Why did the National Party win the most votes but not form New Zealand’s government in 2017?

In the 2017 general election, the National Party won the most votes and the largest number of seats (56) in the House of Representatives, but it failed to secure a parliamentary majority.12

New Zealand utilizes a mixed-member proportional representation (MMP) system, which typically necessitates the formation of coalition governments between major parties and smaller partners to reach a majority. Following the election, both the National Party and the Labour Party engaged in negotiations to secure the support of the New Zealand First party, which held the balance of power.314

Ultimately, New Zealand First leader Winston Peters announced that his party would enter a coalition with the Labour Party. This agreement, combined with "confidence and supply" support from the Green Party, allowed Labour to form a government, bringing an end to nearly a decade of National Party rule and leading to Jacinda Ardern becoming prime minister.2