What a National-NZ First Govt might actually do

The implosion of unity and goodwill between Labour, the Greens and New Zealand First has increased the chances of a National-New Zealand First Government. Bernard Hickey looks at what policies they might agree on.

With just under 10 weeks to go before the election and signs of increasing divisions between Labour, the Greens and New Zealand First, it's worth looking at what policies a National-New Zealand Government might adopt.

New Zealand First Leader Winston Peters has progressively laid out some of his key demands and reiterated his main policies in recent days, including some that National may be willing to adopt to stay in power.

Those policies and 'bottom lines' include:

1. Changing the Reserve Bank Act to broaden the bank's focus beyond inflation to include economic growth, employment and the value of the currency.

2. Banning foreign buying of land and setting up a foreign ownership register.

3. Reducing net migration to 10,000 per annum from over 70,000, although New Zealand First has yet to specify what policies it would pursue to achieve that, other than capping and restricting family reunion and the migration of older migrants. Achieving that sort of cut in a short period of time would cripple the international education industry and severely restrict the dairy, wine, kiwifruit, apple, aged care and tourism industries, which are increasingly dependent on temporary migrant workers.

4. Having a referendum on removing the Maori seats and on reducing the number of MPs. National's official policy is to remove the Maori seats, although it has been dormant since National's formed governing arrangements with the Maori Party.

5. Building a railway link between the Whangarei to Auckland line and the Marsden Point port at a cost of over $100 million so more port operations can be shifted from Auckland to Northport. National is currently conducting a review of its investments in KiwiRail.

6. Not changing the age of eligibility for New Zealand Superannuation from 65.

Other policies that New Zealand First might introduce into Government-forming negotiations include removing GST on food, making Kiwibank the Government's official bank (rather than Westpac) and introducing a Government-owned 'Kiwifund' option for Kiwisavers.

Winston Peters' speech to his party's annual conference on Sunday laid out many of his policy priorities.

Chances of a Labour-Green-New Zealand Government appeared to dissolve over the last week under a welter of insults between the respective leaders, ending years of an apparent truce when they focused their attacks on National.

Greens Co-Leader Metiria Turei accused Peters of being racist last weekend, looking to differentiate the party from New Zealand First and create some leverage. She also said a Labour-New Zealand First Government would be unacceptable. Green MP Barry Coates then said the Greens caucus had discussed whether it would would force a new election rather than allow a Labour-New Zealand First Government.

Peters described Coates' threat as the "height of political stupidity" and said there would be consequences for Turei's accusation of racism.

Labour Leader Andrew Little then accused Peters of leaking UMR poll results that showed Labour's support down to 26 percent and New Zealand First up to 14 percent, and ahead of the Greens on 13 percent.

Peters suggested that list candidate Little would not be in Parliament if Labour sank to 22 percent. That sparked speculation from Paddy Gower that Peters was quietly looking to undermine Little so he could swoop in and become Prime Minister of a leaderless Labour-Green-New Zealand first coalition after the election.

Little didn't take kindly to the idea. He described Peters as a "blowhard and this is blowhard politics."

"In the end this election isn't going to be fought on the basis of swinging dicks. It is going to be fought on the basis of what party has demonstrated that they are listening to the real concerns of New Zealanders," Little said of Peters in a NZ Herald interview.

The Green-Labour memorandum of understanding aimed at changing the Government also appeared to be in trouble this week as the Green Party launched a social welfare and tax policy that was significantly more left-leaning than Labour and aimed at gathering votes of Labour supporters. The decision by the Greens to support National's Working For Families package in Parliament and in opposition to Labour also surprised and disappointed Labour politicians.

National, meanwhile, were able to sit back and point across the political aisle at the infighting and contrast that with nine years of relative political stability within National's agreements with ACT, United Future and the Maori party.

"I think the public is entitled to think 'well, gosh, is this the alternative?'" Finance Minister and Campaign Manager Steven Joyce told reporters in Parliament on Monday.

National was able to successfully portray the opposition as disorganised and divided during the 2014 election campaign. Its television advertisement showing National's sleek competitive rowing boat vs a rowboat of chaotic paddlers was particularly effective.

However, National's poll standing of around 45 percent suggests it will still need New Zealand First's support to govern, given the relative weakness of ACT, the Maori Party and United Future.

Winston Peters could also still choose to join a Labour-Green Government in exchange for the types of policies outlined above, which are more in tune with the policies outlined by both Labour and the Greens. His relations with Prime Minister Bill English have also deteriorated in recent weeks over the Todd Barclay affair, with Peters calling for English to resign and saying in Parliament he was guilty of a crime.

Peters has always kept his options open to preserve his negotiating power with both and is unlikely to declare his hand before September 23. But the implosion of any sense of unity between the opposition parties has increased the chances of National being able to portray itself as a stability candidate in a strong position to soften Peters' bottom lines.

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