Comment: Asset sales are back in the news. Commenting on a recent report from Treasury, Prime Minister Christopher Luxon said that New Zealand needed to have a “mature conversation about asset recycling”. Luxon claims the state has a “lazy balance sheet”, and that sale of certain assets (sometimes referred to as “privatisation”) should at least be considered.
Over the past 40 years, asset sales have been periodically debated, including under the Labour government of the 1980s and in the 2010s when John Key’s National government sold significant shares of several state-owned enterprises.
Luxon’s comments sparked immediate reaction from Labour Party leader Chris Hipkins, who argued that “Christopher Luxon needs to be upfront with New Zealanders” about what asset sales he is considering.
Though the next election is about a year away, asset sales could become a key issue during the election campaign. It is worth asking, then, what do New Zealanders think about asset sales? Fortunately, the New Zealand Election Study, which has been carried out after every general election since 1990, tracks New Zealanders’ attitudes about a range of topics, including privatisation.
Analysis of the study data shows support for asset sales is low. Indeed, close to 50 percent of the public agree with the statement “Privatisation of state-owned enterprises has gone too far” and only 12 percent disagree.
However, there is a clear split by party, with majorities of Labour, Green, Te Pāti Māori and New Zealand First supporters opposing asset sales. In contrast, Act and National supporters are split between supporting, opposing, or being ambivalent about privatisation.
NZ First leader Winston Peters, despite being part of the coalition government, has been highly vocal in his opposition to Luxon’s support for asset sales, and NZ First’s founding principles include opposition to sales of strategic state assets. It is not surprising, then, to see that a large majority of NZ First supporters are opposed to privatisation. In fact, 76 percent of people who voted for NZ First supported the statement that privatisation has gone too far—the highest for any of the six parties in parliament.
Analysing support for asset sales by people’s income level gives us an indication of why people hold the attitudes they do. People on lower incomes are much more likely to oppose asset sales than people with larger salaries. These differences in attitudes are probably related to poorer people relying more on government services, some of which could be affected by asset sales, than richer people. Richer people may also stand to gain from asset sales through investment returns and having the option to purchase assets as the government sells them. A similar pattern occurs when support for privatisation is analysed by people’s asset ownership.
Interestingly, there has been little change in levels of opposition to asset sales over the past decade. The election study has asked the same question since 2014, when asset sales were a prominent issue. At that time, just over 50 percent of participants agreed that privatisation had gone too far (although a higher proportion strongly agreed compared with 2023). Nearly 17 percent disagreed. There has been little movement in attitudes across subsequent elections, including among supporters of the main parties.
Given the public is largely opposed to asset sales, and that these attitudes seem to be stable, focusing on “asset recycling” in 2026 might be a hard sell for Luxon and National. Act politicians favour asset sales, but it will be tough for National to attract centrist voters by holding such an unpopular stance. Even if the National campaign chooses to focus on other issues, the spectre of asset sales could turn away swing voters, especially if the left-leaning parties keep raising questions about it.
If National is able to form a government after the 2026 election, it may again be faced with challenging coalition negotiations. On current polling, National is likely to once more need the support of NZ First, which has seen its popularity surge since the election, and Act. Indeed, National is likely to be in a weaker position than it was after the 2023 election. Given Peters’ recent statements, it is difficult to imagine him accepting even minor concessions on asset sales.
That said, New Zealand has, since 1999, had a history of stable coalition governments, often in spite of highly diverse ideological and policy perspectives among the governing parties. Peters has also typically taken on a much more conciliatory tone in coalition negotiations compared with his campaign rhetoric. Limited asset sales are thus a distinct possibility in the next parliamentary term, should National win the Treasury benches again in 2026.
This article was originally published on Newsroom.
Sam Crawley is a teaching fellow in the School of History, Philosophy, Political Science and International Relations, Matthew Gibbons is a researcher in the Political Science programme, and Jack Vowles is a professor of Comparative Politics at Te Herenga Waka—Victoria University of Wellington.