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RR RUEHDT RUEHPB
DE RUEHWL #0381/01 3150428
ZNR UUUUU ZZH
R 100428Z NOV 08
FM AMEMBASSY WELLINGTON
TO RUEHC/SECSTATE WASHDC 5530
INFO RUEHNZ/AMCONSUL AUCKLAND 1789
RUEHBY/AMEMBASSY CANBERRA 5316
RUEHDN/AMCONSUL SYDNEY 0755
RUEHAP/AMEMBASSY APIA 0507
RUCNARF/ASEAN REGIONAL FORUM COLLECTIVE
UNCLAS SECTION 01 OF 02 WELLINGTON 000381
SIPDIS
SENSITIVE
STATE FOR STATE FOR EAP/ANP
PACOM FOR J01E/J2/J233/J5/SJFHQ
E.O. 12958: N/A
TAGS: PGOV PHUM KDEM NZ
SUBJECT: PM ELECT JOHN KEY'S CROWDED FIRST 100 DAYS
WELLINGTON 00000381 001.2 OF 002
1. (SBU) Summary. National Party leader and Prime
Minister-elect John Key, victorious in New Zealand's
November 8 General Election, has announced an ambitious
100-day plan. Key plans to quickly formalize governing
arrangements with support parties ACT and United
Future. In past elections, this process has been a
drawn-out affair often lasting weeks. As a result of
pre-election deals, however, Key could complete it
within a week. Once he is sworn in Key plans to call
the new Parliament to session to launch an ambitious
and rigorous legislative agenda. Although the next
hundred days may not be smooth sailing, there are no
obvious hurdles to thwart Key's immediate goals. End
Summary.
First Act: Formalize a Coalition Government
-------------------------------------------
2. (SBU) The first task facing Prime Minister-elect
John Key of the National Party is to install his new
government, and confer a sense of certainty, stability,
and effect a smooth transition from the outgoing Labour
government. Key will seek to formalize the governing
relationship with National's established support
parties, ACT and United Future, in order to confirm his
governing majority of sixty one seats in Parliament.
[Note. On election night National won fifty-nine of the
one hundred twenty-two seats in parliament and in order
to govern must therefore obtain the support of other
parties. End Note]. Once Key is able to secure a
formal governing majority, he will request that the
Governor-General of New Zealand announce the formation
of the new National-led Government.
3. (SBU) The formation of the new government has,
however, been prearranged. The ACT Party, which won
five seats, will be formally invited to form a
coalition government with National by virtue of a pre-
election deal between the two parties. In return for
this guaranteed support, Key will offer ACT's leader
Rodney Hide, and possibly his deputy Heather Roy, a
cabinet position. Although Key does not need the one
seat United Future's leader Peter Dunne won in order to
form a government, Dunne is nonetheless assured a
cabinet position per another pre-election deal with
National. Once Key has established a formal governing
majority, he is expected to talk with the Maori Party,
with five seats, about a possible role in government.
Key does need the support of the Maori Party to govern,
but has expressed a desire to broaden his governing
mandate by involving the Maori Party.
Cabinet Announcement Expected Soon
----------------------------------
4. (SBU) In past elections, forming a government took
weeks as various minor parties negotiated deals with a
major party over the terms of their support. Given
that Key secured deals with the ACT and United Future
parties before the election, the process of formalizing
the new government is expected to be completed quickly.
It is possible that this process could be completed by
November 11 when Key will gather his caucus and
possibly announce his new cabinet. However, a
disagreement over portfolio allocation or differences
over policy with the support parties could stall the
naming of the cabinet and thus the installation of the
new government. One possible stumbling block could be
Key's public insistence that he will not include in his
cabinet ACT's Sir Roger Douglas, the architect of New
Zealand's early 1990?s economic reforms. Then a Labour
MP, Douglas is now regarded as extremely right wing,
and this could damage Key?s efforts to be seen as a
centrist.
Full & Dismal Fiscal Briefing
-----------------------------
5. (SBU) One of the first appointments Key will have
as Prime Minister-elect is a briefing by Treasury
officials where he is expected to receive a full
account of New Zealand's fiscal position. As leader of
the opposition, Key was privy to some Treasury data,
but not all. Some analysts believe that Key will only
then be confronted with the full extent of the New
WELLINGTON 00000381 002.2 OF 002
Zealand's fiscal situation. Key will also receive
briefings from other government agencies.
Key's Crowded 100-Day Agenda
----------------------------
6. (SBU) One reason Key wants to move swiftly to
establish his new government is to expeditiously pass
certain legislation before the end of the year. Key
has already laid out an ambitious 100-day legislative
agenda. This will require that the new Parliament
resume soon, possibly within weeks. The agenda was
first unveiled in the election campaign, and Key is
determined that it will be followed in government.
Key's first ambition is to legislate his tax cut
program so it can take effect on April 1, 2009. Key's
second agenda item is to prune government spending in
the public sector, particular in the health
bureaucracy.
7. (SBU) Other objectives include passing tougher
legislation to address violent crime, organized gangs,
and parole decisions. Establishing a transitional
relief package for workers made redundant is also high
on Key's agenda, together with establishing national
education standards in literacy and numeracy. Key
hopes to quickly amend the controversial Resource
Management Act to facilitate development for housing
and infrastructure. Growing the economy through
infrastructure development was one of Key's main
promises during the campaign. Key will likely create a
new cabinet position to deal specifically with
improving New Zealand infrastructure capacity.
Comment: Path Clear for Key to Move Quickly
-------------------------------------------
8. (U) Although Key's immediate plans are ambitious,
there appears to be little that could block Key's
capacity to establish his new government and implement
his legislative agenda. His pre-election deals with
ACT and United Future mean that the broad terms of
support have already been established which should
translate into a swift and smooth transition to
establishing the new government. The large number
National seats meant that Key did not need to make any
compromises, for example with the Maori party, which
might hobble his agenda. Key's comfortable
parliamentary majority will mean that the passage of
his 100-day legislative agenda should proceed without
opposition, especially given that the agenda items are
supported by both ACT and United Future. End Summary.
McCormick