The Future for the Current Policy Environment under Proportional Representation

Richard Shaw

Following the 1996 New Zealand general election NZ First entered into a majority coalition government with the National Party. Prior to the election there had been significant debate on the likely future of the legislative framework for the management of fiscal and monetary policy, and the degree to which it would be revisited.

This paper aims to provide some predictions on the future of this framework in the new political environment. In 1997 it is already evident that the internal dynamics of coalition government will create policy tensions. It is also becoming clear that under the new regime those proposing legislative change will need to convince a majority of MPs, across parties, of the need for such change. This suggests that radical policy change is unlikely.

Drawing on evidence from the early months in office of the coalition government, and the dynamics associated with passing legislation under proportional representation, the discussion will tentatively conclude that the future policy mix will be substantially the same as that with which the country entered the era of proportional representation. Ironically, the economic reforms which in part inspired the introduction of proportional representation are now likely to be locked in place by this very system of government.