Ok, about time a Kiwi actually got in on this thread!
In the early 1990's the then newly elected National Govt (centre-right) slashed the Defence budget. There were no capability cuts, they just hacked something like 40% off the funding stream, on the pretext of the 'peace-dividend' as a result of the end of the cold-war.
As you can imagine by the end of the 1990's the NZDF was very seriously showing signs of withering away. The RNZAF's 10 Andover Transports were gone without replacement; personnel had had a gutsful of no pay-rises in almost a decade & left; the Army still largely had Vietnam era equipment; the Navy gave up it's patrol fleet (gladly some would say - they were like corks!)....etc,etc, you gte the picture.
However at that stage Naional woke-up to the fact that the NZDF had become to an extent dysfunctional and started looking at spending. The key argument was a 3rd ANZAC frigate vs F-16 cheal via USA. National took the latter option. Other than some high-profile re-equipment programmes, basic infrastructure & pay rates were largely not addressed.
2000 Labour (Centre-Left) gets into power. Faced with increasing issues of obsolesence (many highlighted by the East Timor deploymeny 1999-2001) they decided something hd to be done.
This Govt was (& still is) very much made-up of academics & it's clear spending on high-tech weaponry was / is extremely distasteful to many of those in Govt....pity they don't find the concept of unprepared service personnel dying as distasteful!
Anyway - Labour have in fact committed what is for NZ historically a huge boost in spending to get the NZDF back on track - something that's well underway. However in reality that funding boost amounts to little more than restoring what would have been the status-quo before the savage cuts in the early 90's.
The Govt has had to balance the various needs of each service & made some hard calls - the most obvious being disbanding the RNZAF's combat wing. Man was I disgusted by that - no consultation - they just did it! They commisioned the usual biased reports but even when the key one came out against scrapping the entire combat wing, they just ignored the recommendation - and Australia's disgust, and did it!
Now okay, they did have some hard decisions to make - but we still only spend a tiny amount of our GDP on Defence compared to most of the globe - yet we're enjoying huge govt surpluses (well we taxpayers aren't, the govt is!).
The idea with their defence policy is to develop a small but niche peacekeeping force based around the Army with RNZAF & Navy in support. This is an easy sell to the NZ public as most of us are pig-ognornat about Defence matters - so of course the Govt's going to capitalise on this!
What they've so far created is a Defence force designed & equipped for peacekeeping that would be largely incapable of operating independent of allies in any elevated threat sceanrio (ie: primarily Australia)....sorry fellow kiwi's, but I stand by that assessment!
My god it makes me sick to see what the ADF is having spent on it - but you can bet the NZ govt is loving it - more to leverage (bludge?) off the good old Aussies!
Okay - to be fair we have a very small population (4m) & a land mass larger than the UK - plus we're in the middle of nowhere geographically. The chances of invasion are remote (but not impossible) - but the NZDF is really about making a regional contribution - and that's where a combat wing could be used. In the past it was available to deploy to Aussie (or S.E. Asia), from where it would operate as required - can't see that this isn't still a valid option.
Okay so the combat wing's gone - but the NZDF has no significant airborne fire-power, the Navy has decent frigates that are lightly armed & need upgrading; the Army has great LAV's & decent 105mm artillery, but little modern ISR capability so again relies on others for specialsied equipment & support.
The NZDF has extremely high professional standards which have helped but at the end of the day - it can only operate under the umbrella of the ADF & others. Mind you this is a valid expectation - it's just the degree of dependency that irks me!
When the combat wing was dropped it was described as 'refocuing the RNZAF to a transport & maritime support role. The RNZAF did NOT get any additional capaicty in either area. We have 7 transport aircraft (5 x C130H & 2 x B757) - both getting decent upgrades, but (as yet) no self protection systems. There's 6 x P-3K (B) getting decent upgrades but this excludes the anti-sub systems, anti-ship missiles; & (as yet) self-protection - yah they're still cutting corners! Sorry kiwis, but I don't call that a committment to those capabilities.
Worse still the RNZAF has no capacity to support the Army - even in peacekeeping this should extend further than a Huey with 2 x M60 door guns! (very Vietnam!).
Okay to answer the question 'was NZ right to scrap the combat wing'? - the answer is NO - because it was nothing more than a (massive) reduction in capability.
The answer would have been YES - if it had been accompanied by an investment in desperately needed transport aircraft & provision of ARH (eg: Aussie Tigers etc) to enable the RNZAF to provide a meaningful capability to support deployed forces (NZ or allies) when the crap starts flying!