MICHAEL BLEBY: Back to the future as New Zealand heads for coalitions

Jacinda who? The former global rockstar New Zealand prime minister is lying low after resigning suddenly in January and quitting parliament in April. She hasn’t featured in her Labour Party’s campaign for the election on October 14.

Meanwhile, successor Chris Hipkins has been jettisoning the Jacinda Ardern ballast in an attempt to keep his listing government afloat. The events that defined his predecessor’s premiership — steady management of the crises of pandemic, Christchurch gun massacre and White Island volcano eruption — have long become deadweight for an administration heading for the rocks of cost-of-living and housing affordability crises and rising unemployment.

Soon after she left, Labour dropped Ardern’s “politics of kindness” policies, such as a national insurance scheme for unemployed workers, plans to develop a local biofuels industry and a clean car upgrade scheme, and planned new laws to lower the voting age from 18 to 16. But the party is still struggling.

New Zealand’s coming political realignment — opinion polls predict the opposition National Party will retake power after a gap of six years — shows a return to politics as normal in the Pacific nation. There are other changes afoot too, but it is unclear what force they will exert this time around.

An electoral system favouring coalitions is likely to reassert itself after Labour’s unprecedented landslide three years ago. In 2020 the party took 65 of the 120 parliamentary seats in its own right, the first such majority under a system that was rejigged in the 1990s.

Hipkins’ Labour is now slugging it out against the Nationals, led by former businessman and political newbie Chris Luxon, for the likely prize of becoming the party with the most seats — but not a majority — and hence the one best able to invite smaller parties to join a governing coalition.

The cost of living is the main battleground. Luxon is campaigning with the slogan “Back On Track” to capitalise on Labour’s failure to change some of the country’s deep-seated economic problems during its time in office, but also tapping into the resentment of those who thought the restrictions during New Zealand’s two years of off-again-on-again lockdowns went too far.

Inflation remains doggedly high, New Zealand’s national debt has surged to a forecast NZ$104bn ($62bn) from NZ5$bn before the pandemic, Labour is vulnerable to attack over weakening education standards, and a perceived uptick in crime has all parties rushing out new youth crime policies.

The Labour campaign hasn’t gone well, with Hipkins’ justice minister resigning in July after her arrest for alleged drink-driving and crashing her car, and as early polling kicked off on Monday the prime minister himself was sidelined for five days after catching Covid-19.

So, was Jacindamania just a blip? As recently as December — a political lifetime away — the Labour-led parliament earned worldwide headlines for its smoking ban. That legislation outlawed the sale of cigarettes from January 1 2023, to anyone born after 2009. The law also slashed the number of tobacco stores nationally from 6,000 to just 600.

Smoking rates are higher among New Zealand’s Maori and Pacific Island populations than the wider population, but overall rates of smoking have been falling. The net effect of the antismoking laws, the second of their type in the world after the Himalayan kingdom of Bhutan in 2010, is debatable — tobacco companies are increasingly investing in smoke-free products such as e-cigarettes that largely target young people anyway.

But where there is less smoke among younger voters, there is still fire. New Zealand, like Australia across the ditch, is changing. A growing population of younger people face an economic reality more like the 1930s than the post-World War 2 economic boom enjoyed by their parents. And that is proving a challenge for established political parties.

Lara Greaves, a political scientist at Victoria University of Wellington, told Australia’s ABC that next weekend’s election is likely to give the Labour and National parties their lowest share of the national vote yet as millennials and Gen Z are increasingly looking to minor parties rather than the two dominant postwar parties.

Smaller parties, including the Greens and Maori on the left and ACT (Association of Consumers and Taxpayers) on the right, could all benefit from a widening fragmentation of the vote. On the right, New Zealand First boss Winston Peters, the kingmaker who put newcomer Ardern into power after the 2017 election, says he won’t be backing Labour this time.

The right-wing populist party and Hipkins’ Labour filed for divorce after their one-term coalition experiment. Peters now says he only has eyes for the Nationals. But New Zealand’s voters have surprised everyone before. They may do so again.

• Bleby is a senior reporter with The Australian Financial Review, based in Melbourne.