Why John Key wants to change the electoral system, Otago Daily Times, June 2008

John Key’s plan for a referendum on MMP shows National is mirroring the position of the big business lobby that has always opposed the proportional representation system. Key said last month (May 18 2008) he wanted to dump MMP while retaining “some proportionality”, a reference to the Supplementary Member system being promoted by the business lobby. Fortunately a series of revelations have illuminated the 15 year history of anti-MMP campaigning, showing clearly who is pushing this cause and why.

In the original anti-MMP campaign, Telecom head Peter Shirtcliffe and new right campaigner Brian Nicolle joined forces to swing the November 1993 referendum against MMP. Shirtcliffe said their money came from the public sending in newspaper advertisement coupons, but the estimated $2 million advertising budget clearly came from a group of Business Roundtable types like Michael Fay who had attended an anti-MMP campaign planning meeting at Shirtcliffe’s home. David Lange noted at the time that the anti-MMP campaign represented “the very people who were involved in the relationship between government and business which so angered the public and caused the demand for electoral reform in the first place.”

Shirtcliffe and Nicolle’s motivation was clear. First Past the Post had delivered the strong, single-party governments that pushed through the 1980s and 1990s reforms of Roger Douglas and Ruth Richardson. They feared that MMP would slow the juggernaut, which was exactly why many ordinary New Zealanders wanted it. 100 years after New Zealand women won the vote in 1893, the referendum went to MMP.

Under the first MMP government of 1996-99, the anti-MMP lobby was inactive. Nicolle had set up the ACT Party and free market reforms continued in areas like ACC and health under Jim Bolger and Jenny Shipley. But the Labour-led government that followed was not to their liking and the anti-MMP campaign was revived.

In early 2001 Auckland merchant bank spokesperson Stuart Marshall announced that he and “a few friends” had set up a group called Citizens’ Majority Trust to collect signatures to prompt a referendum on the electoral system. He didn’t personally have a strong opinion about MMP, he said, “but over the last few years I have become concerned that people think the democracy they live in is becoming less responsive to their needs.”

The group was a sham. Nelson Mail reporter Geoff Collett discovered it had been set up in meetings of big business leaders. Nicolle was again the campaign brains. Shirtcliffe claimed publicly that he wasn’t involved but had chaired the establishment meeting. The whole purpose was to get rid of MMP. Shirtcliffe and Nicolle were assisted by two Motueka businessmen: fishing company head Peter Talley and retired lawyer Nick Davidson. They believed that, as they’d feared, MMP was putting the brakes on continued free market reforms.

Their campaign failed this time as well, when they fell far short of the signature numbers required for a referendum. Two years passed before they tried again.

This time Talley and Davidson took the lead. E-mails leaked for my book The Hollow Men show that they had private meetings with National leader Don Brash in late 2002, urging him to back a referendum on MMP and, at the same time, offering to provide a staggering million dollars of resources for National’s 2005 election campaign. It’s not known what Brash’s reply was, but two months later he announced that he backed a referendum on scrapping MMP. Other e-mails show that in April 2005 Brash’s staff were researching the details of how to “abolish MMP” with a referendum; and just days before the October election, when they believed they’d win, his staff were checking details of how to proceed with the referendum. It would have been a first step towards the radical reforms that Brash was quietly promising his backers.

The anti-MMP lobby realised early on that the public was unlikely to support a return to First Past the Post. They united instead around an alternative voting system called Supplementary Member (SM). Under SM, most seats in Parliament (80 of 100 or 100 of 120) would be first-past-the-post electorate seats. Only the last 20 seats would be allocated in proportion to a party’s vote. Under MMP, a party that gets 5% of the party vote gets six seats in Parliament, it’s fair share. Under SM the same party would only get one seat for its 5% vote (5% of the 20 proportional seats). A 9% vote would still only give one MP. Essentially, it would be back to First Past the Post with a token number of small party MPs on the sidelines.

SM was one of the four possible systems offered in the 1992 electoral referendum. It scored lowest, with only 5.6% public support. But it was the self interested second favourite to FPP for prominent members of both National and Labour as it obviously favoured big parties over smaller ones. The 1990s National Party president Geoff Thompson promoted the SM system, explaining openly that “for a major political party, it is only natural to advance your own position.” Later it was picked up as the preferred alternative of the Shirtcliffe-Nicolle-Talley anti-MMP lobby.

Thus SM was promoted as a replacement for MMP by their 2001 Citizen’s Majority Trust. When Brash backed a MMP referendum in 2005 he also advocated replacing it with SM. So too did Brian Nicolle in a newspaper opinion piece the following year, arguing that SM provided “a measure of proportionality” and “would be the system to go head to head with MMP in a referendum”.

This history leads directly to John Key’s MMP referendum statement last week. It was no coincidence when Key said he would be surprised if New Zealand went back to First Past the Post and that “some proportionality makes sense”. He was referring obliquely to the Supplementary Member system. Questions by the Sunday Star-Times to Shirtcliffe and other anti-MMP lobbyists revealed that they had been actively lobbying Key and were awaiting his referendum announcement.

The anti-MMP Key is following directly in the footsteps of Brash and the small group of big business lobbyists who see MMP as an obstacle to their plans. It is the clearest sign to date that National’s wealthy backers are still there, of what they want in return for their support and that Key is listening to them.