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=== First Government (1935–1949) === {{main|First Labour Government of New Zealand}} [[File:Michael Joseph Savage (cropped 3 by 4).jpg|thumb|left|upright|Michael Joseph Savage, the first Prime Minister from the Labour Party]] Party leader [[Michael Joseph Savage]] became [[Prime Minister of New Zealand|prime minister]] on 6 December 1935, marking the beginning of Labour's first term in office. The new government quickly set about implementing a number of significant reforms, including a reorganisation of the [[welfare in New Zealand|social-welfare system]] and setting up the [[State housing in New Zealand|state housing]] scheme.<ref>{{cite encyclopedia|last1=Aimer|first1=Peter|title=Labour Party – First Labour government, 1935 to 1949 |url= http://www.teara.govt.nz/en/labour-party/page-2|encyclopedia=[[Te Ara: The Encyclopedia of New Zealand]] |access-date=19 June 2017|date=20 June 2012}}</ref> Workers also benefited from the introduction of the forty-hour week, and legislation making it easier for unions to negotiate on their behalf.<ref>{{cite journal|last1=Epstein|first1=Richard A.|title=Employment and Labor Law Reform in New Zealand Lecture|journal=Case Western Reserve Journal of International Law|date= 2001|volume=33|url=http://chicagounbound.uchicago.edu/cgi/viewcontent.cgi?article=2222&context=journal_articles|access-date=19 June 2017}}</ref> Savage himself was highly popular with the working classes, and his portrait could be found on walls in many houses around the country.<ref>{{cite web|title= Michael Joseph Savage|url= https://nzhistory.govt.nz/people/michael-joseph-savage-biography|publisher= Ministry for Culture and Heritage|access-date=19 June 2017|language=en}}</ref> At this time the Labour Party pursued an alliance with the [[Māori people|Māori]] [[Rātana]] movement.<ref>{{cite web|title=Rātana and Labour seal alliance – 22 April 1936|url=https://nzhistory.govt.nz/page/ratana-and-labour-seal-alliance|publisher=Ministry for Culture and Heritage|date=17 May 2017|access-date=19 June 2017 |language=en}}</ref> The parliamentary opposition, meanwhile, attacked the Labour Party's more left-wing policies and accused it of undermining free enterprise and hard work. In May 1936, months after Labour's first general election win, the Reform Party and the United Party took their coalition to the next step, agreeing to merge with each other. The combined organisation, named the [[New Zealand National Party|National Party]], would be Labour's main rival in future years.{{sfn|Franks|McAloon|2016|p=100}} [[File:Labour Government caucus 1935.jpg|thumb|upright=1.2|Members of the [[First Labour Government of New Zealand|First Labour Government]] on the steps of the [[New Zealand Parliamentary Library|Parliamentary Library]] in Wellington, 1935]] Labour also faced opposition within its own ranks. While the Labour Party had been explicitly socialist at its inception, it had gradually drifted away from its earlier radicalism. The death of the party's former leader, the "doctrinaire" Harry Holland, had marked a significant turning-point in the party's history. Some within the party, however, were displeased about the changing focus of the party. Most notably, [[John A. Lee]]. Lee, whose views were a mixture of socialism and [[social credit]] theory, emerged as a vocal critic of the party's leadership, accusing it of behaving autocratically and of betraying the party's rank and file. After a long and bitter dispute, the party executive [[The Lee Affair|expelled Lee]] from the party, who then established his own breakaway [[Democratic Labour Party (New Zealand)|Democratic Labour Party]].<ref>{{cite web|title=John A Lee|url=https://nzhistory.govt.nz/people/john-a-lee|publisher=Ministry for Culture and Heritage |access-date=19 June 2017|date=30 March 2015}}</ref> Savage died in 1940 and [[Peter Fraser]], who became Labour's longest-serving prime minister, replaced him. Fraser became best-known as New Zealand's head of government for most of [[World War II]]. In the [[post-war]] period, however, ongoing shortages and industrial problems cost Labour considerable popularity, and the National Party, under [[Sidney Holland]], gained ground, although Labour was able to win the 1943 and 1946 elections. Eventually, in the {{NZ election link|1949}}, Labour suffered electoral defeat.{{sfn|Franks|McAloon|2016|p=133}} Fraser died shortly afterward, and was replaced by [[Walter Nash]], the long-serving [[Minister of Finance (New Zealand)|minister of finance]].{{sfn|Franks|McAloon|2016|p=136}} It would be some time before Labour would return to power; Nash lacked the charisma of his predecessors, and National won considerable support for opposing the "industrial anarchy" of the [[1951 New Zealand waterfront dispute|1951 waterfront dispute]].<ref>{{cite web |title=The 1951 waterfront dispute |url=https://nzhistory.govt.nz/politics/the-1951-waterfront-dispute |website=[[NZHistory]] |publisher=Ministry for Culture and Heritage |access-date=3 July 2021 |date=17 May 2017}}</ref> In the {{NZ election link|1957}}, however, Labour won a narrow majority of two seats, and returned to office.
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