'Minds, not hearts.' How the National Party won the biggest swing in election history

Sunday, 22 October 2023

In two parts, National Affairs Editor Andrea Vance tells the complete story of the 2023 election. With extensive interviews and exclusive access inside the campaigns, this is the inside story of how National achieved the biggest swing in New Zealand election history. Read part one about Labour’s “woeful” campaign here.

On the pavement, just outside the sprawling Queensgate mall, an elderly woman recognised National MP Christopher Bishop.

She approached and engaged him in conversation. Bishop, who was handing out leaflets to harried shoppers, was happy to stop and chat.

It was the Friday before election day. For the last three years, he had been locked in an intense battle to win back the Lower Hutt electorate, taken from him by Labour’s Ginny Andersen at the last election. Every constituent must be courted.

In fact, he was too late. “I just voted for you guys,” she told him. “My heart said vote Labour. I’m normally a Labour voter. But I knew I had to do the right thing this time.”

Bishop smiled. Internally, he was performing a little dance of joy.

Without realising it, this swing voter had repeated back to him one of the central themes in National’s strategy to knock a second-term Labour government from power: winning minds, not hearts.

Hearts, minds, votes. National won, if not all, enough to take prize. The exact shape of Government is yet to be decided, pending negotiations with power-sharing partners ACT and New Zealand First.

It was a remarkable turnaround job – to crib one of leader Christopher Luxon’s oft-used phrases. Twenty-two months earlier, the political novice took charge of a party on its knees.

With the shock resignation of John Key, National had spiralled into decline, self-immolating as MPs turned over leader after leader. The crisis culminated in a messy election campaign, capped with crushing defeat at the hands of Jacinda Ardern’s Labour Party.

Last weekend, New Zealand once again shifted Right. The swing – from 25.6% in 2020 to a provisional 38.99% – is the biggest in the country’s history. National is predicted to take 50 seats, with ACT on 11, taking the two parties to a majority of just one seat.

With around 20% of votes still to be counted, the question remains whether Winston Peters will have to be accommodated into a governing deal.

Former Air NZ chief Luxon spent 2022 putting National back together, and learning the ropes as party leader. It was a steep, quick, and often brutal learning curve to ready him for election year.

The campaign infrastructure also had to be rebuilt, in little under a year. Bishop was appointed campaign chair in September, and MPs breathed a sigh of relief when he coaxed Jo de Joux back to the party.

De Joux has a reputation as a vote-whisperer. The long-serving former campaign manager has been absent for only two election campaigns: 2002 and 2020. National lost both, catastrophically.

“She's able to sit back and analyse research and data in such a way that most other people can't,” a party source said. “Most people listen too much to the last person they spoke to.”

Right-hand woman to the talismanic de Joux was operations and engagement manager Holly Cotter. “She’s a force. When Holly says she’ll do something, she does it,” the source added.

Another encouraging sign was the patronage of ‘The Wizard of Oz,’ legendary political strategist Isaac Levido. In 2019, Levido, who was behind Scott Morrison's unexpected win and the British Tories successful re-election, walked away from early talks with the party without inking a contract.

Busy overhauling British Prime Minister Rishi Sunak’s green policies, Levido didn’t come himself, but sent Zach Ward-Elms, head of research at Fleetwood Strategy, from London.

Polling data, collected by National’s pollster David Farrar was sent back to Fleetwood’s Regent Street headquarters. The time difference would prove a crucial advantage: staff crunched the numbers and provide detailed analysis overnight – just in time for the New Zealand team waking.

Topham Guerin – the digital advertising agency founded by former Young Nats president Sean Topham and Ben Guerin and used by the pro-Brexit-campaign, Morrison and Boris Johnson – signed on again. They pumped out hours of content with a video-led strategy, that shifted partway through the year from attack ads to more upbeat posts, featuring Luxon and his family.

In the three months to election day, National racked up 17m video views on Tiktok, on which they have 66,000 followers. On Facebook, a platform that attracts an older demographic, National and Luxon’s accounts attracted 1.6m video – four times as many as Hipkins and Labour.

The party also put together a formidable, old-fashioned, ground game. An army of volunteers – wearing distinctive, deep blue jackets – knocked on doors and handed out flyers.

Everything was co-ordinated from two Wellington war rooms – one at the party’s Pipitea St headquarters, and the second from a Petone office. Each day of the campaign started early – with a 6am call with key figures in the leadership team.

Candidates dialled into an 8am video conference with Bishop and de Joux, to be drilled on messaging, new policy and to iron out any wrinkles. There was also an award: Back on Tracker of the Day.

“Campaigns don’t work unless you can run it locally, and bring your teams together,” a senior campaign figure said. “You just need to look around the country at that energy, the vibrancy, and sheer numbers of people doing human hoardings – in places like Mangere.

“It’s all about engagement. The more people you can meet in person, call to their house, leave a flyer, call them on phone. And then, they see you waving a sign. All of that just paints a picture of a really well-organised, hungry, local campaign team.”

All of this was funded by a huge war chest. The money started to roll in last year, and the party has raised more than $8m in donations (electoral rules prevent all of that being spent). More than $1m came from the efforts of former deputy prime minister Paula Bennett, who persuaded wealthy Aucklanders to part with their cash.

“The money helped,” a party source said. “We all forget what 18 months ago was like. No staff, no money, and taking on an in-fighting National party. The turnaround really is extraordinary in that period of time.”

The first weekend of September fired the starting pistol of the election campaign in the eyes of both the public and the media. Both mainstream parties hosted gala launches in Auckland, a US-style rally in the south of the city for National.

But for National, the bid to win started in the New Year. The party had a three-phase plan for election year. The first half was devoted to finalising the party’s policy platform.

Then, in May, Luxon was packed off on a nationwide ‘Back on Track’ tour, ostensibly to introduce himself to the voters. The 53-year-old’s leadership was plagued by troubling approval ratings, especially among women, and for much of the last 18 months it held back National’s trajectory. The roadshow was also a rehearsal for the intense public glare of the final phase, the four-week campaign.

As it turned out, there was little to worry about. Luxon outperformed expectations, leaning into his slightly goofy side, and energetically embracing both the public interaction side of the campaign, and the stunts, set up to court the TV cameras.

He was happily thrown around a bouncing Queenstown jet boat, dressed as a pirate for a sword fight. Somehow, he always seemed to be preparing food: buttering scones, assembling cheese rolls, scooping ice-cream.

In the first two weeks, a surprisingly flat-footed Chris Hipkins compared unfavourably. In the first three public polls of September, both men were neck and neck in the preferred prime minister stakes.

The narrative that had dominated much of the year’s commentary – that Chippy could easily best Luxon in a popularity contest – shifted.

“Luxon, to give the guy credit, eight months ago he was awful - but talk about a man who peaked on time,” a senior Labour MP told the Sunday Star-Times. “We underestimated him.”

However, National was still remarkably sensitive to criticism. The party had hired a team of experienced press secretaries, all ex-journalists, and Luxon was rarely seen without two, sometimes three.

He also weathered heavy criticism for failing to answer challenging questions, and for cutting often-tense daily press conferences short. (This practice quickly stopped, although he still relied heavily on prepared talking points).

Leader visits followed a cautious pattern – often to safe, blue seats and rarely to marginal electorates. Events were also tightly controlled, with little exposure to unscreened voters, or protesters. (In fairness, Labour also played it safe, with Hipkins spending large amounts of time in Wellington).

Party supporters have questioned whether a failure to target undecided, or unengaged, voters cost National valuable points. “Objectively, they failed to capitalise and had a terrible campaign,” a former staffer said. “They were always campaigning to the faithful. It showed massive risk aversion.”

A senior party source rejects this, saying the focus was on the party vote. “We had a massive rally in Papatoetoe, hardly National Party heartland. This narrative is total nonsense. Almost the opposite is true – we went to almost every part of the country.”

Another frequent assessment is that Luxon made a strategic mistake in recording a social media video in which he said he’d pick up the telephone to Winston Peters.

For many, it served to make NZ First relevant again. Commentators identify this as the point at which the gap between Labour and National began to shrink, and NZ First’s support began to pick up pace. It certainly charged the media coverage, if not the dynamic of the race.

“It is easy to say in hindsight. But we actually already had him [polling] at five or six [%],” the party source said. “And once he reached that, we knew we had to get on with it.”

Ruling out Peters was judged not to be an option, giving him leverage to play the victim card. “We had very strong research that showed no one believed that Labour wouldn’t work with Winston Peters, when given the choice. And it would have been equally true for us.”

Political wisdom dictates that every election is fought on the same ground: the economy. National had a laborious 100-point plan to tackle inflation, cut spending and red tape, build infrastructure and attract immigrants.

All almost anyone will remember about the campaign was the plan to offer tax cuts. The idea was first floated in Luxon’s first-ever policy announcement, in March 2022. Simon Bridges, then National’s finance spokesperson, wasn’t in favour, preferring to stick with indexation that would adjust tax bands for inflation. He quit politics shortly after.

Nicola Willis, took over the portfolio and honed the policy. It was officially launched in the final week of Parliament, billed as the ‘Back Pocket Boost.’

It would introduce new taxes on foreign property buyers and offshore online gambling, and user-pays immigration levies, to pay for the tax relief. There would also be extensive cuts to the public service and funds raised for tackling climate change through the Emissions Trading Scheme would be paid directly back into the general coffers.

Almost immediately, the $14.6 billion package sustained flack. Economists poured scorn on the numbers. Central to the criticism was uncertainty over the costings: experts said it would require a four-fold increase in online gambling, and the foreign buyers tax would raise just $210 million a year - far short of $740m in Willis’ assumptions.

There was another question – one that National failed to answer. Critics argued that legal snags with the policy would get trading partners offside.

Insiders point the finger at former trade minister Todd McClay who they say was given responsibility to check for loopholes. And while the policy seemed to stay on the right side of free trade agreements, double-tax agreements, like the one held with China, appeared to have been neglected.

Luxon and Willis floundered when forced to explain the discrepancy.

The episode hints at underlying tensions that linger from the pre-Luxon internecine war. During the last campaign, McClay was close to both former leaders Simon Bridges and Judith Collins before being demoted by Luxon.

The insiders say he has clawed his way back to a position of some influence, positioning himself as a rural counter to the urban-liberal influence of Bishop and Willis. (The duo are known as ‘Bishola’ within the caucus, and it is felt that the new intake will strengthen their power base with a number of central and lower North Island MPs).

Some colleagues worry about McClay’s pull. One former staffer called him the ‘Belgian Waffle’ (a reference to his many years as a diplomat in Brussels). “He constructs these complex arguments…he’s relentlessly worked his way back in.”

An MP – and friend – said: “I have just the greatest admiration for his political rat-cunning and political instincts. He’s managed to rehabilitate himself and done very well.”

Another former colleague noted: “Todd dumped Simon, and he was his close mate, as soon as he saw the writing on the wall. But that’s politics. And Chris is smart enough to listen to a lot of people.”

Rivalries aside, McClay’s blunder would be forgotten when the tax package came under fire from a new direction.

The numbers game

A battered, jumbo-sized Casio calculator, its buttons worn with use, but with numbers that went all the way up to 14 digits, was the unlikely secret weapon in the battle to keep National out of office.

Propelled by two, quick-stabbing index figures, this desk-top number cruncher was a relentless battering ram, punching holes in the tax relief package that was central to Christopher Luxon’s manifesto.

Once National released its draft Budget, two weeks out from election day, the calculator got to work again. Totting up the numbers, it soon became clear that only 0.18% – or 3000 families – would get the full $250 a week promised by National.

The attack stung, coming quickly after Goldman Sachs criticised the policies for being inflationary, because it looked like the party had misled voters. National insists it didn’t and that it was clear in advertising.

The calculator belonged to Craig Renney, now Council of Trade Unions chief economist, and had once sat on a desk in the Beehive suite that surrounded Finance Minister Grant Robertson’s office.

The connection incensed Bishop, who had repeatedly, publicly, accused Renney of being a dirty-tricks proxy for Labour. The negative campaign – with almost daily attacks from rivals – had already got under his skin, and Bishop’s political style is naturally combative.

Renney strenuously denies he was working with Labour – saying he was speaking up for union members – and National failed to present any evidence of collusion.

Nevertheless, the attack helped Labour and National had a late slump in the final polls. “That was a devastating moment, it really did have an impact,” a senior Labour source said. “The work we’d done up until that point to lay the groundwork was a bit he said/she said. The public feel politicians are always arguing over numbers, and the Nats knew that, so they kept bludgeoning through.

“If only we’d had a couple of extra weeks. It needed more time to percolate around. The informed voters got it straight away, but they had already made up their minds.”

And it was those minds National wanted to capture. Perversely, National believes the slump drove the soft vote back to them.

“There were Labour voters who wanted a tax cut,” Bishop explained. “So, the TVNZ poll that put us on 40% really hurt us. It drove our win expectation, so people thought they could salve their conscience, vote Labour and still get a tax cut.”

The encounter with the Queensgate shopper, who told Bishop she had ignored her heart to vote with her head, was therefore the high point of his campaign. “I was like: Yes!” he said, with a fist-pump. “We are going to win the election.”