NZ First, Labour agree $1b regional fund

Prime Minister designate Jacinda Ardern and New Zealand First Leader Winston Peters have agreed to a coalition agreement that includes a mechanism to ban non-residents from buying existing homes and a $1 billion regional development fund.

But the deal did not include many of New Zealand First's more expensive and politically difficult promises, including removing GST on food or rebating GST on tourism spending to the regions. New Zealand First also failed to win a plan to move the Port of Auckland to Auckland. Instead, they agreed simply to study the feasibility of such a move.

Ardern said the agreements with New Zealand First and the Greens were incorporated within its existing fiscal framework that envisages budget surpluses and debt repayment.

However, New Zealand First did appear to secure 95 percent subsidies for the agriculture sector in an emissions trading scheme. Labour had proposed that Agriculture be 90 percent exempt from emissions charges. The Greens had wanted Agriculture to be fully included.

New Zealand's biggest win for workers was an agreement to lift the minimum wage from $15.75/hour now to $20 an hour by 2020.

Meanwhile, the Greens secured a reprioritisation of the Land Transport Fund to increase investment in rail in cities and regions, and on cycling and walking. Previously the fund was cordoned off to spending on roads. The Greens also won a plan for a Government-backed Green investment fund of $100 million and the cancellation of the East-West motorway link in Auckland.

Here is the other key details in the Labour New Zealand First agreement:

No mention was made in the agreement on a formal ban on foreign buying of existing houses, which was Labour policy and had been signalled earlier this week as the likely agreement. This was short of the full ban on purchases of both land and houses by New Zealand First. Ardern said they had agreed on a 'mechanism' to ban foreign buying, without ruling out the use of a stamp duty to achieve that. New Zealand's Free Trade Agreement precludes an outright ban, but the previous Government said stamp duties were an option and Peters said he would accept a mechanism that earned revenues.

They agreed to create a $1 billion regional development fund that would invest significantly in regional rail and plant 100 million trees per year in a billion trees planting programme.

They agreed to commission a feasibility study on the options for moving the Ports of Auckland, including giving Northport "serious consideration".

Other large scale (but unidentified) capital projects would be awarded from the $1 billion fund.

A commitment to relocate government functions into the regions, without specifying which functions or which regions.

The re-establishment of the New Zealand Forestry Service.

An unspecified increase in BioSecurity NZ's resourcing and a select committee inquiry into biosecurity.

Honouring existing Crown Irrigation investment commitments, but not to make any more commitments.

Reviewing and reforming the Reserve Bank Act to include an employment mandate as well as an inflation one, along with changing the current single decision maker system.

They agreed to strengthen the Overseas Investment Act (although no details were given on how this would be done) and create a comprehensive register of foreign-owned land and housing.

They agreed to work to increase Research and Development spending to two percent of GDP over 10 years. It was 1.3 percent in 2016 and is below the OECD average of 2.4 percent.

They agreed to re-establish the Mental Health Commission.

Fund an annual free health check for seniors, including an eye check as part of the SuperGold card.

A teen health check for all year nine students and free doctor's visits for all under 14s.

Progressively increasing the age for free breast screening from 69 to 74.

Restoring education funding for gifted students and restoring funding for computers in homes, along with restarting the Te Kotahitanga teacher professional development initiative.

Establishing a Housing Commission, which is equivalent to the Affordable Housing Authority proposed by Labour.

Adding 1800 new police officers over three years, which was more than the 1000 proposed by Labour.

Adding 800 extra places for the Limited Service Volunteer scheme, which is a six-week scheme for young people run by the Army.

Establishing a Criminal Cases Review Commission.

Introducing a new generation SuperGold smartcard containing entitlements and concessions.

Introducing a Zero Carbon Act and an independent Climate Commission, although this was a policy both Labour and the Greens had signed up to.

Revenues from agriculture in the ETS will be recycled back into agriculture to encourage innovation, climate change mitigation and extra tree planting.

A significant increase in funding for the Department of Conservation.

No resource rentals for water in this term of Parliament.

Introduction of a royalty on exports of bottled water.

No new Parliamentary building in this term.

The introduction and passing of a 'Waka Jumping' bill designed to prevent MPs from switching parties mid-term.

They agreed to adopt Labour's migration policy, which was to reduce migration by 20,000 to 30,000, not the 60,000 that New Zealand First wanted.

They agreed to hold a full review into retail power pricing.

Hold a public inquiry to investigate the drivers of local government costs and its revenue base.

Support New Zealand First's Racing policy.

Restart free trade talks with Russia, Belarus and Kazakhstan.

Here are the key details of Labour's agreement with the Greens.

They agreed to introduce a Zero Carbon Act with the aim of a net zero emissions economy by 2050.

The creation of an independent Climate Commission.

Including a climate impact assessment in all new legislation.

They agreed to create a new cross-agency board of public sector CEOs.

Investigating a green transport card to reduce the cost of public transport, prioritising people in low income households and on benefits.

Reprioritising National Land Transport Fund spending to increase investment in rail in cities and regions.

Cancelling the East-West link in Auckland.

Beginning work on a light rail line from Auckland's CBD to the Airport.

They agreed to ask the Climate Commission to plan for 100 percent renewable electricity by 2035, including geothermal.

They agreed to stimulate $1 billion of new investment in low carbon industries by 2020, kickstarted by a Green Investment Fund of $100 million.

They agreed to overhaul the welfare system to remove excessive sanctions, without specifying what they would be.

They agreed to "substantially increase" the Budget provision for insulation of homes.

Introduce a rent-to-own scheme or a similar progressive ownership scheme as part of Kiwibuild.

Increase funding for alcohol and drug addiction services.

As foreshadowed, they agreed to have a referendum on legalising the personal use of cannabis by the 2020 election.

The agreements included portfolios for the two parties.

They included for New Zealand First: Foreign Affairs, Infrastructure, Regional Economic Development, Internal Affairs, Seniors, Defence, Veterans’ Affairs, Children, Forestry, State Owned Enterprises, Racing, Associate Finance, Associate Education and an Under-Secretary for Foreign Affairs and Regional Economic Development.

They included for the Greens: Climate Change, Associate Finance, Conservation, Women, Land Information New Zealand, Associate Environment, Statistics, Associate Transport, Associate Health and an Undersecretary to the Minister of Justice (Domestic and Sexual Violence).

Winston Peters was reported this morning to have accepted the roles again of Foreign Minister and Deputy Prime Minister in Jacinda Ardern's cabinet. They declined to confirm that at today's news conference. The details of which ministers would have which portfolios is due to be announced late tomorrow morning.

Labour ministers

Ardern announced after a Labour caucus meeting on Friday there would be 21 Labour ministers, but she did not specify which portfolios they would have.

With New Zealand First securing four Cabinet positions and one undersecretary role, and the Greens three ministers outside Cabinet and one undersecretary, 21 ministerial spots were available for Labour MPs.

Sixteen Labour MPs will become Cabinet ministers: Ardern herself, David Clark, Clare Curran, Kelvin Davis, Chris Hipkins, Iain Lees-Galloway, Andrew Little, Nanaia Mahuta, Stuart Nash, Damien O’Connor, David Parker, Grant Robertson, Jenny Salesa, Carmel Sepuloni, Phil Twyford, and Megan Woods.

There are five Labour ministers outside Cabinet: Kris Faafoi, Peeni Henare, Willie Jackson, Aupito William Sio, and Meka Whaitiri.

Ardern confirmed on Friday she would take a portfolio related to children’s issues - although she would not be the Children’s Minister - while she would maintain the tradition of prime ministerial responsibility for national security issues.

She said she would spend the weekend allocating portfolios across MPs, including discussions with New Zealand First over its ministerial spots.

Ardern said Labour’s 100-day action plan would “broadly stay the same”, although it was possible there would be one addition and one subtraction.

Ministers Shaw, Genter and Sage

The Green Party announced on Saturday that James Shaw, Julie Anne Genter, Eugenie Sage and Jan Logie would have the three ministerial roles and one under-secretary role.

The Party did not specify who would be the three ministers outside cabinet and the one under-secretary, but the latter is expected to be Logie. It also did not specify the portfolios, but the following comment suggested climate change, water quality and poverty would be covered.

"The Green Party’s Ministers will work hard alongside our team and the rest of the Labour-led government to ensure we make a positive contribution to the lives of New Zealanders by addressing our priority areas of climate change, clean water, and ending poverty," Shaw said in a statement.

One policy detail that emerged on Friday was an agreement with a Green push for a referendum on the legalisation of cannabis.

Referring to a referendum on the legalisation of cannabis promised to the Greens by the 2020 election, Ardern said it could be binding.

Who might get what

Here’s Newsroom’s best guess at who could get some of the major portfolios (a note, this isn't an exhaustive list of all the portfolios up for grabs).

Labour

Jacinda Ardern: Prime Minister, Arts, Children’s Issues, National Security and Intelligence;
Kelvin Davis: Corrections;
Grant Robertson: Finance;
David Clark: Health;
Clare Curran: Civil Defence;
Chris Hipkins: Education
Iain Lees-Galloway: Workplace Relations and Safety, Immigration
Andrew Little: Justice, ACC
Nanaia Mahuta: Maori Development
Stuart Nash: Police
Damien O’Connor: Primary Industries, Trade
David Parker: Revenue, Attorney General, Communications, IT
Jenny Salesa: Skills and Training
Carmel Sepuloni: Social Development
Phil Twyford: Housing, Building and Construction
Megan Woods: Canterbury
Kris Faafoi: Tourism
Peeni Henare: Ethnic Communities
Willie Jackson: Consumer Affairs
Aupito William Sio: Pacific Affairs
Meka Whaitiri: Local Government

New Zealand First

Winston Peters: Deputy Prime Minister, Economic Development (including The Regions), Racing
Ron Mark: Defence, Veterans’ Affairs
Shane Jones: Foreign Affairs, Commerce
Tracey Martin: Tertiary Education, Women
Fletcher Tabuteau: Undersecretary to Finance

Greens

James Shaw: Climate Change
Julie-Anne Genter: Public Transport
Eugenie Sage: Conservation
Jan Logie: Undersecretary to Social Development

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