Incoming Prime Minister Christopher Luxon has leapt into the political unknown, negotiating two coalition agreements in order to form a government with ACT and NZ First as part of the first three-way coalition deal under MMP.

Political reporter Bridie Witton reviews the policies, discussing how some might have come to be, and what was said about them during the election campaign.

Crime and justice

• 500 new frontline police officers in two years.
• More funding for prisons, new youth justice beds, and consideration of a youth justice demerit point system, and boot camps for serious young offenders.
• Reforming sentencing policy to give greater consideration to victims.
• Including gang membership as an aggravating factor in sentencing.
• New legislating which would give prison sentences to those convicted of assaulting first responders.
• Introduce ‘coward punch’ legislation.
• Restore Three Strikes legislation, with amendments to tighten the definition of strike offences and ensure some benefit for pleading guilty.

All three coalition parties campaigned on harsher penalties for youth offenders, and a stronger focus on the rights of victims, so it is not surprising this is a key element of coalition agreements.

NZ First has included a new coward punch bill in its agreement with National – something former National MP Matt King brought up as a members bill in 2020, but which was ultimately defeated.

The Labour Government in 2021 repealed the three strikes law, saying it created perverse and absurd outcomes, such as when the Supreme Court had to intervene after a man with long-standing and serious mental illness kissed a woman on Cuba St and was given a seven-year jail term. The court said the sentence was so disproportionately severe that it breached the Bill of Rights. The man had served nearly five years in jail. ACT vowed then to bring the law back, and is now able to do so.

Public services and regulation

• Cutting “non-essential” back office public service jobs, and setting reduction targets, “informed” by the increase in jobs since 2017.
• New ministerial portfolio for regulation and government department.
• Regulation sector reviews.
• Reform market studies introduced by the Commerce Amendment Act 2018 to focus on reducing regulatory barriers to drive competition.

The public service has been a political punching bag this election campaign, for the right bloc. National’s incoming infrastructure minister, Chris Bishop, went as far to say he ‘hoped’ for job losses at Kainga Ora.

The agreement singles out 2017 as a year to give consideration to regarding public service headcount. Since then, it has grown by 16,000, which suggests this is the reduction target chief executives will be tasked with meeting. Some have argued that the public service growth accounts for population growth, so there are key questions about whether it will still be able to function well with these cuts, although Christopher Luxon, the incoming prime minister, promised it would be able to do so.

Taxes, tax cuts and how to pay for them

• Tax relief (up to $100 a fortnight for an average family) will go ahead from July 1, but the foreign buyers ban will not be lifted.
• Increased funding for tax audits to minimise tax losses.

National’s plans to give tax relief remain, but it has lost a key new income stream. NZ First was behind the ban on foreign buyers in 2017, so it is not surprising it has pushed National to find another way to fund its tax cuts. The incoming government will now need to find up to $740 million a year in new revenue. It is a major concession to NZ First considering the 15% tax on foreign buyers purchasing homes for $2m or more was the centrepiece of National’s campaign policies. Luxon has promised it can find the money, but exactly how remains to be seen. It seems probable National will have to borrow in order to fulfil promises, although incoming finance minister Nicola Willis has previously said it will not have to do so.

Te Reo Maori, ‘co-governance’ and Māori self-determination

• Ensuring all public service departments have an English name.
• Require most public service departments communicate primarily in English.
• Remove co-governance from all public services.
• Restore the right to local referendum on the establishment or ongoing use of Māori wards.
• Confirm that UNDRIP does not have any binding legal effect in New Zealand.
• Introduce a Treaty Principles Bill based on ACT policy.

Some public servants have already raised their concerns after Te Reo Māori was erased from some official use at the Ministry of Foreign Affairs and Trade in anticipation of the new National-led Government. Labour leader Chris Hipkins, who used to oversee the public service, said this was undoing more than decades-worth of progress to create a more inclusive public service. But this is another issue which Peters had campaigned on, so its appearance in the agreement was expected.

ACT campaigned on a referendum on the Treaty of Waitangi, but Luxon was against this and felt it would be divisive, which was a sticking point during negotiations. A Treaty Principles bill based on ACT Policy is a concession from National.

Covid-19 inquiry

• A “full scale, wide-ranging, independent” inquiry conducted publicly with local and international experts into how the Covid pandemic was handled in New Zealand, to cover the use of multiple lockdowns, vaccine procurement and efficacy, social and economic impacts on both regional and national levels, and whether the decisions made, and steps taken, were justified.

A Royal Commission of Inquiry is already underway into the Covid-19 response, but Luxon said he wants to broaden its terms to “consider more things and broaden the terms of reference”. Notably, this includes looking at vaccine efficacy, which appears to be a concession to NZ First after what Peters said on the campaign trail. Time will tell whether relitigating these issues creates more division, or if it finally settles concerns.

Education

• Improve the cost-effectiveness of the school lunch programme.
• Replace fees-free first year university study with a final year’s free policy.
• Legislate for universities which get taxpayer funding to commit to a free-speech policy
• “Restore balance” in New Zealand’s history curriculum.

Treasury officials have already raised concerns with the school lunch scheme, and said it had no effect on attendance and provided little benefit for Māori students. Treasury officials recommended extending funding for two years only, with permanent funding dependent on proof the scheme was effective for Māori, and the Labour Government approved more than $300 million to continue the scheme until the end of 2024. Still, feeding underprivileged children is a tricky policy to oppose, so seeking to ensure it is cost-effective is a way for National to show it is going through the books line-by-line while also caring for the vulnerable.

The pledge to “restore balance” to the history curriculum is a nod to a possible culture war around the refreshed curriculum which former prime minister Dame Jacinda Ardern said, when it was released in 2022, would give students a better understanding of one another through learning “more about Māori, the migrant history of Pasifika, and our Asian communities”.

Renters and landlords

• Restore mortgage interest deductibility for rental properties with a 60% deduction this financial year, 80% the following year, and 100% by 2025/26.
• Allow 90-day eviction notices for tenants on periodic agreements – without a reason.
• Return tenants’ notice period to 21 days and landlords’ to 42 if the tenant wished to move and landlord wished to sell property.
• Introduce pet bonds to make it easier for tenants to have pets.

National and ACT both campaigned on re-tipping the balance in favour of landlords, claiming Labour had gone too far to support tenants. Business owners are able to claim back interest on their loans, so there is a logical argument that landlords should also be able to claim back interest costs on their home loans, since they too are also providing a service. The former Labour government stopped landlords being able to do so in 2021 as part of a suite of policies which ACT at the time labelled as a “war on landlords”, so this is not surprising.

Climate and agriculture

• Repeal the clean car discount.
• Review methane science and targets.
• Reverse ban on live animal exports and reform National Animal Welfare Advisory Committee.
• Stop implementation of significant national areas.
• Let farmers offset sequestration against their on-farm emissions.
• Cancel Auckland Light Rail and Let’s Get Wellington Moving and reduce expenditure on cycleways.
• Direct government agencies where practical and appropriate to preference the use of woollen fibres rather than artificial fibres in government buildings.
• Recognise other forms of carbon sequestration including blue carbon.

The NZ First agreement has a number of policies which could be described as populist, especially in the agricultural and climate space. Across the two agreements, there are no meaningful policies targeted at reducing emissions, which draws into question how the country will meet its – now legislated – target for net-zero emissions by 2050.

Some sections of the new agreement are still very woolly, such as “allow farmers to farm, get more houses built and enhance the primary sector”.

Housing, energy, and natural resources

• Replace the Resource Management Act with new laws premised on the enjoyment of property rights.
• Make the medium density residential standards optional for councils.
• Consequences for Kainga Ora tenants who are anti-social.
• Replace fuel excise taxes with electronic road user charging.
• Replace the national policy statement for freshwater management.
• Reintroduce offshore oil and gas exploration.
• Amend the National Environmental Standards for Plantation Forestry (NES-PF) regulations to place a duty upon harvesters to contain and remove post-harvest slash.

National has promised to get rid of impediments to building houses by slashing some of the red tape which dictates what should be built and where, so this set of measures is by no means surprising. Reintroducing offshore oil and gas exploration will be seen by some as an unnecessary distraction from meeting climate change objectives, and may well spark protests.

Infrastructure and roading

• $1.2 billion for the regional infrastructure fund.
• A new National Infrastructure Agency.
• Reverse speed limits where it’s safe to do so.
• 13 new roads of significance.

The regional infrastructure fund appears to be the latest iteration of the provincial growth fund, an NZ First initiative to pump $3 billion into regional economies, launched in 2018. Support for the regions and primary sector is a cornerstone of NZ First policy, so this scheme is not surprising. National also campaigned on reversing speed limits, and 13 new roads of significance.

Health

• Abolish the Māori Health Authority.
• New minister in charge of mental health.
• Three-day stay for mothers at birthing units, and better funding for Plunket.
• Repealing the Therapeutic Products Act 2023.
• $6 million for gumboot friday/I am hope charity.
• Update Pharmac to better take into account patient perspectives.

National has opposed the Māori Health Authority since it was announced as part of the major plan to centralise healthcare in 2021, and ACT and NZ First also campaigned on abolishing it. Its demise now comes as no surprise, and officials knew this was coming. The policy to “update” medicine-buying agency Pharmac to take into account patient perspectives will be welcomed by advocates, but it is a vague and unspecific policy.

Social services and children

• Create an “approved” pool of doctors to issue medical certificates for health and disability-related benefits.
• More sanctions for people on JobSeeker benefit, and sanctions and electronic money management for beneficiaries who won’t follow agreed steps to find a job.
• Remove Section 7AA from the Oranga Tamariki Act 1989.
• Create a “truly independent” monitoring and oversight agency for Oranga Tamariki.

National and ACT joined the Greens and Te Pāti Māori in an unusual display of unity when they opposed plans to overhaul Oranga Tamariki in June 2022. However, the Labour-led proposal to replace the independent Children’s Commissioner, by replacing the office with a board, and stripping it of its investigation powers went ahead, and was fully established in July. The incoming government is now seeking to change the way children are protected, again. Time will tell whether this latest scheme keeps the country’s most vulnerable children safe and ensures they are well cared for while in state care.

National also campaigned on harsher penalties for beneficiaries, despite the Ministry of Social Development research which showed benefit sanctions do not get people into work sooner, and can harm children.

Employment and immigration

• “Moderate increases” to the minimum wage every year.
• 90-day trials expanded to all businesses.
• Repealing the Fair Pay Agreement by Christmas.
• Health and safety regulation reform.
• Increase cap for regional seasonal workers.
• Drop median wage requirements for skilled migrant visa.
• Make it easier for family members of visa holders to work in New Zealand.

Getting the Fair Pay Agreement over the line was a huge moment for the Labour Party. The legislation brings together unions and employer associations to bargain for employment terms for all covered employees, empowering unions to drive up wages.