New Zealand is grappling with economic pressures ahead of its Nov 7 general election, as tens of thousands of citizens leave the country annually in search of better opportunities, particularly in Australia. Despite recovering from a deep recession in 2024, households continue to face high living costs, sluggish economic growth, and a weak job market. The healthcare system is also under strain due to an aging population and global volatility, leaving the next government with the challenging task of improving living standards and public services.
The main contest is between Prime Minister Christopher Luxon’s centre-right National Party and the centre-left Labour Party, led by Chris Hipkins. Both parties aim to grow the economy and reduce household pressures but differ in their approaches. National focuses on constraining government spending to lower interest rates and stimulate hiring, while Labour proposes investing in housing, healthcare, and job creation through apprenticeships. Labour also wants to modify the central bank’s monetary policy to consider employment alongside inflation.
Smaller parties, such as the Greens and New Zealand First, will play crucial roles. The Greens advocate for a wealth tax and higher income taxes on high earners to fund increased government spending, while New Zealand First proposes a government-owned bank and lower taxes for small businesses. Key issues for voters include rising costs of everyday essentials, high electricity bills, job shortages, and a strained healthcare system.
The cost of living is a major concern, with groceries like bread, butter, ground beef, and milk seeing significant price increases over the past three years. Politicians across the spectrum have proposed various market interventions to address these issues. National and New Zealand First suggest splitting one of the dominant supermarket chains to increase competition, while Labour aims to make it illegal for big companies to charge excessive prices for essentials. The Greens propose establishing a state-owned supermarket chain.
Electricity prices have also risen, driven by higher network costs and reliance on expensive gas- or coal-fired generation during dry periods. Demand for electricity is expected to surge 68% over the next 28 years, prompting debates on how to meet this growth. Parties differ on the role of fossil fuels and whether the power market needs an overhaul. New Zealand First and the Greens want to break up power companies to ensure competitive supply, while National aims to relax planning rules for renewable projects and establish an LNG import terminal.
Unemployment has climbed to 5.6%, with youth unemployment at crisis levels. Political parties are focusing on job creation and wage increases. Labour proposes boosting home building and infrastructure projects, while National aims to support private businesses and tighten benefit obligations. The healthcare system faces challenges due to workforce shortages and an aging population, making access to basic care increasingly difficult.