Gaurav Sharma

The Government yesterday found itself thrown into a by-election in Hamilton West that it could  lose.

The by-election has been instigated by the announcement yesterday from the former Labour MP, Gaurav Sharma, for the seat that he will resign ahead of a party move to expel him.

Labour Party President Clare Szabo confirmed last night that a New Zealand Council sub-committee had recommended he be expelled.

But she denied there was any move by Party Leader, Jacinda Ardern, to invoke the waka jumping legislation, which would automatically force him out of Parliament.

“I am not aware of any discussion within Labour, at any level, about the prospect of triggering the waka-jumping law,” she said.

Sharma, however, claims that unnamed members of the Council told Labour would invoke the waka-jumping legislation.

“Members of the New Zealand Council from the Labor Party have been talking to me just like the members of Parliament, and they have said that the party’s next step is to remove me as a member of Parliament, but they want to do it at a time when it is six months or less from the general election, which means there will not be a by-election because the party doesn’t want a by-election,” he told reporters yesterday.

Sharma won the seat with a 6267 majority at the last election after defeating National MP Tim MacIndoe.

MacIndoe was not commenting last night on whether he would seek to stand again.

Though National might be tempted to believe it could win the seat with a big majority in what would effectively be a vote of no confidence in the Government; its pollster David Farrar is forecasting that whoever won the seat at the by-election would probably do so with a much smaller majority than the last election.

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“Based on the swing in national polls, National might nominally lead by 2% or so. It is likely to be very close,” he said in a private blog last night.

Sharma himself intends to stand as an independent as a prelude to forming a centrist party.

“I’m going to stand; it’s for the people of Hamilton West to decide, and, you know, I’ve been out in the community, and all I’ve seen is support for myself,” he said.

Maybe but it is likely to be a crowded field.

But while National might be tempted to smile, Hamilton West is not a sure National win.

The party will have to beat off ACT and a resurgent NZ First, as well as a host of small parties like TOP and the Freedoms and Outdoors Party.

Brian Tamaki’s FreedomsNZ Party is now registering with the Electoral Office, as is Matt King’s DemocracyNZ party.

And the Greens, who did not stand last time, could stand a candidate this time.

Farrar estimates that if ACT or NZ First stands and Greens do not, that helps Labour.

ACT and NZ First will undoubtedly end up emphasising the same issues; co-governance, crime, and, if the weekend conference is anything to go by, NZ First will also want (like ACT) to talk about education.

The point is that all the minor parties will be taking votes from Labour or National.

At the last election, ACT leader David Seymour campaigned in the seat, but its candidate Roger Weldon, though he came third, did so with only three per cent of the vote, whereas the party got 6.9 per cent on the party vote.

One existing ACT MP, James McDowall, lives in Hamilton and, as a fluent Cantonese speaker, has strong connections with the Chinese community there.

NZ First, revved up by its conference and now with a proper party organisation behind it, can use the by-election to raise its own profile to try and get its poll rating up towards five per cent.

The problem for Labour is that Hamilton West is a bell weather seat which is almost always held by whoever is the Government.

It’s a relatively young electorate, with 33 per cent of its voters aged between 20 and 40.

It’s a typical slice of lower to middle New Zealand. Thirty-seven per cent of its houses are privately owned, slightly below the median.

Those homeowners are about to get hit with more mortgage increases.

Yesterday’s 7.2 per cent rise in the Consumers’ Price Index for the year ended September 30 exceeded forecasters’ expectations, and the ANZ Bank economists Finn Robinson and Sharon Zollner said they could now see the reserve Bank raising the Official Cash Rate  (OCR) to a peak of five per cent by next February.

This is a far cry from the Reserve Bank’s May forecast for the OCR to peak next September at 3.95 per cent.

One-year fixed rate mortgages tend to track at 2.5 per cent above the OCR, so that could see those rates go to 7.5 per cent by next February.

Hamilton’s median house value was $812,000 in June, which suggests an average mortgage in the city could be for $650,000. Repayments on that would currently be $3670 a month; if the OCR goes to five by February, then they would jump by over $800 a month.

That will focus the minds of Hamilton West voters more than anything and would be a good reason for the Government to get the election over and done with as rapidly as they can over the next two months.