Fran O'Sullivan: Political gamesmanship and the coming referendum on MMP

Prime Minister John Key has made a clear decision not to waste any of his valuable political capital getting into a public scrap with Winston Peters, now beginning a Lazurus-like attempt to rise from the political dead.

Unlike former Cabinet Minister Richard Worth who Key declared off-limits once he had drummed him off the political stage, Peters is fair game.

But (so far) Key has not got out the bazookas, instead opting to deny the former NZ First leader political oxygen by not publicly entertaining his ambitions. Peters faced little probing from newsmedia either during soft-pedal interviews heralding his political relaunch.

Dubbed "Luigi" years back in mock admiration for his manicured coiffure and slick double-breasted suits, Peters had, by the time he was dumped from Parliament last year, morphed into an aging "Don Corleone" type.

You know the Godfather rant: "I work my whole life ... I don't apologise ... and I refuse to be a fool, dancing on the string held by all those big shots".

Peters' own verbal shtick in one interview last weekend borrowed more from war-time propaganda than the Mario Puzo script: "Our task is to mobilise a political force to take back our country ... there will be no mistakes, missed targets, or casualties from friendly fire."

But despite the Churchillian-style oratory, we now know that the Peters' party was - and possibly will again - be funded by his own clique of racing and fishing big shots.

Underlining Key's political calculations will be the real possibility that Winston Peters could indeed get back into Parliament if the threshold for small parties was reduced to four per cent of votes - rather than the current five - as recommended by the 1986 Royal Commission.

If the four per cent threshold had been in force last year, NZ First, which scored 4.07 per cent of votes, would be in Parliament now with more seats than Act with its 3.65 per cent of the party vote. There is a fundamental issue of fairness at stake here.

On Monday, Cabinet began discussions on a proposal to hold a referendum on MMP. Key believes the referendum will "probably be held at the 2011 election".

But he says it will be "expensive" and require a major advertising campaign. "We can't ask people to make constitutional changes without understanding what the options are."

A referendum on MMP is clearly unfinished business for many Kiwis who have long believed consecutive Governments have failed to honour a promise to voters on this score.

In fact, all the enabling legislation promised was a "thorough review" of MMP after two general elections to consider whether there should be a further referendum on changes to the electoral system. Section 264 of the 1993 Electoral Act outlined that a select committee should report before June 1, 2002 whether a referendum should occur and "if so the nature of the proposals to be put to voters and the timing of such a referendum".

Not surprisingly, the cosy club of MMP beneficiaries (aka MPs) failed to reach an agreement: a result that the Clark Government had effectively gerrymandered in the first place by requiring the committee (some of whose members owed their positions to MMP) to make a unanimous or near-unanimous recommendation.

When it comes to referenda, Key has political exposure. He has faced questions over his decision not to amend the 'anti-smacking' laws in response to the recent referendum.

Much as he assessed the risks in his currency trader days before making big punts, Key has calculated that the issue will quickly subside. He rationalised his decision to one business breakfast this week by saying that the Kiwi Party (which made repeal of the legislation its bottom line issue) got just 0.54 per cent of the votes at the 2008 election. "Even the Bill and Ben party got more."

Citing Herald polls on what really worried people, Key noted the anti-smacking issues rated just two per cent against 21 per cent for health which is where he would rather his Government concentrate its firepower.

This is politically risky stuff given the antipathy Kiwis built up to the Clark regime's Nanny State.

But Key thrives on risk and brinksmanship. It's not too much of a stretch to suggest that he draws his own political oxygen by occasionally escalating issues.

Gamesmanship will again come into calculations on the sequencing of the MMP referendum. Businessman Peter Shirtcliffe has been campaigning for "enough intellectual and organisational horsepower" to be applied so a single stage definitive referendum could be held next year, then applied at the 2011 election.

Frankly, Key should adopt Shirtcliffe's timetable. If past polling is anything to go by, many Kiwis would vote MMP down if given the chance.

Fighting the next election on an electoral system - even First Past the Post - which gave more power to the major party to implement sensible policies would do more to even the gap with Australia than endless horsetrading.