Prime Minister Christopher Luxon apologised on Monday for telling a Rotorua Business Chamber audience that some New Zealand businesses had a "parent-child mentality" and too often looked to the government for help, as National MPs arriving at Parliament closed ranks behind their leader.

Luxon's original remarks, made at a Rotorua Business Chamber event, came in response to a question about businesses struggling to hold on. He said that returning to New Zealand he found a "parent-child mentality" and that businesspeople wondered what the Government was going to do, describing the view as "quite negative" and saying New Zealand businesses needed to move away from it. (NZ Herald)

The Rotorua Business Chamber president said the "parent-child lecture" from the PM "didn't land well" (Stuff), and Luxon was accused of making patronising comments. On Monday he apologised. Finance Minister Nicola Willis said the apology did Luxon credit by acknowledging that the words "didn't come out quite right" (NZ Herald).

National MPs backed the Prime Minister firmly. Rangitīkei MP Suze Redmayne said Luxon supported small businesses 100 percent and was out visiting businesses most weeks, including a visit to Mitchpine in Levin a couple of weeks earlier. Senior MP and Cabinet Minister Paul Goldsmith said the party backed small and big businesses and that he "absolutely" supported Luxon as leader. National's campaign chair Simeon Brown denied that Luxon was bringing down National's party vote (RNZ).

Luxon said no National MPs had raised concerns about his leadership over the last week.

ACT leader David Seymour, meanwhile, said Luxon's "parent-child mentality" description of New Zealand businesses was "valid" in some cases (RNZ).

The business apology was not the only issue Luxon faced as MPs returned to Parliament. He has ruled out sacking Foreign Affairs Minister Winston Peters over comments widely panned as racist, instead calling on New Zealanders offended by the comments to vote for his party at the upcoming election (RNZ).

National MPs were more willing than their leader to label Peters' comments directly. Banks Peninsula MP Vanessa Weenink said Peters' comments were racist and that some of her constituents were "upset" by them, but declined to say whether he should lose his position. List MP Nancy Lu said she thought Peters' comments were racist but avoided further questions on Peters. West Coast-Tasman MP Maureen Pugh called Peters' comments "ill-conceived" and said she had not seen Luxon's apology because she left her phone in Wellington over the weekend. Upper Harbour MP Cameron Brewer said it had been made clear the prime minister said Peters' comments were racist and that the party wished to move on (RNZ).

On foreign affairs more broadly, Luxon said New Zealand's relationship with China was "in good heart" and in a "strong place" (RNZ).

The broader context here is a Prime Minister managing two political headaches in the same news cycle. One is a self-inflicted wound from undiplomatic language directed at his own business constituency. The other is a coalition partner whose rhetoric he will not discipline with anything more than rhetorical distance. In New Zealand's MMP system, coalition governments are made up of separate parties that must work together to hold a majority in Parliament. That means a Prime Minister cannot simply sack a minister from a different party without risking the government's collapse.

The unified front from Goldsmith, Willis, Brown and Redmayne on the business apology is standard caucus discipline ahead of an election period, but the varied responses on Peters reveal the limits of that discipline. Weenink, Lu and Pugh each called the comments racist or ill-conceived without being prompted to, and none would back the line that Peters should stay. Brewer's formulation, that the party wished to "move on," is the clearest signal that National MPs want the Peters story off the agenda rather than resolved.

Luxon's decision to tell offended voters to back National at the ballot box rather than act against his Foreign Affairs Minister is a calculated trade-off: the cost of losing NZ First from the coalition would exceed the cost of absorbing criticism for inaction. Whether that calculation holds through an election campaign is the question National MPs will be watching.