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New Zealand Democratic Party

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This article is about the modern party based around the social credit theory. It should not be confused with the pro-business Democrat Party founded in 1934.

The New Zealand Democratic Party is a small leftist political party in New Zealand. It is based around the ideas of Social Credit, an economic theory which also attracted some degree of support in Canada and Australia. The party does not currently hold any seats in parliament, although it has previously held two. Democratic Party members also held seats when the party was part of the Alliance. The party was formerly known as the Social Credit Party, and was for many years the largest minor party in New Zealand politics. The party's economic policy is still based on Social Credit theories, while in social matters, the party takes a position similar to progressive liberal parties elsewhere.


The Democratic Party describes its foremost goal as being the recovery of "economic sovereignty". This will be accomplished, the party says, by "the reform of the present monetary system, which is the major cause of war, poverty, inflation and many other social problems." The reforms promoted by the Democratic Party are based on the ideas of Social Credit. The party emphasises "economic democracy", claiming that New Zealand's economy must be reclaimed from the control of financiers, bankers, and money-lenders.

The Democratic Party also supports taxation reform, including the removal of GST and the imposition of a tax on financial transactions (a Tobin tax). They also support the introduction of a Universal Basic Income (see external link below).

The Democratic Party states that "what is physically possible and desirable for the happiness of humanity can always be financially possible."


The New Zealand Democratic Party was originally established as the Social Credit Political League, and later became the Social Credit Party. For more information on the party's early history, see the main Social Credit Party article.

When the Democrats adopted their present name, they held two seats in parliament - one was East Coast Bays, held by Gary Knapp , and the other was Pakuranga, held by Neil Morrison . Two years after the new name was adopted, in the 1987 elections, the Democrats lost these two seats, removing them from parliament. In 1988, Gary Knapp and a group of other Democrats were involved in a protest at parliament, criticising the First Past the Post electoral system which prevented their success.

The Democrats, finding themselves increasingly pressured by the growth of NewLabour (founded by rebel Labour Party MP Jim Anderton) and the Greens, opted to increase cooperation with compatible parties. This resulted in the Democrats joining NewLabour, the Greens, and Maori-based party Mana Motuhake in forming the Alliance, a broad left-wing coalition group.

In the 1996 election, which was conducted under the new MMP electoral system, the Alliance won thirteen seats. Among the MPs elected were John Wright and Grant Gillon, both members of the Democratic Party.

However, there was considerable dissatisfaction in the Democratic Party over the Alliance's course. Many Democrats believed that their views were not being incorporated into Alliance policy, particularly as regards the core economic doctrine of Social Credit. The Alliance as a whole tended towards "orthodox" left-wing economics, and was not prepared to implement the Democratic Party's somewhat unusual economic theories.

In 2002, when tensions between the "moderate left" and the "hard left" caused a split in the Alliance, the Democrats followed Jim Anderton's moderate faction and became a part of the Progressive Coalition. In the 2002 elections, Grant Gillon and John Wright were placed third and fourth on the party's list. The Progressives, however, won only enough votes for two seats, thus leaving the two Democrats outside parliament.

Shortly after the election, the Democrats opted to split from the Progressives, re-establishing themselves as an independent party. However, Grant Gillon (the party's leader) and John Wright, both of whom opposed the split, chose not to follow the Democrats, instead remaining with the Progressives (who were now merely the Progressive Party, rather than the Progressive Coalition). The Democrats chose Stephnie de Ruyter, who had been fifth on the Progressive list, as their new leader.

The Democrats intend to contest the next election as an independent party, but have not yet registered in opinion polls. The party hopes that it can regain the support it held when it was known as Social Credit.

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Last updated: 05-23-2005 10:11:59