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### Viewing cable 06WELLINGTON935, JOHN KEY ELECTED NEW OPPOSITION LEADER

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
06WELLINGTON935 | 2006-11-27 18:30 | 2011-04-28 00:00 | CONFIDENTIAL//NOFORN | Embassy Wellington

`

    VZCZCXYZ0004
    RR RUEHWEB

    DE RUEHWL #0935/01 3311830
    ZNY CCCCC ZZH
    R 271830Z NOV 06
    FM AMEMBASSY WELLINGTON
    TO RUEHC/SECSTATE WASHDC 3540
    INFO RHHMUNA/CDR USPACOM HONOLULU HI
    RUEHBY/AMEMBASSY CANBERRA 4627
    RHHJJAA/JICPAC HONOLULU HI
    RUEKJCS/SECDEF WASHINGTON DC
    RHEHAAA/NATIONAL SECURITY COUNCIL WASHDC

` `

    C O N F I D E N T I A L WELLINGTON 000935

    SIPDIS

    SIPDIS

    NOFORN

    STATE FOR D (FRITZ), EAP/FO, AND EAP/ANP
    NSC FOR VICTOR CHA
    SECDEF FOR OSD/ISD LIZ PHU
    PACOM FOR J01E/J2/J233/J5/SJFHQ

    E.O. 12958: DECL: 11/27/2016
    TAGS: PGOV NZ
    SUBJECT:  JOHN KEY ELECTED NEW OPPOSITION LEADER

    Ref A) Wellington 928     B) Wellington 923

    Classified by DCM David J. Keegan, reasons 1.4 (B) and (D).

    Summary
    -------

    ¶1. (SBU) SUMMARY: John Key has won the leadership of New Zealand's
    main opposition party, the National Party.  In an uncontested
    election, Key replaced Dr. Don Brash who resigned last week after
    three turbulent years at the helm.  National also elected a new
    Deputy Leader and Finance spokesman:  the influential Bill English, a
    former party leader himself.  Labour may well find the National Party
    a more difficult adversary now, as this new leadership is less likely
    to commit the gaffes of its predecessor.  Ultimately, however, it's
    National's new message that will determine its support among voters,
    and while a Key-led National will likely be more moderate than
    Brash's party, it has yet to articulate its vision.  End Summary

    Key chosen to led National in uncontested ballot
    --------------------------------------------- ---

    ¶2. (SBU) On Monday November 27, the National Party caucus officially
    chose John Key as its new leader, three days after Dr. Don Brash
    resigned the leadership to take responsibility for his latest
    political gaffe - a failed effort to block a muck-raking journalist
    from publishing a book based in part on his leaked personal emails.
    Although some commentators had predicted a contested leadership
    battle, Key emerged unscathed from what was a relative bloodless
    transition of power.  The former party leader and Education spokesman
    Bill English will serve as National's Deputy Leader.

    English decides against challenge, becomes Deputy Leader
    --------------------------------------------- --------

    ¶3. (SBU) English reportedly thought about challenging Key, but in the
    end decided not to contest the leadership.  Although he had
    previously intimated that he was not interested in serving as Key's
    second in command, English endorsed Key in return for securing the
    Deputy Leadership.  Key apparently convinced incumbent Deputy Leader
    Gerry Brownlee not to fight to retain his position.  As part of this
    negotiated deal, English asked Key for the finance portfolio as well,
    and Key granted the request.  (Reportedly, in addition to wanting the
    powerful finance slot for its own sake, English desired the extra
    position because it makes his portfolio exactly equivalent to that of
    Deputy PM and Finance Minister Cullen.)  Brownlee's ceding of the
    slot was orchestrated to dispel suggestions that there were divisions
    within National's caucus over who would get the Deputy's job.
    Another major factor behind Key's decision to force Brownlee to make
    way for English is that Key needed the backing of English's own
    faction of supporters, most of whom are influential frontbenchers.

    What the new leadership means for National
    ------------------------------------------

    ¶4. (SBU) National's new leadership team is considered the dream
    ticket by many political observers.  It brings together arguably the
    two top performers in the National Party:  the media-genic Key and
    the strategically savvy English.  Moreover, the new leadership will
    likely bring a more moderate tone to National's politics, in contrast
    with what many voters (and some in the party's caucus) saw as Brash's
    Far Right radicalism.  The uncontested leadership transition has
    enabled National to display unity in a time of change.  National has
    had four leaders since Prime Minister Helen Clark took office in
    1999, creating an impression of instability that has dogged the
    party.  English has already stated that this new leadership is likely
    to be in place for several elections.

    What the new leadership means for Labour
    ----------------------------------------

    ¶5. (SBU) The Key/English ticket is the one combination Labour fears
    the most.  Gone now are the vulnerabilities in National's leadership
    that Labour so adroitly, and effortlessly, exploited.  Key is more
    politically astute and disciplined than Brash.  English has the
    gravitas and political and intellectual acumen that Brownlee lacks.
    Unlike most of their caucus colleagues, both Key and English have
    frequently bested their Labour opponents head-to-head in political
    debate.  Moreover, both men are more likely to appeal to the much
    coveted centrist vote, especially women, than their predecessors.
    Labour is fully aware of the combined threat it now faces.  Some
    months ago, an advisor in the Prime Minister's Office confessed to
    Post that a Key-English ticket is Labour's "worst nightmare."

    What the new leadership means for the US-NZ relationship
    --------------------------------------------- ---------

    ¶6. (C/NF) Key has not yet fully articulated his personal positions on
    matters of foreign policy, but will reportedly deliver a speech on
    defense later in the week, which is expected to come shortly before
    he announces who will be National's spokesmen for Foreign Affairs,
    Defence and Trade.  Key has worked in the United States and speaks
    favorably of the U.S.  He has been friendly to Mission New Zealand
    and was scheduled to travel to Washington on the Voluntary Visitor
    Program earlier this year until he had to cancel to help deal with
    (or take advantage of) a political crisis involving Dr. Brash.  We
    expect we will continue to have a good working relationship with
    National under his leadership.

    Brash's future still undecided
    ------------------------------

    ¶7. (SBU) Brash's political fate is uncertain.  On resigning his
    leadership he stated that unless the new leader offers him a
    portfolio of significant weight, he is unlikely to hang around.  Key
    is expected to start allocating portfolios later in the week, and
    Brash is by no means guaranteed of acquiring the sort of significant
    portfolio which would tempt him to stay in parliament.  Before he was
    made leader in 2003, Brash, a former Central Banker, said that he
    entered politics to be Finance Minister in a National Government.
    With English now in finance, this goal will almost certainly go
    unrealized.  A problem for Key is that Brash's continued presence in
    Parliament at the time when a book scathing of him has just been
    launched (ref B), would hamper Key's aim of marketing National as new
    and improved under his leadership.  If Brash does decide to leave,
    the number of National's parliamentary seats will remain unchanged.
    As a List MP, Brash will simply be replaced by the next person on the
    party list, Wellington accountant Katrina Shanks.

    McCormick

`