Political Donations
December 6th, 2010 at 11:00 am by David FarrarA lengthy article on political donations by Jenni McManus in the Dom Post:
Corporate donations – once the financial lifeblood of political parties – have slumped significantly since tough new electoral rules were enacted in 2007.
Not necessarily. Donations over the disclosure limit of $10,000 have slumped, but that does not mean total donations have decreased. The law about to be passed by Parliament will shed some light on this, as it will require reporting of total donations in bands, not just those over $10,000.
Labour’s subsequent law change introduced new rules and a $120,000 cap on such third-party spending.
It also laid down a new disclosure regime for individual and corporate donations, and for anonymous and foreign donors.
For New Zealanders, anything above $10,000 had to be disclosed in the party’s annual return. Multiple donations from a single person or entity above $20,000 had to be reported within 10 days of receipt.
The $10,000 disclosure limit predates the EFA. That has been the law for many years.
So what do corporates hope to gain from donations? And what are they promised for their money? Very little, it seems, in a country the size of New Zealand when big payments to political parties confer no right to dictate policy – or even to be part of the policy- making process.
A large party will spend around $5 million in election year. So a $10,000 donation is just 0.2% of total income. This is why I think $10,000 is a good level for disclosure – it is impossible to think of policies being purchased at such a level.
It’s all about influence and access, says one National Party insider. “They think they become a ‘mate’ of the politicians – that they get on the government’s speed-dial. It puffs them up – gives them a vignette into a secret world, makes them feel part of an inner circle.
“But nothing is explicit. It’s a sort of code among the rich that if you give money, John [Key] is more likely to take your call.”
This type of donor is part of a small, select group. “It’s not your factory owner in South Auckland.”
The insider says it is “complete crap” that Kiwi MPs can be bought: “But the business community wants to be heard and [donations] are a way of ensuring this.”
And for many donors, it is supporting a party’s policies, because they think they are good for New Zealand and/or their business.
John Key and his wife are regular diners at Antoine’s, an exclusive Parnell restaurant owned by National Party supporter Tony Astle.
Astle says Antoine’s donated $105,000 in June this year to the Nats because he “hated the Labour government of the past nine years” and had never been slow in coming forward to express this view.
“It almost ruined by business,” he says. “I was very optimistic about the National Party and that’s why I organised a fundraising dinner for them. It was my opportunity to do something.
A damn generous donation.
Susan Chou (also known as Suzhen Zhou), of Bucklands Beach, has emerged as the National Party’s biggest single donor.
What no one has reported is that she has also donated to Labour – $18,000 in May 2008.
The Electoral Commission has also just reported another large donation – $25,000 in late November from Graeme Douglas.
Related posts:
- SST on secret donations
- Anonymous Donations starting to flow through Electoral Commission
- 2007 Donations Return
- I believe Winston
December 6th, 2010 at 11:29 am
Ah, but what about donations that could be given.
Bu Anderton is not stating either – he’s obviously aware of how to work around the law which doesn’t stop him taking repeat donations of “$9999.99″ from those in the retirement industry.
[DPF: Anderton is wrong. he knows less about electoral law than he does about MMP. If you give multiple donations within a calendar year that exceed $10k, then they must still be disclosed]
Vote:December 6th, 2010 at 11:37 am
To..?
Vote:December 6th, 2010 at 11:44 am
How is it that the Labour Party was bale to disclose a large donation AFTER the election.
Vote:December 6th, 2010 at 12:00 pm
>So what do corporates hope to gain from donations? And what are they promised for their money? Very little, it seems, in a country the size of New Zealand when big payments to political parties confer no right to dictate policy – or even to be part of the policy- making process.
As opposed to unions, who donate large amounts of time and labour. In return they get the Labour Party presidency, a large number of MP nominations, and considerable influence in terms of policy and legislation.
Vote:December 6th, 2010 at 12:22 pm
““”I remember, with some anger I must admit, the huge effort put into lobbying Members of Parliament before the 1999 law change which radically liberalized alcohol retailing and cut the alcohol purchasing age to the social detriment of young New Zealanders.
Vote:“That’s why when I saw this person from the Beer, Wine & Spirits Council wandering around Parliament with an official parliamentary pass around her neck earlier this year, as if she were some kind of official staff member, I asked my staff to make enquiries.
“The way I saw it was that if the Chief Executive of the Hospice Association, or the Chief Executive of Save The Children Fund, who often appropriately come to Parliament to lobby MPs to outline their concerns, aspirations and hopes, aren’t entitled to an official photo ID allowing them to walk around Parliamentary offices any time of the day or night as they like, then why on Earth should a Liquor Industry official?”
http://www.scoop.co.nz/stories/PA0301/S00171.htm
December 6th, 2010 at 12:30 pm
What’s the connection between lobbying and political donations? Gareth Morgan says in his book After the Panic that there is (was) intensive lobbying to increase immigration (and hence the continual need for Auckland to grow and make money for the property sector). The minister Coleman does an equilibrium analysis (garbage in garbage out) which shows that “immigration benefits everyone” and when a Massey economist state the the benefits of immigration are “overstated” the previous minister simply tells him he is wrong.
Vote:P.s I remember John Banks assuring us that there were no back handers in the tourism industry (yeah right!)
December 6th, 2010 at 12:33 pm
Donations from businesses to political parties have actually been on the decline in New Zealand for quite some time, and so it’s really quite a myth that NZ parties are surviving only on the largesse of corporations. My research on political finance shows that such donations are generally becoming less the ‘life-blood’ of the party system, as other forms of funding become more important. Generally in the 1990s, corporate funding of political parties dropped quite significantly, and both National and Labour reported less interest from big business in making donations. For example when I interviewed the general secretary of the Labour Party, Rob Allen, about business donations in 1999 he complained that ‘the corporate sector has not in any way played a part in elections in the way that they used to’.
Likewise, British party finance specialist Michael Pinto-Duschinsky has illustrated this trend by pointing out that in Britain, ‘The proportion of Conservative central income derived from corporations declined from about three-fifths in the 1970s to one quarter in the early 1990s’. This decline in business donations is mirrored by a worldwide trend related to the decline in the saliency of class cleavages in politics. Business does not act in the same collective fashion that it was once more inclined to. Even the business/industry associations that might have once played an overtly political role now intervene in politics on a more pragmatic basis, often donating to parties with influence instead of the parties that they might be more traditionally or ideologically aligned with. It seems that when class politics was at its height, businesses in Western countries felt more obliged to confront what they saw as the dangers of Soviet-inspired communism, and therefore aided those movements that would counter such perceived threats. With the demise of the so-called communist states and the related decline of class politics in general, there is less need for business to financially back their ‘parties of capitalism’. Today it’s really just some occasional wealthy individuals that make the big donations – such as Owen Glenn giving half a million to Labour. But of more importance than even those occasional donations, the tax-payer funded parliamentary budgets of the parties are much more significant, and they can essentially be used in a partisan-political electioneering way, with very few limitations.
Vote:December 6th, 2010 at 12:35 pm
“What no one has reported is that she has also donated to Labour – $18,000 in May 2008.”
I’d be more worried by someone who donates to both parties rather than to one. When someone donates to a single party, it’s more likely to be for ideological reasons than any other explanation. When the money gets splashed around among the parties, it looks – to me at least – more like influence buying.
I’m prepared to be persuaded otherwise on this.
Vote:December 6th, 2010 at 1:31 pm
As far as I understand the situation immigration and the birth rate increase the population. An increase in population increases GDP, and the other way is the increase in productivity. An increase in GDP does help everybody. Yes lobbying by the property sector for more immigration does go on, and yes the benefits from immigration are often overstated, and I would also have to agree that lobbying and donations are a very messy area.
Vote:December 6th, 2010 at 1:41 pm
Anyone who gets mixed up with political parties in NZ gets burnt. I am sure Owen Glenn will not be giving one cent to a political party again and I assume large donors have noted Glenn’s experience. Most NZers have a very cynical attitude to politicians and will not have a bar of them.
Vote:December 6th, 2010 at 2:47 pm
Bryce Says:
“Today it’s really just some occasional wealthy individuals that make the big donations – such as Owen Glenn giving half a million to Labour. But of more importance than even those occasional donations, the tax-payer funded parliamentary budgets of the parties are much more significant, and they can essentially be used in a partisan-political electioneering way, with very few limitations.”
I suppose that it is getting particular people into and up the party that is where the effort and resources might go? “Wheels within wheels” as my mother would say? In that sense the party is a ship but each crew may be different, so in the case of the Green party it is a green ship with a red crew?
Vote:December 6th, 2010 at 4:55 pm
That depends entirey upon the level at which it is donated. Throw $10,000 at party HQ and you’re indeed one of many. Give it to the regional organisation – especially if you choose a region that’s got few MPs and thus might be struggling for member and money – and you’re buying quite a bit of gratitude and, perhaps, influence.
Give it to an individual candidate (who might be, or go on to be, an MP or a Minister) and you’re probably handing them round half to a third of their campaign budget (depending on whether head office centrally organises signage etc).
That’s why $10,000 is far, far too high a hurdle. For most people, $1,000 is a figure that they pause and think about carefully before spending. That is to say, they spend it with some quite deliberate intent. Now that intent may simply be to say “I support Party X and its policies” but, that being the case, there’s no reason they should be shy about saying so.
Bill Bennett says:
Having dealt with donors at electorate and at national level I agree entirely with that perception. The ones making substantal donations to one party definitely trend toward the “true believers” end of the scale, even if they’re hoping to gain your ear if elected. The people who spread it round tend to have no beliefs, other than in their own self-interest and advancement – and were usually quite open about the fact they expected they were buying influence.
Vote: