Thursday, June 30, 2016

Coalition government in New Zealand

In recent days, the New Zealand Labour and Green parties have signed a memorandum of understanding to co-operate closer. The deal contains an agreement "to work co-operatively to change the government at the 2017 election". Collaboration in Parliament is agreed, and an investigation into a joint campaign is promised.

New Zealand's change of electoral system in 1993 has changed the government formation process substantially. The Greens are a substantial political presence in New Zealand, and for the past few elections it has been considered that Green support will be essential for a future Labour government?

But, is this a good deal for Labour? Will it be good for the Greens? And what will it mean for New Zealand's party system? In order to answer these questions, we need to look at how New Zealand's governing coalitions have been formed in the past.

How it all started

In the beginning, there was SMP (single-member plurality). Each district elected one member, voters had one vote, and the candidate with the most votes won. This system was inherited from the United Kingdom, although the two-round system was briefly used between 1908 and 1913. As would be expected with such an electoral system, a two-party system was established. Electoral competition was predominantly between the centre-right National and centre-left Labour parties. The party that won the most votes would win the most seats, normally with a bonus.
In 1954, the first substantial third party since the creation of the National Party contested an election. The Social Credit Party won 11% of the vote, but their votes were spread to thinly for them to win any seats. It took until 1966 until they won a seat, and that was when they won 14.5% of the vote. A new third party, the environmentalist Values Party entered the scene in 1972

The lack of parliamentary influence of the minor parties, along with the general satisfaction of the main two parties with the system meant that reform was not planned. This changed in 1978, when the National Party government of Robert Muldoon secured 51 of 92 seats, despite winning 39.8% of the vote to 40.4% for Labour (which won only 40 seats). At the same election, Social Credit secured a record result of 16%, but only won a single seat.

A similar result was repeated in the next election, with Labour winning 39% to 38.8% for National, but with Labour winning 43 seats to 47 for National. Social Credit secured their best result, winning 20%, but only won one extra seat.

The Muldoon government lost support before the next election, held in 1984, which resulted in a Labour victory. Labour won 43% of the vote and 56 seats, to 36% and 37 seats for National. The newly formed libertarian New Zealand Party won 12.3%, but no seats, while Social Credit's vote dropped to 7.6%; despite this, the party still held on to their two seats.

It was following this election that Labour announced a Royal Commission into the electoral system. The Commission was given the task of investigating into a wide variety of aspects of New Zealand's elections, including political finance, Indigenous New Zealander (Maori) representation, the term of parliament, the use of referenda, the financing of political campaigns and, of course, the electoral system.

The report of the commission was released in late 1986, with a wide variety of proposals. In terms of referendums, it proposed that government should hold referendums from time to time, and that they should be binding, but that there should be no mechanism for members of the public to trigger a referendum by petition. It proposed that Parliament should be increased to 120 members, and a referendum should be held on extending the parliamentary term to four years from three.

However, the most important recommendation was on the electoral system itself. The report ran through a wide variety of alternatives, rejecting most that would keep single-member districts such as the two-round system and instant runoff voting. Three systems were evaluated: mixed-member proportional representation, mixed-member majoritarian, and the single transferable vote. Oddly, the method of the single transferable vote that was chosen for evaluation involved the much maligned Australian-style (not any more, in most cases) group ticket voting, where voters have the option to vote for a party's preference ticket.

This would have been disastrous (source-NZ Electoral Commission)
Overall, the Royal Commission decided upon the mixed-member proportional representation system, although they stated that a referendum should take place before 1987. The proposed system would have sixty single-member district seats to sixty party-list seats, with a 4% threshold.

New Zealand had, at that point, four Maori electorates. In these electorates, only Maori voters or descendants of Maori voters may register to vote, though there is no restriction on who may stand as a candidate. The report proposed abolishing these seats, and replacing them with an exception to the 4% threshold for parties "primarily representing Maori interests", though how that is defined is somewhat unclear.

Despite the report, no referendum was held at the 1987 election. Labour increased their majority in the 1987 election, winning 57 seats in an expanded 97 member parliament to 40 for National. The Social Credit Party was renamed the Democrats, but their support collapsed to 5.7%, and they lost both of their seats.

At the 1990 election, Labour's support dropped dramatically; they won only 35% of the vote, and 29 seats. The National Party only improved its vote share marginally, from 44% to 47.8%; however, they gained 27 seats from Labour, to end with 67. Two new parties were formed to contest the election; the NewLabour party, led by former Labour MP Jim Anderton, which promoted more left-wing policies than the mainstream Labour party, and the Green Party, which promoted environmental policies. The parties won 5.16% and 6.85% of the vote respectively, but only one member of the two parties was elected-Jim Anderton himself.

The National Party had pledged to begin the referendum process if they won government. In 1992, a referendum took place, with two questions on the ballot. On the first, voters approved (in principle) a new electoral system, with 84.7% support. On the second question, voters were asked what sort of electoral system they would prefer. Mixed-member proportional representation secured 70.5% of the (valid) vote, to 17.4% for the single transferable vote, 6.6% for preferential voting, and 5.5% for a mixed-member majoritarian system.

In order to complete the process, a second referendum took place one year later, held on the same day as the election of that year. The result was a much more narrow vote for the change to MMP; 53% voted for change, which nonetheless constituted an endorsement of the proposal.

At the same election, the National Party was re-elected to government, winning 50 seats off 35% of the vote. Labour dramatically improved its seat total, winning 45 seats, though their vote actually dropped by 0.5%. The newly formed Alliance (a coalition of the NewLabour, Green, and Democrat parties, as well as some smaller left-wing parties) won 18.2% of the vote, but only two seats, while the New Zealand First Party, a nationalist group led by former National MP Winston Peters, won 8.4% of the vote and two seats.

While National were initially able to form a majority government, anticipation of the new electoral system caused a number of new parties to be formed. The most prominent of these was the United Party, a centrist group formed by several Labour and National MPs. Other Labour and National MPs deserted to the established smaller parties.

The MMP Era

The result of the 1996 election, the first held under MMP, resulted in National winning the most seats. They won 34% of the vote, and 44 out of 120 seats. Labour fared poorly, too, winning 28% of the vote and 37 seats. NZ First won 13%, and 17 seats (including all five Maori seats), while the Alliance dropped substantially, and the party won 10% of the vote and thirteen seats. A new libertarian party, the Alliance of Consumers and Taxpayers (ACT), won 6% of the vote and eight seats. The United Party was nearly wiped out; it only won 0.9% of the vote, and elected only one MP (former Labour MP Peter Dunne won his constituency, helped by National not contesting).

The result put the New Zealand First party in a pivotal position. Most likely governments would require support from the party. With Peters and other NZ First figures given substantial cabinet portfolios, NZ First went somewhat unexpectedly into coalition with the National Party.

The coalition was not a comfortable one, as NZ First began to lose support in the polls. Following him being sacked from the cabinet, and in an attempt to strengthen his support, Peters announced that he would drop out of the government, which would have theoretically led to the government losing its majority. However, a number of NZ First MPs did not agree with Peters (coincidentally, a fair few of these were cabinet members, who would lose their places), and left the party. These MPs formed the new Maori Pacific Party, and continued to support the National government.

MMP came in for some criticism at this point, especially following the case of one MP, Alamein Kopu. Ms Kopu had been elected as an Alliance MP on the party list, but, following a falling-out with the leadership, left the party. She formed a new party, the Mana Wahine, and decided to support the National Party government. This was criticised, as it was seen that people voting for the Alliance Party did not expect their vote to go to the centre-right National Party. These cases led to a law being passed to allow MPs to have their seats declared vacant if they leave the party they were elected as part of, though that section has now expired.

An election was called for 1999. The National Party leadership had changed hands, and the party was led by Jenny Shipley. Labour was led by Helen Clark. Polls leading up to the election suggested that Labour would win the most seats, though they would still have to form a coalition in order to win government. The Greens had split from the Alliance, and were contesting the election separately; it was unclear whether they would be able to pass the 5% threshold.

Labour did end up winning the most seats, winning 49 seats overall with 39% of the party vote. National's vote held up fairly well; they won 30.5% of the party vote, and 39 seats. The Alliance fell back slightly, winning 7.8% of the party vote, and ten seats; this was likely due to the rise of the Greens, who just crossed the threshold with 5.1% of the vote, as well as winning the electorate seat of Coromandel from National. ACT's vote held steady at 7% and nine seats. Peter Dunne was re-elected thanks to a lack of National Party opposition, though his party won only 0.5% of the vote.

The big loser of the election was NZ First, which collapsed to 4.3% of the party vote. While this put them below the 5% threshold, New Zealand MMP allows a party to win list seats if they win a constituency seat. Peters clung on to his seat of Tauranga by a mere 63 votes, allowing his party to win five seats in the House. The parties formed by defectors performed even worse, with Maori Pacific winning just 0.2% of the party vote, and Mana Wahine's twelve electorate candidates won 0.05% of the vote (though this was better than the party's performance in the Taranaki by-election a year earlier, when the party won seven votes)

Following the election, it was clear that Labour would form government, but less clear how this would be done. The obvious coalition of Labour and the Alliance would have 59 seats, two short of a majority. The Green MPs agreed to support the government, by voting for them on issues of confidence and supply.

The government lasted most of an ordinary parliamentary term; however, a split developed within the Alliance. Jim Anderton left the party, in order to form a new Progressive Party, though he formally stayed within the Alliance. Clark used this in order to call an early election in July 2002.

The results of the election were a resounding first place for Labour, which won 41% of the party vote and 52 seats. National's vote dropped by 10% to 21% of the party vote, and the party only won 27 seats. NZ First made a substantial recovery, securing 10.4% of the vote and thirteen seats, while ACT once again secured 7% of the vote and nine seats. The Greens won the same votes and seats as ACT, though they lost the seat of Coromandel. The most substantial gain was made by Peter Dunne's United Future, which won 6.7% of the vote and eight seats. Anderton's Progressive Party won 1.7% of the vote, which would not normally be enough for parliamentary representation. However, Anderton was comfortably elected in his constituency. The Alliance won 1.3% of the party vote, and did not win a constituency seat, winning they lost all parliamentary representation.

Clark easily formed a coalition with the Progressive Party, but this left her slightly short of a majority. She decided to include United Future in government, though not in cabinet. This nonetheless had a substantial negative effect on the party's support, as would be shown at the next election.

The National Party, under the leadership of Don Brash, made substantial gains at the next election. Labour's vote remained stationary at 41%, and lost one seat. National made large gains, winning 39% of the vote and 48 seats. Most of the minor parties lost support, with NZ First falling to 5.7% and seven seats, and Peters losing Tauranga. The Greens won 5.3% of the vote and 6 seats. During the preceding parliamentary term, a number of Maori MPs had split from Labour, and formed the new Maori Party. This party won four of the Maori seats; however, its 2.1% of the party vote was only enough for them to be entitled to three. For this reason, Parliament was increased by one member.

United Future won only three seats and 2.7% of the party vote; their two list seats were only won because of Dunne winning his own seat. ACT, too, won two seats off 1.5% of the vote thanks to their seat of Epsom. Jim Anderton's party lost one seat, leaving Anderton as the only MP from his party.

The results left the government that would be formed in some doubt. Clark would easily get support from Anderton, but the other MPs would be less certain. Despite expressing distaste for the 'baubles of office', Winston Peters accepted the position of Foreign Minister under a Labour government. The Greens agreed to support the government on matters of confidence and supply, thus allowing a Labour government to take office.

This government lasted its full term, with relatively few hiccups. However, Labour lost support over the term, with National rising to a comfortable lead under the leadership of John Key. The election held in 2008 resulted in National winning the most seats. They won 45% of the vote, and 58 seats. Labour won 34% of the vote, and 43 seats. The Greens improved their support slightly, winning 6.7% of the vote and nine seats. ACT's support also increased, with the party winning 3.6% of the vote and five seats; their seats in parliament was still only secured by their victory in Epsom.

NZ First was the fourth party in terms of votes, with 4%. However, as this was below the 5% threshold, and as Peters did not win an electorate seat, the party did not win any seats. The Maori Party won 2.4% of the vote, but gained one electorate seat to finish with five; as their party vote only entitled them to three seats, this expanded Parliament to 122 members. United Future and the Progressive Party won one electorate seat each.

The coalition formed was a somewhat oversized one of United Future, ACT, and the Maori Party, allowing Key's government to hold a comfortable majority in the House. All three parties were coalition partners, in the sense that they all held ministerial portfolios. This meant that they were heavily connected with the government.

In 2011, another general election was called. The Key government had performed relatively well in the opinion polls, as before, and Labour was struggling. The Greens had improved their support, and NZ First was polling above the threshold, despite their lack of parliamentary representation.

The election gave National 59 seats, with 47% of the vote. Labour fell back, winning 27% of the vote and 34 seats, while the Greens improved their vote share to 11% and won 14 seats. NZ First returned to parliament, with 6.6% of the vote and eight seats.

The Maori Party had lost one seat in the parliamentary term, when Hone Harawira left to form the leftist Mana Party. He was re-elected, and the Maori Party lost another electorate seats. This left them with three seats, one more than their 1.4% of the party vote entitled them to: as a result, Parliament was increased by one member. ACT fell to one seat of Epsom, won due to a deliberately weak National campaign, and 1% of the party vote. United Future performed even worse, winning 0.6% of the vote and Dunne's electorate seat. The new right-wing Conservative Party won 2.7% of the vote, but no seats.

John Key was returned to office, continuing much the same coalition that he had led before the election. Labour continued to struggle in opposition, changing leaders halfway through the parliamentary term. The Conservative Party maintained a fairly strong, but generally sub-threshold position in the polls, provoking debate as to whether the National Party might give the party a free run at an electorate seat to give a new coalition partner parliamentary representation; in the end, this did not eventuate.

The 2014 election was somewhat similar to the 2011 one. National once again won the most votes by a wide margin, winning 47% and 60 out of 121 seats. Labour won only 25% of the vote, and 32 seats. The Greens secured 10.7% and 14 seats, almost identical to their previous results. NZ First improved its support to 8.7% and 11 seats. The Maori Party lost two electorate seats, but they held onto one, and their 1.3% of the party vote entitled them to one list seat. Harawira's Mana Party had merged with the civil-libertarian Internet Party, but Harawira lost his electorate seat, and the party won 1.4% of the party vote, so the alliance won no seats.

Once again, National ran a deliberately weak campaign in Epsom, allowing ACT to win, though they won only 0.7% of the party vote. The same treatment was given to Peter Dunne, who was re-elected in his constituency. However, his United Future party won 0.2% of the party vote (lower than the Legalise Cannabis Party), not enough for a list seat. Thus, Dunne was an overhang, and parliament expanded by one member. The Conservative Party won 4%, not enough to win a seat.

How has coalition government worked?

Since the introduction of MMP, no single party has had a majority, though National came very close in 2014. This has meant governments have of course had to form coalitions with other parties. As you have seen, coalitions have taken different forms; some parties sit in cabinet, others agree to back the government on motions of confidence and supply.

A coalition involves substantial risks for a political party. If the party wants to survive in government, they need to consistently support members from a different party in confidence and supply votes. For parties entering coalitions where there is a substantial ideological gulf between the parties, the largest and most powerful coalition partner will have more influence, and the compromises that need to be made may upset the smaller coalition partner's supporters.

The below chart shows how support for coalition partners has changed following elections.
(note: 1999 figure for loss for ministry members includes NZ First, which left Cabinet before the election)

As you can see, ministry members normally lose support, even in cases where the government gains support. The effect is not consistent for parties that supported the government but did not hold ministries, which could be attributed to their decreased visibility.

The effect of all of this has been to squeeze the support of certain minor parties. The below chart shows support for New Zealand's political parties since the introduction of MMP
At the first MMP election, the major parties received a little over 60% of the vote between them. This figure has risen since then, peaking at 80% in 2005. The figure is currently 75%, still higher than it was before 2005. The long term governing period of the National-ACT-Maori-United Future has done substantial damage to the small coalition partners, damage that appears somewhat irreparable (though, at this point, it is hard to tell).

What does this mean for the Greens?

So far, the Greens have never entered a close agreement with any party. Labour's relatively high vote share before 2008 meant that they could avoid a close agreement with the Greens, and in some cases an agreement with the Greens altogether.

However, it now appears certain that Labour will not be able to form any sort of government in the foreseeable future without Green support. If National loses the next election, the Greens will probably be the single largest coalition partner in NZ history, and will be in a position to make substantial demands of the Labour Party. The issue is what sort of relationship the Greens will want, and the Memorandum of Understanding suggests that it will be a relatively close one.

If New Zealand's history of coalitions suggests anything, a close relationship may have a negative impact on support for the Greens in the future, and could even lead to a party split as it did for the Alliance. On the other hand, the Greens obviously have certain policy goals, and positions in the executive would help them achieve these goals. 

The potential wild card in formation of the next New Zealand government is NZ First. Their leader, Winston Peters, was disdainful towards the agreement. On current polls, his support looks necessary for a Labour-Greens government to be formed in the future. Peters has usually expected fairly high offices under coalitions (Deputy Prime Minister under his 1996 coalition with National, Minister for Foreign Affairs under a 2005 coalition with Labour). Labour will also be fighting harder for his support, as the Greens are ideologically incompatible with National, while NZ First has managed to form government with National in the past.

Close cooperation between NZ Labour and the Greens may have distinct advantages for the Greens, in the form of easier ability to achieve policy goals. However, if this coalition lasts a long time, the past suggests that this will dramatically weaken Green support. Given that NZ First will also be in this coalition, and will likely expect substantial cabinet representation, a coalition between these three parties could lead to an increase in domination of the political system by the two major parties.