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FM AMEMBASSY WELLINGTON
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RUEHAP/AMEMBASSY APIA 0539
RUEHDN/AMCONSUL SYDNEY 0801
RUCNARF/ASEAN REGIONAL FORUM COLLECTIVE

UNCLAS SECTION 01 OF 03 WELLINGTON 000047 
 
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 KEY's BUSY AND POPULAR FIRST 100 DAYS 
 
WELLINGTON 00000047  001.2 OF 003 
 
 
¶1. (SBU) Summary.  The first 100 days on the new National-led 
Government have been active and largely well received by the New 
Zealand media and public.  The Government has kept its campaign 
promises pushing through tax relief and tougher law and order 
measures, starting to reform the bureaucracy, and advancing 
relations with Maori.  Key's government has begun to address the 
economic crisis.  At this early stage, Key and his ministers have 
managed to avoid missteps and have polled a stronger satisfaction 
rating among the public than going into the election last November. 
 End Summary. 
 
Record Pace Set at Forming Government 
------------------------------------- 
 
¶2. (SBU)  As Prime Minister John Key completes his first 100 days in 
power, the country's love affair with his National Party Government 
shows no sign of abating.  Key impressed with the speed at which he 
established his government after the November 8 election. 
Traditionally, the formation of a government in New Zealand takes 
weeks as various parties engage in lengthy negotiations over policy 
and cabinet positions.  Clark took one month to form her government 
after the 2005 election.  By contrast, Key formed his with the Maori 
Party, ACT and United Future in a mere 11 days.  While Key's desire 
to participate in the APEC Leaders Forum in Peru was a driving 
factor, National insiders predicted that the government would form 
in roughly two weeks after the election because Key's plans were 
already worked through. 
 
Judgment Calls on Cabinet Vindicated 
------------------------------------ 
¶3. (SBU)  Key faced skepticism as to some of his cabinet 
appointments.  Although most appointees were well known and signaled 
well in advance, some came as a surprise and raised questions about 
Key's judgment.  None provoked more skepticism than the elevation of 
Paula Bennett, a 39-year old with only three years in parliament, to 
the important position of Minister of Social Development and 
Employment where she would have control of welfare policy and a 
NZD20 billion budget, the largest in the public sector.  The 
appointment of Bennett, who once lived on welfare for five years 
while she raised her daughter, drew a sympathetic but nervous 
initial response from those working in the welfare sector.  Labour 
supporters called her a lightweight and her appointment reckless. 
Yet, Bennett has turned out to be one of the early high flyers of 
the new Government, not least because she personally broke up a 
fight between youths in her West Auckland electorate, but mostly 
because she has proved to be a hardworking and competent minister. 
 
Competent Forays into Foreign Affairs 
------------------------------------- 
 
¶4. (SBU)  Key's performance overseas as Prime Minister has been 
generally well-received in NZ.  The NZ press praised Key's first 
appearance on the international stage at APEC in Peru, impressed by 
his energy and self assurance.  At the January 27 Pacific Island 
Forum Leaders meeting in Papua New Guinea, Key worked hard and 
successfully to establish relationships with his counterparts. 
Key's statesman credentials have been burnished by his successful 
hosting of Australian Prime Minister Kevin Rudd and the President of 
Timor Leste, Jose Ramos-Horta since coming to power.  In March, Key 
is expected to host the President of the Republic of Korea Lee 
Myung-bak and plans to visit Rudd in Australia. 
 
¶5. (SBU)  The new Foreign Minister Murray McCully has warmed to his 
new role despite an early stumble over the closure of Bangkok 
Airport.  He has continued the previous administration's call for a 
return to democracy in Fiji and held firm in the face of provocation 
from interim Fijian leader Frank Bainimarama.  The new Trade 
Minister Tim Groser has spent more time out of the country than in 
it during the first 100 days.  He has worked hard to advance NZ's 
agenda of trade liberalization overseas and recently announced from 
Delhi that New Zealand and India will launch bilateral Free Trade 
Agreement negotiations.  Although the Government faced isolated and 
predictable criticism for not speaking out against the Israeli 
incursion into Gaza (as Helen Clark continued to do as opposition 
foreign affairs spokesperson) others praised its efforts to 
rebalance New Zealand's Middle East policy.  Overall, the 
Government's limited forays into international affairs since coming 
to power were seen as measured, competent and in keeping with NZ's 
traditional postures. 
 
Quick on the Legislative Agenda 
------------------------------- 
 
¶6. (SBU)  The pace set by Key in establishing his government carried 
over into the opening act of his first 100 days in power.  On his 
 
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return from APEC, he quickly enacted his legislation agenda.  He 
ordered parliament to go 'into urgency' (i.e., extending its 
operating hours) to introduce and even pass a series of bills. 
These included passing new tax cut legislation and introducing a 
raft of tough law and order bills.  National also repealed the 
highly unpopular Electoral Finance Act as they had repeatedly 
promised to do while in opposition.  Outside of his legislation 
agenda, Key immediately instructed health officials to make the 
breast cancer drug herceptin available for 52 weeks.  Faithful to 
his campaign pledge to address bureaucracy largesse, he also ordered 
public sector chiefs to open up their books to examine expenditure. 
The legislative session lasted until mid-December, when parliament 
adjourned until February 8, 2009. 
 
Holiday Period Break Invited Criticism 
-------------------------------------- 
 
¶7. (SBU)  The National-led government's 100 days of action was 
largely put on hold for the traditional four-week summer holiday 
with only a skeleton operation running throughout the period. 
Labour leader Goff, hoping to score political points, castigated the 
Government for its perceived inaction on the economy during this 
period.  Goff was supported by his predecessor Helen Clark who said 
other governments had cut their Christmas breaks short so they could 
continue to focus on a response to the global crisis.  However, such 
criticism failed to resonate with New Zealanders because a)  Key was 
reported to be on holiday but still busy with government affairs, b) 
the New Zealand public expects the government to take time off in 
summer (as Clark always did), and c) many New Zealanders were also 
vacationing during this period. 
 
Key Acts Cautiously on Economic Intervention 
-------------------------------------------- 
 
¶8. (SBU)  Despite being a supporter of free market principles, Key 
has embraced a certain degree of economic interventionism in his 
first 100 days in power.  Many of his spending proposals are 
existing capital expenditure projects that would move ahead 
regardless of the economy.  Key resisted pressure from Labour to 
adopt an enormous stimulus package, but has explained that what he 
has proposed puts New Zealand's package (on a per capita basis) 
among the top five developed countries.  Key, however, will try to 
portion out spending over time to target specific weak points and 
maintain the momentum of capital spending.  Mindful that New Zealand 
has an operating budget in the red and a vulnerable credit rating, 
Key has not been prepared to spend freely if it means indebting 
future generations of New Zealanders.  While he has cut regulation 
to stimulate business growth, he has pointedly refused (so far) to 
commit public funds to bail out struggling NZ businesses.  This 
position, though, may be difficult to defend if the integrity of 
NZ's important export sector worsens and unemployment rises above 10 
percent as some economists are predicting. 
 
Kept Promises Earns Support 
--------------------------- 
 
¶9. (SBU)  A hallmark of Key's first 100 days in office has been his 
determined implementation of campaign promises.  His initial phase 
of governing has tracked closely National's First 100 Days Action 
Plan announced in April 2008.  By closely adhering to his campaign 
promises, Key has effectively undercut pre-election claims by Labour 
that he has a hidden right-wing agenda despite his centrist 
credentials.  Prior to the election, Labour repeatedly called Key 
untrustworthy and labeled him "Slippery John."  However, Key has 
frustrated his opponents by establishing in his 100 days a popular 
agenda that has been clearly signaled well in advance.  Although he 
did invite the hard-right ACT Party into government, Key has so far 
kept it at arms length and even signaled a willingness to work with 
the left-wing Green Party.  Despite Labour's claims, Key has 
satisfied New Zealanders that he is delivering what he promised the 
country and what the country had voted for - a pragmatic and 
moderate government. 
 
Race Relations Prominent in Early Days 
-------------------------------------- 
 
¶10. (SBU)  Even before he came to power, Key had made significant 
strides in building a constructive relationship with the Maori Party 
and the wider Maori community.  In power, Key has made this 
relationship one of the most prominent features of his Government's 
first 100 days in power.  Since the election three events have 
underlined Key's positive relationship with Maori.  The first was 
his invitation to the Maori Party to join his government, even 
though National did not technically need its support to govern.  The 
second was Key's successful February 6 National Day visit to 
 
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Waitangi, the birthplace of modern New Zealand.  There he was 
greeted with genuine warmth by Maori leaders in a manner not seen in 
recent visits by political leaders.  The third was Key's signaling 
that his Government intends to continue the momentum established by 
the previous government in addressing the historical grievances of 
Maori, although National says it will expand the Maori middle class 
rather than to fund state programs that incentivize a continuation 
of an underclass. 
 
Country Gives Key Seal of Approval 
---------------------------------- 
 
¶11. (SBU)  Recent polls shows that the pre-election popular support 
for the National Party has carried over into the immediate 
post-election period and even soared to a record high in one poll. 
The February 18 3-News poll found that National recorded the 
highest-ever level of support for any party at 60 percent compared 
to the Labour Party's 27 percent.  (Note:  Traditionally, the 3-News 
poll tends to favor the Labour Party.  End Note).   The poll also 
showed that Key is New Zealand's most preferred prime minister with 
52 percent.  Labour's leader Phil Goff, who has struggled to get 
media coverage since taking over from Helen Clark after the 2008 
election loss, only registered 3.7 percent support.  Goff was easily 
eclipsed by Clark who polled second behind Key at 13.8 percent. 
Four out of five respondents believed that Key has performed well as 
Prime Minister and has exhibited strong crisis management skills and 
sound judgment. 
¶12. (SBU)  The February 22 Colmar Brunton poll, New Zealand's most 
prominent political survey, also underscored that the Government's 
post-election honeymoon shows no sign of diminishing.  The poll 
found that support for National had reached 56 percent, double that 
of Labour at 28 percent.  In preferred prime minister ratings, the 
Colmar Brunton poll reflected the 3-New poll with Key at 51 percent 
with former Labour leader Clark on 10 percent and current Labour 
leader Goff at just 6 percent.  The February 1 Roy Morgan poll 
showed more modest support for National over Labour at 48 percent to 
31 percent, respectively, but still a large 17-point gap. 
Labour out of Step 
------------------ 
 
¶13. (SBU)  Key and his government have continued to receive positive 
press.  Leading political commentator Tracey Watkins of the Dominion 
Post daily wrote that Key "has barely put a foot wrong since the 
election."  Goff and Labour, however, are viewed in less glowing 
terms and have faced press criticism in the wake of its clear-cut 
election defeat.  In his February 14 column, John Armstrong of the 
New Zealand Herald posited that by "installing Goff and Annette King 
as leader and deputy, Labour is failing to undertake the 
generational shift which Key's leadership has done for National." 
Armstrong concluded that Labour in opposition lacks humility.  Wrote 
Armstrong, 'It is as if last November's election result was some 
inexplicable mix-up which placed Labour on the wrong side of the 
chamber; a horrible mistake which will be rectified when everyone 
comes to their senses." 
 
Comment 
------- 
 
¶14. (SBU)  Despite the economic recession and continued law and 
order issues,  the public in general  still seems to trust Key and 
believe he has proven a competent and strong leader.  However, Key 
will be aware that at this stage he, like the public, is still in a 
relative bubble, as New Zealand has yet to feel the full effects of 
the global economic downturn.  Public feeling could sour quickly, 
particularly if people start losing their jobs in large numbers. 
Nevertheless, National has a large cushion of goodwill at the 
moment.  If Key manages to replicate Clark's once-magical ability to 
always stay one step ahead of the media and the public, and to 
constantly scan the horizon for trouble, then his honeymoon could 
continue for some time yet.  End Comment. 
 
Keegan