Scandal Roadblock to Key Re-Election Bid as N.Z. Minister Quits

Photographer: SeongJoon Cho/Bloomberg

John Key, New Zealand's Prime Minister. Close

John Key, New Zealand's Prime Minister.

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Photographer: SeongJoon Cho/Bloomberg

John Key, New Zealand's Prime Minister.

New Zealand’s main opposition party says the resignation of a senior cabinet member following allegations of misconduct shows Prime Minister John Key’s government shouldn’t be re-elected this month.

“John Key’s government is rotten to the core,” Labour leader David Cunliffe said in an e-mailed statement yesterday. “New Zealanders know we need a positive change and we need to change the government.”

The weekend resignation by Justice Minister Judith Collins came after weeks of media speculation about political scandals, damaging Key’s National Party-led government as he seeks a third three-year term on Sept. 20. Labour, trailing in polls, is attempting to use the revelations to gain traction with voters, according to political analyst Bryce Edwards.

“The resignation inflates the scandal and will give other allegations floating around the National Party credibility,” said Edwards, an analyst at the University of Otago’s Department of Politics. “While Key will be hoping her departure will cauterize the wound, this issue is still dominating the headlines, taking oxygen away from his need to talk up his policies and achievements.”

Collins quit her cabinet position on Aug. 30 over an accusation that she sent e-mails undermining the then-director of the Serious Fraud Office in 2011 when she was the minister responsible for the office, Key said in an e-mailed statement yesterday. Collins denied any inappropriate behavior, he said.

“The relationship between a minister and their chief executive is vital, and goes right to the heart of a trusted, effective government,” Key said. “Ms. Collins accepts these are serious allegations and that resigning as a minister is the honorable step to take in these circumstances.”

Campaign Distractions

Collins, a former lawyer and company director elected to parliament in 2002, said in a separate statement that she had asked Key to hold an inquiry so she could clear her name. She will continue to represent the seat of Papakura, she said.

“The election should be focused on the issues that matter such as law and order, health, education and the economy, and I do not want this matter to be a distraction for the Prime Minister or the National Party during the campaign,” she said.

Collins also quit her ministry portfolios for the Accident Compensation Corp. and ethnic affairs. Christopher Finlayson will be acting minister of justice, Craig Foss will be acting minister for the ACC, and Hekia Parata will be acting minister for ethnic affairs, Key said.

Under Pressure

Collins has been under pressure since she was named in “Dirty Politics,” authored by Nicky Hager and published last month. The book cites e-mails sent between government figures and New Zealand’s leading conservative blogger, Cameron Slater, to demonstrate alleged instances of Key’s government using unethical media strategies for political gain.

“National’s alleged involvement in dirty politics makes it appear that the government is looking out for its mates instead of everyday New Zealanders,” Green Party co-leader Metiria Turei said in an e-mailed statement yesterday.

No party has won an outright majority since New Zealand introduced proportional representation in 1996. Polls show that while National has the most support, its potential coalition partners are smaller than those expected to side with main opposition party Labour, and a swing of just a few percentage points could be enough to unseat the government.

In a Colmar Brunton poll published Aug. 17, National had 50 percent support, Labour was on 26 percent, the Greens 11 percent and the Kim Dotcom-backed Internet Mana party had 4 percent. A Stuff/Ipsos poll published Aug. 29 by Fairfax showed Labour up 3.6 percentage points to 26.1 percent.

Economic Credentials

The National Party’s battle to contain the scandal comes even as the nation’s economy grows at the fastest pace since 2007 and the budget is projected to be in surplus for the first time in seven years. While Key has been one of the more popular leaders in recent history, his bid for re-election may suffer should the scandal continue to dominate media attention until polling day, University of Otago’s Edwards said.

“Key’s brand has been that of a centrist, trust-worthy leader who has held his team together,” said Edwards. “That brand is starting to be damaged.”

To contact the reporter on this story: Jason Scott in Canberra at jscott14@bloomberg.net

To contact the editors responsible for this story: Stanley James at sjames8@bloomberg.net Jim McDonald

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