VZCZCXRO6967
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