What Jacinda Ardern’s re-election means for New Zealand

Jacinda Ardern is to govern New Zealand for a second term after the Labour secured a historic landslide victory in the country’s general election. With all votes counted, Labour won 49.1% of the vote, meaning it is the first time under the current system that a leader will govern with a clear majority. It has been described as “a historic shift” by political commentator Bryce Edwards and as an “outstanding result” by opposition National Party leader Judith Collins. But what does this result actually mean for New Zealand – how will Ms Ardern’s majority affect how she governs?

Ardern first came to power in 2017, and her first term did not play out as intended. She promised transformational change to New Zealand society, but many of her efforts were stymied by a necessary coalition agreement with NZ First, a right-leaning and socially conservative party. As a result, despite being known internationally for promoting progressive causes, she faced some backlash at home for failing to live up to her rhetoric.

The three-year premiership of Ms Ardern was largely defined by her response to three major crises. In March 2019, a white supremacist murdered 51 people at two Christchurch mosques. In December that year, White Island erupted, killing 21 and injuring many more. And, of course, she has faced the Covid-19 pandemic – Ms Ardern imposed two extended periods of lockdown, and her ability to generally control cases has received global praise. The PM made the election a referendum on her calm handling of crises, rather than her government’s modest success at achieving its manifesto aims.

Although Ms Ardern has promised to create new jobs, there is a disparity between her government’s economic attitudes towards the affluent middle-class and the poor

In her victory speech, Ms Ardern said: “Tonight’s result does give Labour a very strong and very clear mandate.” But a mandate for what – what kind of policies will the new Ardern government enact? The first answers may come as a result of two referendums held on the same day – one asking whether to give terminally ill people the option of requesting assisted dying, and the second over whether the recreational use of cannabis should become legal. The euthanasia referendum is a binding vote and, if it passes 50%, it will become law.

One thing Ms Ardern must look at are the nation’s finances. New Zealand is in recession for the first time in 11 years, which its borders still shut and the tourism sectors collapsing. Debt is forecast to rise to 56% of GDP, from less than 20% before the pandemic. Although Ms Ardern has promised to create new jobs, there is a disparity between her government’s economic attitudes towards the affluent middle-class and the poor. A major policy issue during the campaign was the Greens’ proposal for a wealth tax, something Ms Ardern categorically ruled out – instead, she plans to increase the levy on those who earn more than NZ$180,000 from 33% to 39%.

The Ardern manifesto is somewhat light on policy and she has faced some criticism for being insufficiently adventurous in her proposals. She pledged to instil more climate-friendly policies, boost funding for disadvantaged schools, and raise income taxes on top earners, but critics say her approaches are too small. Rather than regulating emissions from farms, for example, her government intends to reduce the country’s dependence on coal by outlawing certain kinds of coal fire boilers and making all public buses zero emission. Ms Ardern is motivated by a belief in social justice, but there seems to be a lack of genuinely radical policies that could address structural inequality.

The Covid-19 pandemic has helped create a very real feeling in New Zealand that Ms Ardern is a competent and assured leader who is able to navigate through a crisis

Ms Ardern values cooperation and compromise, and there is a big question over whether she’ll invite the Green Party into her government. If she does, it’s likely her government will be pushed more left than the centrist path she hopes to tread. Dame Marilyn Waring, economist and former National Party MP, argues that having the Greens in government may expand the policy ideas being considered: “Because the Labour caucus does not allow any dissent once a policy is agreed, we will not have much creative imagination brought to the table.”

The Covid-19 pandemic has helped create a very real feeling in New Zealand that Ms Ardern is a competent and assured leader who is able to navigate through a crisis, and she has been rewarded handsomely for that. But with a death toll of only 25, attention is now turning to whether Ms Ardern can deal with the other issues plaguing the country. In her first term, child poverty and homelessness significantly worsened, and house prices have risen to a level that many consider unaffordable. Unemployment has shot up due to Covid-19, and many government proposals to help industry are in industries in which the disproportionate number of now-unemployed women are under-represented.

The likely prognosis is this – Ms Ardern will tally up the possibility of transformation and likely enact further social liberty, but her economic policies will be necessarily conservative in order to help New Zealand back onto its feet. Her election victory gives her the ability to pass more ambitious legislation, but it’s very uncertain how ambitious the government will actually be. Ms Ardern has proven herself able to respond to sudden and serious crises, but in her second term, she’ll be judged on whether she can deal with more systemic societal issues. Voters have given her a mandate, and she must fulfil it.