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On 12 December 1980, a New Zealand Labour Party leadership election was held to determine the leadership of the New Zealand Labour Party. The leadership was retained by former Prime Minister Bill Rowling, who had led the party for the last six years.
Rowling was already seriously considering resigning from politics altogether. After the 1978 election, it was clear that his days as leader were numbered and a leadership challenge was imminent. Earlier in 1980 Rowling sacked Roger Douglas from his shadow cabinet as finance spokesperson for releasing an unauthorised alternative budget, fuelling prospects of a leadership challenge from Douglas' friend David Lange. Many were also weary of the fact that Labour was still polling well below National and just barely ahead of the Social Credit Party, who reached their popularity zenith during the East Coast Bays by-election.
Bill Rowling had been leader for six years including as Prime Minister in 1974-75 despite Labour defeats in the 1975 and 1978 elections. However, he was able to claim a moral victory in the latter where Labour polled more votes overall than National, although they won fewer seats. His contemporaries argued that Labour’s losses reflected badly on Rowling himself, despite making a substantial effort in rebuilding the party's membership during its time in opposition. Also, the fact that Rowling lacked the backing of the trade unions was crippling in Labour's circles and hampered his leverage in party structure.
After entering parliament in a by-election that received much media attention and helped propel him to the deputy leadership of the Labour Party in 1979, Lange became Labour's rising star. Lange had always been a critic of Rowling and came "to resent the bloody-mindedness with which he clung to the leadership"