall gives the story of the cotton mill from the time National took office again until its scrapping in his Memoirs, Vol. 2, pp.15-18. See McAloon, Nelson, p.204.
57. A new agreement was given legislative endorsement in October 1963. Raising the level of Lake Manapouri to facilitate the production of electricity caused considerable political embarrassment to the National Government between 1970 and 1972, culminating in a parliamentary petition with 250,000 signatures opposing raising the lake. For discussion of the smelter see Marshall, Memoirs, Vol. 2, pp.43-44. See also NZ Gazette, 13 April 1961, p.544; Statutes, 1963, Vol. 1, p.244. Much detail about the 1963 agreement is contained in the Act’s schedule. Hugh Templeton, All Honourable Men: Inside the Muldoon Cabinet, 1975–1984, Auckland, 1995, Chapt. 8, has some details about the smelter.
58. Marshall, Memoirs, Vol. 2, p.45.
59. ‘Report of the Provisional Board of the New Zealand Steel Company’, 9 December 1964, Wellington, 1965, p.37. A more technical report, ‘The Ironsands Project’, produced by W.S. Atkins and McLellan & Partners to the Investigating Company in November 1964, is in the possession of David Bold. There is an 81-page history of New Zealand Steel from early times until 1981 prepared for Treasury by P. Lissington, and a briefer history of the early years in the prospectus of New Zealand Steel Ltd, 1966, both of them lent to me by David Bold.
60. The National Government consistently argued that the mill should be privately owned, but that the Government would contribute seeding capital. See NZPD, 23 August 1963, a summary of which was provided by David Bold. There is information about the plant in AJHR, 1966, H-44, pp.5ff.
61. ‘The World Bank Report on the New Zealand Economy, 1968’, p.41.
62. Lissington deals with the debates at the Cabinet level, in 1981, pp.70-73. Roger Douglas discusses the restructuring debate of 1985 in Toward Prosperity, Auckland, 1987, Chapt. 15. Court cases in 1996 and 1997 resulted in rulings that the Crown had an obligation to repay $267.5 million to the receivers of Equiticorp, meaning, in effect, that the Crown’s investment in the mill had completely evaporated.
63. Marshall, Memoirs, Vol. 2, pp.42-43. There is information about New Zealand Steel’s later years in AS, 12 September 1981, p.1 and NBR, 23 May 1997, p.7.
64. Minutes of Officials’ meeting, 18 October 1961, T/39/16, part 1, W2446. There was an announcement in the DOM, 21 October 1961, which claimed that the field of gas could be worth £23.75 million.
65. The deputation’s presentation is in T/39/16, part 1, W2446.
66. K.J. Holyoake to J.B. Price, 28 August 1963, T/39/16, part 1, W2446.
67. Statutes, 1962, Vol. 1, p.764.
68. Marshall, Memoirs, Vol. 2, p.46.
69. P.J. Lloyd, ‘Australia-New Zealand Trade Relations: NAFTA to CER’, in Keith Sinclair (ed), Tasman Relations, Auckland, 1987, pp.142-63; A.E. Bollard and M.A. Thompson, Trans-Tasman Trade and Investment, Wellington, 1987, p.l.
70. Marshall, Memoirs, Vol. 2, Chapt. 3.
71. See Wolfgang Rosenberg, A Guidebook to New Zealand’s Future: Winds of Change over New Zealand, Christchurch, 1968, p.181.
72. Ibid, p.28. See also Paul Wooding, ‘Liberalising the International Trade Regime’, in Alan Bollard and Robert Buckle (eds), Economic Liberalisation in New Zealand, Wellington, 1987, pp.86-101. I am indebted to Sir Frank Holmes for a long interview on 12 March 1997 in which he discussed his role in the NAFTA process. For official documents see ‘New Zealand’s Trade with Australia’ and ‘New Zealand-Australia Free Trade Agreement’, including exchange of letters, AJHR, 1965, A-19 and A-17.
73. Robert Chapman, ‘From Labour to National’, in W.H. Oliver (ed), The Oxford History of New Zealand, Wellington, 1981, p.365. See also John Gould, The Rake’s Progress? The New Zealand Economy Since 1945, Auckland, 1982, p.90.
74. The allegations by Dr A.M. Finlay MP against Meadowcroft were not proven. In any event, trading in import licences had become common enough by this time. The comments of Frank Holmes are to be found in NZH, 27 July 1968. An example of a fairly typical Tariff and Development Board investigation is the inquiry conducted in 1972 into the tariff and import protection received by Donald Brown and Co Ltd, Newton, Auckland. A small family company employing a staff of 18, which had produced carbon brushes for electric motors and dynamos since 1938, the company wanted to retain its protection. Several sets of submissions were required, legal fees incurred, a visit to the factory made by the Board, and a lengthy hearing in Wellington. Six months after the inquiry began the company was informed that it would be able to retain all its protective mechanisms. See IC/4/1/168, W2357. Interview with Donald Brown, 16 May 1997.
75. See Hawke, The Making of New Zealand, p.261. See AJHR, 1965, H-44, p.6.
76. There is detail about the 1963 conference in IC/57/1/20, W1926.
77. There is material indicating National Party doubts and Sutch’s strong advocacy of controls in IC/1/10, W2268. See also Holyoake request, MS Papers 1814/214/3, ATL. Stabilisation subsidies on the price of sugar were introduced in June 1963, then eased in 1964. It was noted that when the price of sugar fell after the introduction of subsidies, most manufacturers did not pass on the benefit they received in lower prices. AJHR, 1965, H-44, p.19.
78. Paul Wooding, ‘Liberalising the International Trade Regime’, p.90.
79. ‘The World Bank Report on the New Zealand Economy 1968’, p.14.
80. See ‘Taxation in New Zealand’, AJHR, 1967, B-18. Ross gives a short account of his life in Ann and Laurie Gluckman (eds), Identity and Involvement: Auckland Jewry, Past and Present, Vol. 2, Palmerston North, 1993, pp.70-84.
81. There is some background to the Royal Commission in G.E. Caiden, ‘The State Services in New Zealand’, NZJPA, Vol. 25, March 1963, pp.11-21. For criticism of the findings, see especially pp.12-14. The report itself is to be found in AJHR, 1962, H-41.
82. Alan Henderson, The Quest for Efficiency, p.314.
83. See Royal Commission into Salary and Wage Fixing Procedures in the New Zealand State Services, Wellington, August 1968.
84. See, for instance, the ease with which changes proposed to Internal Affairs were reversed. Bassett, The Mother of All Departments, pp.200-01.
85. John Martin, Holding the Balance, p.279.
86. See Michael Bassett, ‘The National Party and Compulsory Unions’, typescript, 1983; this was distributed widely. Copy in the author’s possession. See also NZH, 17 June 1961, editorial. Overwhelmingly union members voted to retain what was called ‘the unqualified preference clause’ in their agreements. See Parliamentary Order Paper, 5 August 1983, p.483.
87. There were 332, 362 members in 1960 and 394, 748 in 1972.
88. AS, 16 December 1960.
89. John Martin, Holding the Balance, pp.287-91. See Tom Skinner, Man to Man, Christchurch, 1980, p.119.
90. Martin, Holding the Balance, p.291.
91. Marshall, Memoirs, Vol. 2, p.117. Tom Skinner gives a summary of events surrounding the ‘nil general wage order’ in Man to Man, Chapt. 6. Gary Hawke, Government in the New Zealand Economy, pp.45-47, picks out some of the trends in wages and pricing policy 1950–70. See also A. Williams, ‘Industrial Relations’ in Peter A. Lane and Paul Hamer (eds), Decade of Change: Economic Growth and Prospects in New Zealand, 1960–1970, Wellington, 1973, pp.109-26.
92. P.N. Holloway, ‘Government Policies and Assistance in Manufacturing Development’, in C.A. Blyth (ed), The Future of Manufacturing in New Zealand, Wellington, 1964, pp.195-215.
93. Paul Johnson, Modern Times, Chapt. 19.
94. ‘The Current Economic Situation and Outlook’, Report of the Monetary and Economic Council, No. 7, June 1964, p.5, notes that expenditure grew by 3.2 per cent in 1961–62, by 4.9 per cent in 1962–63 and by 12 per cent in 1963–64. ‘Economic Review 1968’, AJHR, B-5, p.8, shows how gross domestic expenditure and imports moved upwards in tandem between 1963–66. The Monetary and Economic Council Report, No. 17, September 1969, stated ‘It is now clear that effective action to remedy the 1965–67 balance of payments crisis was not taken early enough’.
95. Holyoake’s statement appears in AS, 4 February 1967. For details about reduced subsidies see NZOYB, 1968, p.706. New Zealand switched to decimal currency on 10 July 1967 when $2 became the equivalent of £1.
96. Details are provided in ‘Economic Review 1967’, AJHR, B-5, p.9.
97. Ibid, p.11. See also NZH, 3 May 1968, p.12.
98. ‘The World Bank Report on the New Zealand Economy 1968’, pp.13-14. Farmers’ complaints about rising costs appear in NZH, 1 April 1969. See also the call for a 20 per cent devaluation, AS, 15 May 1969. Edmund Dell, The Chancellors, Chapts 11 and 12, deal with the constant pressures on sterling.
99. See I.B. Johns, ‘Agricultural Sector Planning in New Zealand’, Political Science, Vol. 24, April 1972, pp.2-14.
100. See Cabinet papers on the subject, IC/57/1/20, W1926.
101. The Public Service Association in a pamphlet ‘What the Newspapers Wouldn’t Print about the Sutch Case’, Wellington, 1965, argued that the SSC had succumbed to ministerial pressure and that some members of the SSC were interested in Sutch’s vacant post. The PSA brought a private prosecution against Marshall arguing that he had breached the State Services Act. It was dismissed. See Marshall, Memoirs, Vol. 2, p.142.
102. AJHR, 1965, H-44, p.53.
103. See J.K. Galbraith, The New Industrial State, Boston, 1967, on which Galbraith’s New Zealand lectures were based. For Treasury’s views, see H. Lang memorandum, 29 November 1965, T/1/73/1, part 1, W2907.
104. H. Lang to H. Lake, 21 September 1965, T/1/73/1, part 1, W2907. There is much detail about the British NEDC in Edmund Dell, The Chancellors, pp.269ff.
105. I am indebted to Professor Gary Hawke and Roger Kerr, who discussed this emerging planning process with me. Sir Frank Holmes, as he became in 1975, had been Macarthy Professor of Economics at Victoria University in 1959–67, was then Economics and Planning Manager at Tasman Pulp and Paper in 1967–70, before returning to Victoria as Professor of Money and Finance 1970–77. He was Chairman of the New Zealand Planning Council 1977–82.
106. File T/1/73/1, part 1, W2907 contains many indications of anxiety in high places at the ramifications of planning.
107. The typescript is to be found in T/1/73/1, part 1, W2907.
108. See E.V. Adams to K.J. Holyoake, 1 June 1967, T/1/73/1, part 1, W2907. There is other information about Treasury’s role in T/1/73/30/1, part 1, W2907. See also T/1/73/18, W2907.
109. T/1/73/1, part 1, W2907.
110. Treasury memo to R.D. Muldoon, 8 June 1967, T/1/73/1, part 1, W2907.
111. K.J. Holyoake to E.V. Adams, 9 August 1967, T/1/73/1, part 1, W2907.
112. A debate about the conference’s intentions between Sutch and Henry Lang is to be found in NZH, 22 April 1969; 24 April 1969.
113. See file notes about ministerial briefings, especially 26 November 1968. Also ‘Summary of Sector Committee Views’, 15 January 1969, and CM69/7/17, in T/1/73/1, part 2, W2907. I am obliged to Professor Hawke, who discussed some of the detail surrounding the conference in a letter to the author, 15 June 1997.
114. The comments of Roberts and others are to be found in T/1/73/1, part 2, W2907.
115. The recommendations of the targets committee appear in NZH, 29 April 1969, p.14.
116. AJHR, 1969, B-6.
117. Listener, 25 May 1970, p.8. There is other material about the aftermath of the 1969 conference in T/1/73/1, part 2, W2907.
118. Interview with Sir Frank Holmes, 12 March 1997.
119. In A.R. Low to R.D. Muldoon, 2 May 1972 and R.D. Muldoon to A.R. Low, 11 May 1972, the problem with statistics was discussed. See AALR, T73/2, Box 549, W4446. After 1972 the Third Labour Government expressed reservations about aspects of indicative planning. More dirigiste than their opponents, they restructured the Targets Advisory Group and outlined a set of assistance policies for industry. A series of ‘Industry Studies’ began in a search to identify what assistance was needed to produce faster growth. There is much material about planning 1972–75 in AALR, T73/2, Box 549, and T73/1/6, Box 548, W4446.
120. See comments in Trans Tasman, 26 November 1970.
121. See NZH, 24 February 1971; 2 March 1971.
122. AJHR, 1972, B-6, pp.11-12. See the maiden speech of Aubrey Begg MP, NZPD, Vol. 382, 27 February 1973, p.282.
123. Skinner, Man to Man, pp.120-1. See also Monetary and Economic Council Report, No.21, ‘Economic Trends and Policies’, May 1971, p.45, and the report in AS, 27 May 1971, p.3. The council made a number of specific recommendations in its report (No.22) entitled ‘Inflation and the Labour Market’ in December 1971. Sutch’s arguments were outlined in a YC programme broadcast on 8 December 1971 and printed in the Listener, 17 January 1972, p.13. Professor Conrad Blyth advanced his argument for an Incomes Board in AS, 30 September 1972, p.19.
124. Newspapers were quick to condemn the extra spending in the 1972 budget, pointing out that it would only push inflation to higher levels. See NZH, 23 June 1972, editorial; AS, 23 June 1972, editorial; Press, 23 June 1972, editorial; DOM, 23 June 1972, editorial; ODT, 23 June 1972, editorial. The Herald observed on 27 June 1972 that Muldoon’s budget ‘will be judged over the next six months less by what has been handed out to the taxpayer, the mother or the beneficiary, than by what the concessions mean in buying power. If the spiral [of inflation] cannot be restrained, no one is better off.’ A ‘Review of the Current Economic Situation - December 1972’ prepared for Muldoon summarises the strengths and weaknesses of the economy. It was distributed to all new MPs. It pointed on p.11 to rapidly rising wage levels and to ‘considerable’ increases in food prices but the outgoing government accepted no responsibility for the trends.
1. Johnson, Modern Times, p.669.
2. Douglas, Unfinished Business, p.25. See C.A. Blyth, ‘New Zealand and the International Economy in 1974’, address to the Export Institute of New Zealand, 24 April 1974. Also London Financial Times, 18 January 1980.
3. John Dunmore, Norman Kirk, Palmerston North, 1972, p.25.
4. Entry in the diary of the Chief Labour Whip, Henry May, 10 September 1959.
5. An enlarged heart since childhood had occasionally given Kirk trouble, especially when he was very overweight during his first twelve years in Parliament. It was his varicose veins and his determination to have both legs fixed at once in 1974 that led on to the blood clot that eventually killed him on 31 August 1974. In an interview on 10 June 1997 Rt Hon R. J. Tizard, who was Kirk’s Minister of Health 1972–74 and Minister of Finance 1974–75, suggested that Kirk’s determination to have policy specifics in such detail stemmed from his perception that victory in the 1969 election had eluded him because of vagueness. Clearly there were other factors causing Labour’s loss in 1969 but the author, who was a candidate, recalls the lack of policy specifics that an ill-chosen slogan ‘Make Things Happen’ managed to highlight.
6. Released on 31 October 1972 by the New Zealand Labour Party in Wellington, the red-covered document was entitled ‘1972 Election Manifesto: New Zealand Labour Party’.
7. A pamphlet produced by the Princes Street Branch of the Labour Party in 1966, ‘Opportunities for the Sixties’, which the author helped to write, was an elaborate wish list seeking government intervention and funding for a vast array of educational initiatives. Equally instructive is the 1973 publication by the Labour Party Youth Advisory Council, D. Butcher (ed), ‘Labour Party Young Socialist Positions’. See also H. Keith (ed), ‘New Zealand in the Nineteen Seventies: Economic Development’, Auckland, 1968. Kirk was fond of using the word ‘nationhood’ and titled a booklet during the 1969 campaign Towards Nationhood, Palmerston North, 1969, and another in 1972 containing speeches by his leading spokespersons called Target Nationhood. Kirk had a precise view of New Zealand’s national identity. It consisted, among other things, of having a distinctive passport, distinctive New Zealand honours and designating the sovereign as Queen of New Zealand.
8. NZPD, Vol. 382, 1 March 1973, p.414.
9. Perhaps the clearest statement of Labour’s concerns and the economic changes they intended to introduce came from W. E. Rowling in Norman Kirk (ed), Target Nationhood, Wellington, 1972, pp.93-103.
10. Sutch sought to influence Kirk’s thinking, but his only preferment was the chair of the Queen Elizabeth II Arts Council 1973–75. He tried to increase the protective environment for textile and woollen goods in 1974. See W.B. Sutch to J.P.Lewin, 24 January 1974, AATJ, 7428/2/1/32, W3566. Sutch was charged with a breach of the Official Secrets Act in 1975, tried and acquitted, but died in September 1975.
11. For an account of the period 1972–75, see Michael Bassett, The Third Labour Government: A Personal History, Palmerston North, 1976; also Ray Goldstein with Rod Alley, Labour in Power: Promise and Performance, Wellington, 1975. The Treasury’s briefing note dated 8 December 1972 to the incoming government is in AALR, T52/822/6, W4446.
12. ‘The Election and the Market’, December 1972, from Buttle, Wilson, Rutherfurd &: Co. The stock market rose steadily for a time. On 13 June 1973 the index stood at 1803 compared with 1478 at the same time in 1972. W.E. Rowling to All Government Members, 26 June 1973, p.3, in Michael Bassett Papers.
13. Press statement ‘Overseas Investment in New Zealand’, by Minister of Finance, 12 January 1973. Minutes of meetings of the Cabinet Committee on Policy and Priorities beginning with the meeting on 26 March 1973, in which it was decided that emphasis would be placed on achieving a faster rate of economic growth by use of ‘incentives applied selectively to encourage the required changes to the economy’. Emphasis would be placed on manufacturing. Import licensing would be retained but the tariff review would continue. See CM 73/14/29. Further papers dealing with changing priorities are to be found in PP(74) M25, part 2.
14. More detail is given about the Rates Rebate scheme and other early spending in Bassett, The Mother of All Departments, Chapt. 9.
15. The author has drawn on some of his notes written at the time. See also Bassett, The Third Labour Government, Chapt. 5. There is useful information about funding of the original Queen Elizabeth II Arts Council, established in 1964, in AANY W3208, NA.
16. AJHR, 1973, B-6, p.3. Rowling’s March 1973 Cabinet submissions about economic growth and his further refinements in October and November are to be found in T/1/73/28, W2907.
17. Bassett, The Third Labour Government, pp.131-2. Subsidies rose to $107.4 million in 1973–74.
18. The Property Speculation Tax was eventually repealed in 1979. A model ‘new town’ was to be established at Rolleston in Canterbury, and much work was put into the scheme. Work ceased after the election of 1975, although town planners and some local body politicians continued to argue for the establishment of new towns to take pressure off metropolitan areas. See NZH, 5 December 1975, p.l; 9 December 1975. The Rolleston project is discussed in the Listener, 28 February 1976. There are files in AALR, T52/764/20, W3266 on Rolleston, at National Archives. Warren Freer outlined the Government’s approach to regional development on 5 July 1973 in a speech entitled ‘Industrial and Regional Development in New Zealand’, published in Auckland by the New Zealand Geographical Society.
19. Rowling followed up his speech by circulating to all Government MPs an eight-page letter dated 26 June 1973 setting out his futher plans, Bassett Papers.
20. The decision to hold MPs pay increases gave rise a few weeks later to the introduction of overseas travel concessions for members and ex-members.
21. Kirk’s speech to caucus on 16 August 1973 is summarised in the author’s caucus notes, and dealt with briefly in The Third Labour Government, p.70.
22. A National Research Bureau poll in November 1973 found that the public regarded inflation as the most important problem facing the country.
23. Prime Minister’s telegram to all Labour MPs, 9 September 1973, and the large file of ‘Background Notes’ sent to them the following day, Bassett Papers.
24. W. Freer to A.G. Rodda, Price Tribunal, 12 March 1973, IC/1/10, W2268. Rodda in his reply of 20 March suggested a scheme and raised no difficulty about timing. There is much material about the intricacies involved in implementing MRP in IC/52/4, W2268.
25. See Secretary Trade and Industry to President Price Tribunal, 20 June 1973; Barry Purdy, Retailers’ Federation, to Secretary, T&I, 11 July 1973; C.E. Beard to President Price Tribunal, 20 and 25 July 1973; H.E.J. Martin to President Price Tribunal, 25 July 1973, IC/52/4, W2268.
26. See Bassett, Third Labour Government, pp.144-5. Peter Shirtcliffe of Molenburg Breads told the author in December 1996 that he quickly realised that estimates as to a fair retail price for bread were always calculated on averages and that a smart businessman knew that trimming overheads would guarantee substantial profits under price control. There is material about calculations of pre-tax profits in AALR, T61/1/22/2, Box 278, W4446.
27. There is a file T/1/73/28 W2907 which deals with the Government’s growth strategy. See especially the files on Cabinet Policy and Priorities Committee, 8 May 1974, PP(74)M 25 part 2, and the papers attached.
28. The second reading of the Bill is to be found in NZPD, Vol. 401, 24 September 1975, pp.4742ff.
29. There is an interesting file on the Shipping Corporation, T/1/39/27, W2446. See also AS, 30 June 1973, ‘Weekender’. Reports of the corporation are to be found in AJHR, F-13.
30. The adjective was used by Marshall at the third reading of the legislation, NZPD, Vol. 381, 18 October 1972, p.3445. The best historical treatment of ACC is Ian Campbell, Compensation for Personal Injury in New Zealand: Its Rise and Fall, Auckland, 1996.
31. Campbell, pp.44-45. The Royal Commission report entitled ‘Compensation for Personal Injury in New Zealand’ was published in Wellington, December 1967.
32. There is a handbook by J.L. Fahy, Accident Compensation Coverage, Wellington, 1980, which gives detail about the ACC and its various benefits.
33. The Royal Commission report ‘Social Security in New Zealand’ was published in Wellington, March 1972, p.32. The report is analysed by Elizabeth Hanson, The Politics of Social Security, Auckland, 1980, pp.133-9.
34. Kirk’s illness, death and funeral are dealt with in Bassett, Third Labour Government, Chapts 11 and 14. The observation that Kirk’s years marked the ‘end of the golden weather’ was made by David McLoughlin in North and South, October 1996, p.69.
35. AS, 1 March 1975; Christchurch Star, 4 March 1975, editorial; Listener, 1 March 1975, p.ll, and 8 March 1975, p.18.
36. The Auckland Star carried an article on 13 July 1974 under the headline ‘House Explodes into Open Warfare in the Wake of “Gentleman Jack’s” Departure from Leadership’. Robert Muldoon, The Rise and Fall of a Young Turk, Wellington, 1974, gives his view on the Third Labour Government, and his Muldoon, Wellington, 1977 gives the Muldoon version of Marshall’s toppling in Chapt. 7. Muldoon ends in 1977; Muldoon’s My Way, Wellington, 1981, carries his story to 1981.
37. R.J. Tizard, ‘The Economic Situation’, Wellington, October 1974.
38. North Shore Times-Advertiser, 7 November 1974, p.14.
39. R.J. Tizard, ‘The Economic Outlook’, Wellington, April 1975, p.5.
40. New Zealand Institute of Economic Research, ‘Quarterly Predictions’, September 1975, p.3.
41. By December 1975 inflation was running at 15.7 per cent and had carried the cost of subsidies above $180 million. See DOM, 23 December 1975. I am indebted to Professor Gary Hawke, who saw farmers buying back the subsidised milk and had the economic advantages of doing so explained to him. Gary Hawke to author, 3 July 1997. Tizard reminded the author that most dairy farmers at the time admitted to selling their milk in bulk, while putting out milk bottles to receive subsidised milk for their domestic use. The subsidy figure for the year to March 1976 appears in the 1977 Budget, Table 7, AJHR, B-6, p.52. See also AALR, T/61/1/9/24, Box 269, W4446.
42. See H. Lang to R.D. Muldoon, 2 December 1975, p.7, AALR, T/52/822/6, W4446.
43. Muldoon’s onslaught on the budget is to be found in NZPD, Vol. 397, 27 May 1975, pp.1382-96. For his later statements about the deficit, see NZH, 13 December 1975, p.l.
44. AJHR, 1975, B-6. Tizard was confident that the economic downturn would last no longer than the middle of 1976. See his comments to a Panmure audience, Courier, 19 February 1975, p.3.
45. Party president, G. A.Chapman confirmed this in AS, 11 December 1975.
46. See Bassett, Third Labour Government, Chapt. 22. See also text of interviews with defeated Labour MPs on 4 December 1975, Bassett Papers.
47. Hugh Templeton, All Honourable Men: Inside the Muldoon Cabinet, 1975–1984, Auckland, 1995. Jim McLay, when interviewed on 7 July 1997, told the author that there were six or seven ministers who would argue with Muldoon but the others adopted what McLay called a ‘Trust Rob’ approach.
48. Jim McLay, who became Deputy Prime Minister in 1984, told the author on 18 June 1987 that after the 1981 election he had not been shown the Treasury briefing that raised many hard questions about the economy. The Prime Minister’s Department is discussed in EP, 15 December 1975. There are files on expenditure within the Prime Minister’s Department 1977–80 in AALR, T62/35, Box 448, W4446.
49. New Zealand Institute of Economic Research, ‘Quarterly Predictions’, September 1975, p.3.
50. NZOYB, 1979, p.768.
51. NZH, 13 December 1975, p.l. The full Treasury report to the Minister of Finance is dated 19 December 1975 and is to be found in AALR, T52/822/6, and T52/822/6/1, W4446.
52. One of the first journals to comment on Muldoon’s talent for sideshows was the New Zealand Company Director and Executive, May 1977, in its regular column, ‘Round the Lobbies’. It noted that Cabinet reshuffles, a royal tour, and by-elections in Pahiatua and Mangere had stopped electors thinking about price rises.
53. The Government claimed it was saving $252 million ($84 million on electricity subsidies, $83 million on Post Office charges, $57 million on railways, and $28 million on milk). See DOM, 23 December 1975. Subsidies quickly rose again. See AS, 7 November 1978, p.6.
54. AS, 17 January 1976. Jim McLay in an interview on 7 July 1997 recalled many late meetings of Cabinet and its committees.
55. Public Service figures are to be found in Treasury to G.F. Gair, 1 March 1976, T/1/3/23, part 2, W2591. The quote is from David McLoughlin, North and South, July 1997, p.42.
56. The deliberations of the Cabinet Committee on Expenditure are to be found in T/1/3/23, part 2, W2591. Hugh Templeton describes some aspects of Muldoon’s financial management in All Honourable Men, Chapt. 7.
57. These views were expressed by J.G. Russell to a meeting of the Otago Chamber of Commerce. EP, 4 December 1975, p.22.
58. See Speech from the Throne, NZPD, Vol. 403, 23 June 1976, p.18.
59. Muldoon’s 15-page press release on 2 March 1976 sets out his interest rate policy in relation to housing, Bassett Papers. On 6 September 1977 Muldoon explained that interest rates had to rise in a time of inflation or it simply did not pay to save. EP, 7 September 1977.
60. Press, 15 March 1979. Muldoon’s comments about price and wage controls are to be found in R.D. Muldoon to A.R Knowles, 16 March 1976, AALR, T/61/1/22/3, Box 278, Vol.3, W4446. See Allan Catt, ‘Why Businessmen Should Support a Price Control Policy’, NZ Economist, June 1976, pp.5-8. Also NZ Financial Times, 10 May 1977. The Stabilisation of Prices Regulations 1974 were replaced on 6 April 1979 by the Price Surveillance Regulations. These required every trader to retain records of price increases and to allow the Secretary of Trade and Industry to investigate the prices of any goods and services. In some circumstances the Secretary could recommend that prices be referred for a public inquiry before the Commerce Commission.
61. See Muldoon’s correspondence, AALR, T/61/1/9/24, Box 269, W4446.
62. For subsidy levels see the budget tables each year, Table 7. There is detail about negotiations over tax levels and the CPI in AALR, T/61/9/1/6, W4446.
63. See Muldoon’s budget comments, AJHR, 1976, B-6, pp.2-3. Also his press statement of 2 March 1976, p.3.
64. See the comments by J.K. McLay MP, NZPD, Vol. 403, 29 June 1976, p.102; by A.P.D. Friedlander, MP for New Plymouth, p.206; and W.E. Cooper, MP for Otago Central, p.299.
65. See the comments of Barry Brill, MP for Kapiti, EP, 15 December 1975; M.J. Minogue, MP for Hamilton West, NZPD, Vol. 403, 9 July 1976, p.454; and H.N. Austin, MP for Hobson, NZPD, Vol. 403, 8 July 1976, p.424.
66. I am indebted to Jim McLay for this observation about Muldoon and Lee Kuan Yew. The growth figure is from AJHR, 1979, G-14, p.5.
67. Muldoon’s budgets are to be found in AJHR, 1976–83, B-6. Both the tax consultant Arthur Valabh and Sir Roger Douglas agree that Muldoon’s approach to the economy changed in 1977, when he perceived that deregulation was politically dangerous. Discussion with both Valabh and Douglas, 14 February 1997.
68. There is a lot of information about the new planning structures 1976–80 in AALR, T/73/1, Vols 6, 7, and 8, Box 548, W4446. Reports of the Commission for the Future are to be found in AJHR from 1979, D-10. Early in 1978 the Planning Council published Planning Perspectives 1978–83, which preached the necessity for changing attitudes and argued for efficiency.
69. AJHR, 1977, B-6, p.3. AS, 7 November 1978, p.6.
70. Worker participation was given much publicity in 1977–78. See especially the Listener, 23 July 1977, pp.20-22. Talboys’ comments are in the AS, 25 February 1978, p.l.
71. There are files relating to a number of industry studies in AALR, T/73/28/1, Box 562, W4446. The quote comes from the 1976 budget, AJHR, B-6, p.17. Some Treasury officials were sceptical about the likely success of industry studies. See speech notes of N.V. Lough, 12 April 1978, AALR, T/73/28/1, Box 562, W4446.
72. See EP, 31 January 1979, p.l; Sunday Star, 9 August 1992, p.A-9. See also Bank of New South Wales ‘Review’, No. 27, October 1978, p.l.
73. The 1985 budget tables show that interest on New Zealand’s public debt consumed 2.5 per cent of total taxation revenue in 1976 and 12.7 per cent in 1985. See AJHR, 1985, B-6a, p.42. The OECD report is in NZH, 24 August 1977.
74. Muldoon was taken to court over this unilateral act and was criticised by the Chief Justice. See Palmer, Unbridled Power, pp.187-90.
75. NZOYB, 1979, p.146. The principal extra cost came from extending a state pension to people between 60 and 65 with means. Only some of the extra expenditure was regained in taxation. In dollar terms the outlay on Social Welfare was $784 million in 1975–76 and $1.932 billion in 1979–80. See NZOYB, 1981, p.151. See also AS, 7 November 1978, p.6.
76. The historian David Thomson has written about what is sometimes labelled ‘inter-generational theft’. See NZH, 31 October 1987, Section 2, p.2. Also David Thomson, Selfish Generations? The Ageing of New Zealand’s Welfare State, Wellington, 1991.
77. NZOYB, 1975, p.147; NZH, 14 June 1997, p.G3.
78. NZOYB, 1987–88, graph, p.339. See also 1986–87, p.335.
79. See Chapt. 9, page 2.
80. NZH, 2 January 1979, editorial. See also AS, 7 November 1978, p.6.
81. AS, 22 August 1978.
82. AS, 29 December 1979, p.4. NZH, 23 March 1979. See Ian McLean, The Future for New Zealand Agriculture: Economic Strategies for the 1980s, Wellington, 1978. McLean restated his arguments in NZH, 19 January 1979, p.6.
83. NZH, 26 March 1979. Bayliss’s comments are in AS, 29 November 1978, p.3.
84. See B.W. Dunlop to J.WH. Clark, 5 October 1978. Also J.W.H. Clark to B.E. Talboys, 23 April 1979, AATJ, (IC) 7428, 2/1/32, W3566. There are other complaints in this file from pressure groups and trade associations about controls and regulations. There is a jargon-riddled article that contains a number of interesting details by Brian S. Roper, ‘Business Political Activism and the Emergence of the New Right in New Zealand, 1975 to 1987’ in Political Science, Vol. 44, December 1992, pp.1-23.
85. Sven Rydenfelt, ‘The Rise and Decline of a Welfare State’, reprinted by NZ Chambers of Commerce, Wellington, February 1979.
86. AS, 9 February 1979. Brash stressed the need for tax reform in a further speech, AS, 24 February 1979. Brash and the Planning Council had been preaching tax reform since May 1978. See EP, 20 May 1978, p.40. The only parts of Brash’s ‘package’ that were not part of the reforms after 1984 were the suggestions that death duties be abolished and that a capital gains tax should be introduced. Greenfield’s comments are in the EP, 15 March 1979. The four-year term was advocated by taxation specialist L.N. Ross, AS, 22 August 1978.
87. National’s intake in 1978 consisted of Michael Cox (Manawatu), Douglas Kidd (Marlborough), Ian McLean (Tarawera), Geoff Thompson (Horowhenua), Don McKinnon (Albany), Robin Gray (Clutha), Winston Peters (Hunua), Bruce Townshend (Kaimai), Pat Hunt (Pakuranga), and Paul East (Rotorua). Not all were ‘free marketeers’ but those who were joined forces with like minds from the 1975 intake, such as Jim McLay (Birkenhead), Warren Cooper (Otago) and Derek Quigley (Rangiora), to form a considerable group within the National caucus who favoured freeing up the economy. They were joined in 1981 by Simon Upton (Waikato), Ruth Richardson (Selwyn) and John Banks (Whangarei).
88. Hugh Templeton, pp.139-52. Muldoon makes a few comments about the coup attempt in his My Way, pp.162-7.1 am grateful to Jim McLay for his account of the plotting against Muldoon, which began, he says, from an evening of ‘whisky and wickedness’ among caucus colleagues.
89. There is information about the same process of change within the Australian Labor Party in Peter Walsh, Confessions of a Failed Finance Minister, Sydney 1995, Chapt. 5.
90. The new Labour intake after 1975 consisted of David Lange, who won a by-election in Mangere in March 1977, while the new Labour MPs in 1978 consisted of David Butcher (Hastings), John Terris (Western Hutt), David Caygill (St Albans), Ann Hercus (Lyttelton), Stan Rodger (Dunedin North) and Ralph Maxwell (Waitakere). Rejoining the caucus were Mike Moore (Papanui), Michael Bassett (Te Atatu), Kerry Burke (West Coast), Joe Walding (Palmerston North), Frank O’Flynn (Island Bay) and Jack Ridley (Taupo). By-elections in 1979–80 produced Geoffrey Palmer (Christchurch Central), Bruce Gregory (Northern Maori) and Fred Gerbic (Onehunga), while the 1981 election brought in Fran Wilde (Wellington Central), Margaret Shields (Kapiti), Helen Clark (Mt Albert), Philip Woollaston (Nelson), Michael Cullen (St Kilda), Bill Jeffries (Heretaunga), Phil Goff (Roskill), Peter Neilson (Miramar), Geoff Braybrooke (Napier). Colin Moyle (Hunua) rejoined the caucus in 1981, defeating Winston Peters in Otara.
91. See Ian Templeton, Sunday Star, 9 September 1992, p.A-9.
92. EP, 15 February 1979. Rowling outlined what was labelled ‘A Five-Year Plan for New Zealand’s Economic Health’ in the run-up to the 1981 election. See AS, 12 October 1981, p.6.
93. Vernon Wright, David Lange: Prime Minister, Wellington, 1984, Chapt. 14.
94. Roger Douglas, There’s Got to be a Better Way IA Practical ABC to Solving New Zealand’s Major Problems, Wellington, 1980. The book begins with the comments: ‘As at no other time in its history, New Zealand stands a divided, confused, dispirited Nation. It lacks a sense of clear direction for the future. Its loyalties are torn between conflicting interests, each determined to extract the maximum for itself with no regard to others. Its standard of living has dropped and continues to drop visibly. It stands on the brink of economic ruin. It has stifled innovation for mediocrity.’(p.9) There is a brief chapter on Roger Douglas in Simon Collins and Tony Keesing, Rogernomics: Is there a Better Way? Wellington, 1987, pp.2-17.
95. Bassett caucus notes, 12 December 1980, Bassett Papers.
1. ‘Current Economic Situation’, 1 December 1978, AALR, T/61/1/9/24, Box 269, Vol. 9, W4446.
2. Files of the task force are to be found in AALR, T/33/18/5, Box 28, W4446.
3. Hugh Templeton, All Honourable Men, p.117.
4. Gary Hawke to the author, 3 July 1997.
5. See file note following Treasury officials’ discussion with the Meat Board on 18 March 1982, AALR, T/82/2/5, Box 659, W4446. There are other papers about SMPs in AALR, T/83/1, Box 675, W4446.
6. See Dairy Board file, T/82/4/17, Box 664. There are similar stories about the Meat and Wool boards in T/82/2/17, and T/82/3, Box 661, W4446. For the earlier story of 1 per cent financing of boards, see Chapt. 9.
7. The era of increasing farm subsidies and the problems they caused for farmers are discussed in Brian Chamberlin, Farming and Subsidies: Debunking the Myth, Wellington, 1996. The figures relating to farm subsidies are included in AJHR, 1986, B-6, p.25. The story of one farming couple who in 1979 made an application for assistance to the Marginal Lands Board (set up in 1951 to award concessional loans to deserving applicants) is told in a commission of inquiry report entitled ‘The Marginal Lands Board Loan Affair’, AJHR, 1980, H-5. There is information about rising farm prices in T.M. Berthold to J.H. Falloon, 7 April 1983, AALR, T/83/1, Box 675, W4446. I am indebted to Professor Gary Hawke for comments on the predicament faced by many farmers in the 1980s.
8. See Chamberlin’s comments, Northern Farming World, April 1978, pp.1-2; also Provincial President’s Address, 1 May 1979. Auckland Federated Farmers resolved at their conference in June 1976 that they were ‘not in favour of any price smoothing scheme … unless the Government agrees to some satisfactory form of restriction on internal inflation’. The same conference argued that Federated Farmers should ‘take the strongest possible action to curb the declining profitability of farming and our decreasing relativity with other sections of the community’. See Northern Farming World, July 1976, p.4. I am indebted to Brian Chamberlin for his interview in April 1997.
9. AJHR, 1979, B-6. Changes to import licensing in the 1970s, and criticism of the whole experiment since 1938, are discussed in A.A. Smith and J. Burney, ‘Import Licensing’, in R.S. Deane, P.W.E. Nicholl and M.J. Walsh (eds), External Economic Structure and Policy, Wellington, 1981, pp.432-5.
10. A cost-of-living increase was incorporated in the budget on 3 July 1980. AJHR, 1980, B-6, p.ll. Muldoon and Skinner had neighbouring houses on Auckland’s eastern seafront and Sunday meetings between the two were regular occurrences. Skinner retired as President of the FOL in May 1979 and was succeeded by W. J. Knox, who had been Secretary.
11. Details of these schemes are set out in AJHR, 1980, B-6, pp.20-22. There is an analysis of the beneficiaries of industry assistance in J. Gibson and R. Lattimore, ‘Causes of the Pattern of Manufacturing Industry Assistance in New Zealand, 1981–82’, NZ Economic Papers, Vol. 25(1), 1991, pp.100-22.
12. Hugh Templeton, p.120.
13. There is material about Treasury’s work on taxes in AALR, T/61/9/1/6, W4446.
14. See Muldoon’s comments quoted by Ian Templeton, Sunday Star, 9 August 1992, p.A-9.
15. NZPD, Vol. 434, 4 November 1980, p.4685.
16. In 1961 the commission granted licences to 11 restaurants in New Zealand. John Gould observes that until the licensing changes in the early 1960s, if one wanted to celebrate, one ‘had a choice between a meal in a brewery hotel, where one was rushed through four predictable if wholesome set courses in sixty minutes flat (so as to save on penal overtime rates); or, in one or two of the larger cities, a very rare “quality” restaurant where, if one was prepared to risk the quite high probability of a visit by the police, the management would turn a blind eye to an introduced bottle of wine, preferably disguised as lemonade; or a meal in a superior fish-and-chip saloon, probably with tiled walls and a linoleum floor’, The Rake’s Progress”?, p.67. There is more detailed historical information on changes to the law in the report of the Royal Commission into the Sale of Liquor, 1974.
17. AS, 7 November 1978.
18. Hugh Templeton, Chapt. 6.
19. Muldoon’s caucus between 1975 and 1978 contained two women out of 55 members (Labour two out of 32); between 1978 and 1981 one out of 51 members (Labour three out of 40); and between 1981 and 1984 two out of 47 members (Labour six out of 43). National’s failure to promote women was the subject of a long article by Judith Aitken, subsequently Chief Executive of the Ministry of Women’s Affairs, in NBR, 14 December 1981, p.7.
20. Hugh Templeton, p.142. Fearing that Muldoon would take advice while overseas that could impact adversely on the New Zealand economy, Treasury usually sent a senior official with him to keep tabs on the information the Prime Minister was receiving. The only trip on which Treasury failed to send an official was the one immediately preceding the imposition of the wage-price freeze in June 1982. Discussion with B.V. Galvin, Secretary to the Treasury 1980–86, on 23 June 1997.
21. NZOYB, 1981, p.607; p.592; 1986–87, p.651.
22. Hugh Templeton, Chapts 13, 17 and 18, deal with CERand his difficulties with Muldoon. Some of the background to CER is also dealt with in a speech by Jim McLay, ‘CER and the Shifting Winds of Politics to the Year 2000’, 1994, of which the author has a copy. See also P.J. Lloyd, ‘Australia-New Zealand Trade Relations: NAFTA to CER’ in Sinclair (ed), Tasman Relations, Chapt. 8. The official documents associated with CER were printed in AJHR, 1983, A-20. An interesting booklet on the background to CER is Colin James, The Tasman Connection: A New Path, Wellington, 1982. See the 1982 budget, NZPD, Vol. 445, 5 August 1982, p.1756, for comments about CER. Muldoon’s later claim about CER is to be found in NZH, 12 January 1983, p.3. A review of the trading relationship between New Zealand and Australia following CER by Sir Frank Holmes entitled ‘The Trans Tasman Relationship’ was published by the Institute of Policy Studies, Wellington, in 1995. Another view was expressed by Greg Ansley, NZH, 1 May 1997, p.D2.
23. The savings from carless days are mentioned in the Energy Plan, 1980, D-6a, p.30.
24. An outline of the measures is contained in AJHR, 1980, D-6, p.9. I am indebted to Hon. Jim McLay, who discussed with me on 7 July 1997 the air of crisis that surrounded many of the 1979 Cabinet energy decisions.
25. There are four files about the Huntly power station up to 1978 in AALR, T/40/196/35, Box 192, W4446. The cost estimate comes from NZH, 11 September 1981, p.16. The station ran into competition from private and local authority producers of power once the industry was deregulated. By 1997 a station that employed 450 staff was down to 175. See NZH, 24 July 1997, p.3.
26. Muldoon set out his arguments for ‘Think Big’ in the last chapter of My Way, p.159. Jim McLay told the author on 7 July 1997 that Muldoon was ‘nearly rolled’ in Cabinet on the go-ahead for the methanol plant at Waitara.
27. The annual energy plans are to be found in AJHR, D-6a, starting in 1980.
28. Reports of the Liquid Fuels Trust Board began in 1979 and are to be found in AJHR, D-8. The production of methanol was an expensive process in which half the energy value of the gas was lost in the conversion. See NZH, 4 January 1982, Review ‘81, p.32.
29. AJHR, 1980, D-6, p.5. The figure for anticipated employees appears in the ‘1982 Energy Plan’, AJHR, D-6a, p.4.1 am grateful to Bob Tizard, who was Minister of Energy 1984–87, for discussing details of the ‘Think Big’ schemes.
30. NZH, 8 September 1981, p.2; AS, 10 October 1981.
31. A major and unfriendly analysis of ‘Think Big’ appeared in the AS, 9 October 1981. See also NBR, 14 September 1981, pp.10-11.
32. The final result in Taupo was a majority of 36 for the National candidate. Several other seats were retained by the Government with majorities of under 200. There is an analysis of the 1981 election results by Robert Chapman in Comment, August 1982, pp.11-18.
33. Financial Times (London), 18 January 1980. There is discussion about this article in AALR, T/61/1/9/24, Box 269, Vol. 9, W4446.
34. The report to Muldoon is in AALR, T52/822/6, W4446 in the form of a signed submission from B.V.Galvin to R.D. Muldoon, undated [December 1981]. Galvin confirmed to the author that he eventually approved the report.
35. On 15 April and 1 July 1997 the author discussed Treasury views with Roger Kerr and Dr Bryce Wilkinson, who were senior Treasury officials at the time. The author also discussed issues with Bernard Galvin on 23 June 1997.
36. Jim McLay, who became Muldoon’s Deputy Prime Minister in 1984, told the author that he had never seen Treasury’s post-election briefing to Muldoon in 1981 and had reason to believe that the Associate Ministers of Finance had not been shown it either.
37. See briefing papers in AALR, T/61/9/1/6, two volumes, W4446.
38. NZH, 13 January 1982, p.3. There is a reflective review on the economy in 1982 by P.J. Scherer in NZH, 6 January 1983, ‘Review ‘82’, p.22.
39. NZH, 4 January 1982, ‘Review ‘81’, p.32.
40. The figures for borrowing are drawn each year from the budget documents, AJHR, B-6, tables on financing the budget.
41. Douglas, Unfinished Business, p.23.
42. See Ian Templeton’s figures, Sunday Star, 9 August 1992, p.A-9. More complete figures are to be found in Table No.6 of the budget 1985, AJHR, B-6a, p.40. Government’s domestic borrowing stood at $4.1 billion in 1976 and $15.8 billion in 1985, for a total public debt of $28.2 billion. The percentage figures for expenditure on servicing the Government debt appear in the 1985 budget, NZPD, Vol. 463, 13 June 1985, p.4841.
43. This point is argued by Paul Dalziel and Ralph Lattimore in A Briefing on the New Zealand Macroeconomy, 1960–1990, Auckland, 1991, p.46.
44. NZH, 5 January 1983, p.1.
45. The costs of ‘Think Big’ are listed in AJHR, 1986, B-6, p.27. They do not include losses on several state trading organisations like the Coal Division of the Ministry of Energy whose affairs were affected by the major energy projects. The budget speech on 31 July 1986, NZPD, Vol. 473, pp.3294-316, contains further information and commentary about ‘Think Big’. There are many Treasury files dealing with the financing of ‘Think Big’ in AALR, W3993.
46. NZPD, Vol. 473, 31 July 1986, p.3301.
47. Douglas, Unfinished Business, p.24. See the figures in Peter Scherer’s article, NZH, 6 January 1983, ‘Review ‘82’, p.22.
48. NZH, 3 January 1983, p.2.
49. Kerry McDonald, ‘New Zealand Sinks with the Weight of Dead Economic Albatross’, AS, 19 September 1981.
50. Douglas, Unfinished Business, p.25. Also John Gould, The Rake’s Progress? pp.24-26. See also Roger Douglas press statement on 29 March 1984 outlining the real growth figures in GDP since 1975. Bassett Papers.
51. AS, 17 October 1981.
52. Quoted in an obituary of Wilson, Independent (London), 25 May 1995, p.22.
53. Inflation for the quarter to the end of June 1982 was running at an annual rate of 21.6 per cent. See AS, 9 July 1982.
54. Hugh Templeton, p.170. Jim McLay told the author on 7 July 1997 that the issue of the wage-price freeze was raised by Muldoon with his Cabinet as an oral item after discussions with the Cabinet Economic Committee. Those ministers not on CEC saw no papers about the issue and had no opportunity to discuss it with officials. I am indebted to Bernard Galvin, who discussed the circumstances surrounding the imposition of the freeze on 23 June 1997. Professor Gary Hawke also gave details of the background in a letter to the author on 3 July 1997. Both Roger Kerr and Bryce Wilkinson recalled the event in a discussion with the author on 1 July 1997. The courts subsequently declared some parts of the freeze invalid and the Government was obliged to rush through the Economic Stabilisation Amendment Act in December 1982 to validate the Order in Council of June 1982. See NZPD, Vol. 449, 16 December 1982, pp.5711ff. The Economic Stabilisation Act 1948 was eventually repealed in 1987.
55. The comment about Muldoon’s moods comes from an early biographer, Spiro Zavos, The Real Muldoon, Wellington, 1978, p.139.
56. NZH, 13 January 1983, p.l.
57. NZH, 12 January 1983, p.3.
58. The figures come from Paul Kennedy, Preparing for the Twenty-First Century, Toronto, 1993, pp.351-2.
59. Introduced on 12 October 1982, the Bill contained a complex regime to deal with tax shelters that enabled income to be converted into non-taxable capital gains by investment in property and subsequent sales. The Bill also widened some concessions, introduced a new tax regime for film making and provided for the taxation of some lump-sum superannuation schemes. NZPD, Vol. 447, 12 October 1982, pp.3919-24.
60. AS, 9 July 1982.
61. NZH, 17 April 1982, p.l. See Hugh Templeton, p.213.
62. Hugh Templeton, p.207. See DOM, 10 February 1984, and editorial, p.6. See also Jones’s comments, NZH, 26 June 1997, p.A4. See also Bob Jones, Memories of Muldoon, Christchurch, 1997. This book is a kind of retrospective apology to Jones’s old friend which nonetheless indicates considerable disagreement with the thrust of Muldoon’s policies in 1981–84.
63. NZH, 11 January 1983, p.4.
64. Lange tipped the scales at 27 stone (370 pounds) when he first entered Parliament in a by-election on 26 March 1977. A stomach operation in 1982 was discussed with a reporter from the New Zealand Woman’s Weekly, 10 May 1982, pp.4-5. The operation enabled Lange to buy new suits and gave him more energy and mobility. Lange’s life until he became Prime Minister is dealt with by Vernon Wright, David Lange: Prime Minister, Wellington, 1984. See also Listener, 5-11 February 1983, pp.14-17.
65. Holt shifted to Wellington in May 1983 to the position of Chief Historian within the Department of Internal Affairs. A personal friend of Auckland businessman Alan Gibbs, son of the author of the 1951 Taxation Review, Holt wrote several speeches for Lange and Douglas in 1982 and early 1983. Holt died suddenly on 24 July 1983. His paper ‘Ideas for the Eighties’ written in July 1979 had been published by the Labour Party’s Education Office in 1980. Holt’s paper analysing Labour’s 1981 election defeat, ‘The 1981 Election and the Future for Labour’, was circulated to all members of the Labour caucus early in 1982. Doug Andrew was a Treasury officer seconded to Lange’s office, and Geoff Swier was a commerce graduate who worked in Labour’s Research Bureau and then Douglas’s office when he was minister. Labour’s economic policy formation between 1981 and 1984 is analysed with the help of Douglas’s files, but with no sign of interviewing the participants, by W. Hugh Oliver in Brian Easton (ed), The Making of Rogernomics, Auckland, 1989.
66. NZH, 17 January 1984, p.l.
67. I am indebted to Hon. Jim McLay for his observations on 7 July 1997 about the debate over the corporatisation of Railways.
68. Announced in the 1978 budget, the review of transport was established in November. The review eventually led to the passage of the Transport Amendment Bill No.5, passed in October 1983. There are four boxes of material relating to the Transport Review in AALR, T/78/13/1, W4446.
69. Industry reform papers 1981–85 are to be found in AALR, T/61/1/9/5, Box 270, W4446.
70. Hugh Templeton, p.210. There is detail about internal opposition to Muldoon in NZH, 17 December 1983, p.5.
71. NZH, 8 January 1983, p.l. There is some information about the economy in 1983–84 in Treasury’s briefing paper to the new Minister of Finance in July 1984, pp.55-63. It was published on 27 August 1984 under the title Economic Management.
72. AS, 10 April 1984, editorial, p.A6; EP, 12 April 1984, p.4.
73. AS, 23 April 1984.
74. There is some discussion about the snap election decision in Marcia Russell, Revolution, Auckland, 1996, pp.49ff. See also Hugh Templeton, p.219. Diabetes caused another fatal (for his opponent) mistake when Sir Joseph Ward misread his speech notes during the 1928 election campaign.
75. Lange expressed this opinion to Labour’s key spokespeople on the evening of 14 June 1984, when it became known that Muldoon had been to see the Governor-General and had been granted a dissolution. Bassett Papers.
76. Galvin told Gary Hawke some time later that he experienced difficulty getting Muldoon to concentrate on the budget and other Treasury officials at the time conveyed this information to both Douglas and Lange. See also Gary Hawke to the author, 3 July 1997, p.5.
77. Several files dealing with hotel depreciation allowances are to be found in AALR, T/52/991/2/1, Box 258, W4446.
78. Details about Dairy Board borrowing are to be found in AALR, T/82/4/17, Boxes 661 and 664, W4446. Meat Board details are to be found in AALR, T/82/2/5, Box 659, W4446. Stephen Britton, ‘Recent Trends in the Internationalisation of the New Zealand Economy’, Australian Geographical Studies, Vol. 29, April 1991, pp.3-25, estimates that the broad range of producer subsidies came to $2 billion, or 6 per cent of GDP in 1984.
79. All figures are drawn from ‘Estimates of Expenditure’, 1983–84, and 1984–85, AJHR, B-7, part 1. See also the budgets, tables, commentaries and annexes, 1985–86, B-6 and B-6a. Templeton’s figure comes from NZPD, Vol. 449, 16 December 1982, p.5711. His total figure for employees on the government payroll in 1982 was 187,000. The $11 billion figure was often quoted in the late 1980s, when the Labour Government moved to reduce superannuation rights for public servants.
80. Derek Quigley, ‘Economic Reform: New Zealand in an International Perspective’, Round Table, Vol 339, 1996, p.311.
81. The phrase about Marciano was used by TV reporter Barry Shaw, NZH, 7 August 1992.
82. Brian Easton explores the relationship between ministers and officials over the exchange rate in ‘From Run to Float: The Making of the Rogernomics Exchange Rate Policy’, in Easton (ed), The Making of Rogernomics, pp.92-113.
83. The quotes come from Hugh Templeton, p.211. Jim McLay told the author on 7 July 1997 of his briefings by Treasury during Muldoon’s absence from New Zealand, and of his discussion with the Prime Minister on his return from overseas. McLay’s recommendations to the Prime Minister were greeted with dismissive grunts.
84. Roderick Deane, the then Deputy Governor of the Reserve Bank, quoted in Marcia Russell, Revolution, p.56.
85. The results of the election in detail are to be found in AJHR, 1984, E-9.