Five takeaways from Luxon’s State of the Nation address (including what turns him on)

Monday, 19 January 2026

No new policy, no election date and no mention of the coalition, Winston or Seymour. The prime minister’s State of the Nation speech said more in what it omitted than what it included. Oh, and he said “actually” at least 23 times. Lloyd Burr breaks it down.

ANALYSIS: As business leaders tucked into beef cheek and kingfish at the newly opened (and new-smelling) New Zealand International Convention Centre, Christopher Luxon served up his take on the state of the country.

The State of the Nation address, hosted by the Auckland Business Chamber, is an annual speech by the prime minister - although most other party leaders do them now too. In election year, they usually set the agenda for what the main campaign issues will be.

Sometimes they’re used to announce a new policy or the election date. Mainly they’re used as a platform to talk about all the achievements chalked up by the Government and why it should be re-elected.

Here are five main takeaways from what Luxon had to say.

1. Lots of ‘National Government’ and no ‘Coalition Government’

Even though he’s the prime minister of a coalition government, he didn’t mention it. He didn’t use the word “coalition” either.

Heck, he didn’t even mention his coalition partners, ACT and New Zealand First, nor their respective leaders, David Seymour and Winston Peters - both of whom have served as his deputy.

Instead, Luxon talked about “our Government” and a “National Government”, mentioning the latter three times:

“It will only happen with a National Government after this year’s election” … “The only way to build that future is with a National Government” … “If you want education reform that gives your children the very best possible shot in life, then you need a National Government”.

Why is this significant? It could be seen as a snub of his governing partners in a speech given in his capacity as the head of the Coalition Government.

Listing off all the achievements of the Coalition Government but not mentioning those who helped with those achievements may not go down well with Peters or Seymour.

Framing them as achievements of the National Party alone could add insult to injury.

2. The world is in chaos

If it’s not tariffs killing off the green shoots of the economic recovery, it’s the risk of “a dangerous miscalculation” in the Indo-Pacific.

And if it’s not North Korea going ballistic, it’s nation states picking and choosing when to respect international law by invading foreign territories, or threatening to.

Luxon touched on all of these issues, painting a picture of a world that’s essentially in chaos on many fronts.

He defended his big spending in the defence sector because the world is “witnessing a shift from economics to security”.

“National security demands are expanding. Governments need to protect their people and assets against economic coercion, foreign interference, cyberattacks and terrorism,” he said.

“In the Indo-Pacific, there’s a rising risk of a dangerous miscalculation.”

The prime minister spoke of the damage being delivered by the United States, on the tariff front and on the Greenland front.

With US President Donald Trump seeking control of Greenland, a desire testing the US-EU relationship along with the stability of Nato, Luxon backed the people of Greenland choosing to be part of the Kingdom of Denmark and the need for trans-Atlantic stability.

But what can we do about it all? Not much. “We can only control the things we can control,” he told former National Party leader-turned-Auckland Chamber chief executive Simon Bridges during the Q and A session that followed his speech.

3. Still talking tough on housing, despite watering down Bishop’s changes

Even though he’s about to water down some of the radical housing reforms of his housing minister, Chris Bishop, Luxon talked tough on the desire to move away from property speculation as a way to get rich.

“There were calls… for a big fiscal stimulus and to open the immigration gates and pump up house prices,” he said. “We can’t risk repeating the sugar-rush economics of the past.

“Rapidly rising house prices and more borrowing might have felt good in the moment, but in the long-run those actions ultimately just make us poorer as a society.”

Despite the talk, behind the scenes the plans are being changed yet again because there’s been a pushback from some Auckland homeowners.

With an election looming and some National MPs worried about losing their marginal seats over the issue of housing intensification, Bishop’s bold changes will be diluted to please the voting NIMBYs.

How’d it go down with Bishop? The prime minister used the word “dynamically” when asked about it at the post-speech press conference.

“It won’t surprise you, but in our government, we actually talk to each other a lot, and quite dynamically and consistently,” he said. “It’s regular. It’s not formalized. We’re just very open and transparent.”

4. This election will be all about the economy

Luxon was elected in 2023 on the promise of an economic turnaround. It’s taken much longer than he expected - but he’s betting the ranch on it finally turning a corner this year, just in time for the election.

His speech was littered with talk of a growing economy, falling inflation, lower interest rates, growing business confidence and a recovery starting to blossom.

There was a cheer from the crowd when he mentioned the latest free trade deal with India.

He spoke of exports, investment, unshackling growth and creating more jobs.

“I feel more confident than ever that the recovery has now arrived and Kiwis can look forward to a year which is brighter than the last few,” he said.

“There’s real cause for optimism. My focus now is translating that optimism into real results for New Zealanders in 2026, with more jobs, higher incomes, and the best possible shot at a better life,” Luxon said.

Expect this type of chat to be the soundtrack of the election year.

5. ‘It’s what turns me on’

You read that correctly.

In an unscripted Q and A with Auckland Business Chamber boss Simon Bridges, the prime minister was talking about his approach to rebuilding the economy and reducing red tape.

“It’s government working with business, working with community, that ultimately gets the country we all deserve,” he said.

“That’s an exciting mission. That’s a really energising reason to get out of bed each and every morning.

“It’s what turns me on.”