New Zealand First wasn’t happy with the first deal offered by National – and the big hurdle ahead is how to fund Christopher Luxon’s promised tax relief
Analysis: As the coalition talks roll into a second week tax and Treaty issues are proving sticking points.
That’s led to Christopher Luxon all but giving up hope of being Prime Minister in time to head to Apec in San Francisco on Wednesday night.
It’s been 11 days since the special results were delivered and while the relationship between Winston Peters and Luxon started off well, it's Act leader David Seymour that the New Zealand First leader has teamed up with in recent days.
Newsroom understands both minor party leaders feel they’ve been “low-balled” by National and can see merit in putting their differences aside to work together and leverage Luxon for a better result.
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New Zealand First doesn't want to see National's tax package come at the cost of needing to fund it through a foreign buyer tax and to take revenue from the Climate Emergency Response Fund (CERF).
In August, Peters posted on social media, in response to National's tax plan, that "they are clearly relying on mass immigration and a mass foreign buy up of Kiwi homes to fund its tax cuts – and their 'squeezed middle' will be squeezed further."
In addition, the party is committed to seeing revenue from polluters destined for the CERF being spent on adaptation and mitigation, such as flood protection, not in tax relief that landlords will largely benefit from.
For Act a priority is securing a decent deal around the role the Treaty plays in both governance and legislation.
It’s understood Peters saw an offer from National on Friday and not long after packed his bags and headed to the airport.
One source told Newsroom Peters appeared to be “pretty offended by it”.
In the days following, Peters and Seymour have kept lines of communication open as they seek to leverage a better deal by joining forces on areas they’re aligned on.
New Zealand First MPs will all be back in Wellington on Tuesday for a caucus meeting and it’s expected Luxon and Seymour will also return to the capital to continue conversations in-person.
There are also questions as to why Luxon hasn’t better utilised Brownlee in negotiation talks given he has a long-held relationship with Peters.
If Luxon was to make the flight to San Francisco on Wednesday evening he’d need to have signed a deal with both parties by the end of Tuesday to allow time for him to be sworn-in on Wednesday before jetting out.
But with no deal struck with either party, and both parties still needing to get sign off from their respective boards and caucus before agreeing to anything, the clock is running out for Luxon.
Sources spoken to by Newsroom suggested the end of the week could be possible for a deal, but there’s nothing to say it wouldn’t go on into next week.
That means the caretaker government will be required to represent New Zealand at Apec instead.
On Monday morning Luxon told TVNZ he wouldn’t send an observer with the caretaker government, as had been the case with the Pacific Islands’ Forum last week when senior MP Gerry Brownlee accompanied caretaker deputy prime minister Carmel Sepuloni.
But by Monday afternoon a spokesperson for Luxon told Newsroom no decisions have been made about whether anyone from National would attend Apec.
It suggests Luxon got ahead of himself when he definitively ruled it out earlier in the day.
There are also questions as to why Luxon hasn’t better utilised Brownlee in negotiation talks given he has a long-held relationship with Peters.
In an interview just days out from the election Peters told Newsroom Brownlee was someone he considered a friend, “to the extent we respect each other – yes, we’ve had our rows, but we still talk to each other politely”.
Instead Luxon has been taking his deputy Nicola Willis and chief of staff Cam Burrows with him to his meetings with New Zealand First.
While Luxon and Peters have spent time together a handful of times before negotiations started last week, nobody in the room has any long-established rapport with him, or an intricate understanding of how Peters operates.
Just two weeks out from the election, Luxon declared he didn’t know Peters.
If negotiations drag on into next week they could end up knowing each other very well.
