Patrick Gower interviews John Key

Headlines:

New 3News Reid Research poll shows opposition to National deal with Conservatives: 60% say no and only 22% say yes. National voters: 31% say yes and 49% say no.

Does Key want a deal: "I truthfully can’t answer that question. I can say there’s merits for both sides of the argument".

John Key fails to name one good thing Colin Craig has done this year.

Insists National still hasn't decided whether to do a deal in East Coast Bays or Epsom.

Key refuses to match Labour's promised spending on health and education: "...the absolute amount of expenditure we’ve had in health and education has been more than sufficient over the course of the last six years".

John Key promises to see out a third term, should he win in September and guarantees not to hand over to a successor.

Says "there's every chance we don't win" the election and he gets "very worried" about losing.

On Donghua Liu: "This isn’t something that we’ve set up, this isn’t something we’ve orchestrated in so much that if they have engagement with Donghua Liu, they had him as a donor and he gave them money then that’s a matter between them."

Patrick Gower started the interview by asking, given the level of opposition, does he really want a deal with Colin Craig?

John Key: First thing I’d say is we want to be the government post 2014 election. And I think New Zealanders do understand that involves doing deals or accommodations and actually cobbling together 61 seats. So in terms of will we specifically outline a deal with the Conservatives or United or Act, well we’ll announce that in a few weeks’ time you know, some grace time.

Patrick Gower: So yes or no to the question. Do you want a deal with Colin Craig, yes or no? Because even your own voters, one in every two National voters does not want a deal with Colin Craig.

Key: Well I truthfully can’t answer that question. I can say there’s merits for both sides of the argument and we’ll take it through a process which will obviously include the president and the sort of kitchen cabinet. And we’ll do that relatively soon. But I can’t be absolutely sure of a definitive answer, I don’t want to mislead you but – but what I can say is realistic enough to know despite the fact that we are polling well a lot can change in an election campaign and we are likely to have to do a coalition deal.

Let’s look at it this way then. Colin Craig, tell me one good thing that he’s done this year?

Well I don’t want to critique his performance because that’s just simply not my job.

No, but it’s not a critique it’s, what’s one good thing you’ve seen him do?

Well not so sure that’s really the answer that I need to look for I mean the answer is –

But it is if you want to do a deal with him you’ve got to be able to say this is - here’s something good that he’s done.

Well he has a legitimate voice for some New Zealanders. It might be a position that’s quite a far away from me when it comes to social issues but there are plenty of New Zealanders that would support his view on smacking or gay marriage or whatever it might be. It’s not where I’m at personally but I understand that position.

But you can’t actually name something that you’ve seen and then you’ve gone ‘hey that’s pretty good’.

I don’t follow everything he does but what I’m saying to you is that we live in a world where we have to put together 61 seats. Realistically could we work with him if we go into Parliament? Let’s just argue, he either wins a seat or he gets 5%, the answer is yes I think we could because we’ve worked with lots of other different parties as well.

Yeah but I just want to pick up on that because it’s just about numbers isn’t it. It’s just about whether he can help you win, it’s not about Colin Craig’s character, it’s not about what the Conservatives can do for New Zealand, it’s about whether they can help you win.

But that’s true of every major political party. In the end whether you’re Labour or whether you’re National, you’ve got to work out how you get that race of 61 seats. Now in putting together those groups you have to answer the obvious question, do we have enough in common or do we believe we’re malleable enough to actually work together for the betterment of New Zealand. Because the other alternative is everybody gets stubborn and we say oh no, we don’t have 50-percent so guess what we’re going back for another election. Well New Zealanders don’t want that, that’s for sure. There’s a couple of problems in doing that.

But there’s a difference. The difference with Colin Craig though is he will only get into Parliament with your say-so. There is no other way he will make it. You decide whether he lives or dies.

Well the way you can make that case but you can’t be absolutely sure of that. I mean he’s sitting at 2.8-percent in your poll. Now I accept he’s in a range of different polls, he’s a range of different levels.

He has never got anywhere near 5.

No.

So he survives, he gets into Parliament whether you decide or not part of the difference with him.

I’m one hundred percent not sure you can make that case at this point. I mean I accept certainly if we helped him that’s definitely beneficial to -

What’s right about that? About you helping him and he gets in, what is the good part about that for voters?

Well taking the first point though, if you go back to the 2002 campaign you did see a situation where both United, Act and New Zealand First considerably lifted their vote in the campaign. And you’ve seen it actually in other campaigns, in New Zealand First in the 2011 campaign. So I don’t think you can coherently say there’s just no chance that he can get there without any support from us. From our point of view if you go to National voters and you say ok here’s the alternative, National can put together a government that works in accommodation with some other political parties. Or the alternative is New Zealand is governed by Labour and the Greens and New Zealand first and Mana-Internet and maybe other political parties. Do you want that? I think the bulk of people will want to see National as the government, we’d crudely say they’d expect me to find accommodations to put together something that’s a stable government. Now there’s obviously flexibility within all of that and I’m not arguing these decisions are easy. But I am making the case though that I think it’s far better that we’re transparent with New Zealanders and up front. And I think if you look at that, New Zealanders want that actually.

Well let’s pick up on that transparency because look at what’s happening at Epsom. Paul Goldsmith is not campaigning, Paul Goldsmith is not looking or anything other than the party vote, the Act party thinks there’s a deal on, I know there’s a deal on, you know there’s a deal on but you won’t say it.

Well again, we haven’t, we’ve never sat down and actually had the conversation with the group of people.

But there will be a deal there, won’t there?

There could be and we’ll see.

So where is the transparency, why don’t you just say?

Because the election is going to be held on September the 20th and National is the only political party I can see that’s actually in front of voters saying we’ll give you clarity, we already have in terms of who we can work with and we’ll give you absolute clarity on those things.

You’re saying it, but you’re not doing it.

Yeah I know, but we’re not doing it today because this is your timetable and with the greatest respect we’re twelve weeks out from an election and you might want me to unwrap that present for you today on The Nation but I’m not in a position to do that. But that doesn’t mean -

But the present is unwrapped.

But it’s not unwrapped. Because if it was you’d already be able to answer those questions and you can’t. That’s why you’re asking me that. And I can’t explain it, not because I can’t be difficult-I’m trying to be difficult about it - but because we have not made those decisions yet. But the decision we have made is that we will be absolutely clear with people and we’ll do that in some time well and truly before the campaign. And when we do that, mark my words, we will be the only political party that will be saying this is who we can work with and if there are accommodations there are the ones that we think make sense from our perspective. No one else will give you that straight answer. New Zealand First won’t give you that, David Cunliffe certainly won’t give you that. So in a way I think we have the moral high ground here because we are prepared to be transparent.

On those other deals. Let’s look at Hone Harawira and Kim Dotcom. What is the difference, if any, between the deal they are doing and the deals that you do?

Can you pick up on any difference?

Ah, I mean I could critique, you know, whether they can naturally fit together or the merits of a guy that’s fundamentally funding a political campaign for his own personal self-interest.

But in terms of that electorate deal is there any difference really between your arrangements and their arrangements?

Theirs is a little different, in so much that they’re actually looking like their going to form a party and split apart, so it is a bit of a rort through the system. At the end of the day we haven’t criticised that. We’ve – you know – we’ve accepted -

That’s what I’m saying, you don’t criticise that deal do you.

We’ve actually accepted the fact that -

Because you can’t-

Well it’s not that we can’t. It’s – I’ll just come back to the main point. You know I’ve given a lot of thought to this issue and I’ve been involved in leading National into a number of campaigns now and there’s been all sorts of variations or sending signals to voters and we’ve become more refined and have a better understanding. What New Zealander voters definitely do understand now though is the only vote that matters is the party vote. And if they want to see National in the government, in the end, the surest way of that in the end is getting 50-percent.

Sure. I want to look quickly know at Donghua Liu. You threw it out there and I’ll quote you, what you told us over the United Nations, the donation could be $15-thousand, $30-thousand or hundreds of thousands.

Agree.

That was wrong what you said, proven to be wrong; you obviously had some idea of what was coming out in the statement. What was your intention of throwing out that number?

I don’t know it has been proven to be wrong -

The over 100-thousand has by Donghua Liu himself. What was your intention in essentially spreading the rumour?

Well what I’d heard was that there was a donation, and I’d heard that the donation was more than 15-thousand.

Well what were you trying to do by putting that out there?

Well I think from memory, because you have to go back, you guys asked me questions about the donation.

This was a question about the letter; sorry I’m just asking not, I don’t want to go back again.

I was simply making the point that what I’d heard was that there was a donation that was made and that the donation was larger than 15-thousand. That’s proven to be correct.

Do you feel It’s wrong though for a prime minister to be spreading rumours? That’s where I’m going here.

Well if you guys are prepared to go on, going forward, not ask me questions I’m more than happy not to give you answers. In the end this is a situation between Labour and Donghua Liu. This isn’t something that we’ve set up, this isn’t something we’ve orchestrated in so much that if they have engagement with Donghua Liu, they had him as a donor and he gave them money then that’s a matter between them.

I want to move quickly now to John Roughan’s book which is just out, I’ve had a read of it. In this business that we’ve been talking about that when you felt like quitting, that you don’t like losing, in that context in that you felt like that in the second term, can you guarantee voters that you will see out a third term?

Yes, but I mean I think it’s important -

You can also guarantee you won’t hand over to anyone during that third term?

Correct, but if you go back to the second term, you know, and the statements in the book, I think it’s worth putting a bit of context around that which was Bronagh and I, over that Christmas holiday had a legitimate conversation about whether we were committed to a third term. And actually if, you can make the case if I should or shouldn’t say those sorts of things, I’ve been a pretty open sort of Prime Minister. But it’s not logical is it, really, for a political household like ours where the expectations on Bronagh and our family are that they make considerable concessions for me to be in my job, for us not actually as a couple to sit down and say are we committed to another three years of this?

So what does that mean, in that fourth term, are you going to stand for that fourth term if you are going to go all the way through and not handover?

Well I might do and I’d probably like to but my point is that -

Because there’s no way of doing that isn’t there without handing over, you’re basically saying the fourth term is on, if I get the third.

Correct. But the point is you’ve got to get the third. And this is where everybody gets a bit ahead of themselves because in reality we’ve got to win that third term. And I know the polls look strong for us. And I know on the 3 Reid Research poll we’ll be able to govern alone and I’m really personally desperately hope that’s what election night looks like. But you and I both know it’ll probably be tighter than that and there’s every chance that we don’t win. And so you know – I just get very worried. It’d be like the All Blacks saying well I’m worried about the 2015 World Cup by the way I’m worried about the 2019 one, winning that one was well. Your headspace is in completely the wrong place if you start adopting that viewpoint.

Looking very quickly at a couple of other things, your mother as we see in the book and we know the story, three times essentially she restarted her life, first as a refugee, then with your father and then of course leaving him, is that something you’ve inherited the ability to make the tough decision and then go on with it without looking back. Do you-

Well I’m very, I think naturally as a disposition, I’ve got quite a happy disposition and I am good at looking forward. It doesn’t mean that I don’t ever want to look back but my mother certainly taught me that a, you get out of life what you put into it so if you work hard that will help you know in the results you get, but secondly whatever decisions you make, make the best ones you can. But in the end you can’t dwell in the past. I’ve made mistakes. Look, I’ve made mistakes in politics and I’ve made plenty of mistakes in life. But in the end all I’ve tried to do is learn from those mistakes.

Looking forward then to the potential for a third term, what’s the agenda, most in particular where do tax cuts fit into your agenda if you get that third term?

Well again, we haven’t made that decision yet, but what we have done is given ourselves the room for potentially tax cuts if we want to, and you saw that in Budget 2014, with the Budget documents quite clearly say the headroom if you like, the capacity to spend money or return it to New Zealanders has lifted from that base of about a billion dollars to 1.5-billion. Now there are pressures on that and I know from doing a lot of tax cut packages in the past, you actually need quite a lot of money. So our risk is that we do tax cuts and people perceive them to be not enough, on the other side of the coin we as a political party desperately believe in people being able to get ahead under their own steam, returning money and having the right incentives in the tax system.

Sure, so I’ll pick up on that because health and education for instance, Labour this week promised a billion dollars a year to spending at pace with inflation. You’re saying there that you could match that?

No what I’m saying is we make our own -

So yes or no, can you keep the real spending on health and education there?

Well my view is the absolute amount of expenditure we’ve had in health and education has been more than sufficient over the course of the last six years. What Labour demonstrated in office was that they were great at spending money and actually not great at getting results from it.

So can you promise that spending in real terms in health and education won’t drop?

Well that’s not the way I’m looking at it. What I’m looking at is results. I’m not going to bother engaging in something I don’t think is the realistic argument because if you go and have a look at elective surgical operations, hips and knees, under us in 2014 160-thousand of those operations will be undertaken in 2008 there was 120-thousand. So we’ve got a lot more efficiency out of the system and that is the problem with Labour. They want to tax you more, you’ve already seen that, capital gains tax and raising top personal rate, they want to spend more of your money which they’ll spend in inefficiently. And in the end will you get more for it and a better quality result, well history tells you, you don’t.

Final question, what’s the unfinished business if you get another go, what’s the unfinished business?

Ah, there are lots of things. I think firstly I think locking in that growth, locking in that international engagement. I think New Zealand is doing well with being a multi cultural fully engaged country. I think education reform is critically important. There’s more infrastructure that we need to build. The last thing I suppose is in the end, 2015 onwards I want to run the campaign of changing the flag.

Prime Minister, that’s a good place to leave it. Thanks very much.

ends

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