The electoral finance reform the Government turned down

April 20th, 2010 at 12:00 pm by David Farrar

Last week a courier delivered a fairly large batch of documents to me, from the . They were all their internal papers on the latest electoral finance reform, which I had requested under the OIA. There were a couple of deletions (which I may appeal to the Ombudsman) but what they did deliver has revealed what reform packages were considered by the Government, and hence what we might have got.

Nat Lab Green ACT Maori
Taxpayer Funding Any campaign expense Broadcasting only Broadcasting only Any campaign expense (if any funding) Any party expense
Parties able to pay for own broadcasting Yes No No Yes Yes
Donation Disclosure Limit $10K and inflation adjust $1K $1K $10 K and inflation Adjust
Overseas Donations Limit $2K $0K $1K Lift from $1K
Donations Cap None Yes $35K
Party spend limit Inflation adjust from 2008 Inflation adjust back to 1995 $1.50 per capita
Elect spend limit $30K and inflation adjust Inflation adjust from 2008 Inflation adjust back to 1995 $1.50 per capita
Regulated Period 3 months Starts 1 May Starts 1 May From Writ Day 3 months
Parallel Campaigning Transparency only Registration threshold of $100K and a spending limit Low threshold for registration and $120K spending limit Transparency only Proportionate restrictions
Parallel Campaigners allowed broadcasting access Yes No No Yes

This table shows the positions of the five main parties (more than one MP) on some of the key issues.

The Government put great weight on having consensus amongst parties, in contrast to the . Effectively the Labour and Green parties were given a veto over any changes from the status quo. This meant that that changes I personally would have liked to have seen, did not occur.

On the issue of the taxpayer funded broadcasting allocation, National and ACT supported allowing it to be spent on any medium (not just TV/radio) and allowing parties to purchase their own broadcasting time. Labour and Greens opposed this

Views on the donation disclosure limit ranged from $1,000 to the status quo of $10,000.

Labour and the Greens supported a cap on the amount one donor can donate. The Greens advocated $35,000.

In terms of the party spending limit, the Greens supported adjusting it for inflation retrospectively (which I support). National oddly had no position on this. Labour wanted inflation adjustments to apply from 2008 onwards only, and ACT suggested a limit of $1.50 per person (which I also support).

National and Maori Party supported a 3 month regulated period. Labour and Greens a six to seven month period (from 1 May) and ACT a period of around four weeks (from Writ Day).

National and ACT did not support a spending limit for parallel campaigners. Labour supported a spending limit, but did not say what. As they advocated a $100,000 threshold to register I presume a fairly high limit. The Greens wanted a low threshold to register and a $120,000 spending limit. Maori Party supported some limit.

put up five options to Cabinet. They were:

  1. Consensus Package – changes which all or almost all parties supported
  2. Comprehensive Package – a full reform package which includes reforms supported broadly by parties on the right (broadcasting liberalisation, higher spending caps) and reforms supported broadly by parties on the left (spending limits for parallel campaigners)
  3. Parallel Campaigning Package – a left leaning package which is the consensus package plus more regulation of parallel campaigning
  4. Broadcast Reform Package – a right leaning package which is the consensus reform package plus liberalisation of the broadcasting regime.
  5. Status Quo

Packages 3 and 4 were politically untenable. The left would attack Package 4, and the right would attack Package 3.

The comprehensive reform package, as it had aspects supported by both left and right, could have been politically feasible. I don’t know if it would have been supported by both sides, or attacked by both sides, so I guess in the end the Government went for the safer consensus package of limited change.

A matrix showing the salient aspects of each package is below:

Consensus Comprehensive Parallel Reg Broadcast Reform Status Quo
Taxpayer Funding Broadcasting only Any campaign expense Broadcasting only Any campaign expense Broadcasting only
Parties able to pay for own broadcasting No Yes No Yes, up to $300K No
Donation Disclosure Limit $5K draft but $10K finally $5K $5K $5K $10K
Overseas Donations Limit $1K $1K $1K $1K $1k
Donations Cap None None None None None
Party spend limit Inflation adjust from 2008 Inflation adjust back to 1995 Inflation adjust from 2008 Inflation adjust from 2008 $2.4m
Elect spend limit Inflation adjust from 2008 Inflation adjust back to 1995 Inflation adjust from 2008 Inflation adjust from 2008 $20k
Regulated Period 3 months 3 months 3 months From Writ Day 3 months
Parallel Campaigning Register at $40K, no spend limit Register at $40K, spend limit of $500K Register at $40K, spend limit of $500K Transparency only Transparency only
Parallel Campaigners allowed broadcasting access Yes Yes No Yes No

The comprehensive package would have seen the taxpayer funded broadcasting allocation able to be spent in any media, and parties able to buy their own broadcasting time (so long as under an overall spending cap).

The spending caps would have increased by inflating adjusting back to 1995.

Parallel campaigners would have a spending cap of $500,000 but be able to purchase their own broadcast advertising.

Before the Electoral Finance Act, I would have quite happily supported a reform package based on the comprehensive package. The third party spending cap of $500,000 is four times higher than the EFA, and the other gains (higher spending caps, ability for political and third parties to buy broadcast advertising) more than compensate for this.

The EFA, partly because of the malignant way it was negotiated in secret, and the hypocrisy that the Government was trying to clamp down on taxpayers spending their own money, yet exempt parties taxpayer funded parliamentary spending from the campaign cap, generated great hostility to the idea of third party spending caps. I helped lead that hostility.

In a post EFA world, I am not sure even a $500k spending cap would not face significant public resentment. It would have been widely supported before the EFA, but as a trade off to the other liberalisations may have been a package worth pursuing.

One other interesting revelation from the OIA documents, is that the consensus package originally included a lowering in the donation disclosure limit for parties from $10,000 to $5,000.  This was absent from the final package announced publicly, so Cabinet presumably did not support that.

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10 Responses to “The electoral finance reform the Government turned down”

  1. krazykiwi (9,189 comments) says:

    Interesting — thanks for posting this DPF

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  2. Graeme Edgeler (3,280 comments) says:

    The consensus was ‘register at $40k’. Comprehensive was ‘register at $40k’. Parallel was ‘register at $40k’.

    We got register at $12k. Any indication why?

    [DPF: Nope, they have with held the note made after the Cabinet meeting. Presumably they saw it as better transparency]

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  3. Graeme Edgeler (3,280 comments) says:

    Also, did ACT really want $1.50 per capita ($6.5m) or $1.50 per voter? Becuase $1.50 per capita is quite an increase over the current limit at both the party vote and electorate vote level.

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  4. AG (1,823 comments) says:

    “We got register at $12k. Any indication why?”

    It’s the figure required under the EFA. An admission Labour got it right. ;-}

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  5. tvb (4,321 comments) says:

    There are three problem areas and I am not sure how they have been addressed. Firstly having this uncertain regulated period of 3 months – from when?? Secondly what are trade unions allowed to do for parallel campaigning – are they within the definition of parallel campaigner. Thirdly there needs to be much better clarification of funding from vote “parliamentary service”.

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  6. krazykiwi (9,189 comments) says:

    tvb – absolutely agree re unions. The value of their campaigning, under the guise of representing their members, must have been in the millions of dollars last election. I can’t see this stopping in a hurry. A coordinated bunch of chinless scarf wearers however… well that’s a different story: pillar ‘em!

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  7. Gooner (995 comments) says:

    National introduced the prohibition on purchasing your own broadcasting time (the anti free speech law). It would be good to see them repeal this and I hope they do.

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  8. Graeme Edgeler (3,280 comments) says:

    National introduced the prohibition on purchasing your own broadcasting time (the anti free speech law). It would be good to see them repeal this and I hope they do.

    While I don’t dispute this needs to go, the prohibition on parties purchasing broadcasting time with their own money is much older than the 90s law you’re thinking of. The prohibition was contained in the Broadcasting Act 1989, as originally passed in 1989, when National wasn’t in Government (and I believe it’s older than that).

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  9. AG (1,823 comments) says:

    tvb.

    3 months is backdated from election day.
    Unions will be allowed to advertise just like everyone else – if they explicitly support a party, they’ll need that party’s permission. If they just run issue-related ads, they’ll simply have to register as parallel campaigners. Any other activities are unregulated. Of course, if you want targeted laws that regulate how union members voluntarily spend their time/restrict how union members can communicate with one another, feel free to argue for more controls.
    Parliamentary funding is being addressed by a parallel, cross party process within the House. The executive (ie National) can’t tell the House what to do.

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  10. GPT1 (2,116 comments) says:

    One thing that does not appear to have been addressed is the farce where the ruling Party plays a silly game over when the election is to be held. Some transparency is required here – especially if there is going to be a restricted period.

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