Geddis on donations

March 10th, 2014 at 12:00 pm by David Farrar

blogs at Pundit:

There’s been a bit of lefty gloating going on around the traps aboutPatrick Gower’s interview with John Key on The Nation, in which he sought to draw an equivalence between David Cunliffe’s use of a trust to receive donations for his Labour leadership campaign and donations that National received back in 2010 and 2011 through a dinner held at “Auckland’s pricey Parnell restaurant Antoine’s”.

The fact that the Herald, Fairfax and TVNZ have all ignored the story is either evidence that, like Geddis, they think it is bullshit (my term) or a vast media conspiracy. I think the former considering they have all been covering the Collins story in a critical way.

But much as I would love to grab a pitchfork and torch and follow in behind the crowd all the way to the door of Key’s castle on a bleak mountain top (which is what he lives in, right?), my goddam conscience just won’t let me do it. So I’m going to have to break ranks and say, “nice try, but not quite.”

The asserted equivalence seems to be that Cunliffe’s trust lumped together a bunch of money and passed it on to him in ways that did not reveal the individuals who donated it, whilst the “Dinner at Antoine’s” likewise generated a bunch of money from individuals that then got passed on to the National Party without anyone getting to see who really gave it. That’s true enough. But it’s a superficial and misleading similarity.

Because the important difference is the intent in each case. 

This is a point I made around 50 times on Twitter at the weekend. A trust hides the identity of the donors, and that is the intent. A dinner does not hide the identity, nor is it designed to. In fact it increases transparency.

Cunliffe’s use of a trust was deliberately meant to enable individual gifts that otherwise would have to be declared to Parliament’s registrar of pecuniary interests (which has a $500 threshold) to remain “faceless”, in that it permitted only the Trust’s gift to Cunliffe to be declared. It’s the exact same strategem that the National Party used for years with its Waitemata Trust donation laundering vehicle – a practice that Labour criticised heavily at the time and enacted the Electoral Finance Act to stop (amongst other things). Which is why Cunliffe’s decision to adopt the same strategy was so very, very silly.

I’d use another word starting with H!

In comparison, none of the individual donations made at the Dinner at Antoine’s (in the form of a $5000 payment to attend) had to be declared to the Electoral Commission, as the threshold for declaring party donations was at that time $10,000 (its since gone up to $15,000). So there was no necessary reason for the donations to be bundled together  and passed over in one lump sum. It just seemed to happen that way because the owner of Antoine’s got the attendees to first pay him for the dinner, then gave a single cheque to National a few days later, rather than the attendees writing out cheques to National directly. If they had done the latter – which would have been entirely legal – then we would not have had any record of the dinner taking place at all.

That is a useful point.  The individual donors were not disclosed, because their donation was below the disclosure limit. And yes if they had paid National directly for the tickets, then the dinner itself would not be disclosed. National could have structured the dinner in a way that it never appeared on the books at all, yet they didn’t. Quite the opposite to Cunliffe.

(Oh, and in case anyone’s wondering how we know how many places any individual person bought, note that National’s financial return for 2010 states that the donation from Antoine’s was made up of “contributions” … so National must have been told who each of the guests at the dinner were. And had any of these guests paid for more than one place at it, their identity would have had to be disclosed under s.210(1)(b) (as the disclosure threshold stood at that time). So the fact that no-one’s name was disclosed tells us that each attendee paid for only one place.)

Yes, and if any of those people had made other donations to National and over a year it exceeded $15,000 they would have been exposed.

That’s why Cunliffe’s decision to use the Trust actually does feed into the whole “tricky” label that National is trying to pin on him. Itwas a strategem to avoid an outcome he did not want, in a way the Dinner at Antoine’s episode was not.

Indeed. The dinner is not a strategy for avoiding disclosure. It is a strategy for getting people to hand over money to the National Party :-)

The rationale for permitting this is that, in the scheme of fundraising for a political party’s campaign, $5000 is such small change that it doesn’t raise any real concern that you’ll get anything in return for it. Indeed, it’s only once someone gives $15000 in a year that we (now) require the political party tell the world who they are. Anything given below that amount is kept strictly between the donor and the party.

OK. That’s fine. But let’s say that the guest list for the Dinner at Antoine’s got leaked. And let’s say that it turned out six of the places around the table were taken by Chris MollerBruce Carter,Peter CullinaneNigel MorrisonRod McGeoch and Brent Harman. (Note to Chapman Tripp or whomsoever may be asked to look at this paragraph – I am not saying that these individuals were at the dinner, but rather posing a purely hypothetical point for the purpose of academic discussion.) Would it not be of considerable public interest to know of that fact? In particular, would it not be relevant to us that (in the purely hypothetical case discussed) members of SkyCity’s Board of Directors had given National $30,000 between them prior to the last election, so that they could spend an evening in private conversation over dinner with the PM? And then let’s say that each of their wives also had chosen to buy a place at the table in their own names – adding another $30,000 to the pot.

I’m not saying that this was what the Dinner at Antoine’s was all about. It probably wasn’t – more likely it was an amalgam of social climbers and old friends taking the chance to hang out with a guy who is (by all accounts) good company. What I am saying, however, is that because New Zealand has set the legal disclosure level for donations to political parties at such a high level, we may never know if and when such a dinner ever does take place. And that, I think, is a problem.

Andrew supports a lower disclosure limit than $15,000. It used to be $10,000 which I supported but National and Labour voted for it to increase to $15,000 in 2010. But as I pointed out yesterday that is still under 0.5% of a party’s allowable spend during the election year.

In the hypothetical case above, I’d point out that each director and spouse would have to pay for their ticket personally. If one person or company was reimbursing them for the ticket or paying for it, then they have a legal obligation to reveal that.

The other thing worth noting is that a dinner is in fact a transparent fundraising device as everyone there sees who everyone else is. Just send a cheque to a political party, and no one knows but them and you. Turn up to a dinner and everyone else there will see. And I’m sure people would notice an entire board of directors there and their spouses :-)

So a very good post by Andrew on this issue. His hypothetical is just that. As it happens I think $10,000 is a better limit than $15,000 but I put this in the context of a party’s likely total spend in election year being between $3 million and $5 million.

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29 Responses to “Geddis on donations”

  1. berend (1,711 comments) says:

    What’s up with Andrew’s:

    check out Antoine’s menu and the attached prices. This, remember, apparently is one of John Key’s “favourite places to eat”. That this fact does not at all seem to undermine the popular view of him as being “just like us” is a source of unending mystery!

    What’s up with the prices? It’s not McDonalds, but doesn’t seem to be unreachable expensive. Couldn’t afford to eat there much myself, but seems to be pretty standard prices.

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  2. Brian Smaller (4,023 comments) says:

    The fact that Gower tried to make this a ‘gotcha’ moment in his interview shows why he is compromised as a journalist as well. If he couldn’t see the difference between the two situations then he is either 1) wilfully ignoring facts to seem fair, or 2) stupid.

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  3. burt (8,275 comments) says:

    This is standard left-wing MO – just scream and point at others shouting “They did it too !!”

    The fact their team did it is now moot, because like children if others did it too then they shouldn’t be held accountable.

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  4. Harriet (4,976 comments) says:

    As Antoine’s chef might quip,

    “Labour has tried to create a soufflé from this place in the hope that Cunliffe’s stocks will rise in the hot cauldron of an election year – and it’s all turning to custard. Pot calling the kettle black. They should stick to giving away free sweets. They’re extra good at that.” :cool:

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  5. burt (8,275 comments) says:

    Oh, as an aside – I expect Winston to chime in for National saying that they have done nothing wrong, it’s not like they had free Scampi while being chair of an inquiry into Scampi quota irregularities.

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  6. igm (1,413 comments) says:

    It is abundantly clear, Key does everything above board (much to the consternation of left-wing media), Cunliffe, being a leftie, must do things underhand, as that is the way socialists move, so as to keep the public unaware of their self-indulgent lifestyles. No matter what their objective may be, this is the way of the left.

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  7. BeaB (2,125 comments) says:

    The problem with these Leftwing academics is that they truly do believe, in a fairyland sort of way, that the rich are different. Any of us who have known someone really rich or powerful know they are mostly like us. They may not have money worries but they still have worries. They usually value the same things all of us do – the love of family and friends, a comfortable home, simple pleasures as well as the usual pursuits of the rich like golf. They may done in posh restaurants but they also mostly enjoy the same familiar dishes we do.
    I remember a Labour Party acquaintance who was agog because a well known millionaire had opened the door early on a Sunday morning in his pyjamas! And another who had seen him mowing the lawn!
    It’s their mad world full of envy, resentment, over- heated imaginations and sheer hatred.

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  8. DJP6-25 (1,388 comments) says:

    It’s good to see such a balanced article coming from someone on the left.

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  9. igm (1,413 comments) says:

    BeaB: The type of envy you mention is promoted in columns scribed by Gordon Campbell, one of Fairfax Media’s left-wing messengers, masquerading as a journalist. He is closely followed by the editor of Manawatu Standard, he being a executive member of NZLP. These types not only live in sheer envy of the successful right, but also try and indoctrinate those of lower IQ to adopt their evil philosophies. This is the reason that anyone in a position of influence, in any media, should make their political affiliations, and positions within parties, public!

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  10. Brian Smaller (4,023 comments) says:

    I remember a Labour Party acquaintance who was agog because a well known millionaire had opened the door early on a Sunday morning in his pyjamas! And another who had seen him mowing the lawn!

    You can’t be talking about Cunliffe. I cannot believe he mows his own lawn.

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  11. ross69 (3,652 comments) says:

    A dinner does not hide the identity

    That’s weird, because you haven’t named any of those who attended the dinner. :)

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  12. Elaycee (4,393 comments) says:

    I doubt Labour will be wanting to make a great song and dance about this – someone (was it Claire Trevett?) tweeted over the weekend that Labour had a similar fund raising dinner with Sir Ian McKellan at the top table and the cost was $500 / person and tables were (by coincidence) $5,000 a pop. (Lunch was a ‘snip’ @ $250 per person)….

    And the Labour function was within the rules – no different to the dinner at Antoine’s.

    But that won’t stop the overtly left wing, low rent ‘interviewers’ such as Patrick Gower from trying to morph a dinner arranged by the Nat’s at Antoines, into something other than what it was: a fundraiser.

    Pathetic.

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  13. burt (8,275 comments) says:

    ross69

    It’s a shame you seem to think only National should be accountable. Is this a mental disorder you have or are you consciously bias and defensive of corruption in your own team ?

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  14. RRM (9,933 comments) says:

    So one of John Key’s favourite places to eat does $45 mains, and that shows how out of tough JK is?

    FFS, methinks Andrew Geddis doesn’t get out too often.

    (I don’t eat $45 mains any more, but that’s because because I traded the single life for having a young family and a mortgage… not because of some rich prick / right wing conspiracy… ffs… don’t they teach you ANYTHING at postgrad political science school?? )

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  15. burt (8,275 comments) says:

    RRM

    Union reps spend that kind of money on mains but their members don’t – so they pretend it’s expensive to sound like they care for the low paid workers who’s backs they ride on.

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  16. Lipo (229 comments) says:

    Do you think that is is an attempt by Patrick Gower to look like a Political Neutral?
    One week they have a go David C for rightly stuffing things up so in an attempt to look fair look for a story on National

    In the interest of Transpency Mr Gower – who gave you this story because I bet you never thought of it by yourself?

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  17. Grendel (1,002 comments) says:

    What i dont get it, has no other party done a fund raising dinner? i figured they were standard stuff. of course the style will be different, i hate to think what kind of lentil mash you might get at a greens dinner (though every dinner would come with free patronising).

    i went to an Act breakfast once, Prebble was a great speaker.

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  18. ross69 (3,652 comments) says:

    a dinner is in fact a transparent fundraising device as everyone there sees who everyone else is

    Therefore, you’d be happy to reveal all of those who attended the dinners, seeing as it’s no big deal and everyone knows anyway?

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  19. burt (8,275 comments) says:

    ross69

    Let me guess, if National used a secret trust you would say it’s OK because Cunliffe did it too !

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  20. RightNow (6,994 comments) says:

    ross69 (3,540 comments) says:
    March 10th, 2014 at 1:26 pm

    a dinner is in fact a transparent fundraising device as everyone there sees who everyone else is

    Therefore, you’d be happy to reveal all of those who attended the dinners, seeing as it’s no big deal and everyone knows anyway?

    You only have to go to the dinner to see who is there mate. Maybe you should book a seat for this year’s dinner.

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  21. ross69 (3,652 comments) says:

    You only have to go to the dinner to see who is there mate

    Why would I need to go there when everyone apparently knows who was there, and John Key wants transparency?

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  22. burt (8,275 comments) says:

    ross69

    Lets compare apples with apples. Imagine National passed a law explicitly saying collection of donations at ‘Dinner events’ were illegal. Then what they have done would be comparable with Cunliffe using a secret trust – I know, it’s different when the people who write and pass the laws ignore them.

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  23. georgedarroch (317 comments) says:

    Who are the secret donors?

    Who are the National Ministers who were talking to the secret donors, and what were the subjects of conversation?

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  24. georgedarroch (317 comments) says:

    When were the last secret donor dinners?

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  25. Than (475 comments) says:

    Do you think that is is an attempt by Patrick Gower to look like a Political Neutral?

    I had a similar thought about Bryce Edwards latest blog roundup piece, particularly when WhaleOil pointed out that he solicited blog posts on the subject. There’s just so much bad news for Labour right now journalists are worried they’ll look biased, so they’re actively looking for bad news for National. But the net result is they end up publishing obvious non-stories and looking silly.

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  26. AG (1,827 comments) says:

    @RRM:

    I don’t eat $45 mains any more, but that’s because because I traded the single life for having a young family and a mortgage…

    And that was kind of the point I was making. Key has been remarkably adept at winning the hearts and confidence of the majority of NZers who think view him as essentially the same as they are, despite his having a lifestyle that is quite different to theirs. (And for those trapped in the inner-city Auckland bubble, $30 entrees and $50 mains are pretty remarkable.) Now, I’m not saying this is a con-trick, or a bad thing, or a ruse, or anything – it’s just a fact. And just how he is able to transcend that fact is what makes him such a remarkably good politician (in a non-pejorative sense).

    don’t they teach you ANYTHING at postgrad political science school??

    No. They don’t. Which is why I’m glad I never went. I’m a law academic.

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  27. Harriet (4,976 comments) says:

    “………I don’t eat $45 mains any more, but that’s because I traded the single life for having a young family and a mortgage……

    ……. and someone who can’t cook.” :cool:

    True love. :cool:

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  28. Zapper (1,021 comments) says:

    AG

    Perhaps the fact that he’s a down to earth and good bloke is why he can stay in touch with ordinary every day people? Maybe those of us who are not the PM, nor have earned 50 million don’t care about those things as those as he’s a good bloke?

    If we ignored all his attributes except the fact that he has a main worth $45, that would be extremely petty and envious wouldn’t it? What sort of people suffer from such envy?

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  29. doggone7 (808 comments) says:

    ross69 “A dinner does not hide the identity, nor is it designed to. In fact it increases transparency.” It’s only the list of people that’s not transparent.

    No doubt the wine they drank was Claytons too! And the quoted line here is straight out of the John Key book of logic.

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