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### Viewing cable 06WELLINGTON928, OPPOSITION LEADER BRASH RESIGNS; KEY TIPPED TO

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
06WELLINGTON928 | 2006-11-24 03:10 | 2011-04-28 00:00 | CONFIDENTIAL//NOFORN | Embassy Wellington

`

    VZCZCXRO7393
    OO RUEHCHI RUEHFK RUEHHM RUEHKSO RUEHPB
    DE RUEHWL #0928/01 3280310
    ZNY CCCCC ZZH
    O 240310Z NOV 06
    FM AMEMBASSY WELLINGTON
    TO RUEHC/SECSTATE WASHDC IMMEDIATE 3527
    INFO RUEHZU/ASIAN PACIFIC ECONOMIC COOPERATION IMMEDIATE
    RUEHBY/AMEMBASSY CANBERRA IMMEDIATE 4621
    RUEHLO/AMEMBASSY LONDON IMMEDIATE 0150
    RHEHAAA/NATIONAL SECURITY COUNCIL WASHDC IMMEDIATE
    RUEKJCS/OSD WASHINGTON DC IMMEDIATE
    RHHMUNA/CDR USPACOM HONOLULU HI IMMEDIATE
    RHHJJAA/JICPAC HONOLULU HI IMMEDIATE

` `

    C O N F I D E N T I A L SECTION 01 OF 02 WELLINGTON 000928

    SIPDIS

    SIPDIS
    NOFORN

    STATE FOR D (FRITZ), EAP/FO, AND EAP/ANP
    NSC FOR VICTOR CHA
    SECDEF FOR OSD/ISD JESSICA POWERS
    PACOM FOR J01E/J2/J233/J5/SJFHQ

    E.O. 12958: DECL: 11/24/2016
    TAGS: PGOV PREL NZ
    SUBJECT: OPPOSITION LEADER BRASH RESIGNS; KEY TIPPED TO
    TAKE CHARGE

    REF: WELLINGTON 924

    Classified By: DCM David J. Keegan,
    for reasons 1.4 (b) and (d)

    Summary
    -------

    ¶1. (C) SUMMARY:  New Zealand's main opposition party leader,
    Dr. Don Brash, has resigned after weeks of speculation over
    his leadership. Dogged by a series of gaffes and missteps
    that raised questions over his political judgment, Brash
    announced that the National Party will caucus on Monday to
    pick a new leader. The charismatic John Key is the likely
    contender. A former investment banker with Merrill Lynch, Key
    remains an admirer of the United States.  He rates high with
    the NZ media and in polling, but many caucus members remain
    uncomfortable with his lack of political experience.
    Meanwhile, the gag order has just been lifted on the book
    reportedly containing allegations of National Party campaign
    malfeasance, which served as catalyst to Brash,s departure.
    The author claims it also contains information damaging to
    Key.  End Summary.

    Brash,s often turbulent leadership comes to an end
    --------------------------------------------- -----

    ¶2. (SBU) Thursday afternoon, November 23, Brash announced his
    resignation as National Party Leader. Brash,s decision
    follows months of missteps, and there have long been rumors
    he would be removed by his caucus. But the speed of his
    departure was something of a surprise.  In a hastily called
    press conference, Brash said he could no longer continue as
    leader because of continuing speculation about his future.
    Although he claimed to have been considering his future for
    some time, it is probable he knew his caucus would not
    support him following his latest political misstep over a
    soon to be published damaging book (reftel) . Brash declined
    to commit to staying in Parliament, saying it would be up to
    the new leader to decide if he had a future within the party.
    Brash,s resignation is effective from Monday November 27
    when National,s caucus will meet to decide who among its MPs
    will become its next leader.
    And that leader is likely to be John Key
    ----------------------------------------
    ¶3. (SBU) Even though anything could happen behind the closed
    caucus doors, Monday,s meeting to pick Brash,s successor is
    likely to be a straightforward transition to a John Key
    leadership. Soon after Brash,s resignation announcement
    Key, National,s Finance spokesman who has long been
    considered a potential leader, officially threw his hat in
    the leadership ring.  Although former Party leader Bill
    English has refused to rule out a leadership bid he will
    probably not mount a challenge to Key as he is unlikely to
    win. On the day Brash resigned, Key got endorsements from two
    senior National MPs:  Deputy Leader Gerry Brownlee and
    Industrial Relations Spokesman Wayne Mapp.  National will
    want a smooth transition to the next leader, as a divisive
    contest could damage the party,s political fortunes going
    forward (particularly at a time when it is outstripping
    Labour in the polls). National Front bencher and shadow Trade
    Minister Tim Goser told DCM Thursday evening that National
    will move quickly to endorse Key and prepare to challenge
    Labour.
    ¶4.  (C) Although the top slot is essentially secured, the
    Deputyship is wide open. Incumbent Brownlee refuses to say
    whether he will seek to retain his position. Other contenders
    are:  Law and Order Spokesman Simon Power, Economic
    Development Spokesman Katherine Rich and Welfare Spokesman
    Judith Collins.  Brownlee has the edge as an experienced
    street fighter, but National may wish to improve its
    currently poor standing with female voters by selecting a
    woman for the slot.  English is not believed to be interested
    in serving as Key,s deputy, and he may expect to be offered
    the coveted finance portfolio in return for his support.
    Labour will be nervous about Key
    --------------------------------
    ¶4. (C) Deputy Prime Minister Michael Cullen claims to be
    bullish at the prospect of facing a potential Key leadership,

    WELLINGTON 00000928  002 OF 002

    but its probable both he and Prime Minister Clark would have
    preferred the status quo.  Labour has often easily exploited
    Brash,s lack of political savvy, his struggle to perform
    within the adversarial bear pit of the Parliamentary debating
    chamber and his tendency towards embarrassing gaffes. Key has
    none of these weaknesses. In the 2005 campaign Key bested
    Cullen on the critical tax reform debate, scoring valuable
    political points for National. Additionally, a former very
    successful investment banker raised by his Austrian-Jewish
    widowed mother in NZ state housing, Key is a rags-to-riches
    story who appeals to New Zealanders.  He also offers a more
    modern, fresh and dynamic leadership which could contrast
    with Labour, widely viewed as becoming stale and staid after
    7 years in power. Clark and co. will try to exploit Key,s
    relative political inexperience: he entered parliament in
    ¶2002. However, Key has learnt the political game fast and
    will likely prove to be a more dangerous opponent for Labour
    than Brash.
    COMMENT:  U.S.-National Ties Will Remain Solid
    --------------------------------------------- -

    ¶5. (C) Amid the swirl of speculation surrounding National,s
    next leader, the looming presence of Hager,s book, "The
    Hollow Men", remains (reftel). Among the allegations
    reportedly contained in the book are ones concerning a
    clandestine relationship between the National Party and some
    US neo-conservatives during the 2005 election campaign. Post
    has not seen an advanced copy of the book but understands
    that this section will essentially take the form of  name
    and shame, exercise. If the public reaction to this
    allegation is found to be politically damaging for the
    National Party, it may seek to publically place some distance
    between it and the US.  But as reported reftel, we have heard
    the U.S. portion of the book is not prominent.  In any case,
    Key is an admirer of the United States and friendly to
    Mission New Zealand, and other National contenders are the
    same.  We anticipate continued good relations with the party
    no matter who takes up the reins.
    McCormick

`