New Zealand gets two deputy PMs after marathon coalition talks

Nearly six weeks after New Zealand’s general election, the incoming prime minister, National’s Christopher Luxon, has announced the shape and policies of the next government alongside the libertarian Act and populist New Zealand First parties.

After a signing ceremony at parliament on Friday, Luxon said the role of deputy prime minister would be split between populist NZ First party leader Winston Peters and ACT party leader David Seymour. Peters will take the role for the first half of the term, and Seymour will go second.

National party deputy leader Nicola Willis will be finance minister and Peters will be also foreign minister, the three parties said in a joint statement.

“Despite the challenging economic environment, New Zealanders can look forward to a better future because of the changes the new government will make,” Luxon said in the statement.

The coalition revealed a series of policy changes that the coalition government will undertake, including narrowing the remit of the Reserve Bank Of New Zealand (RBNZ).

Luxon said the government will amend the Reserve Bank of New Zealand Act 2021 to remove the dual mandate on inflation and employment, to focus monetary policy only on price stability.

“The Reserve Bank will be properly focused on doing the job it should have been doing for the past three years,” Act New Zealand leader David Seymour at a news conference after the announcement.

The coalition will also repeal a ban on offshore oil and gas exploration that was introduced by the previous Labour government, it said.

On 14 October, the centre-right National party beat the centre-left Labour party, winning a razor-thin majority to govern in a coalition with Act. That majority disappeared once additional voting results were announced three weeks later, forcing National to rely on a third party, New Zealand First, to reach the 61-seat majority needed to form a government.

The country has been in political limbo since then, watching on as the three party leaders went between upmarket Auckland hotels to conduct negotiations. It is the second-longest period of negotiations under New Zealand’s mixed-member proportional (MMP) voting system, the first being in 1996, when New Zealand First was again in the kingmaker position and took two months to make a deal.

It is the first time in New Zealand’s history three parties have formed a coalition, meaning all will have representatives inside cabinet.

It is the third time Peters will hold the coveted deputy PM role.

There has been significant speculation over how National will manage the policy priorities of the minor parties, particularly those of New Zealand First. Where National has campaigned on allowing foreign buyers back into the housing market, to help pay for its proposed tax cuts, New Zealand First said it was flatly against it. Peters had also slammed National and Act’s desire to slash funds and jobs from public services and said he did not want to see superannuation age raised from 65 to 67, nor agricultural emissions priced in any form – both policies on National’s agenda.

Meanwhile, one of Act’s major policy priorities was holding a referendum to redefine the Treaty of Waitangi, New Zealand’s founding document signed by more than 500 Māori chiefs and the British Crown. Luxon said he did not support a referendum and that it would be “divisive and unhelpful”.