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N.Z. Labour Party Sees Close Election as Campaign Begins

Labour Leader David Cunliffe
Labour leader David Cunliffe officially launches Labour's election campaign at Viaduct Events Centre on August 10, 2014 in Auckland, New Zealand. Photographer: Phil Walter/Getty Images

New Zealand’s main opposition Labour Party kicked off its election campaign with a pledge to extend free doctor visits to pregnant women and the elderly as opinion polls show it trailing the ruling National Party.

Speaking to an audience of about 800 at an events center on Auckland’s waterfront yesterday, Labour leader David Cunliffe highlighted rising interest rates and falling dairy prices as risks to New Zealand’s economic outlook and said the Sept. 20 election “is going to be very close.” He promised extra health spending of NZ$280 million ($237 million) a year targeted at pregnant women, people aged 65 and older and children up to the age of 13.

Labour is seeking to prevent National, led by Prime Minister John Key, a former head of foreign exchange at Merrill Lynch & Co., from securing a third three-year term amid the fastest economic growth since 2007 and a budget projected to be in surplus for the first time in seven years. Labour, which wants to raise the minimum wage and widen the remit of New Zealand’s central bank, had 28 percent support in a Colmar Brunton poll for TVNZ’s One News published July 27, trailing National’s 52 percent.

Labour is trying to buy itself into contention with its spending promises, Associate Finance Minister Steven Joyce said in an e-mailed statement.

If it is to form the next government, Labour will need the support of one or more of New Zealand’s minor parties. Under the country’s German-style electoral system, parties that get 5 percent of the vote are guaranteed representation in parliament.

Kim Dotcom

The Green Party, which is at odds with Labour over deep-sea oil drilling off New Zealand’s western coast, had 10 percent support in last month’s Colmar Brunton poll, while the anti-immigration New Zealand First Party was on 4 percent.

The Internet-Mana Party, funded by Kim Dotcom, the web tycoon facing extradition to the U.S. on piracy charges, got 2 percent in the poll. Dotcom said in an interview last month that Internet-Mana’s internal polling showed them at 4.8 percent and that they were on track to win 5 percent in September.

The election comes amid a plunge in prices for dairy, New Zealand’s chief export earner. Whole milk powder prices fell to a two-year low at auction Aug. 5, bringing their slump from a peak reached in February to 46 percent.

Cunliffe said the declines -- which spurred local dairy giant Fonterra Cooperative Group Ltd. to reduce its forecast payout to New Zealand’s farmers last month -- show the risks of relying too much on one industry.

Reserve Bank

Labour has promised to give the central bank the power to recommend changes to the rate of the national pension savings program to hone its ability to control inflation and reduce upward pressure on interest rates and the New Zealand dollar.

“Our monetary policy will make our exports more competitive,” Cunliffe said.

Labour also pledged last week to ban the sale of farmland to foreigners and said it would block the purchase of the 34,000-acre Lochinver station on the nation’s North Island by Shanghai Pengxin Group Co., a Chinese property developer that bought 16 New Zealand dairy farms in 2012.

Cunliffe, 51, the son of an Anglican Church minister, worked as a business consultant with Boston Consulting Group in Auckland before being elected to parliament in 1999. He was elected Labour leader in September last year.

Disciplined Communication

While the election will probably be closer than opinion polls suggest, Labour faces an uphill battle and Cunliffe will need to be more disciplined in his communication, according to Claire Robinson, a professor at Massey University who specializes in political marketing.

“He just needs to not say stupid things, which seems to be quite hard for him,” she said in an interview.

Cunliffe drew criticism last month when he apologized for being a man in a speech to a Women’s Refuge symposium. The group supports women who flee violent or abusive relationships.

“I’m sorry for being a man right now, because family and sexual violence is perpetrated overwhelmingly by men against women,” Cunliffe said in the July 4 address.

Key labeled the comments “pretty silly” and said it was “insulting” to imply all men were abusive.

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