Economy behind NZ PM Luxon’s 10-month election call
Life was good for New Zealand prime minister John Key in the summer of 2011.
The first-term leader (now Sir John Key) was heading to the polls with a Rugby World Cup on home soil and, of course, looking forward to an electoral coronation.
However, the timing of the two events was contradictory.
The selection was to be held a few weeks after the World Cup; This was a untouchable event so that rugby-mad Kiwis would not be influenced by campaigning or election date speculation.
Over the summer Sir John realized he could solve the problem in transit.
“I thought it would be a virtue to announce the date in advance,” he told AAP.
So he announced February 2, five weeks after the World Cup final, and November 26 as election day.
Sir John had been given the important advantage of hiding the election date from his rivals, but he won a second term after the All Blacks won their second world title.
“This was about saying, ‘Hey, we’re confident in the government’s performance so we’re not going to leave things in the dark,’ while (hoping) to get brownie points for transparency,” Sir John said.
Fifteen years later, early dating is now an accepted tradition in New Zealand politics and has been practiced by every prime minister since.
Julia Gillard even followed the Kiwi approach in Australia in 2013, setting 14 September as the election date in a shocking speech at the National Press Club in Canberra in January.
So was Chris Luxon supposed to follow the same tactics?
This week, Mr Luxon, the first-term prime minister who counts Sir John as his political mentor, called for the November 7 election to be held “to ensure New Zealanders have certainty”.
The only problem is that the National party leader is not doing well at the polls: he is in a dogfight to avoid becoming the country’s first single-term government in more than 50 years.
“Luxon is very unpopular,” The Post senior correspondent Amelia Wade told AAP.
“His personal popularity has long been thought to be a drag on National’s votes.”
David Farrar of Curia Market Research, which polled for Sir John, confirmed Mr Luxon’s struggle to connect with voters.
The Curia’s latest poll gave the former Air New Zealand chief executive a net satisfaction rating of -17, while Labor leader Chris Hipkins gave it a +4 rating.
Frustrations with Mr. Luxon’s leadership nearly led to a coup in 2025 that never went away.
“It looked like MPs were sounding as to whether there was appetite for change,” NZ Herald political editor Thomas Coughlan told AAP.
“The answer was a resounding ‘No’, as National is still recovering from the instability of the Ardern years.”
While Mr Luxon’s popularity is a key factor, all analysts say the election will depend on New Zealand’s economic recovery.
New Zealand performed much worse economically, after using its natural advantages to combat the Covid-19 pandemic much better than Australia.
A recession hit in 2024 and annual GDP growth has remained in reverse ever since, despite Mr Luxon’s promises of jobs.
Mr Coughlan said the election appeared to be “a referendum on the state of the economy” and that Kiwis were “not feeling it” at the moment.
“From a labor market perspective, you would have to go back to the GFC to find a higher unemployment rate,” he said.
“More than 70,000 Kiwis have left the country – the highest number in history.
“House prices have fallen by more than 20 per cent in Auckland and more than 30 per cent in Wellington, on par with some predictions of the American slump during the depression.
“This has had a real impact on how people feel about the economy.”
Therein lies the basis of Mr Luxon’s 10-month campaign call: enough time for the economy to recover.
“Luxon will be hoping that by November the economic recovery is well underway and Kiwis are feeling a little better off,” newsroom.co.nz political editor Laura Walters told AAP.
“But if things don’t improve and Kiwis have another long, difficult winter then the nation’s mood may not have improved sufficiently by November.”
The contest will then become a 10-month battle to see who Kiwis will blame for their economic difficulties.
Will it be Mr Luxon, who ran a magnificent campaign in 2023 and will spend the year ruthlessly suppressing the “mess” left to him?
Or is it Mr Hipkins, who lost the last poll after handing over the leadership to Dame Jacinda Ardern, and will claim the “out of touch” prime minister is not up to the job?
There are, of course, many other battlefield issues: a health system in crisis, the government’s record on Maori issues, infrastructure and more.
There are minor parties too: the populists of a resurgent NZ First are on the march, the right-wing ACT is certain to turn the tables, the Greens have solid support and the Maori Party is in meltdown.
But all roads to the Beehive seem to lead through the most important issue: affordability and economics.
“This is critical to their success,” Mr Farrar told AAP.
“And National still leads Labor as better economic managers.”
On the current figures, Mr Farrar said it was likely the National-led coalition would return, although it was not certain.
“Would one be surprised or shocked if there was a change of government? You would be surprised, but not stunned,” he said.
