Matthew Hooton: Why MMP is our worst mistake

If politics was Tweedledee and Tweedledum before MMP, it's worse now. Photo / NZME

OPINION:

Changing to MMP a quarter of a century ago was the worst decision New Zealand ever made.

MMP was meant to add diversity to Parliament, which it has. But it has also created a new tyranny of the median voter and a bland Wellington nomenklatura in both major parties.

If politics was Tweedledee and Tweedledum before MMP, it's worse now. Our ability to make transformational change has been destroyed, whether the challenge is climate change or reforming the tax system in line with the evolving nature of work.

Electoral reform was needed. The 1978 and 1981 elections, where Labour won more votes than National but was denied office, are difficult to justify. So, too, the exclusion or radical under-representation of Values, the New Zealand Party, Social Credit, the Greens and NewLabour, despite them having significant support.

For a final villain, blame the economic reformers of the 1980s and 1990s for their arrogance towards the electorate, especially over superannuation.

It made economic and moral sense to make superannuitants pay Labour's surcharge on additional income above a certain level. But National promised in 1990 to abolish it, "no ifs, no buts, no maybes".

That promise should have been kept simply because it had been made. The fiscal benefits of breaking it weren't worth the cost in lost trust — and certainly not once it paved the way for MMP.

As advertised, MMP has made the House of Representatives worthier of its name. It is good that parties like the Greens, Act, the Alliance, NZ First and even the various versions of Peter Dunne's United Party won seats in Parliament. (Te Pāti Māori is excluded from the list because it wouldn't have needed MMP to win the Māori seats after Helen Clark's foreshore and seabed confiscation in 2003.)

Also positive is Labour and National using their lists to ensure representation of minorities, and bring in experts like law professor Margaret Wilson, monetary economist Don Brash, Treaty lawyer Chris Finlayson and epidemiologist Ayesha Verrall.

Yet similar benefits were likely under other alternatives to FPP, such as Single Transferable Vote (STV), with multiple MPs from each electorate but no list MPs.

The problem with any system needing list MPs is that they are entirely reliant on patronage from party bigwigs. Some brown-nosing of the establishment was always necessary to rise up the ranks, but list MPs were new in not having to stay connected at all with ordinary voters and party members.

Nor, if they fall out with their parties' powers-that-be, do they have the possibility of using their own independent support bases to survive without the old party badge, the way Jim Anderton did in Sydenham, Winston Peters in Tauranga, Peter Dunne in Ōhariu-Belmont and Tariana Turia in Te Tai Hauāuru.

They have no choice but to be toadies.

In turn, that sycophantic culture has infected ordinary MPs as they compete for promotion.

Meanwhile, recognising parties in Parliament's rules led to taxpayer funding of their political activities. These funds amount to far more than that raised from members and donors, even when private fundraising is going well.

With taxpayer funding determined by the results of the previous election, it solidifies the status quo by making it much more difficult for those outside Parliament to compete.

Current moves to basically prohibit private fundraising would make it impossible.

Taxpayer funding is also controlled by parties' parliamentary wings, centralising power around leaders and their cronies.

Before MMP, the best way for an ambitious person to become an MP was to get known by their local community and their party's local members. Heading to Wellington rendered you as part of an out-of-touch elite.

Now, the best path is leaving your community and getting in with your party's Wellington elite. This advice applies not just to people wanting spots on the list, but even to those wanting to represent an electorate.

Nevertheless, MMP's worst effect is the pandering to the median voter as the decider of elections, and the transformation of Labour and National into near-identical servants of the status quo.

The median voter is by definition doing okay. If not, there wouldn't just be a change of government but a revolution.

Roughly, their annual household income is a little over $80,000 and their disposable income around $70,000 after tax and Working for Families. Their children attend a decile 5 or 6 school. After housing, they have about $30,000 a year to spend. Their neighbourhood is average — not crime-ridden although not necessarily safe at night.

They voted three times for Clark and John Key, probably for Bill English in 2017 and for Jacinda Ardern in 2020. They don't want economic reforms or anything done about climate change if it is going to cost them.

Most topically right now, they own a house.

Before MMP, the median voter wasn't so electorally omnipotent. Parties won power by having new ideas and securing a strong plurality of the vote, usually around 45 per cent.

Their support had to be geographically spread. There was no value in Labour boosting its vote in Ōtara or National in Remuera. They had to focus on marginal electorates scattered throughout the country.

Parliament wasn't proportional. Governments had absolute power, with 45 per cent of the vote, or less. But they were accountable for their promises, made with an expectation on both sides that they would be kept. Voters rightly hated on National for breaking its superannuation promises. Now National would just blame Act for not following through.

Over time, voters have learned that nothing parties promise will necessarily survive coalition talks and so have stopped expecting them to. In turn, parties have stopped making meaningful commitments or even bothering with much policy work. Winning elections is about the vibe and the median voter feeling comfortable.

How better to make the median voter feel comfortable than to ensure their house price keeps climbing?

Should we really be surprised the housing crisis really began in 1994 (see graph) after the MMP referendum? The reasons prices keep accelerating are manifold and correlation is not causation.

But Clark, Key, English and Ardern have had no incentive to stop it. Whenever house-price inflation slips, the median voter gets grumpy and the Government falls.

The same is true for every other crisis. Without MMP, a Labour Government would surely have come in and boldly tackled climate change the way Roger Douglas addressed the economic crisis. Similarly, a National Government would have fixed the Resource Management Act.

Instead, we drift.

- Matthew Hooton is an Auckland-based public relations consultant.