United Future Policy Statement

Hon Peter Dunne Minister of Revenue Leader, United Future Party

The arrangements surrounding the formation of New Zealand's government after the recent general election have caused much debate, particularly around the conventions of collective responsibility and the role of Ministers who are not formally part of the government. The debate has been largely the abstract preoccupation of media commentators and academics, and thus overlooks the essential simplicity of the agreements that have been reached.

In simple terms, New Zealand's current government is a minority coalition between the Labour and Progressive Parties, supported on matters of confidence and supply and other specific issues by the New Zealand First and United Future Parties. These four parties command a majority in the House. As part of the arrangement, the leaders of New Zealand First and United Future serve as Ministers outside the Cabinet.

There is a formal coalition agreement between the Labour and Progressive Parties, and specific bilateral confidence and supply agreements between Labour and New Zealand First, and Labour and United Future. The arrangements and commitments of each Party derive from those agreements.

In the case of Labour and United Future, the agreement covers some 15 specific policy areas where "... the Labour-led government has agreed during this term of Parliament to adopt and implement the following broad principles, policies and priorities advanced by United Future." In return, United Future has agreed to "... provide confidence and supply for the term of this Parliament, to a Labour-led government." The agreement further states that the Leader of United Future will be appointed to a full Ministerial position outside the Cabinet and that "... United Future agrees to fully represent the government's position and be bound by Cabinet Manual provisions in respect of any area within the portfolio responsibility of the Leader of United Future and to support all areas which are matters of confidence and supply. In other areas 'agree to disagree' provisions will be applied as necessary."

In essence, what this means is that as Minister of Revenue, I am obliged to support the government's positions and actions on revenue policy, which is hardly likely to be difficult, since I will be involved, either singly, or in consultation with the Minister of Finance, in making those decisions in the first place. It also means, as per the agreement, that both Labour and United Future are obliged to uphold and support the specific provisions of the agreement, including the policy commitments. Again, this is hardly radical or problematic. On all other matters, including matters in the agreements between Labour and other parties that are not covered in the United Future agreement, we are free to act as we wish. Put another way, when I speak as a Minister, or on matters covered by our agreement, collective responsibility applies; when I speak as Leader of United Future on any other matter I am under no such constraints. For my party colleagues, the position is equally clear - they are obliged to uphold the provisions of the agreement, but are otherwise unconstrained.

What is implicit and obvious in all this, (and referred to in passing at the commencement of the agreement) is that the parties act in good faith. It specifically requires the two parties (Labour and United Future) to support publicly not only the provisions of the agreement, but all decisions made jointly by both parties pursuant to it. This was precisely the same provision that applied in the similar confidence and supply agreement (without the Ministerial post) between Labour and United Future in the previous Parliament. Interestingly, and not without some relevance to the current situation, that earlier agreement has proved to be not only the most durable yet of any agreement between parties in the years since New Zealand introduced the MMP electoral system, but also the model for both the New Zealand First and United Future agreements reached in this Parliament. It worked - as I believe our current one will - because the parties recognised what they agreed over and got on with implementing its policy provisions; while managing their differences when they occurred to the maximum respective advantage of both parties.

Some have argued that these developments are a perversion of the democratic process because they transfer power from Parliament to party backrooms. It is difficult to see how that can be the case, since the government has the support of the majority on matters of confidence and supply and has to build majorities issue by issue beyond that in order to advance its legislative agenda. If anything, the power of Parliament and its select committees - where the government holds a majority on only one of fourteen committees - has been strengthened, not weakened. Agreements of this type certainly lead to more inter-party negotiation and more deals and trade-offs to get particular legislation passed, but such are surely the stuff of politics, and have not just emerged with the advent of proportional representation, or the 2005 election.

What they further emphasise is the profound change that proportional representation has unleashed on the New Zealand political system. Not only have the days of the two-party system long ended (we now have eight parties represented in Parliament), but also increasingly the era of single party dominance of Parliament is over. Labour is the largest Party in Parliament with just 50 of the 121 seats. New Zealanders have got used to the fact that it is unlikely any party will ever win a majority in its own right again. At the 2005 election, although the race between, eventual vote share and proportion of seats going to, the two major parties was greater than at any point since 1996, the real issue of interest was where the minor parties would line up. ACT, and the Greens hitched their stars unequivocally to National and Labour respectively; United Future retained a consistent stand of saying it would talk first to the Party winning the largest number of seats; New Zealand First refused to commit itself either way, until very late in the campaign when it adopted a position similar to United Future's. All were equally criticised: ACT and the Greens were seen to have made themselves irrelevant by stating so unequivocal a preference; United Future was accused of sitting on the fence, and New Zealand First was harried into doing likewise. Yet everyone knew that to a greater or lesser extent some or other of these Parties would determine the shape of the new government. What seemed to be of most concern, though, was that the post-election negotiation process should not be too prolonged. In the event, it took less than three weeks from the declaration of the final results for the new government to be resolved and sworn in.

What is clear from these current government arrangements is that the substance of our system has not changed. We remain a robust parliamentary democracy where the Executive is accountable to Parliament, and enjoys its confidence, and where governments are formed after the expression of the public will at a general election. Voter participation remains high - in 2005, over 80% of eligible voters turned out to vote, a very high figure compared to many comparable parliamentary democracies.

The changes that have occurred have been to the form of government, and in that regard are consistent with a long tradition of innovative pragmatism in our parliamentary arrangements. In the last twenty years alone, we have seen the following developments that have now become mainstream: the appointment of Ministers outside the Cabinet first happened in 1987; minority (and on occasion majority) coalition governments have been the norm since 1996; confidence and supply agreements between the government and parties outside the government have been common since 1999; and the sharing of select committee chairperson's roles among all parties has been the pattern since 2002. Since 1996 it has been the practice to involve parties outside the government, but supportive of it, in the annual Budget formation process. Each one of these initiatives was in its own way ground-breaking, but each is now part of the accepted way of government formation. The arrangements initiated after the 2005 election are thus similarly likely to become the norm for future government formation, where the support of a number of parties is required.

This is the third time I have served as a Minister. The first occasion was in a majority Labour government, operating under our old First Past the Post system. The second was in the National/United minority coalition in the lead-up to MMP. While the three occasions have been vastly different, the fascinating point is that the practice of how Ministers operate has remained by and large unchanged. And that reinforces the fundamental point the academic critics and the theorists have failed to grasp - that these simple arrangements are no more than a further step in the growth and development of one of the world's oldest parliamentary democracies.

Ends

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