Peters looks for third time lucky

Analysis - Bill English was in a contemplative mood when he wandered into my office.

Talks with New Zealand First were on a knife edge and English was worried whether a coalition deal would be the best thing for the National Party. During our chat he asked what I thought.

Half in jest, half-serious, I suggested he go back to his National Party MPs and tell them to walk away from talks with New Zealand First and its leader Winston Peters. Let Labour and its allies deal with Peters instead.

That was 1996. English was a rising star in the National Party but not yet the influential figure he has become. Nor did he take my suggestion.

After eight weeks of negotiations in 1996 the two parties stitched together a deal to form that ill-fated third-term National-led government. Then, as now, Peters played a peculiar role.

As the talks began I wrote for the now defunct Evening Post:

"It was not a good beginning to the brave new world of MMP. The first formal talks to negotiate the country's next Government were shrouded in the secrecy and drama New Zealand First leader Winston Peters so enjoys."

A month later Peters threatened to stop talking to Post reporters. He was particularly upset by the newspaper's editorials critical of him and his party.

"I am not going to go along assisting publications who think it is their sole duty to berate New Zealand First," he said. "That sort of behaviour on the part of the newspaper and its editor is a downright disgrace."

Sound familiar? In my experience Peters is like a grumpy uncle. His bark is worse than his bite.

Back to Bill English though. His worry was how National could get on with New Zealand First and Peters in particular. Many National MPs were uncomfortable with relying on Peters to put them back into government.

But whatever their reservations, in the end realpolitik won out and a deal was done. For some National MPs the agreement went too far and Peters won too many concessions. The then-National Party leader and Prime Minister, Jim Bolger, took the flak.

Just a year later in 1997, the coalition already under strain, a backbench MP Brian Neeson launched an extraordinary attack on Bolger, saying there was a "crisis of leadership within the National Party and the Government".

The dispute all hinged on Bolger's perceived failure to back his health minister in a spat with the Associate Health Minister and New Zealand First MP Neil Kirton. And National's Health Minister by then? Bill English.

That fractious, dysfunctional National-New Zealand First coalition finally came to an end in August, 1998, when Jenny Shipley, who had replaced Bolger late in 1997, sacked Peters as Deputy Prime Minister and Treasurer.

The New Zealand First caucus split in acrimonious circumstances, with a number of its MPs deserting Peters and staying in government to prop up the Shipley administration. As for the party itself, it barely survived the crisis but managed to scramble back into Parliament after the 1999 election.

While the history of New Zealand First and National is traumatic it does not necessarily rule out the two parties trying it again.

There are two things worth remembering about 1996. It was the first MMP election and the first time political parties had had to negotiate a government agreement of that sort. As well, National had only won 33 percent of the party vote so was not in as strong a position to dictate terms.

Remember too, that New Zealand First did much better second time round when it did a deal with Labour after the 2005 election. That did end badly, with New Zealand First failing to return to Parliament after the 2008 election. But those problems were all of the party's own making and had nothing to do with any difficulties with Labour.

Former Labour leader Helen Clark was adamant the New Zealand First leader held up his end of the bargain throughout his time as Foreign Minister. As for Peters, he has said he remembers it well because he felt he was treated with respect and as an equal by Clark and her deputy Michael Cullen.

So the strategy for Bill English and Jacinda Ardern should be the same: be prepared to treat Peters and his party with respect or walk away from talks.

Neither major party leader needs to make outrageous concessions to win New Zealand First's support. Peters does not have, as some commentators claim, absolute power.

He has some leverage in coalition negotiations but he and his party will want to use that wisely. He will have learned from past mistakes and surely knows if his party implodes again he will struggle to save it a third time.

* Brent Edwards was the political editor at the Evening Post in 1996.