iPredict Ltd: New Zealand Political Update—30 November 2011

Press Release – iPredict

There is a 74% probability that official election results will see National drop to 59 MPs, from the 60 MPs indicated on election night. With the Greens favoured to take the extra seat, National would therefore need the support of both Act and …iPredict Ltd: New Zealand Political Update—30 November 2011

www.ipredict.co.nz

Key Points

• National caucus likely to drop to 59 MPs after special votes, making passing legislation marginally more difficult
• Labour favoured for 2014 election, with National’s party vote forecast to fall
• Parker favoured for Labour Leader and new 2014 PM stocks launched
• Act, Maori Party and UnitedFuture leaders, and Bridges and Tremain, expected to be Ministers Outside Cabinet
• Adams, Foss and Guy expected to be promoted to Cabinet
• English safe in Finance and Collins set to take Justice
• Brownlee’s hold on Economic Development and Energy & Resources less certain
• Tolley and Coleman to lose Education and Immigration
• Commerce up for grabs

Details:

There is a 74% probability that official election results will see National drop to 59 MPs, from the 60 MPs indicated on election night. With the Greens favoured to take the extra seat, National would therefore need the support of both Act and UnitedFuture, or the Maori Party, to pass legislation in parliament, compared with just one of these as indicated on election night. Final seat allocation stocks can be traded here.

Labour is now favoured, with 52% probability, to win the 2014 election, with National’s party vote expected to fall back to 45.5%. Stocks for the 2014 election can be found here.

The improvement in Labour’s longer-term prospects has raised the probability that the contest for the leadership of the Labour Party is a contest for the prime ministership. This has prompted iPredict to launch stocks asking which of the candidates for the party’s leadership is most likely to be Prime Minister by 31 December 2014. These can be traded here.

iPredict suggested yesterday that what appeared to be irrational exuberance by supporters of candidates David Parker, David Cunliffe, David Shearer and Grant Robertson had pushed the sum of the probabilities of the four candidates well over 100%, creating certain profits for traders if they shorted all these stocks. The market has since significantly corrected, and Mr Parker is now favoured with a 54% probability of being the next leader, followed by Mr Cunliffe on 37% probability and Mr Shearer on 11% probability. No other candidate has more than a 1% probability of being leader. Labour leadership stocks can be found here.

Act, the Maori Party and UnitedFuture all have more than 90% probability of having at least one Minister (in or outside Cabinet) in the next Government.

iPredict’s stocks on the new Cabinet here currently suggest that a 20-member Cabinet would consist (in order of probability) of:

1. Gerry Brownlee (100%)
2. John Key (99%)
3. Bill English (99%)
4. Steven Joyce (98%)
5. Tony Ryall (98%)
6. Christopher Finlayson (98%)
7. Paula Bennett (98%)
8. Judith Collins(98%)
9. Hekia Parata (98%)
10. Anne Tolley (98%)
11. Murray McCully (96%)
12. Tim Groser (96%)
13. Jonathan Coleman (95%)
14. Nick Smith (95%)
15. Amy Adams (93%)
16. Craig Foss (93%)
17. Kate Wilkinson (93%)
18. Nathan Guy (89%)
19. Phil Heatley (89%)
20. David Carter (89%)

Ministers Outside Cabinet are expected to be (in order of probability):

1. Peter Dunne (92%)
2. Tariana Turia (91%)
3. Pita Sharples (90%)
4. John Banks (74%)
5. Simon Bridges (66%)
6. Chris Tremain (66%)

• Bill English remains overwhelmingly favoured to continue as Minister of Finance (98% probability) and Judith Collins remains overwhelmingly favoured to become Minister of Justice (89% probability). Steven Joyce is expected to remain Associate Minister of Finance (85% probability).

• Gerry Brownlee is favoured to retain his Minister for Economic Development portfolio, with 60% probability, but he appears to be in a contest with Hekia Parata to retain his Energy & Resources portfolio, with just 48% probability compared with 45% probability for Ms Parata.

• Anne Tolley and Jonathan Coleman are expected to lose their Education and Immigration portfolios, with only 20% and 21% chances respectively of keeping those jobs.

• Early trading in Minister of Commerce stocks here suggests the portfolio is up for grabs. Stocks for Agriculture, Fisheries and State-Owned Enterprises have been launched this morning and further portfolio bundles will be launched through the day. All ministerial stocks can be traded here.

• Stocks whose payout was determined on election night are being closed progressively through the week.

iPredict is owned by Victoria University of Wellington. Details on the company and its stocks can be found at www.ipredict.co.nz The New Zealand Political Update is published periodically depending on market developments.

ENDS

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