Polls show the most likely governing arrangement after the election on October 14 will be some combination of the National, Act, and New Zealand First parties.
The possibility that National and Act could govern alone remains on the table, and has been slightly bolstered by the (tragic) death of an electoral candidate in Port Waikato.
A quirk of electoral law means that an extra list seat will be added to Parliament in lieu of the electorate vote, and will stay even after a by-election has been held to elect a local MP.
The likely outcome of that process is that National will pick up one extra seat. This could be enough to get a two party government, although it's not what our polling average shows.
Even if National and Act are able to scrape together the 61 seats required to form a majority, they may still need some support from NZ First to provide a buffer.
Having a one seat majority would leave a government vulnerable to by-elections, rebel members, and resignations. Extra votes on confidence and supply would be welcomed.
While the three parties’ policy goals are broadly aligned, they will still have to work through a handful of thorny issues.
The culture wars
The National Party is a broad church coalition that includes socially progressive and conservative members. It aims to keep up with voters, who are relatively socially liberal.
The NZ First and Act parties represent more niche groups, some of whom are more interested in American-style culture wars than the average New Zealander.
Voters that support these parties are likely to be highly motivated by concerns around co-governance, gender issues, and ‘wokeism’.
This is difficult ground for National which doesn’t want to be forced into taking a strong stance on issues that could alienate parts of its voter base.
Act has said holding a referendum to redefine the Treaty of Waitangi would be a priority in coalition negotiations. NZ First also has campaigned on lessening the legal rights of Māori.
The previous National Government was in coalition with the Māori Party and made significant progress on treaty settlements, which had begun under Jim Bolger in 1990.
Christopher Luxon, the current party leader, has said he doesn’t support the referendum but would work it out in negotiations.
He has also ruled out NZ First’s policy which would require public buildings to have unisex bathrooms, which transgender people would be required to use.
National opposes the ill-defined idea of ‘co-governance’, but still supports the concept of Māori–Crown ‘partnership’ as agreed in the treaty.
Size of the government
All three parties agree there should be less government, but disagree on how much.
National wants to cut public sector budgets by 6.5%, while Act wants to slash staff numbers back to 2017 levels. The latter would close four ministries in their entirety.
NZ First’s stance on the size of the Government is somewhat amorphous. It opposes spending in some areas, but has also proposed significant expansions in others.
One sentence in its manifesto seems to suggest the party would hack Crown spending by more than $6 billion next year to deliver a surplus immediately.
It reads: “NZ First’s fiscal policy is to create surpluses to deal with unfunded commitments and to pay down debt by setting total government expenses at no more than $165bn, while holding core government expenses to no more than $133bn for 2024/25”.
NZ First appears to have taken the revenue forecast in the Pre-Election Economic and Fiscal Update and proposed that as a hard spending cap. All other parties expect to stay in deficit for several years.
Even scrapping National’s tax cuts, while keeping the revenue and spending cuts, wouldn’t be enough to balance the budget next year. There would still be a roughly $3 billion deficit.
NZ First has also promised a 50% rebate of local government rates for retirees, several billion in extra healthcare spending, money for 500 new police officers, and a tax cut.
The rates rebate policy was costed at $1.2 billion in one part of the manifesto and also “approximately $480m” in another section. Many policy costs were not estimated at all.
Winston Peters told reporters the release of the manifesto had to be delayed until after the Reserve Bank announced its Official Cash Rate decision last week. However, there was no sign the interest rate had been used in any financial modelling and there was no attempt to calculate the net fiscal impact of the various policies.
Tax policy
National has staked its campaign on its tax policy and has suggested it will be non-negotiable during coalition talks. There is unlikely to be much scope for change here.
The Act Party supports tax cuts but wants to prioritise balancing the budget first, and has proposed a much flatter tax system than National.
It wants to move from five income tax rates to just three over the next few years, ranging from 17% to 33%.
NZ First wants the first $14,000 of income to be tax free, current brackets to be indexed to inflation, and a select committee inquiry to look at making food GST-free.
It also wants a committee to explore the possibility of lifting the minimum wage to $25 and giving business tax concessions to help cover the costs.
Another vague policy says “Undertake a Select Committee Inquiry on the introduction [of] an exporters tax of 20% for new business or product lines” with no further explanation.
Retirement age
National and Act agree the age of eligibility for superannuation needs to be lifted to 67 years, they just disagree on how quickly to move. National would hold off until 2044, whereas Act wants to get there by 2028.
NZ First opposes any change to the age and appears to consider it a bottom line.
“The age of retirement will remain at 65 years. No ifs, buts, or maybes,” the manifesto says.
The party also proposes allowing homeowners to withdraw KiwiSaver funds to pay down their mortgages and several other policies for aged people.
Climate change
On the campaign trail, Peters has appeared sceptical about climate change but the manifesto itself acknowledges it as a “pressing issue”.
The Act Party believes in climate change but doesn’t currently have any policies on its website to combat it.
Instead, it has proposed repealing the Zero Carbon Act and only wants to reduce emissions at the same rate as our trading partners.
NZ First agrees and says it would not support agricultural emissions pricing “in any form” unless adopted by trading partners, especially the European Union.
National will have to face down both parties in coalition talks. Luxon has ruled out repealing the Zero Carbon Act and said there was no room for climate scepticism this election.
The party plans to meet its international climate change pledges and price farm emissions by 2030 “at the latest”.
Pet projects
While Act and NZ First fight over a similar set of voters, the two parties are ideologically quite far apart. One is a free-trade libertarian party and the other a nationalist interventionist one.
The two may butt heads over NZ First’s desire to break up vertically-integrated supermarkets and energy companies. It also wants to give Kiwibank more capital, while Act wants to sell it.
NZ First has proposed a new version of the Provincial Growth Fund, secured as part of its coalition negotiations with Labour in 2017, called the Regional Productivity Growth Fund.
It would be focused on building infrastructure that helped “unblock” regional businesses and grow jobs.
“This is different from long-lived public infrastructure as it is focussed on providing modal solutions, opening up land, sea and the seafloor, water supply, power and internet to get all regions humming,” the manifesto says.
Act’s David Seymour has previously called the Provincial Growth Fund a “slush fund” and would be unlikely to support creating another one.
National has said it would expect “much greater rigour in ensuring investments have clear goals for growth and [are] monitored for outcomes” if the PGF was to be continued.
80 Comments
"NZ First has also promised a 50% rebate of local government rates for retirees"
An appalling handout to the asset rich, inevitably funded by higher taxes or reduced services for the productive sector of society.
50% rates rebate, but good luck ever seeing the grandkids again, they'll be off to Aussie.
Nope, although at least the rubbish is being picked up again. First 6 months of the year it was hopeless.
Meanwhile we will turn SH45 into a bike lane (to save on carbon) while trucking our recyling to Auckland, our Greenwaste to Hamilton, and our Rubbish to Marton.
I take it you've finally made up your mind about who to vote for then? Wonders never cease ... next we will find Lord Lucan.
In all seriousness, I haven't voted yet and while I don't think things will be as bad as you make out there are definitely some downsides to the (likely) right coalition. If only I was still in Raf's electorate and I could give him my tick.
That being said, I do believe Labour has only itself to blame. How you can have an absolute majority and waste that opportunity so badly that three years later you're potentially about to take the biggest political beating since Julius Caesar decided to poke his head into a Senate meeting, I don't really understand.
I don't think that many people are voting for the right parties' policies as they are voicing their displeasure at Labour's track record (which must be fairly nonexistent as they aren't campaigning on it are they?) Wild to think that because one party has done such an appalling job we are basically forced by default to accept something that will at best be no worse - albeit in a different way.
Is that "right" ... probably not, but when did you ever have to be right to vote?
In the end I decided Labour were the safest choice, especially when I found out how pathetic the tax cuts were. But I may actually make a tactical National vote now, I really dislike ACT and NZF so the more votes National get the better. Kind of like when the right voted Labour to exclude the greens.
Agree that the tax cuts are pathetic from National - they would have been far better to just say "we will index brackets to inflation - and update that every year" and not push any specific cuts, as from an optics perspective they've spent half the campaign arguing the merits of what is ultimately a rather underwhelming package.
With my marketing hat on, I'd love to share my thoughts on the rubbishness of National's campaign and messaging to whoever is responsible for it.
Things could get far worse…just look at outcome of Liz Truss’s election if you want to understand what can happen when a government tries to implement irresponsible fiscal policy, unfunded tax cuts, etc…. And if you’re still in doubt start looking at Argentina, Lebanon, Venezuela et all…
“Size of the government” as captioned. All agreed then. Less would be good. How about then, starting at the top. Reduce the number of mps to 90. That was the number at the time of the introduction of MMPand about which, the relative Royal Commission stated there was absolutely no need for any increase.,Cannot imagine that any voter in any electorate would not welcome a reduction of 25% of these identities clowning around in Wellington.
Guy Williams (who is a "comedian" - I use the term loosely, I've had more humorous bowel movements after a night on the vindaloo and beers) approached Luxon and asked him if he believed in dinosaurs, to which Luxon said "see ya" or something like that and walked away. Apparently this is evidence that Luxon believes the Earth is only 6000 years old and dinosaurs are fictional creatures from a movie called Jurassic Park ... or something like that.
I'd say more likely that Luxon (and anybody else with a brain) knows that Guy Williams is a bit of a weirdo and to be avoided. It was of course, in typical Luxon fashion, a dumb move as he should have just answered the question, shut it down and moved on rather than making a headline out of it.
It's like an even sillier version of whomever put Hipkins on the spot that time by asking him if could define what a woman is. The sort of hard-hitting political discourse the country really needs right now.
This was cleared up yesterday when luxon said he did believe dinosaurs existed.
Of course, as a christian, he presumably believes in the book of revelation and that a jewish man performed some miracles 2000 years ago. Is that better than not believing dinosaurs existed?
The only way ACT gets leverage would be if National could either pick NZF or ACT to form a majority. Ironically it might be the case that if you support ACT's policies, a vote for NZF could make them a more realistic prospect. If NZF is absent entirely, what bargaining power would ACT have?
I disagree. NZF is fundamentally socially conservative and economically left. ACT is the opposite. There's some overlap in the emphasis on self-responsibility and incarceration but honestly I think they're more dissimilar than similar, which is why they conflict. Contrast to TPM and Greens, who are fully aligned; in the leaders' debates, Greens and TPM leaders are indistinguishable.
the new poll out has NZF taking ACT votes and now will have more Mps than ACT so weakens Acts hand a lot
national will be stopped from selling our houses offshore unless they up the value to above 5 million, the tax cuts are a dead duck BUT the cuts to government departments will still happen as will the crime stuff
This has been debated and settled in New Zealand's courts (as is practice in Western democracies) ref:
The principle of partnership is well-established in Treaty jurisprudence. Both the Courts and the Waitangi Tribunal frequently refer to the concept of partnership to describe the relationship between the Crown and Mäori.
Partnership can be usefully regarded as an overarching tenet, from which other key principles have been derived. While there appears to be substantial concurrence in the views of the Courts and Tribunal on the issue of partnership, the two bodies have sometimes differed in the language they use to give substance to the principle.
Link: https://www.waitangitribunal.govt.nz/assets/Documents/Publications/WT-P…
It needs to be debated & settled by the people of NZ - all of them.
As we all know, Courts can get a lot wrong (some history of this at the link below) & the Tribunal can only make recommendations not law.
Starting with the Crown cannot enter into a partnership with it's subjects.
The Treaty doesn't mention partnership at all, nor imply it. The fact that sovereignty was ceded mandates the exact opposite of a partnership. The partnership claim is absurd. For something this fundamental to the country a referendum on principles is required.
"The chiefs of the Confederation and all the chiefs who have not joined that Confederation give absolutely to the Queen of England for ever the complete government over their land." This is the direct translation of the Māori version. This unambiguous statement mandating one Crown Government has inexplicably been interpreted by some as allowing for partnership and/or co-governance. Next you'll be telling me that the Queen ceded sovereignty to the Māori chiefs.
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