Did the migrant vote decide the NZ election?

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By Leith van Onselen

It’s fair to say that I was shocked by last month’s New Zealand General Election, which delivered the most electoral seats (but not an outright majority) to the incumbent National Government despite the party’s epic failures on housing, which was identified as the key concern amongst voters in the lead-up to the election.

Labour went to the election with an excellent housing platform that addresses both supply and demand with negative gearing reform, banning foreign buyers of existing homes, tighter capital gains taxes, removal of urban growth boundaries, plus bond financing for infrastructure. It also outlined a plan to reduce immigration by around a third in order to relieve chronic housing and infrastructure pressures. I thought these policies would resonate with voters, but was clearly wrong.

Today, Interest.co.nz has published an interesting report assessing whether the Chinese and Indian migrant vote might have played a key role in National’s electoral success because its policies are more favourable towards housing values and mass immigration:

… with migrant communities having a strong presence in the parts of Auckland that saw support for National increase from the last election, it’s fair to question whether a lot of National’s support came from this sect of society…

From a Chinese perspective, research suggests this is bang on the money.

According to a Trace Research survey, 74% of Chinese voters recall giving their party vote to National in the last election, versus 14% for Labour. This time around, 59% considered Bill English their preferred prime minister, and only 20% Jacinda Ardern.

Trace estimates there are 168,000 Chinese New Zealanders of voting age, which represents 5% of the voter roll.

Labour’s East Coast Bays candidate, Naisi Chen, is one of two Chinese nationals on the party’s list.

Currently in her final year of completing a law degree, Chen is keen to see more Chinese representation in parliament.

Yet she recognises there are a number of hurdles for Labour to cross, to win the Chinese vote…

Asked about the extent to which the Chinese community sees National’s policies as more favourable than Labour’s, she accepts it views Labour as less pro-migration than National.

Chen also admits the Chinese community is afraid the possible introduction of a capital gains tax will see property prices fall…

Asked about whether he believes the migrant community saw Labour’s immigration policy as anti-migrant, Twyford says: “We took the view that National had allowed a massive blowout in net migration numbers. They had allowed net migration to quadruple in the last few years.

“[We believed] that a better balance was needed in immigration policy to take away some of the pressure on infrastructure, while ensuring that immigration policy continued to deliver the skilled migrants that the economy needs.

“The National Party tried to portray this as xenophobia or a desire to turn off the tap, which it never was”…

“New migrants in a city like Auckland are working hard to try to establish themselves and get ahead, and the very issues like affordable housing and infrastructure pressures impact on them hugely.”

Twyford is adamant these were the right issues for Labour to campaign on…

What about the Indian community? To what extent has it helped prop up National?

Auckland-based India Trade Alliance general secretary, Sunil Kaushal, believes the National Party’s moves to preserve Indian culture in New Zealand, have gone a long way to help it secure the Indian vote.

He mentions National’s election promise to make it legal for Sikhs to carry a ‘kirpan’ (traditional knife) on them.

He also notes its willingness for Hindi to be taught in schools.

As for migration policy, Kaushal says: “No one will go into detail with what the policies are, but just to say, ‘we’ll cut down the number of immigrants’ is enough to drive them to the other side”…

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New Zealand’s voting system is unusual in that it allows both citizens and permanent migrants to vote (most countries only allow citizens to vote).

Thus, it seems migrants’ penchant for rising housing values and mass immigration has benefited National, who has effectively bolstered its vote by ramping immigration to record levels, as well as made fighting the bubble even more difficult.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.