WELLINGTON — New Zealanders go to the polls on Saturday in a cliffhanger election that sees conservative Prime Minister Bill English battling a challenge from charismatic young rival Jacinda Ardern.

No party has formed a majority government in New Zealand since proportional voting was adopted in 1996 and this election is unlikely to change that.

But English and his National party looked set to be in the driving seat until Ardern became opposition leader last month.

Her appointment immediately galvanised support for the ailing centre-left party, resulting in an unprecedented 20-point popularity boost for Labour and bringing it level with National.

The 37-year-old is bidding to become the youngest prime minister since 1856 and only the third woman to lead the South Pacific nation of 4.6 million people.

It is now shaping up to be the closest election since 2005, with opinion polls swinging wildly between the two leaders.

"It’s down to the wire and it will be extraordinarily close," Ardern said, adding that she was taking nothing for granted in a campaign where the polls have reflected the electorate’s volatility.

The vote could be so close that there is no clear winner on election night as both major players scramble to forge coalition agreements with minor parties.

While coalition governments are standard in New Zealand, elections usually result in either National or Labour gaining a clear lead, meaning they can dictate terms to minor party coalition partners.

When both major parties are evenly matched the minor parties hold the whip hand and coalition negotiation can stretch on for weeks.

Waiting in the wings should that occur is Winston Peters, the 72-year-old leader of New Zealand First, who has played kingmaker in two previous elections and would jump at the chance to do so again.

Movement for change 

Arden accuses the government of inertia, saying that after three terms it has run out of ideas on issues such as housing affordability and protecting the environment.

"There’s a movement for change and I think after nine years people are starting to believe that we’re drifting," she said.

Ardern’s policy platform includes free tertiary education and slashing immigration to reduce pressure on housing and infrastructure.

She has also talked up the prospect of generational change in New Zealand politics, appealing for young, disaffected voters to get behind her.

English, who took over as prime minister when John Key stepped down last year, has meanwhile dismissed so-called "Jacinda-mania" as "stardust" with no substance.

The 55-year-old ex-farmer and father-of-six points to his track record as finance minister under Key, saying only National can deliver strong economic growth.

English remains bullish about his prospects of defeating Ardern, even though no New Zealand government has won a fourth term in more than 50 years.

The latest poll released Wednesday put National ahead of Labour 46 per cent to 37, but English said he was not reading too much into it and the contest remained "neck-and-neck".

"The volatility in the polls shows there’s an undecided vote there that is still going to make up its mind in the next few days," he said.

Myriad minor parties -- including Greens, Maori, ACT, and United Future -- could come into play as National and Labour look for coalition partners.

But polls point to Peters’ NZ First holding the decisive vote if the result is close, meaning English and Ardern could be seeking his support.

The populist anti-immigration campaigner has shown in the past that he will back either side if the right offer is made. — AFP