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AAP
Ben McKay

NZ PM-to-be Luxon unveils coalition compromises

National's Chris Luxon said the electoral system meant there had to be compromises. (Mark Coote/AAP PHOTOS)

Incoming New Zealand Prime Minister Chris Luxon has dismissed broken promises in his government's policy plan as the reality of coalition negotiations.

The National party leader unveiled his coalition policy program on Friday in a joint ceremony with ACT leader David Seymour and NZ First leader Winston Peters.

The most eye-catching part of the deal is a novel deputy job-sharing arrangement.

Mr Peters, who is also foreign minister, will hold the job until May 2025, when Mr Seymour will take over in the post.

Beyond the ministry, there are dozens of policy promises between the three parties that will form their agenda over the next three years.

The government will deliver income tax relief next year, it will cut the public service, it create a National Infrastructure Agency and $NZ1.2 billion ($A1.1 billion) regional infrastructure fund.

It will toughen sentences for criminals, create a new minister for regulation, disestablish the productivity commission, and overturn previous bans on live animal exports and exploring for offshore oil and gas.

No party has gotten everything they want.

National's agenda dominates as the major partner in the New Zealand's first true three-party coalition.

National received 38 per cent of the vote in October's election and will have 14 cabinet ministers, compared with ACT (8.6 per cent) and NZ First (6.1 per cent) which will have three cabinet ministers each.

There are also many elements of National's promised policies that have been abandoned.

Winston Peters, Chris Luxon and David Seymour in Wellington
Winston Peters will be deputy PM until May 2025, when David Seymour will take over in the post. (Mark Coote/AAP PHOTOS)

The centrepiece of National's alternate budget was to repeal a ban on foreign homebuyers and tax them, but the NZ First party successfully axed the proposal as they are against an expansion of foreigners buying homes.

Mr Luxon said the deal-making necessitated by New Zealand's mixed-member proportional (MMP) electoral system meant they couldn't get everything.

"In an MMP environment there is compromise and as a result we won't be pursuing that in this term," he said.

Mr Luxon also promised National would put the climate change minister in cabinet, but failed to do so, with the job going to outer minister Simon Watts.

ACT has also won a concession to water down National's pledge to install 10,000 public electric vehicle chargers across New Zealand by 2023, with a clause saying they are now subject to a "robust cost benefit analysis".

While Mr Luxon insisted his government was committed to action on climate change, outgoing prime minister and Labour leader Chris Hipkins was unconvinced.

"The government have presented a grab bag of policies which ... do nothing to prioritise climate change and fail to highlight any meaningful support for vulnerable New Zealanders at a time when they need it most," he said.

Health Minister Ayesha Verrall also attacked a coalition agreement to axe the government's world-first plans to phase out cigarette smoking among the next generation.

"Repealing smokefree laws will mean thousands of deaths and billions of health costs," she wrote on Twitter.

"(Incoming Health Minister) Shane Reti said he supported 2/3 smokefree reforms but now he is scraping the lot. Way to start being health minister - by caving into the tobacco industry."

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