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New Zealand's Stranger Than Fiction Governing Arrangements

Chris Ford - 10/26/2005

New Zealand's general election outcome on September 17 was the closest in over a decade and has resulted in some of the most constitutionally bizarre governing arrangements seen in the nation's post-war history.

Under the nation's German-style electoral system, the incumbent centre-left Labour Party of Prime Minister Helen Clark gained the most seats winning 41% of the vote and 50 seats. Conversely the centre-right National Party of former central bank head Don Brash, after a strong campaign, finished up on 39% and 48 seats. Other parties that made it over the five percent official vote threshold were the conservative nationalist New Zealand First Party on 5.6% (7 seats) led by Winston Peters, and the more left-leaning Green Party on 5.3% (6 seats) under the co-leadership of Jeanette Fitzsimons and Rod Donald. Parties to have gained seats on the basis of their winning at least one electoral district under the New Zealand system (and claim some party list seats as a result) included Peter Dunne's Christian right-oriented United Future (three seats), Jim Anderton's centre-left Progressive Party (one seat) and the major winner of the election, Tariana Turia's Maori Party which claimed four of the seven electoral districts reserved for Maori voters.

The election result created a virtual 50/50 tie between the competing centre-left and centre-right governing blocs after a campaign dominated by debates over tax, social policy and race relations. This transpired as the centre-left parties (Labour, Green and Progressive) came under threat from the centre-right grouping (National, Act and United Future) after the Maori Party, formed out of indigenous Maori protest over the 2004 foreshore and seabed legislation (see Race Politics in New Zealand, Parts I, II and III) threatened to join them in opposition to Labour and thus create a 57-all deadlock in the nation's Parliament.

This would be the result if NZ First held to its pre-election promise to sit on Parliament's cross-benches and abstain on confidence and supply votes unless the party with the most seats, if it were successful in forming a government, was threatened with being brought down. Prime Minister Helen Clark's Labour, having won the most seats and therefore the right to claim first call on forming a government, wanted to avoid this scenario. So, in order to stave off this threat, Clark initiated discussions with both the centre-right leaning New Zealand First and United Future parties. She was particularly focused on getting NZ First to switch its position to what she described as a more "positive" support arrangement favouring Labour. At the same time, these same right wing parties were in discussion with the National Party, partly in order to strengthen their own position vis-à-vis with Labour.

On October 17, exactly one month after the election, Labour was successful in striking support deals with both NZ First and United Future and a policy agreement with the Green Party.


Constitutionally bizarre

The most fascinating and constitutionally bizarre aspect of these negotiations was the type of confidence and supply agreements concluded with both right wing parties by Labour that have not been seen in the country outside of wartime. 1

This is the case, as being a former British colony, New Zealand inherited many of the constitutional conventions practised within the Westminster system. These include the notions of collective responsibility within the cabinet (government executive) which requires all ministers to adhere to all policy decisions reached by government irrespective of whether they personally agree with them or not. Cabinet ministers in most democracies also come from the government party and/or parties. In New Zealand (unlike in the US and some European countries) all ministers must be elected parliamentarians.

All but the final rule was broken in order to secure NZ First and United Future support for the third term Labour-led government. Respectively, both the NZ First and United party leaders, Messrs Peters and Dunne, were brought off in return for their support with ministerial posts. In New Zealand a convention has grown since the late 1980s of appointing both an inner and outer cabinet (much on the same lines as exists in Britain and Australia). It was to this outer cabinet that both minor party leaders were appointed and besides their parties won significant policy concessions from the government in terms of a rise in age pensions and additional police for NZ First and a pledge to reduce taxes on families for United Future.

The most significant and for some bizarre innovation is that both Peters and Dunne were given ministries on the basis that their parties did not have to support all government policy moves on an 'agree to disagree' basis. Furthermore, both these ministers are personally free to criticise the government on any issue provided it lies outside their portfolio responsibilities which are the all important Foreign Affairs post for Winston Peters and Revenue (Taxation) for Peter Dunne. Moreover, these parties are not considered to be formally part of the new Labour-led government as the official coalition consists of it and Jim Anderton's Progressive Party.

By contrast, the Green Party, considered to be more of a natural partner for Labour, concluded a more conventional policy agreement with PM Clark whereby in return for effectively abstaining on confidence and supply votes, it won concessions in terms of both a solar energy and buy New Zealand made campaign from the new government. However, they were not given any cabinet posts but they could be given crucial parliamentary committee chairpersonships in return. 2

The reason why these agreements were concluded lies in recent political history. Recent coalition governments, including that between National and New Zealand First in the late 1990s and the 1999-2002 Labour-Alliance Government fell apart because the junior partners in both cases (NZ First and the Alliance respectively) polled poorly while in government. This was the result of the larger governing partner in most cases taking credit for policy wins that were gained due to pressure from the smaller parties, hence diminishing their identity. These and other issues helped create tensions within both NZ First and the Alliance during their respective times in government which led to the near extinction of both parties.


Questions raised

All this raises a number of questions.

The first is how will this new constitutional/political arrangement be effective? More to the point can it be? This question is relevant as Winston Peters holds the key Foreign Minister role but outside of government. Currently nowhere in the world is there a key cabinet minister, let alone a Foreign Minister, who is outside of their executive. This raises issues of how influential can Peters be as Foreign Minister if he is seen to be outside of the government and yet speaking for it? This paradox is further complicated by Peters' own past behaviour in that his party was opposed to the huge wave of Asian immigration that occurred in New Zealand during the late 1980s and early 1990s. As a party of conservative economic nationalism NZ First is also opposed to the free trade deal that New Zealand is currently negotiating with China. Yet his new Foreign Affairs and Trade Ministry handles these same trade negotiations on behalf of the New Zealand Government.

Peters attempted to handle these questions upon his appointment by effectively saying that he and his party would still vote against the trade agreement legislation when it reached Parliament as all trade negotiations would be handled by the country's incoming Trade Minister Phil Goff. This is a doable proposition as the country's Trade Minister is appointed to a separate portfolio even though the same ministry is answerable to both Goff and Peters. But this means there is potential for disagreements on trade and other related economic issues to arise and this could seriously tarnish the country's image abroad.


Potential for infighting wide

The potential for infighting is wide within what PM Clark has called in the media an "extended confidence and supply agreement". The potential for internal party infighting is already rearing its ugly head within NZ First. On the day of the government's appointment, New Zealand First Party President and MP Doug Woolerton resigned his party post stating that he openly disagreed with the new governing arrangement. A day later, the party's Deputy Leader Peter Brown said that despite their leader being a minister, the party was still an opposition party.

These statements were also made with the party's support base in mind. Peters' pre-election promise to not join government in any shape or form has effectively been broken and while not many opinion polls have come out since the election, it is expected that NZ First support will steadily decline as a result fuelling further tensions within the party and more pressure on Peters to distance himself from Labour thus leading to potential instability. United Future due to it holding fewer seats and having had a formal support arrangement in the last Parliament with Labour is expected to present a lesser challenge to the Clark Government.


Clark has the cards

Even if the Labour-led administration comes under threat from Peters withdrawing his support, Clark has more cards to play. She could try and bring the Maori Party into government by promising to review the foreshore and seabed law (as National reportedly tried to do) and make other policy concessions but this could backfire amongst some of Labour's European working and lower-middle class supporters who resent additional 'concessions' to Maori. She could also bring the Greens into a more formal governing coalition which would find favour with many traditional and progressive Labour supporters who are concerned with the rightwards drift of the new governing arrangements. Otherwise, if no agreements were secured on any of these fronts, governmental collapse would result and a new election and/or a parliamentary vote could install a National-led centre-right government.

Currently it looks as if the old Chinese proverb 'may you live in interesting times' will be an apt one within the New Zealand political context over the next three years. The country faces an economic slowdown that may test the stability of the new administration arrangements at an early stage. Perhaps though it maybe a catastrophe such as a possible flu pandemic or a terrorist strike on neighbouring Australia that may cement the government together in a way not foreseen by critics.

Whatever the next three years may bring, one thing is certain in that constitutional specialists throughout the world will have a stranger than fiction governing arrangement to examine.