InfoAnda - New Zealand Nationals sign deal to form government

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My Profile Top News Reuters top ten news stories delivered to your inbox each day. Subscribe You are here: Home > News > International > Article Home Business & Finance News U.S. Politics International Technology Entertainment Sports Lifestyle Oddly Enough Environment Health Science Special Coverage Video Pictures You Witness The Great Debate Blogs Reader Feedback Do More With Reuters RSS Widgets Mobile Podcasts Newsletters You Witness News Make Reuters My Homepage Partner Services CareerBuilder Affiliate Network Professional Products Support (Customer Zone) Reuters Media Financial Products About Thomson Reuters New Zealand Nationals sign deal to form government Sat Nov 15, 2008 10:18pm EST Email | Print | Share | Reprints | Single Page [-] Text [+] WELLINGTON (Reuters) - New Zealand Prime Minister-elect John Key announced on Sunday his party has signed a deal with allies to form a government, allowing him to start work on pulling the country out of recession. Key's center-right National Party won the largest share of the vote in a November 8 general election, ending nine years of center-left Labour Party rule under Helen Clark, but not enough to govern outright. After the poll, Key, a former foreign exchange dealer with only six years political experience, quickly began negotiations with the free-market ACT, centrist United Future and indigenous Maori parties. He said National has signed agreements with all three to form a government with 70 seats in the 122-seat parliament and that their support would allow him to form a stable administration. "In order to promote strong growth in investment, employment and incomes, stable government and high levels of business confidence are required," he told a media conference. New Zealand entered a recession in the first half of 2008, and some analysts believe it will not pull out until 2009 as weak consumer spending, falling house prices and the global credit crisis bite. National has promised to move quickly to legislate for further income tax cuts to take effect in April, increase spending on infrastructure projects, and start the reform of planning laws to stimulate the economy. Key said he had telephoned Governor-General Anand Satyanand, the representative of head of state Queen Elizabeth, to advise him that he would be able to form a government. The make-up of his cabinet is expected to be announced on Monday and the government sworn in on Wednesday, in time for Key to leave on Thursday for a meeting of leaders of the Asia Pacific Economic Forum (APEC). No party had won an outright majority under New Zealand's complicated proportional voting system, although National, ACT and United Future had won 65 seats between them. The Maori Party, which draws its support from New Zealand's indigenous people who make up 15 percent of the 4.3 million population, had always loomed as the kingmakers of the election. Under the governing arrangement, ACT and the Maori Party will both get two ministerial posts, while United Future will get one. The three minor parties in the coalition will be formally outside the minority National government but have agreed to support National on issues of confidence and supply. Key had previously said he supported the idea of a minority government with support arrangements, just as Clark and Labour had done. It allows the support parties to criticize the government on areas outside their ministerial responsibilities. National won 59 seats in the election, ACT and the Maori Party 5 each, and United Future 1. The new Parliament will sit for the first time on December 8. 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