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National Primed For 4th Term

Insights Into Politics:

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Ringside on Politics – National’s success in Saturday’s election shows the party is much more than the “John Key effect.” After Key stepped down at the end of last year, his deputy, Bill English, became PM. National appeared to be cruising to victory until Greens co-leader Metiria Turei’s confession about lying to the Department of Social Welfare in the 1990s triggered a series of upsets, one of which led to the ascension of Jacinda Ardern as Labour leader.

Ardern appeared to have enormous popularity, reflected in huge rises for Labour in the polls and in a phenomenon dubbed the “Jacinda effect.” There were doubts that dour English could match his youthful, optimistic opponent. He also faced the difficult task of trying to return National for a fourth term. But he outperformed Ardern , his 46% more than the 44.93% National won in 2008. Ardern were more than 10 percentage points behind. These percentages may change after special votes are counted.

Most Minor Parties Shut Out - The battle between the National and Labour leaders led voters to shun the minor parties and only five parties remain in Parliament. Only one of National’s support partners for the last three terms remains. Peter Dunne’s resignation spelled the end of United Future. The Maori Party is out, with Labour now holding all seven Maori seats. ACT returned, but only thanks to its special deal in Epsom, where National voters are encouraged to give their electorate vote to David Seymour and their party vote to National. ACT won only 0.5% of the party vote.

The Greens are unlikely to form a coalition with National, although adding their 5.9% could allow National to form a Govt.

Return of the PM Maker - Winston Peters’ NZ First garnered 7.5% and it could form or give confidence and supply support to either National or Labour. However, on current seats, it would be simplest for Peters to form a two-party coalition with National (probably excluding ACT), with a Govt with a total of 67 seats. Forming a Govt with Labour would also have to involve the Greens who have bickered with Peters, and would create a three-party coalition with a precarious total of only 61 seats. It would take the defection of only one MP from any of the three parties or perhaps a death leading to a by-election and such a Govt could fall. Expect Peters to haggle, but the diminished size of his own party and the mandate English has will probably lead to him having to limit his demands.


The Economy – Much of the country’s short to medium term economic future will still be decided beyond our borders as evidenced by global market volatility to which NZ is still particularly vulnerable. Dairy farm debt is shaping as a major problem. Auckland's housing crisis is finally beginning to recede as restrictions on investors in particular start to bite.

Business & Economic Trends – Growth is spectacular but predicted to slip slightly by year’s end although the Trump factor could cause more dramatic changes. Inflation appears to have been tamed for now - in fact it is being seen as too low. The dollar however is on an upward trend again as markets digest the Trump presidency and Brexit. The big problem for NZ outside global market volatility and a potential crash in China.

Is there an alternative for NZ if the China trade goes bad? The TPP agreement is now effectively dead. PM English is negotiating for a quick UK trade deal post Brexit and talks on other deals with India and the EU are ongoing, but a Trump presidency is likely to bring in a new era of protectionism and the era of globalisation could in fact be dead - a big task ahead for the Government and Trade Minister McClay.

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Our special weekly “In the Lobby” column goes right to the heart of what’s happening in the Select Committees and looks at the driving forces in them, the work they’re doing, and their impact on Govt.


Trade – Businesses are benefiting from new Free Trade deals, especially the one signed with China. Asian markets are growing while European economies are still finding the going tough. But the Trans Pacific Partnership is dead. Climate change, and the environment, are moving to be high not just on the political, but also the business, agenda. Water management has become one of the battle grounds for political advantage.

The Sharemarket & Companies in the News - How will you fare as global markets go through a period of volatility? The swings – and roundabouts. What are the forces at work? Running the rule over the blue chips. Keeping an eye on the “sleepers” who may be tomorrow’s high-fliers. Spotting the movers and the shakers.

Select Committees - See what the Committees are doing and what they are thinking in our Select Committees column.

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Trans Tasman Political Alert has a team of 6 highly-qualified specialist contributors, analysing discussions & decisions, looking at potential repercussions, identifying trends, listening to Select Committee debate & reporting on opinions, submissions & personalities. We draw upon a wide range of sources close to the Beehive inner circle who wish to remain anonymous, for obvious reasons.

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IN THIS WEEK'S ISSUE

21 September 2017

  • This Week...Expect the unexpected on election day. That’s not only because the main public polls have produced contradictory results, but also because the campaign has been like no other in recent memory.
  • As the drag race between the two main parties approaches the finish line, it’s opaque what kind of Govt will emerge. It might be National-Maori Party-ACT, National-NZ First, or even National on its own if National wins the most party votes. Otherwise, it could be Labour-NZ First, Labour-Green-NZ First, or Labour-Green-Maori Party.
  • Over the campaign National has made ground in the regions, but in Auckland, apart from its strongholds on the North Shore and across the affluent suburbs to the east. Jacinda Ardern may be able to capture party votes in the West Auckland electorates where National did well under John Key.
  • And methodologies used by political pollsters look likely to come under scrutiny after Saturday’s election. Conflicting opinion polls by the public pollsters have reflected wide variations sufficient to skew perceptions one way or the other.

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