WELLINGTON, New Zealand (AP) — New Zealand will hold a national election on Nov. 7, Prime Minister Christopher Luxon announced Wednesday.

Luxon, the leader of a center-right government, will seek a second term in office, with the election likely to be a ballot on whether his pledges to improve the economy after the COVID-19 pandemic have gained enough traction to convince voters still struggling with living and housing costs. The main center-left opposition Labour Party, lead by Chris Hipkins, has regained support since its poor showing in the previous 2023 election and analysts forecast a tight race.

New Zealand elections are held every three years with the government selecting the exact date. Voters choose which party they prefer to see in government and also select a local candidate to represent their constituency in Parliament.

The country of 5 million people has a unicameral parliament, which means governments are powerful deciders of how the country operates. The National Party and Labour usually must form coalitions with smaller parties to hold a majority in parliament, giving the minor parties unusual sway in which major party leads.

The economy and living costs are central

Announcing the election date at a retreat for his party’s lawmakers in the city of Christchurch on Wednesday, Luxon underlined what he said was his party’s track record on working to rebuild a post-pandemic economy. Days earlier in a speech to a business audience in Auckland on Monday, he acknowledged that reversing the country’s fortunes had not been simple and that many New Zealanders have endured “two years of hard grind.”

The economy has contracted a further 0.5 percentage point in the most recently measured 12 months, and migration to neighboring, wealthier Australia has at times hit record highs during Luxon’s tenure. Luxon on Monday blamed the former Labour-led government for the country’s woes, saying he had “inherited a mess.”

Analysts said that with inflation trending down and business confidence beginning to grow, Luxon will hope the months until this year’s election will be long enough to convince New Zealanders that the economic reversal he pledged in 2023 is taking root.

Hipkins, his main challenger to lead the country, on Monday dismissed Luxon’s remarks as “a whole lot of management-speak mumbo-jumbo.” The opposition leader added that Luxon hadn’t delivered on political promises he had made, including making housing more affordable in what has been one of the world’s hottest markets and ensuring access to public health care for all.

Paying for the country’s ailing infrastructure and how to fund pensions will also be central economic issues. Luxon decries Labour’s approach as one reliant on accruing national debt, while Hipkins said Monday that National had squandered money on unaffordable tax cuts.

2 men named Christopher bid to be prime minister

An unusual quirk of the election is that the premiership will once again be contested by two men named Christopher, as it was in 2023. Luxon, 55, is still a relative newcomer to politics, making a rapid ascent to National party leader in 2021 after entering parliament as a constituency lawmaker at the 2020 election.

The millionaire former business executive was the head of the national carrier Air New Zealand before turning to politics and previously worked as an executive for Unilever when he lived in the United States. Luxon pledged to bring managerial experience, but his detractors highlight his political inexperience and say his wealth means he is out of touch with ordinary New Zealanders.

Hipkins, the opposition leader, entered Parliament in 2008 and held major portfolios in the previous Labour government, including as minister for health and education. The 47-year-old, who presents himself as a humble man from an ordinary background, briefly became prime minister in 2023 when incumbent leader Jacinda Ardern abruptly quit, citing exhaustion.

Labour was already flagging in the polls and Hipkins was unable to reverse the party’s fortunes, with a dismal result ushering in Luxon’s center-right government. Critics of Hipkins on the left decry him for being too timid, while those on the right often seek to remind voters of his role in Ardern’s government as its strict COVID-19 lockdowns lost public confidence in some parts of the country.

Minor parties are likely to hold major sway

Under New Zealand’s proportional voting system, political parties must generally form alliances to govern. That makes the votes won by smaller parties crucial to the outcome. Following the election, whichever major party holds the most votes begins negotiations with their traditional governing parties, with minor party leaders sometimes extracting steep policy concessions to secure their support.

Luxon’s government was formed with the libertarian ACT party and populist New Zealand First. Winston Peters, the leader of New Zealand First and current foreign minister, is New Zealand’s longest-serving current lawmaker and has crowned both National and Labour governments before — but has animosity with Labour and Hipkins after their last period in government together.

On the left, Hipkins would seek support from the left-leaning Green party and Te Pāti Māori, a minor party which contests seats reserved for Indigenous lawmakers. The Māori party too has sided with both National and Labour governments before, but has supported Labour more recently.

It is rare for New Zealand governments to survive only one term. The last time a government was voted out after a single three-year cycle was in 1975.

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McGuirk reported from Melbourne, Australia.