ACT back in government in NZ

Despite the National Party winning an impressive 59 seats out of 122 in their election victory last weekend, Nats leader John Key has still had favours to call in and deals to strike.  Three seats short of a majority, he’s spent the last running around trying to corral into suitable agreements his three prospective coalition partners: the ACT, the Maori Party, and United Future.

The first of those happens to be a classical liberal party.*  The ACT, the Nationals’ “natural allies”, came fourth (behind the Nats, Labour, and the Greens), with 5 seats - enough for the Nats-ACT coalition to rule by itself.  That means that, the ACT are in the rare situation of being classical liberals deciding the government.  That’s why I’m a member - having signed up after the disastrous election year of 2005, when we won only 2 seats.

What we get from selling out to the Nats has been revealed, as John Key has announced all the coalition agreements today.  What libertarian policies can New Zealand expect.  Well, here’s the full agreement (12-page PDF) if you’re keen to know, but it basically boils down to:

• ACT leader and deputy leader are ministers (like UK Secretaries of State) outside the cabinet with combined responsibilities for Local Government, Regulatory Reform, and Consumer Affairs, and associate ministers (like Ministers of State) for Commerce, Defence, and Education.
• Postpone the Emissions Trading Scheme under the Kyoto protocol and ban on new build of ‘non-essential’ fossil fuel plants will be scrapped.
• Private-sector review of all government expenditure.
• Passing the Taxpayers’ Bill of Rights: capping growth in government expenditure.
• “Significant tax reductions“, including reducing top rate of all income and corporation tax to 30%.
  utting regulation.

At the same time, the ACT being outside the cabinet, and hence only required to support the Nationals on confidence and supply, means that they are not required to vote with the Nats on social issues.  There’s no way the Nats could accept the explicit aim of increasing net immigration to 40,000 people a year (that’s 1% of the population: how would Conservatives react in the population of the UK growing by 600,000 a year?!), or the inclinations of most of its leadership towards liberal social policies.**

To an extent, the ACT is kept in check by the coalition agreement with the Maori Party, which whores itself to whichever of the big two parties wants its MPs’ support.  But, given that the ACT’s support isn’t necessary for a National government, the coalition agreement looks very generous.  If the agreement is implemented, it looks set to move government in New Zealand back towards classical liberalism - and hopefully, libertarianism.

* I’m careful not to call it a truly libertarian party, because there is one of them - the Libertarianz - that does lots of direct action and maintains the excellent Not PC blog.  It just doesn’t stand a chance of getting elected.  That’s all.
** Although not as liberal as the Libertarianz, sadly…