Labour leader Chris Hipkins says he would have sacked Shane Jones as a minister over his "knee pads" comments, but has stopped short of ruling out working with NZ First after the 2026 election.

Hipkins told the NZ Herald that Jones would be dismissed if he were a Labour MP and had made the remark (NZ Herald). Speaking to RNZ, he said Jones would have been sacked if he were in charge. He also said he would expect all ministers to follow the Cabinet Manual — a document that sets out the rules for how ministers must behave — and that there would be consequences for any minister who did not, in any deal Labour struck with another party (RNZ).

The controversy started with comments Jones made on the Saturday before publication. Jones criticised supporters of the free trade agreement with India and said he would keep "calling out" the levels of Indian migration into New Zealand. He told other parties: "Labour Party, National Party, ACT Party, Green Party: the next time you go to an ethno-nationalist rally to receive a foreign leader, take off your knee pads. You represent the New Zealand Parliament" (RNZ).

Prime Minister Christopher Luxon called the comments "crass and unprofessional" and said it was up to Jones to be responsible for his own language. Luxon said he would have a conversation with Jones making it clear the comments were unacceptable (RNZ).

Jones has defended his remarks. In an earlier RNZ article published on 18 July, he described NZ First as "nationalist" and said "looking after our own people isn't racist" (RNZ). He previously compared the India free trade deal to a "butter chicken tsunami", which led Luxon to call his comments "alarmist" (RNZ).

The India free trade agreement has caused ongoing tension within the coalition government. Labour's own view has shifted over time. In February, the party said any deal "must be for the good of New Zealand", with Hipkins saying: "We firmly believe in free trade, but our free trade agreements must not cause New Zealand harm" (Labour Party). By April, Labour said it would support the deal, but warned businesses to do their own homework before getting involved (Labour Party). Labour also said in February that Luxon was losing control of his coalition as it argued over climate policy, pointing to Jones's disagreements on the India FTA (Labour Party).

On whether Labour would work with NZ First after the next election, Hipkins is keeping his options open. NZ First has already said it will not work with Labour in 2026. Hipkins has not said the same in return. On the Tuesday before publication, he told RNZ he had ruled out working with NZ First at the previous election and that it was "highly unlikely" to change. But he also said there were "different permutations now" compared to six months earlier (RNZ).

New Zealand uses a voting system called MMP, where parties usually need to join forces with other parties to form a government. That means smaller parties like NZ First can sometimes decide which major party gets to lead. NZ First leader Winston Peters has held that kind of power before. So whether Labour shuts the door on a deal with his party matters well beyond the Jones controversy. Hipkins ruled NZ First out before the 2023 election. His refusal to do so again, even as he calls the party's deputy leader unfit for a minister's job, leaves things deliberately unclear.

The broader point is the gap between what Hipkins is saying and what he is doing. He is setting a standard for ministerial behaviour but not applying that same standard to the party whose deputy leader broke it. That is a political calculation about keeping his options open heading into the next campaign, and it leaves the final decision for closer to election day.