“We just don’t know how the situation would unfold,” Joseph, a legal academic at the University of Canterbury specialising in constitutional law, told LawNews. “It’s never happened, that’s the first point to make.
Professor Philip Joseph KC
“But what if it did? Well, you could have all the rules in place, all the guardrails you could think of, but if a prime minister was as rogue as that, not even those guardrails would stop him in his tracks.”
Joseph emphasises that no New Zealand leader has breached the caretaker convention since it was first adopted in 1986. So far, they have honoured their constitutional obligation to exercise power without adopting new policy initiatives from polling day until a new government is formed.
So no one’s suggesting that if Prime Minister Christopher Luxon fails to forge a coalition after November 7, he’ll have a conniption and declare war on China, ban unions or unilaterally raise the retirement age to 75.
But Luxon and his ministers do officially retain executive authority during the caretaker period and there have been occasions, even in mature democracies, when questionable behaviour from leaders has threatened to disrupt the smooth handover of power.
The United States appeared on the brink in 2021 during the January 6 insurrection, before Donald Trump finally reined in a mob of his supporters. New Zealand had its own constitutional crisis in 1984, discussed below, when there was a post-election showdown between outgoing Prime Minister Sir Robert Muldoon and the incoming David Lange over devaluation of the dollar.
‘No hard and fast rules’
The Muldoon-Lange spat led directly to adoption of the initial version of the caretaker convention, which deals with what happens when it is clear the incumbent government has lost the election and there will be a new administration.
In addition to undertaking no new policy initiatives, it requires the incumbent to follow the instructions of the incoming government if there is a significant issue that requires action during the transition period “even if the outgoing government disagrees with the course of action proposed”.
The interval between governments was generally very short after first-past-the-post elections but the caretaker convention was amended in 1996 to recognise that the MMP system usually requires extended coalition negotiations between political parties.
“There’s every chance that we could see a weeks- if not months-long post-election negotiation phase,” University of Otago law professor Andrew Geddis said. “In 1996, for instance, it took Winston Peters nine weeks to decide to form a coalition with National rather than Labour.”
Professor Andrew Geddis
The convention states that, when possible, significant decisions should be deferred “until the political situation is resolved” or handled via temporary arrangements which are not binding on the incoming government.
When decisions must be made immediately – say, a natural disaster or international crisis – it requires the incumbent to consult with other political parties, stating: “The level of consultation might vary according to such factors as the complexity, urgency and confidentiality of the issue.”
Crucially, the caretaker convention says “there are no hard and fast rules. Ministers may need to take into account various considerations (including political considerations), in deciding whether it is appropriate or necessary to proceed on a matter.”
There is a common misconception that the caretaker convention begins three months before an election. While true in Australia, the caretaker mode officially begins in New Zealand on polling day, although in reality governments tend to avoid major policy shifts in the final three months of a term.
In theory, the caretaker convention could also kick in mid-term if a government has “clearly lost the confidence of the House” and a new government must be formed, either by negotiation or via an election. The scenario has never occurred.
Mandate to govern
The inherently political nature of the post-election environment, with intense negotiations between parties and multiple possible scenarios, is one reason why the caretaker convention is set down in the Cabinet Manual but not formally codified in legislation.
“Because it is a convention, not a legal rule, it is not included in statute,” Geddis said. “Were it to be made a legal rule through being legislated into force, it would open its application up to scrutiny by the courts. Leaving it as a convention means that its meaning and applicate is purely a matter of political understanding.”
Joseph said the caretaker convention relies on participants self-regulating and recognising they need to follow the rules so a government, whether incoming or incumbent, can be formed in an orderly manner as part of the democratic process.
“Conventions are self-reinforcing or self-regulating. A constitutional convention is more than simply a political practice, it’s actually binding as a matter of constitutional obligation on the political actors,” he said.
“How do we identify constitutional conventions? Well, there are two criteria basically. One is that the political actors themselves must regard themselves, as a matter of constitutional obligation, as being bound by that conventional rule. The second criterion for a rule to be a convention is that it must serve a necessary constitutional purpose. The caretaker convention is a constitutional convention because it secures the democratic mandate. It reinforces who has the confidence of the House, because that gives the mandate to govern.”
Rules clear, even if a bit ‘fuzzy’
Before the caretaker convention was drafted in 1984, all parties tacitly understood the post-election restraints on an outgoing government. However, Muldoon blew that understanding out of the water following a snap election that year in which campaigning was dominated by New Zealand’s nuclear stance and the state of the economy, resulting in a convincing win for the Lange-led Labour Party.
At the time, the New Zealand dollar was pegged to the US greenback and had been under pressure from currency speculators. Prime Minister-elect Lange, in line with advice from Treasury and the Reserve Bank, wanted it devalued, but Muldoon, who was also Finance Minister, refused.
“Muldoon said he’d rather resign than sign off the devaluation, but he capitulated within about two or three days, so as to avert the crisis,” Joseph said.
Muldoon’s backdown came after he was pressured by Cabinet colleagues, led by Sir Jim McLay, who warned that if he did not relent they would advise Governor-General Sir David Beattie he had lost their confidence and recommend his dismissal.
Which brings us back to the original question: what can be done when a leader breaches good faith and refuses to honour the caretaker convention?
“We don’t quite know because it’s never happened, but we’ve got sufficient flexibility within our system to be able to handle that,” Jospeh said. “A leader who went rogue like that, well, his own party would simply sack him as the leader anyway, so he’d lose the mandate to govern.”
Geddis said he would expect a minister who was acting in a fragrantly unconstitutional manner during the caretaker period to face criticism from the public and resistance from others involved in government.
“For instance, if a disgruntled outgoing leader tried to declare war, the armed forces might not accept that they have to obey that declaration.” he said.
Joseph described application of the caretaker convention as “common sense”, while Geddis was confident they would work effectively even if there is a lengthy negotiation period after the upcoming election.
“The rules on what should happen in the interim are pretty clear, even if the application of those rules may be a bit fuzzy. And as long as the spirit of them is adhered to, then they will operate just fine,” he said.
Public service constraints
The caretaker convention applies to government agencies, as well as politicians. The Public Service Commission advises on its website that: “Government work is likely to be constrained during this time and public servants should plan accordingly.”
Constitutional law expert Dr Mai Chen explains the convention’s practical impacts:
Mai Chen
“The reason why the caretaker convention matters is because many lawyers/barristers like me have applications with regulators halfway through processing. Given how tight the election results are likely to be on current polling, there will be a protracted period post-election, while the parties negotiate to determine who can form a majority coalition government.
“The official election results are not due until November 27. The question is whether applications will still meet statutory deadlines for decision-making, and who will make the decision.
“The caretaker convention also matters to lawyers where a change in government means that applications still in the pipeline may be discontinued or subject to different standards/legal tests by bills introduced after the new Parliament is convened, likely in December 2026. It becomes critical then that applications can be progressed to a decision if possible under the current Act and the current Minister, and not be in abeyance until a new minister is sworn in.
“For example, I have a client with a significant time sensitive application, subject to statutory decision-making timelines for whom the caretaker convention matters. I have been assured by officials that the current minister has been provided with the advice and regardless of who is voted in as government on Saturday at the general election, those statutory deadlines will be met. Even if the minister or his party is no longer the government, the minister will stay performing his statutory ministerial duties until the new government is formed and the new minister is sworn in, or the secretary of the department involved will be delegated the decision-making powers.
“The Constitution Act 1986, that my former law partner Sir Geoffrey Palmer oversaw the enactment of as Minister of Justice, ensures that the breach of the caretaker convention which resulted in the 1984 constitutional crisis, when the outgoing Robert Muldoon government refused to devalue the overvalued NZD, on the instruction of the incoming David Lange government, thereby deepening a currency crisis and leading to massive capital flight from the country, can never happen again.”
Neil Sands is a New Zealand legal journalist and Deputy Editor of LawNews, specialising in reporting on the legal profession, courts, legislation and developments in New Zealand's justice system. This article was sourced HERE
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