iPredict Update

An interesting update from iPredict:

John Key would remain Prime Minister and be able to govern alone even if both the Act and UnitedFuture parties failed to be returned to Parliament at the next General Election, this week’s snapshot from New Zealand’s prediction market, iPredict, and associated analysis suggests.  If Act and UnitedFuture were returned to Parliament, as the market continues to forecast they will be, Mr Key would be able to govern with the support of Act or the Maori Party.

This is an unusual scenario, for normally the wisdom is National does better with allies. It all depends on how much vote National gets. This week the market is at 46.5% for National (up 1%), 3.6% for ACT and 1.7% for United Future.

On those results National gets 59 seats, ACT 5 and United Future 2. You need 62 seats to govern, so National could govern with ACT.

However if Rodney does not win Epsom, then that is wasted vote and National goes to 62 seats, meaning it can govern alone. And if Peter Dunne does not win Ohariu, National would go to 63 seats.

In order, there are five levels of vote National can achieve:

1. Enough to govern alone regardless of what other parties makes it. This would generally need at least 49% of the vote.
2. Enough to govern alone if there is significant wasted vote – ie parties such as NZF, ACT and UFNZ don’t qualify, and their vote is effectively redistributed. This is what happens if National gets around 46% to 49%.
3. Can only govern with support of ACT and/or United Future. Based on iPredict, this is around the 43% to 46% range if both parties win seats.
4. Will be reliant on a deal with Maori Party to govern. This comes into play between 40% and 43% if ACT and United make it, and between 43% to 46% if those two parties don’t make it.
5. Unable to form a CR Government under any circumstance – if National gets below 40% and ACT/UFNZ make it or if National gets below around 43% and no ACT/UFNZ

So if National gets over 49% or below 40% then the presence of ACT and UFNZ make no difference. Between 40% and 46% the presence of UFNZ makes it more likely that National can form a Government. But between around 46% and 49%, National is better able to govern alone if ACT and UFNZ don’t make it.

This is one reason why I don’t think people should judge what may happen in a seat until the final weeks of the campaign. Only at that stage can you look at the party vote, and make decisions on how useful a particular outocme in a seat might be.