John Key's most memorable phrase during the National Party conference was the observation that it's "better to win ugly than to lose tidily".

Key was talking about the Australian elections, but it also acted as a warning - and advice - to Labour.

That advice is slowly seeping in for Labour under leader Andrew Little.

Elections are fought and won with several critical ingredients: Policies, money, candidates and propaganda.


Under MMP another critical element is coalition deals - ranging from wooing possible partners in advance to strategic voting. Labour is taking a more pragmatic approach to issues from fundraising and deals in electorate seats to putting aside its old resentment against the Green Party as it strives to show it's ready to run a coalition Government.

Here we look at Labour's progress in the fight to win next year's election.

The policies

The big three areas for Election 2017 are shaping up as taxes and the economy, immigration and housing. Little says Labour had too much policy in 2014, which confused voters. Next year it will have four or five "bold policies" on issues such as housing. Little has also benched two of Labour's more controversial policies - a broad capital gains tax and an increase in the retirement age.

Immigration: The nuclear option?

Should Labour resort to a nuclear option to get a quick boost in the polls, immigration is the most likely area. It has been an itch scratched in the Donald Trump rise in the United States and the Brexit vote in Britain.

Immigrants are being blamed for everything from low wages to expensive houses by NZ First. It is potentially fertile soil. And Labour under Little has already started inching down that path. It has developed a more protectionist hue in its call to restrict foreign property buyers, tighten up the migration of semi-skilled workers, and in opposing the Trans-Pacific Partnership.

National's Immigration spokesman, Michael Woodhouse, predicts it will be a feature of the campaign. He lumps Labour in with NZ First as responsible for "thinly-veiled xenophobic rhetoric".

The nuclear technique worked well for former National leader Don Brash for his Orewa "one law for all" speech on so-called Maori "privilege".

But getting rewards out of immigration will not be easy for Labour.

The Brexit issue will still be alive during the 2017 election. Expect National to grab hold of that to push home the stability message and to try to get political capital out of Labour's opposition to the TPP trade deal as New Zealand moves to negotiate a free trade agreement with Britain and the EU.

Labour finance spokesman Grant Robertson is charged with puncturing the perception National is better at economic management than Labour.

"We can provide good stable government like we've done in the past, but good stable government with a purpose to help every New Zealander achieve their potential," he says. He doesn't think Brexit will be a big issue, "but the underlying issues round whether people are feeling the benefits of the economy certainly will be."

The candidates

Former party president Mike Williams says an ability to attract good candidates is a sign of strength in a party. Labour has already selected a handful of electorate candidates. While it us up to individual electorates to decide when to hold selections, it is aiming to get candidates in marginal seats selected as early as possible to give them a solid run up to the campaign.

Among its picks is first-time candidate Duncan Webb, a Christchurch lawyer and former academic who has acted for home owners dealing with their insurance claims.

Webb will stand in Christchurch Central, long a safe Labour seat but won by National's Nicky Wagner in 2011. Webb's job is to win it back.

Williams said he tried in vain to recruit Webb some years ago. Webb, in his late 40s, says he's standing now because of frustration about Christchurch's recovery process.

"I think what's going on in Christchurch is absolutely appalling and you can't fix it one person at a time, there needs to be a change of management at the top. The recovery ... has been appallingly led."

He says Labour's difficulties in the polls have not put him off. "It's a chicken and egg problem. What we need is a wave of really good-quality candidates and once we get that, I think that will show the electorate that Labour is genuinely ready to become involved and take the reins."

He says for him the defining difference between Labour and National is: "National wants to move the middle, but doesn't really also account for people who are never really going to make it very far in life."

The party is also tightening up its list candidate selection process. That was described as "dominated by a gaggle of gays and self-serving unionists" by MP Damien O'Connor in 2011.

The changes are effectively an admission he was right, although nobody will say it in quite the same way.

Labour is holding a special conference tomorrow to pass changes to the old process. That will allow individual party members in each region to vote on their region's list before a much smaller, strategic group of the party's ruling council and three MPs makes the final decisions.

Party president Nigel Haworth says that is to try to ensure candidates are selected strategically.

The party has also released a list of the types of background it wants its candidates to have. That includes health and business - areas it lacks representation in.

The deals

Little moved early to sign a memorandum of understanding with the Green Party, partly to ensure the parties did not take pot shots at each other during the campaign but also to present a cohesive partnership ready for Government.

Labour has criticised National's deals in Epsom and Ohariu in the past, but the Northland byelection taught Labour some of the value of it.

NZ First leader Winston Peters' win restricted National's ability to get a majority in Parliament by removing a National MP.

That in turn gave Labour the numbers to get measures such as the Paid Parental Leave Bill passed in Parliament, forcing National to veto it. It also stymied National's Resource Management Act reforms again.

The Greens agreement is likely to result in some deals on electorate seats. There are about six contenders for such deals. They include Auckland Central to take the seat from National's Nikki Kaye, Christchurch Central to wrest a once-safe Labour seat back from National's Nicky Wagner, and Ohariu to try to block out United Future's Peter Dunne.

But the Greens will be reluctant to pull candidates from areas it polls strongly in, such as Auckland Central.

Labour will also not want to ask too much from the Green Party - it will not want to owe the Greens too much by the time post-election negotiations begin.