Thresholds

What percentage of the vote should a party have to win to be eligible for seats in Parliament? The thresholds (or Basis for Eligibility for List Seats) is the first of the seven issues being considered by the MMP Review that I am going to look at.

As I said in my last post I voted to retain MMP, I like proportionality and believe it produces the the fairest and most representative government. But the question here is proportionality or stability?

Why would we lower or remove the threshold? If we were to lower or remove the threshold it would make parliament more proportional and reduce the number of wasted votes (It is important to note that under full proportionality there will still be wasted seats, unless there is partial allocation of seats).

Many commentators have argued that if we lower the threshold it will be much harder to form stable governments and that we will be left with a parliament much like Israels (The current Knesset comprises 13 parties and the two largest parties do not have the numbers to form a majority). Other commentators have argued that in countries like Israel it is the culture that creates the instability and New Zealand would not have the same problems.

Based on my own analysis of the six General Elections that have taken place under MMP, not having a threshold would not have changed the outcome of the election (Although National in 1996 would have needed the support of either the Christian Coalition or Act to govern). A fully proportional system would have made the governments following the 2002 and 2011 elections more vulnerable to problems with their smaller members and hence less stable, although this does not necessarily mean they would have collapsed. This analysis is not perfect as it assumes people would have voted exactly the same way knowing there wasn't a threshold.

Despite the fact that removing the threshold would not have altered the result in the first six MMP elections, I am not in favour of removing it. While in these cases it has not led to an unstable parliament there is no guarantee that it would not do in future and I believe a balance needs to be reached between proportionality and stability. I think the 5% threshold has this about right.

I think there are two possible solutions to improve the proportionality of parliament and reduce the number of wasted votes.

The first is preferential voting. When you make your party vote you rank the parties in order of preference. The party with the lowest number of votes is discounted and their votes are given to the voters second preference. This continues until all votes are allocated to parties over the threshold. The benefit of this is that every vote counts, however it does continue to favour the established parties.

The second is an idea I may have come up with myself (as I cannot recall having heard about it anywhere else). It is the LMP or Limited Member of Parliament. Those parties who do not reach the 5% threshold but receive at least 0.83% of the vote (Enough to win a seat under a fully proportional system) are allocated one seat in parliament. They participate in debates, are on select committiees but do not get to vote. I believe this increases representation without affecting the stability of parliament.

No electoral system will ever be perfect, however I think the two above solutions could improve the NZ MMP electoral system. I believe the LMP in particular is an incredibly interesting idea that deserves investigation.