Third Labour Government of New Zealand
Encyclopedia
The Third Labour Government of New Zealand was the government of New Zealand
Governments of New Zealand
The Government of New Zealand , formally Her Majesty's Government in New Zealand, is based on the Westminster system of responsible government...

 from 1972 to 1975. During its time in office, it carried out a wide range of reforms in areas such as overseas trade, farming, public works, energy generation, local government, health, the arts, sport and recreation, regional development, environmental protection, education, housing, and social welfare. Māori also benefited from revisions to the laws relating to land, together with a significant increase in a Māori and Island Affairs building programme. In addition, the government encouraged biculturalism
Biculturalism
Biculturalism in sociology involves two originally distinct cultures in some form of co-existence.A policy recognizing, fostering or encouraging biculturalism typically emerges in countries that have emerged from a history of national or ethnic conflict in which neither side has gained complete...

 and a sense of New Zealand identity, but it lacked the economic skills necessary to lead the country through a difficult economic period. The government lasted for one term before being defeated a year after the death of its popular leader, Norman Kirk
Norman Kirk
Norman Eric Kirk was the 29th Prime Minister of New Zealand from 1972 until his sudden death in 1974. He led the Parliamentary wing of the New Zealand Labour Party from 1965 to 1974. He was the fourth Labour Prime Minister of New Zealand, but the first to be born in New Zealand...

. It was the last of the traditional New Zealand Labour
New Zealand Labour Party
The New Zealand Labour Party is a New Zealand political party. It describes itself as centre-left and socially progressive and has been one of the two primary parties of New Zealand politics since 1935....

 governments.

Significant policies

The government's most significant policies concerned attempts to create a distinct New Zealand identity, both internally and in the world. For most of its history, New Zealand had been, economically, culturally and politically, highly dependent on Britain. This began to change during World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...

, when it became clear that Britain was no longer able to defend its former colonies in the Pacific. As Britain began to turn away from what was left of its former Empire and towards Europe, New Zealanders became less inclined to think of themselves as British. Initially the country turned instead to the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...

, and so entered into the ANZUS
ANZUS
The Australia, New Zealand, United States Security Treaty is the military alliance which binds Australia and New Zealand and, separately, Australia and the United States to cooperate on defence matters in the Pacific Ocean area, though today the treaty is understood to relate to attacks...

 pact with the US and Australia, and aided the US in the Vietnam War
Vietnam War
The Vietnam War was a Cold War-era military conflict that occurred in Vietnam, Laos, and Cambodia from 1 November 1955 to the fall of Saigon on 30 April 1975. This war followed the First Indochina War and was fought between North Vietnam, supported by its communist allies, and the government of...

. However by the early 1970s many New Zealanders felt the need for genuine national independence, a feeling strengthened when Britain joined the European Economic Community
European Economic Community
The European Economic Community The European Economic Community (EEC) The European Economic Community (EEC) (also known as the Common Market in the English-speaking world, renamed the European Community (EC) in 1993The information in this article primarily covers the EEC's time as an independent...

 in 1973, causing serious problems for New Zealand trade. Most of this government's policies can be seen in this light.

Treaty of Waitangi

This was the first government to give serious recognition to the Treaty of Waitangi
Treaty of Waitangi
The Treaty of Waitangi is a treaty first signed on 6 February 1840 by representatives of the British Crown and various Māori chiefs from the North Island of New Zealand....

, first by making the anniversary of its signing a national public holiday, and then by establishing the Waitangi Tribunal
Waitangi Tribunal
The Waitangi Tribunal is a New Zealand permanent commission of inquiry established under the Treaty of Waitangi Act 1975...

to investigate contemporary breaches of it. Both were concessions to increasingly angry Māori protest, as was the appointment of Matiu Rata
Matiu Rata
Matiu Rata was a New Zealand Māori politician. He was the Member of Parliament for Northern Maori from 1963 to 1979, the Minister of Lands and Minister of Māori Affairs in the Third Labour Government of New Zealand between 1972 and 1975...

 to Minister of Māori Affairs
Minister of Maori Affairs
The Minister of Māori Affairs is the minister of the New Zealand government with broad responsibility for government policy towards Māori, the first inhabitants of New Zealand. The current Minister of Māori Affairs is Dr. Pita Sharples.-Role:...

 (and initially Lands). He was the first Māori Minister of Māori Affairs since the 1930s and the first ever Māori Minister of Lands.

The Treaty of Waitangi Act 1975 was the first legal recognition of the Treaty, but did not allow the Tribunal to investigate historical breaches. The New Zealand Day Act 1973
New Zealand Day Act 1973
The New Zealand Day Act 1973 made the sixth of February a public holiday in New Zealand. The day had been known for some time as Waitangi Day and commemorated the signing of the Treaty of Waitangi. In 1960 the first Waitangi Day Act was passed enabling any area of the country to substitute a...

, which made Waitangi Day
Waitangi Day
Waitangi Day commemorates a significant day in the history of New Zealand. It is a public holiday held each year on 6 February to celebrate the signing of the Treaty of Waitangi, New Zealand's founding document, on that date in 1840.-History:...

 a national public holiday
, also fulfilled the Māori demand for greater acknowledgement of the Treaty. However it was also a part of the government's programme of nationalism, as the name of the day (New Zealand Day) indicates. New Zealand Day was intended to appeal to New Zealanders of all ethnicities, including those who were neither Māori nor Pakeha
Pakeha
Pākehā is a Māori language word for New Zealanders who are "of European descent". They are mostly descended from British and to a lesser extent Irish settlers of the nineteenth and twentieth centuries, although some Pākehā have Dutch, Scandinavian, German, Yugoslav or other ancestry...

.

Economic

  • New Zealand's economy was heavily dependent on overseas trade, and Prime Minister Norman Kirk felt that it made little sense to be dependent on foreign-owned shipping firms. A state-owned shipping line was thus founded, but was to be financially unsuccessful.
  • The Development Finance Corporation bill was passed, which reconstituted the Development Finance Corporation as a wholly Government-owned body. It operated like a Development Bank in assisting with the promotion of regional development and new industrial projects.
  • The government tried to avoid inflation via massive overseas borrowing and a variety of local regulations. A scheme was introduced to fix maximum retail prices, while to keep people in employment it added the post office, the railways, milk, lamb, mutton, and wool to the number of industrial subsidies.
  • During the government’s first year in office, adjustments were made to the salaries of State Servants while the Stabilisation of Remuneration Regulations were introduced, which provided wider flexibility for employers and trade unions to negotiate new pay rates. These changes enabled wage and salary-earners to negotiate with their employers for a better deal, which they quickly did.
  • The Development Finance Corporation was provided with powers to “grant up to 40 per cent of the capital cost of plant and machinery for projects designed to achieve a high export performance”

.
  • New provisions were introduced to encourage employers “to finance their employees into shareholding agreements with the company”.

Subsidies and suspensory loans were introduced to encourage regional development, together with selective investment incentives “to encourage desirable changes in the pattern of industry.”
  • Many of the direct penalties on strikes and lockouts were removed.
  • Average real wages rose substantially, with the share of the economic “cake” accruing to labour rising from 45% in 1972/73 to 48% in 1975/76.
  • In his first budget, Bill Rowling announced that state spending on housing and electricity capital works would increase, and 14% more would be spent on education and 19% more spent on health..
  • Bob Tizard reduced income tax rates for many on lower incomes, and a standard tertiary bursary and additional house lending were included in the 1975 budget.
  • Including benefit payments, new training, export and production incentives, and further money for health, education, housing, culture, and recreation and regional development pushed expenditure up by 19% for 1974-75.

Foreign affairs

  • Recognition of the People's Republic of China
    People's Republic of China
    China , officially the People's Republic of China , is the most populous country in the world, with over 1.3 billion citizens. Located in East Asia, the country covers approximately 9.6 million square kilometres...

    .
  • Opposition to French nuclear testing in the Pacific Ocean
    Pacific Ocean
    The Pacific Ocean is the largest of the Earth's oceanic divisions. It extends from the Arctic in the north to the Southern Ocean in the south, bounded by Asia and Australia in the west, and the Americas in the east.At 165.2 million square kilometres in area, this largest division of the World...

    .
  • Refusal to allow sporting contacts with apartheid South Africa
    South Africa
    The Republic of South Africa is a country in southern Africa. Located at the southern tip of Africa, it is divided into nine provinces, with of coastline on the Atlantic and Indian oceans...

    .
  • Abolished compulsory military training.

The government's foreign policy reflected its desire for independence from the powerful nations of Europe and North America. It was also influenced by the many left-wing movements of the period, such as environmentalism, the peace movement, and anti-racism. However in many cases it was simply catching up to the rest of the world, much of which had already recognised the People's Republic of China and cut sporting ties with South Africa. The decision to block a proposed tour by the South African Springbok rugby team
South Africa national rugby union team
The South African national rugby union team are 2009 British and Irish Lions Series winners. They are currently ranked as the fourth best team in the IRB World Rankings and were named 2008 World Team of the Year at the prestigious Laureus World Sports Awards.Although South Africa was instrumental...

 was only made once it became clear that international disapproval of the tour would seriously harm the 1974 Commonwealth Games
1974 British Commonwealth Games
The 1974 British Commonwealth Games were held in Christchurch, New Zealand from 24 January to 2 February 1974. The bid vote was held in Edinburgh at the 1970 British Commonwealth Games....

 in Christchurch
Christchurch
Christchurch is the largest city in the South Island of New Zealand, and the country's second-largest urban area after Auckland. It lies one third of the way down the South Island's east coast, just north of Banks Peninsula which itself, since 2006, lies within the formal limits of...

. Before the 1973 election, Kirk had promised not to get involved in the sporting contacts issue. Aid to the developing world (which had virtually static for at least two decades) was also significantly increased, with official development aid increasing from 0.22% of GNP in 1972 to 0.55% of GNP by 1975. This measure was seen as characteristic of the “new morality” in foreign policy pursued by the Third Labour Government.

Constitutional

  • Altered the Queen's title in New Zealand

The Royal Titles Act 1974
Royal Titles Act 1974
The Royal Titles Act 1974 changed the New Zealand title of the monarch of New Zealand to 'Elizabeth the Second, by the Grace of God Queen of New Zealand and Her Other Realms and Territories, Head of the Commonwealth, Defender of the Faith.'...

 removed mention of the United Kingdom from the Queen's title in right of New Zealand. This was a symbolic act which made no difference in practical terms, as New Zealand's monarchy
Monarchy in New Zealand
The monarchy of New Zealand also referred to as The Crown in Right of New Zealand, Her Majesty in Right of New Zealand, or The Queen in Right of New Zealand is the constitutional system of government in which a hereditary monarch is the sovereign and head of state of the Realm of New Zealand,...

 was made legally independent with the passing of the Statute of Westminster
Statute of Westminster 1931
The Statute of Westminster 1931 is an Act of the Parliament of the United Kingdom. Passed on 11 December 1931, the Act established legislative equality for the self-governing dominions of the British Empire with the United Kingdom...

 by the first Labour Government
First Labour Government of New Zealand
The First Labour Government of New Zealand was the government of New Zealand from 1935 to 1949. It set the tone of New Zealand's economic and welfare policies until the 1980s, establishing a welfare state, a system of Keynesian economic management, and high levels of state intervention...

 in 1947.
  • Passed the Constitution Amendment Act 1973

This altered the New Zealand Constitution Act 1852
New Zealand Constitution Act 1852
The New Zealand Constitution Act 1852 was an Act of the Parliament of the United Kingdom that granted self-government to the colony of New Zealand...

 so that the New Zealand Parliament could legislate extra-territorially.
  • Lowered the voting age from 20 to 18.
  • An electoral amendment bill increased Māori representation.

Social policy

  • Payment of the "Christmas bonus."

Soon after taking office, the government announced that a “Christmas bonus,” an extra benefit payment, would be paid to all means-tested beneficiaries.
  • Establishment of the Domestic Purposes Benefit
    Domestic Purposes Benefit
    The Domestic Purposes Benefit was first introduced in New Zealand in 1974. The Destitute Persons Act 1910 and the Domestic Proceedings Act 1968 created a statutory means by which a woman could seek a maintenance order against the father of her children...

     for single parents.

Single parenthood and divorce were no longer as scandalous as they once had been, and the introduction of the DPB reflected this.
  • Establishment of compulsory pension savings' scheme.

The elderly were the one group of New Zealanders not entitled to non means-tested income support when they were unable to work. Both parties attempted to address this issue: Labour with a compulsory savings scheme and National with a scheme to be paid for out of general taxation. The superannuation scheme introduced by the Third Labour Government benefitted 750,000 workers who previously had no other form of retirement pension aside from the age benefit. Labour's short-lived scheme was abolished by the third National government
Third National Government of New Zealand
The Third National Government of New Zealand was the government of New Zealand from 1975 to 1984. It was an economically and socially conservative government, which aimed to preserve the Keynesian economic system established by the First Labour government while also being socially conservative...

 and replaced with universal superannuation.
  • An expanded welfare system.

The Third Labour government made considerable changes to New Zealand's social security system, both in terms of the adequacy of benefits and in the range of welfare benefits available. As noted by the historian Keith Sinclair
Keith Sinclair
Sir Keith Sinclair, CBE was a poet and noted historian of New Zealand.Born and raised in Auckland, Sinclair was a student at Auckland University College, which was then part of the University of New Zealand. He was awarded a Ph.D...

,

“The Kirk-Rowling Government gave exceptional attention to the needs of the needs of the least privileged – often recent Pacific Island immigrants or ‘solo mums’.

Substantial increases were made to social security benefits such as married couple’s benefits, single benefits, and pensions. The basic benefit was also increased and sickness benefit was liberalised: where a married couple had both been in full-time employment for at least 12 months and intended to remain members of the regular workforce, a sickness benefit would be paid for up to three months at half the rate payable to married couples, if one couple became sick. There would be no income test on this. Prior to this reform, if a husband had fallen ill while his wife was working, no Social Security payment was made. Pensions were increased and Supplementary Benefit for pensioners was replaced with what was called an additional benefit. State insurance rebates were also introduced for pensioners.

In addition, the Xmas bonus was subsequently repeated in 1973 and 1974, while age benefits were adjusted six times from 1972 to 1975. The real incomes of many means-tested beneficiaries were further increased by the introduction of telephone, television, and rates rebates in 1973. In 1974, aid was given to help pay the insurance premiums on the homes of pensioners, and a major effort was undertaken to increase the availability of suitable accommodation for the elderly. Increased financial assistance was also provided to voluntary groups working with handicapped or underprivileged persons, while four weeks paid relief was provided for those caring for the disabled and handicapped at home. From January 1974 onwards, approved day-care centres for children received a government grant of $4.50 per week per child.

The amount of income that income-tested beneficiaries could receive before their benefit levels were affected was also increased, while the basic dental service for children was extended to dependants up to the age of eighteen. In addition, the physiotherapy benefit was increased while a new hearing aid benefit was introduced. Altogether, the increases in welfare benefits and pensions helped narrow the gap between one-income families and welfare recipients.
  • Major initiatives in housing.

State intervention in housing was significantly increased during the Third labour’s Government’s time in office. A Housing Corporation was set up in order to tackle new housing demands, whilst the mortgage and rental house management activities of the State Advances Corporation were amalgamated with the Housing Division of the Ministry of Works and Development. The new Corporation also took over the housing care of the elderly, which had formerly been the responsibility of the Department of Health, while the rural lending functions of the State Advances Corporation were transferred to the newly established Rural Banking and Finance Corporation. Advances to the Housing Corporation were significantly increased and special emphasis was given to people on low incomes. Income limits for 3% lending were increased, and fixed loan limits on urban residential loans were abolished and their terms extended. A number of houses were bought for rental purposes, income restrictions on applicants for state homes were removed, the criteria for the allocation of state houses were standardized, and annual rent reviews were introduced, “the rents to be relevant to the family income.”

The government increased the total number of houses built (especially lower-cost houses), sustained the building industry, increased government involvement in housing, and achieved stabilised property prices by the 3rd quarter of 1975. 31,000 houses completed in 1973-74, compared with 27,400 in 1972-73 and 22,400 in 1971-72. State Housing construction was also encouraged, with nearly 4,000 State Houses completed in 1975-76, compared with 700 constructed in 1972-73. The criteria for allocating State Housing was also changed, which led to more people being offered such houses. Income limits for 3% housing loans were also increased, and Rent Appeal boards were set up to control rents to protect the rights of tenants. Rent subsidies for pensioners were introduced.

New housing loans were introduced, such as a new 4.5 % loan for those whose qualifying incomes were between $70 and 75$ a week, plus $5 for each dependent child. An additional loan was also introduced for applicants who had a total income of less than 490 a week and were eligible to capitalise on the family benefit. Greater flexibility was extended to the State Advances Corporation “in determining the size of average loans “to be made available both at 3 and at 5 per cent.” In the first budget, a special fund was announced for refinancing mortgages where people had second and third mortgage commitments that were placing strains on the family budget. Rent Appeal boards were also set up to restrict the rights of landlords to make arbitrary increases in rents.

New Home Ownership Accounts were introduced to encourage people on low and middle incomes to save towards housing. Savers were entitled to a tax concession of 25% if savings were retained in the account for at least three years and were then put towards the purchase or construction of a first house or apartment. A Property Speculation Tax was introduced in 1973 in an attempt to control speculative dealing in property, and in 1974 building restrictions were imposed on commercial building and the construction of larger houses. A land tax was also introduced to control profit-making on rezoned land. Improvements were also made in the design and planning of State housing accommodation, with additions such as carports, driveways, tree-planting, and landscaping. In addition, an amendment to the Public Works Act provided more generous arrangements for those whose property had been taken under the Act, while other legislation ensured that a joint family home was exempted from death duties on the death of whichever spouse died first.. Additional house lending was later provided in the 1975 budget .
  • Major initiatives in education.

A new Standard tertiary benefit was introduced for university students., while at the secondary school level, staffing ratios were improved, an accelerated school building programme was carried out, and the number of guidance counsellors was markedly increased. Pilot schemes in “second chance” education and community education were introduced, and in May 1973 the government abolished the maximum school-leaving age of nineteen to enable adults to attend secondary schools full-time. The government also introduced “the concept of schools incorporating community facilities for use outside school hours,” and tried to broaden the function of schools into community centres. In addition, sessional allowances and building subsidies for kindergartens and playcentres were significantly increased, bursaries and other grants were increased for technical institute and university students, housing allowances were granted to married male teacher trainees, and grants for hobby classes (which had been cut in 1971 as an austerity measure) were also reinstated.

Attempts were also made to extend the teaching of Maori language and culture. Maori was introduced an optional subject in many secondary schools, proficient speakers of Maori were recruited for teacher training, Maori language lecturers were appointed in al teacher’s training colleges. In tertiary education, more technical institutes were constructed, as indicated by large increase in annual gross voted expenditure on capital works for different tertiary institutions between 1972 and 1975: 25% for universities, 50% for teacher’s colleges, 97% for primary and secondary schools, and 157% for technical institutes. For students in training colleges, technical institutes, and universities, were to receive $24 a week for up to three years of tertiary education, and the allowance would be increased to $27 for subsequent years if the course required more than three years. Special provision was also made for married students. In 1975, the Standard Teriary Bursery was made available for part-time study, where the student was not otherwise employed.

Numerous measures were introduced which extended pre-school services and supported local voluntary organisations. These included the creation of ten district pre-school committees with the purpose of coordinating development at the local level. The subsidy for building play-centres and kindergartens was doubled and provision was made for helping in the purchase of sites. New salary scales for kindergarten teachers were approved, and assistance was extended to day-care centres, with the government providing a grant of $4.50 per week for each child cared for in an approved centre, which also qualified for a two-thirds subsidy on construction costs. In 1972, 1 in 3 children received pre-school education, while in 1975, the equivalent figure was 2 in 3.
  • Major initiatives in health.

Attempts were made to increase grants to Hospital boards in order to overcome staff shortages, while specials subsidies were paid in order to attract doctors to rural and other medically deprived areas. Fees were paid to doctors for each patient consultation were increased and doctors were required to lower the charge made to the public. As a result of these measures, the 1973 budget witnessed a 19% rise in expenditure on health services and benefits. Reforms were carried out in the mental health service in line with recommendations made by a Commission of Inquiry in 1971, and the problem of staff shortages in mental hospitals was significantly reduced through the provision of a further thousand staff positions.” The government also increased the subsidies paid to church and other voluntary organisations which wished to build or extend private hospitals attached to private homes for the elderly. Hospital waiting lists were also reduced during the government's time in office.
  • Accident Compensation Amendment Act (1973).

This extended coverage to those not already covered by the 1972 Accident Compensation Act (including students, non-earners and visitors to New Zealand). Under the 1973 Act, three schemes were established, including the earners’ scheme, the motor vehicle scheme, and the supplementary scheme, with covered those who weren’t covered by the other two schemes (the government funded this scheme).
  • Major improvements in the national minimum wage.

The national minimum wage was significantly increased, in line with a recommendation of the 1972 Royal Commission on Social Security. In 1972, the minimum wage represented 44% of the average wage, but within a year upon taking office, the government had raised the value of the minimum wage to nearly 66% of the average wage.
  • The Counties Amendment Bill No. 3 and the Municipal Corporations Amendment Bill No. 2.

These bills extended the power of Local Authorities to introduce differential rating, in response to complaints by municipalities that they did not have the power to obtain realistic contribution from high-rise or multi-unit properties. The two bills also gave Local Authorities more power in preventing alcohol consumption in streets closed for public functions, and Police were given the authority to search packages or bags carried into such closed streets.
  • Measures to combat sex discrimination.

The distinction of sex in the residence rights of New Zealanders who had married foreigners was removed. Prior to this legislation, female New Zealanders were not permitted to bring their foreign spouses to reside in New Zealand as of right, due to the assumption that women should follow their husbands. The government also instructed the State Services Commission to start negotiations with the Combined State services Organisations to reach agreement on the removal of sex-based distinctions in conditions of employment.
  • The Maori Affairs Amendment Act (1974).

This was passed in order to promote biculturalism.
  • The Education Amendment Bill No. 5.


This legislation gave Education Boards permission to carry out architectural and construction work on behalf of pre-school authorities, and provided for teacher representation with full voting rights on all secondary school boards. It also allowed schools to provide free continuing education so that adults would be able to attend regular day classes at schools.
  • Improvements in holiday entitlements (1974).

The minimum entitlements to paid holidays were extended from two to three weeks.
  • The Recreation and Sport Act (1973).

This piece of legislation established the Office of a Minister of Recreation and Sport and provided for the creation of a Council for Recreation and Sport. It also introduced a subsidy regime which councillors could direct towards community groups.
  • The Fire Services Amendment Bill.

This considerably reduced the cost of Fire Services to local authorities (and by extension ratepayers) while raising the contribution of the insurance companies.
  • Introduction of the rates rebate scheme.

This helped many people on low incomes to pay their property rates
.
  • The Children and Young Persons Act (1974).

This provided police and social workers with the legal authority to intervene in family situations where the child was at risk.
  • The Disabled Persons Community Welfare Act (1975).

This provided greater provisions for those with disabilities.
  • Special assistance to farmers.

To help farmers, the Third Labour Government introduced a number of measures to increase assistance to farmers. A range of measures were introduced which helped to stabilise farm costs including waiving of interest on loans, the abolition of meat inspection fees, and increased fertiliser subsidies. A farm settlement scheme was also established in conjunction with a farm training scheme to get landless farmers onto their own units of land. A five-year training scheme culminating in a Trade Certification Board advanced trade certificate in farm management was introduced in order to make the settlement opportunities as egalitarian and expansive as possible.
  • The establishment of the New Zealand Authors’ Fund.

This measure targeted government funding for the arts towards New Zealand authors and recognised the contribution made by New Zealand authors.
  • The personal loans scheme.

This scheme, which began in April 1973, with interest rates ranging from just over 5% to just over 6%, increased the number and value of personal loans. For instance, by 1975, over 12,500 personal loans worth more than $7 million were on record with the Post Office Savings Bank alone.
  • The promotion of preventative medicine.

Preventative measures to promote public health were pursued by the government, with the expansion of audiology clinics, the provision of subsidies for water supply and sewerage,
the establishment of a public health laboratory, and the setting up of a committee to advise on noise control procedures.
  • The promotion of greater productivity at work.

Greater productivity was encouraged by the introduction of a 10 cents an hour rebate on overtime and 40 cents for every shift worked.
  • The Social Security Amendment Act (1973).

This substantially increased the allowable income for means test beneficiaries as of Valentine’s Day that year.
  • The New Zealand Social Work Training Council.

This was established in 1973 as a way of organising and co-ordinating the training of social workers from both voluntary and government agencies.
  • Larger funds for social research.

The amount of money devoted to social research was significantly increased.
  • Greater allocations for geriatric hospitals and residential homes.

Subsidies for residential homes and geriatric hospitals run by religious and welfare
organisations were increased considerably from 1972 to 1975.
  • The extension of the provision of practice nurses to urban areas.

A subsidy of 100% of the salary costs of nurses in urban practices was
made available by 1975.
  • The Home Ownership Savings Act 1974.

This established special savings accounts as a means of encouraging saving for home ownership.
  • The Volunteers Employment Protection Act 1973.

This protected employees from dismissal as a result of being absent from work while undertaking any protected voluntary service.
  • Introduction of new concessionary allowances.

A system began in October 1973 whereby pensioners paid only half their telephone accounts. This principle was extended in January 1975 to television license fees for income-tested beneficiaries.
  • Revision of the Sale of Goods Act.

This legislation strengthened consumer rights in retail contracts.
  • The Land and Income Tax Amendment Act (1974) .

This legislation introduced a government-assisted profit sharing scheme.
  • A more progressive tax system.

Various tax reforms were introduced to bring about greater progressivity in the tax system.
New tax scales were introduced, which reduced taxes married taxpayers earning under $6,000 per annum, while New Zealanders earning over $12,000 per annum saw a slight increase in their tax burden. In addition, a new property speculation tax was introduced.

Formation

By 1972, National
New Zealand National Party
The New Zealand National Party is the largest party in the New Zealand House of Representatives and in November 2008 formed a minority government with support from three minor parties.-Policies:...

 had been in power for twelve years, and was seen by many as tired and stale. Long-serving National Prime Minister Keith Holyoake
Keith Holyoake
Sir Keith Jacka Holyoake, KG, GCMG, CH, QSO, KStJ was a New Zealand politician. The only person to have been both Prime Minister and Governor-General of New Zealand, Holyoake was National Party Prime Minister from 20 September 1957 to 12 December 1957, then again from 12 December 1960 to 7...

 had retired earlier in the year to be replace by Jack Marshall
Jack Marshall
Sir John Ross Marshall, GBE, CH, , generally known as Jack Marshall, was a New Zealand politician. After spending twelve years as Deputy Prime Minister, he served as the 28th Prime Minister for most of 1972....

. While generally respected, Marshall lacked the charisma of Labour
New Zealand Labour Party
The New Zealand Labour Party is a New Zealand political party. It describes itself as centre-left and socially progressive and has been one of the two primary parties of New Zealand politics since 1935....

 leader Norman Kirk. Labour's election publicity focussed on Kirk, and used the slogan 'It's Time', signifying that the government had been in power for too long. Labour won 48.37% of the popular vote and 55 seats, to National's 41.5% and 32 seats.

Defeat

Labour was defeated in the 1975 election, after only one term in power. In a reversal of the previous election's results, National won 47.6% of the popular vote and 55 seats, while Labour retained only 39.6% and 32 seats. Several factors contributed to the result:

Leadership

Kirk's death the year before had robbed Labour of its biggest asset. In response to Kirk's popularity, National had replaced Marshall with Robert Muldoon
Robert Muldoon
Sir Robert David "Rob" Muldoon, GCMG, CH served as the 31st Prime Minister of New Zealand from 1975 to 1984, as leader of the governing National Party. Muldoon had been a prominent member of the National party and MP for the Tamaki electorate for some years prior to becoming leader of the party...

, a brash but popular man who could hold his own against Kirk. Kirk's replacement, Bill Rowling
Bill Rowling
Sir Wallace Edward Rowling, KCMG , often known as Bill Rowling, was the 30th Prime Minister of New Zealand. He was in office for just over a year, having been appointed Prime Minister following the death of the highly popular Norman Kirk...

, lacked the charisma of either Kirk or Muldoon, and was the subject of frequent mockery from Muldoon.

Economic factors

New Zealand, like most other countries, was hard hit by the 1973 oil crisis
1973 oil crisis
The 1973 oil crisis started in October 1973, when the members of Organization of Arab Petroleum Exporting Countries or the OAPEC proclaimed an oil embargo. This was "in response to the U.S. decision to re-supply the Israeli military" during the Yom Kippur war. It lasted until March 1974. With the...

. In addition, Britain had joined the European Economic Community
European Economic Community
The European Economic Community The European Economic Community (EEC) The European Economic Community (EEC) (also known as the Common Market in the English-speaking world, renamed the European Community (EC) in 1993The information in this article primarily covers the EEC's time as an independent...

 the same year, restricting New Zealand's agricultural exports to its biggest market. Labour seemed to lack the economic skills to handle these crises. By contrast, National's leader, Muldoon, was also its finance spokesperson, and an accountant by profession. He was able to convince many voters that he could solve New Zealand's economic problems.

Ironically, another factor in Labour's defeat was the popularity of National's universal superannuation scheme compared to Labour's compulsory savings programme. Universal superannuation, which replaced Labour's scheme, was to cause major financial headaches for subsequent governments.

Social factors

Labour's progressive social and cultural policies, which encouraged biculturalism
Biculturalism
Biculturalism in sociology involves two originally distinct cultures in some form of co-existence.A policy recognizing, fostering or encouraging biculturalism typically emerges in countries that have emerged from a history of national or ethnic conflict in which neither side has gained complete...

 and the growth of Māori culture
Maori culture
Māori culture is the culture of the Māori of New Zealand, an Eastern Polynesian people, and forms a distinctive part of New Zealand culture. Within the Māori community, and to a lesser extent throughout New Zealand as a whole, the word Māoritanga is often used as an approximate synonym for Māori...

, may have caused a backlash amongst working class Pakeha
Pakeha
Pākehā is a Māori language word for New Zealanders who are "of European descent". They are mostly descended from British and to a lesser extent Irish settlers of the nineteenth and twentieth centuries, although some Pākehā have Dutch, Scandinavian, German, Yugoslav or other ancestry...

, who had traditionally supported Labour. The cancellation of the proposed Springbok Tour was particularly unpopular. Many disliked and distrusted what Kirk's government was doing, but found Muldoon's style and message strongly appealing. This shift, along with the appeal the government's policies had for many middle class intellectuals, helped to change the culture of both parties, in Labour's case permanently. Under Muldoon, National had much more working class support than previously or since. The third Labour government's policies attracted a large university-educated liberal contingent to Labour, transforming the party from its working class, trade union
Trade union
A trade union, trades union or labor union is an organization of workers that have banded together to achieve common goals such as better working conditions. The trade union, through its leadership, bargains with the employer on behalf of union members and negotiates labour contracts with...

 roots. This shift in party culture explains how the fourth Labour government
Fourth Labour Government of New Zealand
The Fourth Labour Government of New Zealand was the government of New Zealand from 26 July 1984 to 2 November 1990. It enacted major social and economic reforms, including reformation of the tax system. The economic reforms were known as Rogernomics after Finance Minister Roger Douglas...

's policies differed so dramatically from those of its predecessors. As a result of this change, Kirk was to be the second to last Labour leader (the last being Mike Moore) to come from a working class and union background rather than be university-educated.

Electoral results

Election Parliament Seats Total votes Percentage Gain (loss) Seats won Change Majority
1972
New Zealand general election, 1972
The New Zealand general election of 1972 was held to elect MPs to the 37th session of the New Zealand Parliament. The Labour Party, led by Norman Kirk, defeated the governing National Party.-Background:...

37th 87 48.37% +4.17% 55 +16 23
1975
New Zealand general election, 1975
The 1975 New Zealand general election was held to elect MPs to the 38th session of the New Zealand Parliament. It was the first election in New Zealand where 18-20 year olds and all permanent residents of New Zealand were eligible to vote, although only citizens were able to be...

38th 87 39.6% -8.77% 32 -23 -

Prime ministers

Norman Kirk
Norman Kirk
Norman Eric Kirk was the 29th Prime Minister of New Zealand from 1972 until his sudden death in 1974. He led the Parliamentary wing of the New Zealand Labour Party from 1965 to 1974. He was the fourth Labour Prime Minister of New Zealand, but the first to be born in New Zealand...

 was Prime Minister
Prime Minister of New Zealand
The Prime Minister of New Zealand is New Zealand's head of government consequent on being the leader of the party or coalition with majority support in the Parliament of New Zealand...

 from the 1972 election until his death in August 1974. He was replaced by Wallace (Bill) Rowling.

Cabinet Ministers

> > > > >
Ministry Minister Term(s)
Deputy Prime Minister
Deputy Prime Minister of New Zealand
The Deputy Prime Minister of New Zealand is second most senior officer in the Government of New Zealand, although this seniority does not necessarily translate into power....

 
Hugh Watt
Hugh Watt
Hugh Watt was a Labour member of Parliament and Deputy Prime Minister of New Zealand from 1972 – 1974. He was briefly the Acting Prime Minister of New Zealand between 1 September 1974 – 6 September 1974 following the death of Norman Kirk....

 
1972–1974
Bob Tizard  1974–1975
Minister of Finance
Minister of Finance (New Zealand)
The Minister of Finance is a senior figure within the government of New Zealand. The position is often considered to be the most important Cabinet role after that of the Prime Minister....

 
Bill Rowling
Bill Rowling
Sir Wallace Edward Rowling, KCMG , often known as Bill Rowling, was the 30th Prime Minister of New Zealand. He was in office for just over a year, having been appointed Prime Minister following the death of the highly popular Norman Kirk...

 
1972–1974
Bob Tizard 1974–1975
Minister of Foreign Affairs
Minister of Foreign Affairs (New Zealand)
The Minister of Foreign Affairs is a major ministerial portfolio in the government of New Zealand.The current Minister of Foreign Affairs is Murray McCully, who was National Party Spokeperson of Foreign Affairs and Shadow Minister of Foreign Affairs. There are also Associate Minister roles...

 
Norman Kirk
Norman Kirk
Norman Eric Kirk was the 29th Prime Minister of New Zealand from 1972 until his sudden death in 1974. He led the Parliamentary wing of the New Zealand Labour Party from 1965 to 1974. He was the fourth Labour Prime Minister of New Zealand, but the first to be born in New Zealand...

 
1972–1974
Bill Rowling 1974–1975
Attorney-General
Attorney-General (New Zealand)
The Attorney-General is a political office in New Zealand. It is simultaneously a ministerial position and an administrative office, and has responsibility for supervising New Zealand law and advising the government on legal matters...

 
Martyn Finlay
Martyn Finlay
Allan Martyn Finlay was a New Zealand politician of the Labour Party, a lawyer and Q.C.- Member of Parliament :He represented the North Shore electorate from 1946 to 1949, when he was defeated...

 
1972–1975
Minister of Defence
Minister of Defence (New Zealand)
The Minister of Defence is a minister in the government of New Zealand with responsibility for the New Zealand armed forces and the Ministry of Defence.The present Minister is Dr...

 
Arthur Faulkner
Arthur Faulkner
Arthur James Faulkner was a New Zealand politician of the Labour Party.-Member of Parliament:He stood unsuccessfully for the Franklin electorate in 1951 and the North Shore electorate in 1954...

 
1972–1974
William Fraser
William Fraser (New Zealand)
William Alex Fraser was a New Zealand politician of the Labour Party.He represented the Dunedin electorate of St Kilda from 1957 to 1981, when he retired....

 
1974–1975
Minister of Education  Phil Amos
Phil Amos
Phillip Albert Amos was a New Zealand politician of the Labour Party. He was the Member of Parliament for Manurewa from 1963 to 1975, when he was defeated....

 
1972–1975
Minister of Health
Minister of Health (New Zealand)
The Minister of Health is a minister in the government of New Zealand with responsibility for the New Zealand Ministry of Health and the District Health Boards.The present Minister is Tony Ryall, a member of the National Party.-History:...

 
Bob Tizard 1972–1974
Tom McGuigan
Thomas McGuigan
Thomas Malcolm McGuigan was a New Zealand politician of the Labour Party. He was the Member of Parliament for Lyttelton from 1969 to 1975, when he was defeated....

 
1974–1975
Minister of Justice
Minister of Justice (New Zealand)
The Minister of Justice is a minister in the government of New Zealand. The minister has responsibility for the formulation of justice policy and for the administration of law courts....

 
Martyn Finlay
Martyn Finlay
Allan Martyn Finlay was a New Zealand politician of the Labour Party, a lawyer and Q.C.- Member of Parliament :He represented the North Shore electorate from 1946 to 1949, when he was defeated...

 
1972–1975
Minister of Māori Affairs
Minister of Maori Affairs
The Minister of Māori Affairs is the minister of the New Zealand government with broad responsibility for government policy towards Māori, the first inhabitants of New Zealand. The current Minister of Māori Affairs is Dr. Pita Sharples.-Role:...

 
Matiu Rata
Matiu Rata
Matiu Rata was a New Zealand Māori politician. He was the Member of Parliament for Northern Maori from 1963 to 1979, the Minister of Lands and Minister of Māori Affairs in the Third Labour Government of New Zealand between 1972 and 1975...

 
1972–1975
Minister of Railways
Minister of Railways (New Zealand)
The Minister of Railways was the minister in the government responsible for the New Zealand Railways Department 1895–1981, the New Zealand Railways Corporation 1981–1993, and New Zealand Rail Limited 1990–1993...

 
Tom McGuigan  1972–1974
Ron Bailey
Ron Bailey (New Zealand)
Ronald "Ron" Leslie Bailey was a New Zealand politician of the Labour Party. He was the Member of Parliament for Heretaunga from 1960 to 1981, when he retired....

 
1974–1975
Postmaster-General Roger Douglas
Roger Douglas
Sir Roger Owen Douglas , is a New Zealand politician who formerly served as a senior New Zealand Labour Party Cabinet minister. He became arguably best-known for his prominent role in the radical economic restructuring undertaken by the Fourth Labour Government during the 1980s...

 
1972–1975

See also

  • Governments of New Zealand
    Governments of New Zealand
    The Government of New Zealand , formally Her Majesty's Government in New Zealand, is based on the Westminster system of responsible government...

  • New Zealand Labour Party
    New Zealand Labour Party
    The New Zealand Labour Party is a New Zealand political party. It describes itself as centre-left and socially progressive and has been one of the two primary parties of New Zealand politics since 1935....

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