By Paul Dalziel, Professor of Economics and Deputy Director
Agribusiness and Economics Research Unit, Lincoln University
On 24 September 2017, New Zealand held its three-yearly general election under its mixed member proportional representation system.
There were 64 general electorates and 7 Māori electorates, each decided by the candidate with the most votes from voters in the electorate. The remaining 49 seats were allocated from party lists to ensure the overall distribution of representatives in Parliament matches each party’s share of party votes made by all voters.
Of the general electorates, 30 are concentrated in the major urban regions of Auckland, Wellington and Christchurch. Of the remaining 34, the National Party won all but five. Thus, non-urban regional New Zealand in the general electorates voted overwhelmingly for the National Party.
The two major parties both issued policy documents on regional development. Labour’s manifesto was built on five promises:
- to establish a regional development fund (NZ$200 million over four years) for strategic projects;
- to develop a regional ports and transport strategy;
- to make a Young Entrepreneurs Grants scheme available outside the main centres;
- to look for opportunities to locate government operations in regions; and
- to guarantee local participation in regional development policy making.
National’s manifesto offered a six-point plan for regions:
- Previously announced tax cuts would raise family incomes.
- It would continue to invest in roads and broadband infrastructure.
- It would continue to negotiate international trade agreements and build skills and innovation through regional research institutes.
- It would maintain fiscal responsibility.
- It would invest in world-class public services for regional New Zealand.
The sixth point was possibly the most telling. Labour had promised to reverse National’s promised cuts to income tax and had signalled its intention to introduce a royalty on the commercial use of water (by irrigation schemes, for example). In contrast, National promised not to introduce new taxes on farmers, and would continue to exclude agriculture from the Emissions Trading Scheme.
Further, National was able to point to its Regional Growth Programme, introduced in 2014 (see https://www.mbie.govt.nz/info-services/sectors-industries/regions-cities/regional-growth-programme). This programme focuses on regions identified as facing persistent economic challenges or likely to benefit from economic diversification. The programme sponsors a stock-take of economic opportunities, which then feeds into the development of an economic action plan. Ten regions have been supported by this programme, covering almost all of non-urban New Zealand.
The Regional Growth Programme applies current theories of place-based development, analysed, for example, in the Regional Studies journal of the Regional Studies Association (see especially Volume 29, Issue 8, in 2015). The programme helps local actors identify economic opportunities based on regional strengths, with a focus on projects that are enablers for local enterprise. Central government plays an important partnership role (through infrastructure investment, for example), but leadership is exercised at the local level.
Consequently, the National Party’s strategy for regional New Zealand came across as better considered and more detailed than the Labour Party’s strategy for regional development. Some localities in rural regions undoubtedly face challenges (see, for example, the essays in Paul Spoonley’s edited book on Rebooting the Regions, published by Massey University Press in 2016), but central government is designing policies to address these challenges.
The more difficult policy problem is the level of persistent poverty in parts of New Zealand’s larger urban centres. Overcrowded accommodation in uninsulated homes in places like South Auckland is contributing to health and education difficulties blighting the lives of tens of thousands of children (see Philippa Howden-Chapman’s book Home Truths published by Bridget Williams Books in 2015). Regional policy in New Zealand is almost blind to this problem, but the spatial concentration of urban poverty must be addressed.