Excellent news from New Zealand where the National Party has won a landslide victory delivering a third term for Prime Minister John Key. (They have elections every three years down there.)

The National Party won over a million votes and over 48 per cent of the vote. That means that even with the complicated proportional representation they will just about have overall majority of seats with 61 with 121.

In any case some of the smaller parties are natural allies – such as the ACT Party who have an MP. He is David Seymour, who won in Epsom. He is a staunch advocate of free markets and limited Government.

It was disastrous election result for the Labour Party, who stood on a platform of tax increases. They ended up 24.6 per cent of the vote – their worst ever result.

A fringe, far left, party Internet Mana got no seats. It was funded by the piracy mogul Kim Dotcom with backing from Julian Assange and Edward Snowden.

Under Mr Key the New Zealand Government is running a budget surplus this year. The National Party manifesto pledged to maintain budget surpluses to reduce debt while also allowing room for income tax cuts.

Billions of debt has been repaid through energy privatisations.

Economic growth in New Zealand is running at 3.9 per cent a year. That is a vindication of the 2010 tax cuts which included a cut in the top rate of income tax from 38 per cent to 33 per cent. Income tax was also cut for low and middle earners. Also important has been the negotiation of free trade agreements. Deregulation has also helped businesses to cut costs.

“Partnership schools” have been established – New Zealand’s version of free schools – despite the bitter opposition of the teaching unions.

Another approach that is familiar to British Conservatives is welfare reform – which has achieved a reduction in unemployment in New Zealand. 60,000 fewer people in that country are on benefits than in 2010.

Future plans including making every prison a “working prison” with inmates given a 40 hour working week. Already the focus on this area has seen a sharp reduction in the reoffending rate.

One measure of the greater optimism in New Zealand is that net migration to Australia has fallen from 3,000 a month in 2008 to just 80.

The rest of the world can learn a lot from this small country.