Tid-bits from New Zealand: an election, a referendum, and a multi-party government policy programme

[This post first appeared on the UK Constitutional Law Group's Blog]

The new parliamentary year kicked off in New Zealand this week, following an election held late last year in the shadow of the Rugby World Cup.

A National-led, multi-party government was returned to power, with John Key continuing as Prime Minister. The National party won a record share of the party vote (47.3%, which translates into 59 MPs of the 121 MPs in Parliament). However, the coalition government’s overall majority in Parliament fell slightly as support for the minor parties in the coalition dropped (64 government MPs vs 57 opposition MPs, down from 69 vs 53 MPs following the last election).

After the election and the formation of government, there was little time for parliamentary business before the summer holiday. MPs return to serious business this week, under slightly revised Standing Orders (most notably, with new provisions regulating urgency and extended sitting hours, following growing concerns about the increasing amount of law-making being fast-tracked; see Geiringer et al, What's the Hurry? (2011)).

Three matters from the election and new term of government are of some constitutional interest:

- the voting system referendum and subsequent review;

- the multi-party coalition/governance arrangements and collective responsibility;

- particular policy commitments (constitutional review, regulatory standards, part-privatisation of State-Owned Enterprises).

Each of these matters has an on-going constitutional dimension, which will be played out in this 50th term of New Zealand’s Parliament.

Voting System Referendum and Review

As well as choosing their government, voters were also given the opportunity on election day to express their views on the current voting system.

The referendum process was a mirror image of the original referendum process adopted in 1992-1993 when New Zealand changed from the First Past the Post system (FPP) to the Mixed Member Proportional system (MMP).

Voters were presented with two questions:

A:        Should New Zealand keep the Mixed Member Proportional (MMP) voting system?
Yes / No

B:        If New Zealand were to change to another voting system, which voting system would you choose?
First Past the Post (FPP) / Preferential Voting (PV) / Single Transferable Vote (STV) / Supplementary Member (SM)

Like the original referendum, if there was a mood for change in the first part of the referendum, then the status quo would be run-off against the most popular alternative system in a subsequent binding referendum.

On election day, voters overwhelmingly endorsed MMP in first part of the referendum, securing 57.8% of valid votes -- up from 53.9% in the 1993 referendum which originally saw MMP adopted. A significant endorsement for proportional representation.

In the second part, the old FPP voting system was the most supported alternative (46.7% of valid votes), with nearly double the support of the SM system endorsed by the Prime Minister and the main lobby group promoting change (24.1%). But, still, more people spoilt their vote in the second part of the referendum than supported FPP.

MMP’s victory in the first part of the referendum obviates the need for a subsequent binding referendum. However, the victory automatically triggered a review of aspects of the MMP voting system. A public consultative review must now be undertaken by the Electoral Commission, with a report due in October 2012 (see Electoral Commission review process).

The terms of reference include:
- the thresholds for a proportionate share of the party votes (presently 5% of the party vote or one electorate seat),
- the ratio of electorate seats to list seats,
- dual candidacy in an electorate and on a party list, and
- the ranking of party lists.

The number of MPs in Parliament and seats reserved for Māori are specifically excluded from review.

The Electoral Commission is set to release its discussion paper this month, with a couple of issues expected to be at the forefront. The thresholds for entitlement to party list seats (particularly the one electorate seat rule which sees an MP bring in other list MPs on their coat-tails even though their party fails to meet the otherwise applicable 5% threshold) have been subject to a lot of criticism from both the public and experts. There is also significant public disquiet about so-called “zombie” MPs – those MPs rejected in electorate seats but who return to Parliament via the party list. This will provide some impetus to change the rules presently allowing dual candidacy, although the views of experts on such a change are more equivocal. (For some literature assessing the operation of MMP and multi-party government in New Zealand, see (2009) 7(1) NZJPIL (Special Issue: MMP and the Constitution) and (2011) 63(1) Political Science (Special Issue: Coalitions).)

The Electoral Referendum Act 2010 does not address any change process following the report of the Electoral Commission, with any decision about what to do with the recommendations being left for Parliament. The recommendations and process which follows will be watched with great interest, particularly whether any changes to MMP will be taken back to the people for endorsement.

Governance Arrangements and Collective Responsibility

As mentioned, a National-led government was formed soon after the election, with support from the single MP United Future and ACT parties, along with the three-member Maori party.

The coalition – or, rather, “confidence and supply” – arrangements took the same form as those adopted by recent administrations. In return for a commitment to support the government on confidence and supply, support parties negotiated ministerial positions (outside Cabinet) and a number of policy concessions (see the separate but largely similar agreements agreed with United Future, ACT and Maori parties). Otherwise, the principal focus of the agreements is operational and relationship arrangements.

From a constitutional perspective, the most notable aspect of the governance arrangements is the approach to the tricky “unity-distinctiveness” conundrum that underlies coalition politics (see Boston and Bullock, “Experiments in Executive Government under MMP in New Zealand” (2009) 7 NZJPIL 1). In particular, collective Cabinet responsibility has been deliberately eroded under MMP to allow greater ability for support parties to express disagreement with governmental policies and decisions.

Loose – and progressively looser – solidarity rules have been adopted in governance arrangements to ensure support parties can distance themselves from some decisions of government so that they can maintain their distinctiveness (see LAWS179: “The (r)evolution of collective responsibility”).

The first departure saw the inclusion of “agree to disagree” provisions, where a support party could seek permission not to support a particular governmental policy.

Subsequently, a form of “selective collective responsibility” has been adopted, where collective responsibility only applies to ministers from support parties in relation to matters within their ministerial portfolios. Outside their portfolio responsibilities, they are entitled to wear their party – rather than ministerial – hat and may refuse to support decisions made by Cabinet (except, of course, on matters of confidence and supply, which they must still support in parliamentary votes). This circumscribed form of collective responsibility – for ministers from support parties, restricted to portfolio responsibilities – is now seen as routine and is recorded in confidence and supply agreements, along with the Cabinet Manual (see Cabinet Manual, cls 5.22-5.28).

But the practice appears to be still evolving further. There have been some instances in the last term of government where ministers from support parties expressed disagreement in relation to decisions made within their portfolio responsibilities – with such dissent being condoned by the Prime Minister. This hints at further loosening of cabinet collective responsibility. However, any evolution has not yet been reflected in the Cabinet Manual (which lags behind practice, like a dictionary: see Kitteridge, “The Cabinet Manual : Evolution with Time”) or the newly agreed confidence and supply agreements, which merely restate the principle of selective collective responsibility within portfolio responsibilities.

Prime Minister John Key generally adopts a relaxed attitude to dissent within his government, no doubt reflective of the fact that his coalition brings together minor parties with very different ideological leanings. It will be interesting to see whether this further modified approach is fortified under the present government’s tenure.

(As an aside, the loosening of the demands of collective responsibility has led some to again question whether collective Cabinet responsibility continues to have any constitutional character: see Joseph, Constitutional and Administrative Law in New Zealand (2007), p 750 (“it is a rule of pragmatic politics, not a constitutional convention”) and Geddis, “Decisions, dissent and the myths of collective cabinet responsibility”.)

Particular Policy Commitments (Constitutional Review, Regulatory Reform and Part-Privatisation of SOEs)

Three particular policy commitments within the confidence and supply agreements have some constitutional interest.

First, the commitment to a wide-ranging review of Constitutional Arrangements has been renewed in the confidence and supply agreement with the Maori Party. Originally included in last term’s agreement, a review was belatedly instigated last year under the co-chairship of Emeritus Professor John Burrows QC and Sir Tipene O’Regan (see Department of Justice, “Consideration of Constitutional Issues”). While little progress was made before the election, the Review’s mandate is confirmed and a reporting date of September 2013 has now been set.

The Review’s terms of reference are wide. Various electoral and parliamentary matters are slated for review (size of Parliament, parliamentary term - including the possibility of fixed terms, number and size electorates, and party-switching consequences for MPs). A number of contentious issues relating to the Crown-Māori relationship are included (such as Māori representation in Parliament and local government, and the place of the Treaty of Waitangi in New Zealand’s constitutional arrangements). These agenda items reflect key policy differences between the governing National party and supporting Maori party and the genesis of the review process – depending on one’s perspective, either to genuinely explore some compromise or to remove these issues from the political crucible. The Bill of Rights is also targeted for appraisal (particular entrenchment and the possibility of including property rights), as is the perennial question of a written constitution.

Rather oddly, the terms of reference avoid issues relating to the Head of State and republicanism (especially as officials in New Zealand’s Cabinet Office are coordinating the multi-realm efforts to amend the line of succession). This apparently stems from a governmental concern that republican issues might distract people from more important constitutional issues.  However, the government has acknowledged the republican question might still find its way into the Review, if there is a public appetite for discussion.

Earlier grand attempts to review constitutional arrangements petered out, partly due to a lack of cross-party support. Again it will be interesting to see if this review gathers greater momentum.

Secondly, the confidence and supply agreement with the ACT party breathes life into the Regulatory Standards Bill, albeit in a much diluted form. Earlier efforts by the ACT party in the last two terms of Parliament to advance a Bill insisting that new laws conform to “principles of responsible regulation” were widely condemned – including by Treasury, as the department responsible for such reform – and ultimately stalled (see Ekins, “Regulatory responsibility in New Zealand”.)

The ACT and National parties have agreed, however, to revise the Bill for enactment within the next 12 months. This Mark III version is to be based on the Treasury’s preferred alternative for regulatory reform (Option 5): strengthening Parliament’s own legislative quality and impact assessment processes. This shift in focus is welcomed, especially because the original Bill would have fundamentally reconfigured key constitutional relationships and placed the courts in an awkward position of adjudicating on the quality or merits of legislation.

But much work is still to be done to settle the suite of principles against which legislative quality is to be assessed (for example, the present suite is labelled by Ekins as “heterodox”). It seems strange to attempt to reinvent the wheel by generating controversial and loaded principles of regulation, when New Zealand has for many years had an excellent – more detailed, nuanced and respected – bible on legislative quality in the Legislative Advisory Committee’s Guidelines on the Process and Content of Legislation.

Thirdly, one of the central planks of the National party’s electoral platform was the part-privatisation of some State-Owned Enterprises. The National party negotiated on-going support from the ACT and United Future parties (but not the Maori party, which recorded its specific opposition) for the extension of a mixed-ownership model to three state utility companies and the government-owned coal mining company; that is, sale of 49% of the shares in these companies to the public, with retention of a 51% majority shareholding by the government.

Those plans took an interesting turn last week when it was revealed that the government was considering not carrying over the present Treaty of Waitangi clause into the new legal regime governing mixed-ownership.

The existing clause in the State-Owned Enterprises Act prevents the Crown from acting inconsistently with its obligations to Maori under the Treaty of Waitangi (and is supported by other provisions ensuring SOE land is preserved for return as part of the settlement of Treaty grievances). The incorporation of this Treaty obligation was a catalyst for the development of much of New Zealand’s modern Treaty jurisprudence and the rise in the Treaty’s constitutional gravitas (see Cooke, “The Challenge of Treaty of Waitangi Jurisprudence”,  Baragwanath, “NZMC v AG”, and Ruru (ed), In Good Faith). The Treaty clause therefore has great legal and symbolic significance, especially for Maori.

Unsurprisingly, the government’s proposal not to roll over the Treaty clause (or to otherwise tinker with it) has sparked outrage amongst many Maori and others. Protests took place at the Waitangi Day celebrations over the weekend. Claim were quickly lodged with the Waitangi Tribunal, alleging the proposed part-privatisation breached the Treaty.

While the government has the parliamentary numbers to proceed with part-privatisation, the question of how it navigates through the Treaty implications and tensions with its Maori party coalition partner will be interesting. It is early days at this point. But the issue will no doubt occupy the political and legal domains in New Zealand for much of the year.

Dean Knight is a Senior Lecturer at Victoria University of Wellington’s Faculty of Law, an Associate of the New Zealand Centre for Public Law, and a PhD candidate at LSE.