What National can, can't do while NZ waits for Winston Peters' decision

While New Zealand waits for NZ First leader Winston Peters' October 12 deadline to make up his mind on the next government, the previous National government has been relegated to the caretakers' shed.

After every election there is a period during which the previous Government stays on in a "caretaker" role until the next government is appointed - meaning it can deal with administrative and minor issues but is restricted from making any significant decisions on policies or appointments that should be left for the next government to make.

It is particularly important this time around because the election night result has not delivered a clear-cut result for the first time since 2005. When there is a clear outcome, the outgoing government is required to act on the instruction of the incoming government until the new government is appointed.

It is a convention rather than a hard and fast law - and was famously ignored by former Prime Minister Robert Muldoon in 1984 when he continued to refused to devalue the currency during a handover to the David Lange government.

National's Steven Joyce said he had no intention of bucking the convention.

The caretaker period meant keeping up with the normal "machinery of government" but steering clear of big decisions by both ministers and Government departments, Joyce said.

"So things people would release in the normal course of business, long-decided policy which is just continuing the work - but if there's anything that involves a policy decision or a policy change you either wouldn't do it or, if it's big enough, you'd consult with the Opposition party."

The Cabinet Manual says caretaker governments can implement decisions already made, but cannot decide on controversial issues with long-term impact, such as major contracts or significant appointments, or changes to policy.

If possible, a government had to do what it could to put things into a holding pattern for the next government to decide on - and if that was not possible, it must consult with other political parties.

Joyce said that happened in 2008 during the Global Financial Crisis when immediately after the election the caretaker Labour Government had to make decisions on the deposits guarantee scheme for financial institutions. Labour had gone to National over that.

The convention was cited as the reason the Government decided to lodge an appeal against a High Court ruling in favour of Teina Pora's request for a judicial review of his compensation pay-out by the deadline for the appeal on Monday.

Lodging the appeal means the next government can either pursue the appeal or choose to drop it.

Justice Minister Amy Adams told Labour's justice spokesman Andrew Little of her decision to lodge the appeal as a "placeholder"' and although Little has said Labour would withdraw the appeal, he respected her decision to take the step.

Earlier in the year, Joyce had also appointed Grant Spencer as the interim Reserve Bank Governor to replace outgoing Graeme Wheeler, whose term ended the day after the election. That was to allow the next government to choose the next Reserve Bank Governor.