One of the oldest political parties in New Zealand is plotting a comeback. But Social Credit would argue that they never went away. Alex Braae went to their annual conference to find out more. 

“Here for good”, they say. It’s a slogan that Social Credit leaders believe sums up their party, despite spending the last several decades lost in the political wilderness. 

Social Credit are one of New Zealand’s oldest political parties, and used to hold huge sway over the third party space between Labour and National. They last had MPs under their own banner in 1987, and as part of the Alliance until 2002. Ever since, the party has stubbornly persisted, without ever coming remotely close to any sort of electoral success. But they’ve also outlasted almost every other minor party in the country’s history. 

They’re an unusually consistent bunch, in that their big animating idea has barely changed in decades. For Social Credit, it all starts with monetary reform. They believe that rather than borrowing from banks, the government should simply create money through the Reserve Bank, and use that for beneficial spending for the country. It’s basically a rejection of the orthodox monetary policy that has prevailed for decades. Social Credit also believe in nationalistic economic sovereignty, a form of universal basic income, and private property ownership.

Under a revitalised leadership, they’re hopeful of breaking through once more. But how are they going to get their message out to voters who have either forgotten they existed, or never heard of them in the first place? And why keep going at all, with so little to show for their efforts? 

I went to their party conference in August to find out. The Waipuna Hotel in Mt Wellington has hosted many fractious political events, including recently a National Party regional conference that had police holding back lines of protesters trying to break in. By contrast, Social Credit’s event felt like a particularly sedate form of political purgatory. 

The hotel is deep in the heart of what once would have been called the mortgage belt of Auckland. In the foyer, there was barely a soul. The music being played was quietly inoffensive, and pastries and great vats of Robert Harris coffee sat ready for the attendees to finish their closed sessions. 

When the doors were opened to media (only me, unfortunately) the conference floor was revealed as about 40 people, sitting in rows of desks as if in a classroom. A table at the back featured flyers, dense economic theory books, and news clippings of past glories. At the front was a lectern, and a small banner tacked to the wall. 

The party faithful tended towards the old, even by the standards of political participation in New Zealand. During one discussion, someone stood up to make a comment, quoting a speech made at the 1956 party conference. It turned out he had actually been there to witness it. 

Their new party leader is Chris Leitch, a ballroom dancing teacher from Northland. There is a widely acknowledged sense around the party that Leitch represents a new dawn for the ideas that have sustained the party for decades, along with the chance to bring in new faces. In terms of his own profile, he noted that he’s one of the few politicians who could make a case for being on Dancing with the Stars as either a professional or a guest.  

There was even a Social Credit youth wing present, though it appeared to consist of three young men. Cory Aitken had come from Labour and the West Coast, but was disillusioned by the party’s lack of interest in ideas around a Universal Basic Income and monetary reform. Callan Neylon met Chris Leitch because he taught his high school’s ballroom dancing class, and learned after talking to his family that there had been a “family scandal” in the 70s over a few relatives ditching Labour for Social Credit. 

That sense of history is an ever-present theme for Social Creditors, and is a crucial factor in understanding the party of today. For older people who follow politics, the name is almost certain to conjure up some emotion – perhaps not positive, but they’ll certainly have heard of them. 

The knowledge that the party was once remarkably influential sustains the hope of the members that it could be again. At times, that hope could perhaps be better described as a grievance of being shut out. 

The high water mark was winning a 20% vote share in 1981, at a time when the electoral system was effectively rigged against third parties. That extraordinary result only translated into two seats out of 80, but it came after decades in which the trend was heading towards more and more support. 

It never eventuated. Part of that could be put down to a name change in 1985. They became the New Zealand Democratic Party instead. Bruce Sheppard, a candidate in 1981 who went on to found the NZ Shareholders Association, believes ditching the name was a historic mistake. “I’ve long held the view that you only build brands by doing something consistently over a very long period of time. So that your name becomes something that people remember and it has meaning to them, however dumb it might seem.” 

The Democrats saw their vote slump in 1987, and then collapse in 1990 altogether. They were eclipsed by both the Greens and New Labour, and weren’t far off being beaten by a disaffected rump of the party who retained the Social Credit name. 

From there, they became part of the Alliance, in which they weren’t seen as one of the dominant component parties. Perhaps because of that, they were also able to retain a distinct identity which was never subsumed into the wider whole. When the Alliance disintegrated in bitterness and acrimony, much of Social Credit left with Jim Anderton, to be part of the Progressive Coalition instead. Then when it became clear that was going nowhere, the Democrats split off again – adding the Social Credit branding back into their name. 

Since then, the key figure in the party has been Stephnie de Ruyter. She was elected when the Democrats split from the Progressives. The two leading Democrats of the time, Grant Gillon (who is now an Auckland local body politician) and former Alliance MP John Wright both urged the party to stay within Anderton’s fold. De Ruyter, who also works for Grey Power in Invercargill, says the elections that followed were arduous. 

“In the early days of my leadership, there was quite a bit of interest. But that didn’t continue. The political playing field got pretty crowded through those years, at some stage, up to 19 registered political parties. Most of them have come and gone, they haven’t lasted. Social Credit has.”

However, in each election, the vote share was a fraction of a percent. In 2017 Social Credit pulled in just 806 party votes overall. For scale, it takes 500 financial members to register a political party with the Electoral Commission. 

If there is any hope for Social Credit’s ideas, it is in the turning tide of economic thinking. Concepts like Modern Monetary Theory, or quantitative easing, have been around a while now, and while they don’t precisely align with Social Credit policy, there’s plenty of sympathy.

Social Creditors tend to be admirers of Adrian Orr, the Reserve Bank governor who has slashed interest rates and frequently speaks out about fiscal policy. And as leader Chris Leitch put it, they see in Treasury a remarkable turnaround, from being a “neoliberal nest of vipers unleashed by Roger Douglas” to recommending the government adopt “funny money to fix the problems they caused.” 

The choice of phrase is deliberate, and will be immediately familiar to older New Zealanders. It was a pejorative thrown at Social Credit, to make them look like they were raving on the sidelines of the debate. To use it again shows a party both immensely proud of its history, and also stung by the taunts of yesteryear. 

They have a hatred of any debt that seems arbitrary. Because in their view, money can and should be created by the Reserve Bank, provided to the government with no interest attached. And from there, the government would have an extra $6 billion a year in saved interest payments to spend on whatever it wanted to – for example, a graph on their website shows an extra $2.75 billion would go into infrastructure. 

Those aren’t staggering sums by comparison to the government’s annual spending, but the idea is that such spending would be cumulative, and over time a much richer society would develop. It would also theoretically cut foreign owned banks out of the equation, and in an economically nationalistic sense keep the money in the country. 

Here is where they really go against the general governing consensus of the last several decades – that foreign investment is to be welcomed and encouraged. Because with investment comes ownership, and they are aghast at what they see as a long-term foreign takeover. They gained a brief flurry of media attention after taking an injunction to the High Court, to test the view that the Overseas Investment Office are too loose with the rules. It focused on the sale of Westland Milk to a Chinese conglomerate – a minefield of a topic for several reasons. 

There was a very particular focus placed on China among those speaking. But as far as I was aware, every single reference anyone made to China was around money. Either from Chinese businesses, or the Chinese government itself, the complaint was always about land or businesses being bought from overseas. Chris Leitch didn’t mention immigration at all during his speech, and when anyone else did, it was in relation to cuts to ease infrastructure planning. But still, could they not see how this could be taken as quite inflammatory? 

“Well, I certainly don’t intend them to be. My address was talking about overseas investment generally, but specifically China, because China is the only overseas investor where the investment is being driven by the government of China. And that’s a completely different scenario,” he said. 

Fundamentally though, Social Credit is a party defined by monetary policy. And that means there is quite a simple question for the party to ask itself – could an election actually be won on something dry like monetary policy? 

No, Leitch conceded, it couldn’t. “Monetary policy is largely an intellectual exercise. But an election could be won on saying something like – simply by changing banks, the government could have $6 billion a year to spend on hospitals, education, roads, the environment and a whole lot of other things.” He says that subsequent step of what could be done with the money will largely be what Social Credit takes to the electorate next year. 

It promises to be another hugely difficult slog for the party, not just in terms of winning votes, but in even making voters aware of their existence. But what does another dismal election result matter to a party that has survived so long on such meagre sustenance? Chris Leitch harked back to the slogan – Social Credit intend to stick around for a long, long time yet.