Act leader Rodney Hide has welcomed Sir Roger Douglas back into the fold.

Act leader Rodney Hide has welcomed Sir Roger Douglas back into the fold.

It came as a surprise to those who follow the fortunes of Act New Zealand to hear that Sir Roger Douglas has apparently made his peace with the party, and will will speak at Act's election year conference in Auckland on Friday and Saturday.

Sir Roger co-founded the Association of Consumers and Taxpayers with former National MP Derek Quigley in 1993, turning it into a political party in 1994. But after relinquishing the leadership to another former Cabinet minister from the fourth Labour Government, Richard Prebble, Sir Roger became disenchanted with the party's apparent drift.

It went away from promoting his prescription of low tax and personal insurance-based funding models set out in his 1993 book Unfinished Business towards more soundbite-friendly scandal-mongering.

He resigned as party president in 2001, severing all formal links three years later, after "perkmaster" Rodney Hide won the leadership in a US-style party primary, following Mr Prebble's retirement.

It is not yet clear whether Sir Roger will once again take on a formal position within Act, although he has suggested he would be happy with a symbolic placing lower down the party list. Instead it seems likely he will be content to occupy a figurehead role.

The chief benefit Sir Roger, 70, can offer Act is his name. During the party's start-up phase, he possessed an extraordinary capability to unify supporters of the neo-liberal economic reforms which he introduced, but did not complete during his time as Minister of Finance from 1984-88.

Dubbed the "Roger Douglas fan club" by one journalist, his reputation quickly drew together high-profile advocates of economic reform, including former Labour ministers like Mr Prebble and Trevor de Cleene, businessmen Craig Heatley and Alan Gibbs, and thousands of other enthusiastic rank-and-file members, many new to politics.

By the time Sir Roger gave up the leadership in early 1996, Act had recruited 7000 members and supporters, which has since dwindled to just 1500.

Of course, as memories of the fourth Labour Government fade, it is quite possible that Sir Roger's pulling power has itself diminished over the years. But if his return could convince even a fraction of his former fans to take his cue and return to Act, the party would be off to a good start.

Moreover, Sir Roger's reunification with Act should encourage some of the party's more wealthy benefactors to provide a much-needed cash injection for the election campaign. In 2005, donors deserted Act for the then near ideologically identical National Party, led by Don Brash - a much safer bet considering the uncertainty of whether a single Act MP would even be returned to Parliament.