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Everything's peachy on "Planet Key"

“Planet Key” entered the New Zealand political lexicon when Prime Minister John Key was challenged by the Greens in Parliament two years ago to define his version of nirvana and said (bizarrely) there would be no toilets on Planet Key and that the only greens would be on golf courses.

Neither of these perfect states has yet been attained but otherwise everything on Planet Key is pretty peachy right now for the National Party and its leader.  So solid and apparently gravity proof is his popularity that he is routinely described as a “phenomenon” and it is accepted that the strength of National’s win owes a lot to his personal appeal. 

National has bolted in for a third term, producing its best election result since 1951 and the first outright majority for a single party under New Zealand’s proportional representation system.

This was achieved despite the release, just before the official campaign launch, of Dirty Politics - a book based on the hacked e-mails of right-wing blogger Whale Oil Beef Hooked, who ran “black ops” campaigns against National’s political opponents. 

Although Dirty Politics claimed a scalp in the resignation of one of Key’s front bench Ministers, and although Whale Oil’s collusion with a person in Key’s office was well-evidenced, Key himself has escaped largely unscathed, so far.  And an event orchestrated by internet entrepreneur Kim Dotcom, which was to have undone Key, bombed so spectacularly that it actually gave him a late bounce in the polls.
 
Dotcom, who is wanted by the FBI for copyright infringement on his Megaupload website, had promised that he was going to prove five days before polling day that Key had used him as a bargaining chip in Key’s 2010 negotiations with Warner Brothers to get The Hobbit shot in New Zealand, essentially agreeing to grant him New Zealand residency so that he could then be extradited to the US.

Dotcom has a vendetta going against Key and saw the election as an opportunity to deal to him.  He set up the Internet Party, bankrolled it to the tune of $4.5 million and entered a strategic alliance with MANA, a left-wing Māori Party, which could have leveraged the Internet Party into Parliament – had the MANA leader held his constituency seat.

But the promised Moment of Truth (which also featured Julian Assange, Edward Snowden and Glenn Greenwald) backfired when Dotcom’s evidence – an e-mail purportedly from Warner Brothers chairman and CEO Kevin Tsujihara - was widely derided as a fake.  And MANA was turfed out of Parliament because voters disliked the Dotcom connection.
 

What now?

So, having managed to surf successfully through all of this turbulence and weirdness without losing his balance, what will Key do with his mandate?  Basically the plan is to continue “to hug the centre line” and to keep the public on-side for an historic fourth term in 2017.
 
Although National can govern alone, it will replicate the coalition arrangements it has had in its previous two terms with the ACT Party, United Future and the Māori Party.

Key is expected to rejuvenate his executive by promoting some of National’s younger talents to Cabinet but also to maintain continuity in a number of key portfolios.  Bill English will retain finance, Steven Joyce, Economic Development and Murray McCully, Foreign Affairs.
 

Steady as she goes

National has two pieces of legislation sitting on the books which it had been unable to get majorities for in the last Parliament – a Bill to rebalance the Resource Management Act (RMA) more toward economic development and a Bill to further deregulate the labour market.  Both of those Bills will now be passed.

It will continue to nurture the relationship with China and to pursue international agreements which open overseas markets to New Zealand exports.  Policy settings in relation to overseas investment into New Zealand will be unchanged.   There will be no further asset sales beyond those National campaigned on in 2011. 

Other priorities include:
  • to return the budget to surplus and reduce debt.  If these objectives are on track to be achieved by 2017, it has signalled modest income tax cuts
  • pursue the Trans-Pacific Partnership and a Free Trade Agreement with South Korea
  • amend the RMA to reduce consenting times and to remove the “hierarchy” favouring environmental values over economic ones
  • amend the Employment Relations Act to make it easier for employers to opt out of collective bargaining, allow employers to reduce pay during partial strikes and extend flexible working arrangements. (Latest Statistics NZ figures have just over 27% of the New Zealand workforce unionised and only 24% covered by collective agreements)
  • assist first home buyers into new homes with targeted grants
  • reduce the numbers on welfare benefits, particularly young people, and
  • bed in the education reforms, in particular a scheme to raise standards by deploying ‘star’ teachers across a number of schools.

At the other end of town

The Labour Party is in serious trouble.  It has gone through three leaders since Helen Clark left for the UN in 2008 and still has unresolved issues around both leadership and strategy.  These look like taking some while to sort through.  The scene was set in a seven hour caucus post-mortem which everyone has been sworn to secrecy on but which was apparently torrid.

It’s a long way from here back to Labour’s happy place.












Andy Nicholls is a partner at Chapman Tripp, specialising in regulatory, competition and public law.