Backroom Bargain?
Out for dinner last weekend, a number of friends were keen to pick my brain on whether to vote Opportunity this election. We’re talking well educated middle class white Wellingtonians in their early to mid-60s. Voters since 1981. Not entirely satisfied with what’s on offer by the other parties and wanting a change-up, but also not wanting to waste their vote.
Our economically dry host was astounded that some of our friends were even contemplating it. Unlike them, he has actually read Opportunity’s policies from cover to cover, and thinks their flagship policies are so reckless the party can’t be taken seriously. These are his exact words on the UBI:
National are right to describe this as making beneficiaries of us all. It will create and embed the mindset that the State is omnipotent and the provider for all. Traditional market ideas that income comes from work will dissipate as people will rationally say that income actually comes from the Government. That this will somehow increase aggregate wealth and aggregate enterprise and encourage participation and innovation is, quite frankly, bonkers.
And on the land tax:
Every single business will have an additional cost - whether the business owns their property and pays direct or leases it and pays through rent. Businesses will pay much more tax to fund a household windfall - a wealth transfer from the productive sector to the non-productive. Every coffee shop, hip boutique, plumber and doctor will pay more.
He wasn't comforted when I said most voters don't vote on policy. The drivers are habit, protest, hope, ‘vibe’. Nor when I pointed out that the other established minor parties carry plenty of equally unproven policies that never see the light of day. I tried to reassure him that most minor parties don't walk into coalition and have their platforms turned into legislation overnight. A UBI and a land tax need far more public, policy and parliamentary scrutiny than a three-month election campaign can ever provide.
But I understand his nervousness. Smuggling untested minority ideas past the majority is exactly what happened this term. In the 2023 coalition negotiations, Christopher Luxon agreed to purchase off-the-shelf measures that only a small slice of the country had voted for – policies never put through publicly transparent cost-benefit analysis or parliamentary debate – in exchange for minor-party support for a National-led government. It was a trade of power in the political market that bypassed normal democratic processes, not because the ideas were popular, but because they were the currency that bought a government.
Not what MMP intended
Back in 1986, the Royal Commission on the Electoral System acknowledged the risk that small parties might wield disproportionate leverage or hold to ransom a major party trying to form a coalition. It judged the risk ‘overrated’ on the grounds a minor party making extreme or unreasonable demands would face electoral punishment at the next election.
The Muldoon-era FPP elections were fresh in the Commissioners' minds – two governments formed on a minority of the popular vote but a majority of electorate seats in 1978 and 1981. They weighed hypothetical small-party leverage under MMP against the problem of unbridled executive power and concluded that a single party holding 100 per cent of executive and legislative authority on a minority mandate was the far greater democratic threat.
They recognised MMP could have the effect of removing the selection of government from the electorate and placing it in the hands of the occupants of ‘smoke-filled rooms’ during post-election negotiations, but considered this underestimated the ability of voters to influence the election of a government. They expected that potential coalition arrangements would be evident before an election.
Forty years later and three years in Luxonia have exposed this assumption as fallacy. Not only are coalition arrangements not normally pre-advertised, but the Commissioners entirely missed the scenario where not just a government but an entire three-year legislative programme could be formed behind closed doors post-election (no longer smoke filled, thanks to the Smokefree Environments Act 1990), delivering to the current coalition as much unbridled executive power as Muldoon had, leaving parliament to spend much of its valuable time rubber-stamping policies mandated by eight and six per cent of the electorate.
This week’s Q?
The question this week, now that Luxon has ruled out forming a governing arrangement with Opportunity, is no longer whether a vote for Opportunity is a vote for a land tax and a UBI. It is whether a vote for Opportunity is a vote for a Labour-led government. The current coalition parties will push this threat hard as a warning to any of their own supporters flirting with Opportunity.
It’s a tactic designed to scare, but it’s also jumping the gun far too early on what might happen after the election. There’s an aspect of recency bias underpinning the panic, where people give more importance and attention to things that just happened instead of looking at older, long-term facts.
Recent history may have minor parties going into full coalition government with a major party. But this is only one option for government formation. In fact, it is the most atypical arrangement since the introduction of MMP, where minority government is way more common.
A minority government is one where the major party holds fewer than half the seats, and so cannot pass anything on its own numbers. It governs by making confidence-and-supply arrangements with minor parties for survival, then negotiates support for each bill on its merits – leaving the balance of power on the floor of the House rather than locked up in a coalition.
Minority governments carry both executive and parliamentary advantages. At the executive level, a major party can hold every Cabinet and executive portfolio without sharing ministries. Freed of the minor-party distractions and internal competition that has been a feature this term, they can focus on stability, continuity, single messaging and public confidence. At the parliamentary level, it fosters a more collaborative environment, where laws must reflect a broad consensus rather than the unfiltered agenda of one major or minor party.
Helen Clark’s Labour governed as a minority for most of 1999 to 2008, taking confidence and supply from a rotating cast while keeping them off her front bench. John Key’s National ran a version of it after 2008, propped by support partners rather than a full coalition. In addition to the reassurance offered by Clark’s and Key’s effective management, there was a growing appreciation that MMP offered more collaborative policy-making processes with bridges being built between parties in a manner unknown under FPP. Importantly, both Labour and National retained voter support above 40% once in office. Figures Labour and National can only dream about today.
Free advice
If I were advising the major parties, it would be to take lessons from the past three years and not enter full coalition with minor parties just to reach a majority government. Embrace minority government and make the House a chamber of self-respecting parties, producing good legislation that survives more than one term because other parties are also invested in it. Secure confidence and supply, by all means. Opportunity in Parliament actually gives you more options, not fewer, to secure support. But remember that Parliament is the people's chamber and being the fastest lawmaker in the West is not a badge of honour.
To Opportunity, I would say this: if you clear five per cent, don't go into coalition with either major party. Give one or other support if they ask for confidence and supply but stay on the cross-benches and vote bill by bill. A new party's first term is for maturing, not governing. You will receive Parliamentary Services funding to cost your policies properly and build research capacity. Untested members will learn the trade of being MPs before anyone hands them a ministerial warrant. Play the long game. Reassure voters. Manifest your promise through performance.
And my advice to those weighing a vote for Opportunity is the same as for any party: the next government will have to face some very big questions, including how to grow the economy to fund the longevity requirements of an ageing population in a country with the infrastructure and climate adaptability needs of a far larger one – at a time when the biggest productivity gains come from technology owned offshore and the profit keeps leaving the country. The current parties in Parliament are struggling to find the answers. If you believe Opportunity will be a fresh voice that will jolt the others into better public policy making, then give them your vote. But don't do it to engineer or avoid a coalition combination as there are many scenarios that could unfold. Under MMP, your vote only shapes the composition of Parliament – not the formation of government.