US embassy cable - 05WELLINGTON664

UNCLAS SECTION 01 OF 02 WELLINGTON 000664 
 
SIPDIS 
 
SENSITIVE 
 
STATE FOR EAP/ANP, EAP/RSP, EAP/EP, INR/EAP 
NSC FOR VICTOR CHA AND MICHAEL GREEN 
SECDEF FOR OSD/ISA LIZ PHU 
PACOM FOR J2/J233/J5/SJFHQ 
 
E.O. 12958: N/A 
TAGS: PREL, PGOV, NZ 
SUBJECT: NZ ELECTIONS: A MINOR ROLE FOR ACT, UNITED FUTURE, 
AND PROGRESSIVES 
 
REF: WELLINGTON 70 
 
1. (SBU) Summary: Recent polling suggests that the September 
17 general election will likely be a head-to-head contest 
between the two major parties, Labour and National. Such a 
result would diminish the role of the minor parties in the 
next Parliament. Since introduction in 1996, New Zealand,s 
mixed member proportional (MMP) electoral system (reftel), 
every general election has delivered a coalition government 
where minor parties have held the balance of power.  At this 
point, only two minors: NZ First and the Greens, are polling 
enough support to play that role as parties and therefore 
negotiate a significant role in any government that includes 
them.  This cable highlights three other small parties -- 
ACT, United Future, and the Progressives.  Although they are 
unlikely to have a major influence on future government 
policies, these parties' MPs may help a future coalition 
government get a majority of Parliament seats.  They may also 
hold Cabinet positions. 
 
ACT New Zealand 
--------------- 
 
2. (SBU) The ACT party positions itself as the bastion of 
free markets and personal freedom. Long seen as a natural 
coalition partner for the more centrist National Party, ACT 
is polling poorly as a party and at this point seems unlikely 
to win a constituent seat. (Currently, all nine ACT MPs hold 
list seats.)  There are three related reasons for ACT,s 
potential departure from the national political scene: (i) an 
inability to attract enough voters to cross five percent 
party vote threshold needed if no candidate wins an 
electorate seat; (ii) a failure to appeal to the National 
Party as a viable coalition partner in-waiting, and (iii) a 
failure to stop a flow of support from ACT to a resurgent 
National. 
3. (SBU) Not surprisingly, ACT's leader, Rodney Hide, has 
been beating a steady mantra of late: that without the 
support of ACT, even if National finds itself in a position 
to form a government after the election it will have little 
chance of implementing tax cuts and other policies.  But 
National has until now eschewed open support of Act as a 
possible coalition partner, in large part to convince voters 
to give their Party vote to National.  As Labour continues to 
lead in the polls, however, National leader Don Brash has 
begun to publicly state that his party could work with ACT in 
government. He also has not ruled out National's  withdrawing 
a candidate from a local electorate race in order to give ACT 
the seat.  The likely spot for this would be Epsom, 
constituency of ACT leader Rodney Hide.  This would enable 
ACT to retain that seat, plus possibly gain additional seats 
up to the percentage of the share of party votes that are 
cast for ACT. 
 
United Future 
------------- 
 
4. (SBU) Centrist party United Future,s claims a "pragmatic" 
versus ideological approach to politics. Placing the family 
at the center of its policy making United Future says it 
wants to empower communities and put the interests of the 
country ahead of "petty" politics. In 2004, United Future 
entered into a modified coalition agreement with Labour by 
agreeing to support the government on all issues surrounding 
spending and votes of confidence (confidence and supply). 
However, due to recently poor polling, United Future faces a 
diminished presence in the next parliament.  It is currently 
polling well below 5%, although analysts agree party leader 
Peter Dunne at least will probably win his electorate seat. 
 
5. (SBU) At present, United Future has not committed its 
post-election allegiance, instead making overtures to both 
Labour and National. Unlike any other minor party, both 
Labour and National would welcome United Future into either a 
formal partnership or support arrangement.  There are rumors 
that Dunne wishes to be Minister of Foreign Affairs in any 
coalition government.  (NB: He has served as a cabinet 
minister in both parties' governments.) A diminished United 
Future presence could mean a future Labour-led coalition 
would be less stable. In spite of some distinct differences 
over social policy, United Future has been a key peacemaker 
in the current government, the longest lasting coalition 
since the MMP electoral system began in 1996. Notwithstanding 
this recent cooperation, United Future will not automatically 
align with Labour after the election. On crime, Treaty of 
Waitangi issues, labor regulation, tax and social policy, 
United Future more closely reflects the more conservative 
National Party. 
 
The Progressive Party 
--------------------- 
 
6. (SBU) The Progressive Party is presently the junior 
partner in the governing coalition, being to the left of its 
Labour ally. It currently holds two seats in parliament, one 
belonging to leader Jim Anderton and the other to Matt 
Robson. Despite being left-wing on economic issues, the 
Progressive Party focuses particularly on economic 
development and job creation, espousing full employment and 
even favoring a cut in corporate tax rates.  Jim Anderton is 
currently the Minister of Economic Development. The party 
also promotes free education and free healthcare. It also 
favors maintaining a zero tolerance position on drugs. 
 
7. (SBU) In reality, The Progressives, influence on 
Government does not carry much weight. The party's profile 
and name recognition is low, and their voice is more often 
than not muted inside and outside of parliament. As a result 
of this, Labour views the Progressives as a low risk partner 
in government. At present, the Party hardly registers in 
national polling. However, Anderton is well supported in his 
constituent seat, and along with Robson, should be returned 
to parliament in the new term. If Labour is restored to 
power, expect The Progressives to once again occupy a similar 
role in government. 
Burnett