Kiwiblog

There are more and more questions over NZ First and their accounts. Both NZPA and the Dominion Post have said that Nick Kosoof is both NZ First’s Auditor and their Accountant. Surely not?

So can someone find out the following:

1. Who was NZ First’s Auditor in 2005?
2. Who was NZ First’s Accountant in 2005?
3. Who was NZ First’s Treasurer in 2005?
4. Who was NZ First’s Party Secretary in 2005?

To the best of my iformation the Party Secretary in 2005 was not some poor office person (as Helen suggests) but Edwin Perry who was an NZ First MP at the time.

Also Audrey Young blogged in February 2008 that the Party Treasurer in 2007 was also a former NZ First MP – Brent Catchpole. Was he also Treasurer in 2005?

And then we have an interview on Nine to Noon with Peter Williams. Parts are amusing as he rants about Matthew Hooton, and parts are clearly wrong.

Williams said around 5 minutes 20 secs in:

The money that they paid, I think it was about $80,000 wasn’t it? … The moneys that were subscribed by the Vela family were paid to the Spencer trust, and in turn the Spencer trust paid the money to NZ First.

But the Spencer Trust was set up in August 2005, and the Vela donations were between 1999 and 2003.

No wonder the SFO doesn’t go along with Mr Williams insistence that it can all be cleared up in five minutes and his latest line that they have made one little mistake in 15 years of flawless behaviour.

Two other stories of note. Martin Kay in the Dom Post says:

When The Dominion Post first put to him in July that NZ First received money through a trust, he said through a spokesman: “It’s a lie.”

Mr Peters’ brother, Wayne, is one of three Spencer trustees. Fellow trustee Grant Currie said on Monday that its only purpose was to channel money to NZ First.

So Peters said it was a lie, yet the lie was his.I am sure Helen just sees it all as another innocent mistake.

Ben Thomas at NBR also points out NZ First are recycling excuses:

New Zealand First’s explanation for why it didn’t disclose a $25,000 donation allegedly funneled through the Spencer Trust will sound strangely familiar to Winston watchers.

The party’s auditor said yesterday it failed to declare the $25,000 donation from Sir Robert Jones in the 2005 year because it slipped people’s attention “during a change in administrative staff.”

That is now the second time – and for the second separate set of accounts – that the party has used the excuse of a personnel changeover for ostensibly breaching electoral finance disclosure laws.

Like all Winston Peters’ rhetorical greatest hits – “if you stop telling lies about me,  I’ll stop telling the truth about you,” for example – “administrative error” may have been too exquisite a line to only use once.

In August this year New Zealand First was let off on the late filing of its return of donations for the 2007 year, because the Electoral Commission accepted its explanation the delay was caused by “changes in the upper levels of office holders such that many had not been through the donation return process before.”

New Zealand First missed the April 30 deadline for filing its donation returns. When the late return did arrive it didn’t disclose any donations – so why the delay? It should have been a simple matter to verify no donations over $10,000 (the minimum amount that has to be declared) had been received.

The party denied media reports that its president and secretary had been waiting for the return of Parliamentary party leader Winston Peters from overseas to sign off the accounts (which would have been unusual, since he is not a legal office holder as far as the party is concerned).

Instead the secretary offered up the “office-holder changeover” scenario, and aid there had been a miscommunication between the treasurer and the auditor. The commission decided that was a reasonable excuse, and so no breach of the Act had been committed.

Given how long it seems to take the New Zealand First party to sort out its finances after these periods of flux, the commission may be tempted to ask office holders to double check the zero-return filed for 2007. It is after all apparently quite easy for cash to slip between the cracks in times of HR churn.

I think it would be very prudent for the Electoral Commission to double check the zero return for 2007, especially before the deadline for prosecution expires. The fact that the Party President is on record as referring to a large anonymous donation (a stance he has never publicly recanted) gives them more than enough grounds to start checking.

The NZ Herald reports that more details tomorrow are likely from Owen Glenn. Good.

Apart from the motivation issue (Glenn has no motivation to lie, while Peters/Henry have plenty) of who is telling the truth, there is also the timing issue. Glenn has not just suddenly stated that Peters solicited the money. He told the PM this back in February. Peters denied it, and denied a donation, and the donation was later established to be correct.

The fact of the donation has been established. Owen Glenn has stated Peters solicted it, and thanked him for it. And it is almost beyond belief that you would donate $100,000 to help someone and not tell them about it. Especially if you are Owen Glenn!

Now Peters and Henry have their story that Winston knew nothing (despite even Helen telling him about it) and that Henry heard from someone else to contact Glenn. Well Henry now has to substantiate his version of events. Was that “other person” Roger McClay or a member of Winston’s staff? If so, guess who told them about it! Does he have a copy of phone records or e-mails to show he contacted Glenn and solicited the money himself? Or will the e-mail just show he sent through bank account details?

The NZ Herald says this week will see a focus on the PM’s knowledge of the Owen Glenn donation.

The more I think about it, the more appalling it is that she said or did nothing. Let us first dispose of her claims that she had no choice but to accept Peters’ word.

1. The convention of accepting the word of an MP, only applies in the House itself. There is no such convention in the wider political sphere.
2. More importantly, accepting someone’s word only applies up until there is evidence which contradicts that word. The direct testimony of Owen Glenn that he donated $100,000 to assist Winston Peters is evidence.
3. In previous cases where the evidence contradicts what the Minister says, Clark has asked to examine the evidence. She had her staff examine media tapes of Benson-Pope’s interviews to determine he had lied, and sacked him.
4. This was not a case where one had to accept the word of Glenn over Peters or vice versa. A donation is a provable fact and she could have gained absolute proof with a single phone call.
5. She could have urged Peters to contact Glenn to find out why he thinks he donated. That would be the 100% logical thing to do, unless you suspected Glenn was right and Peters was lying.

Now let us look at all the things one may have expected an ethical Prime Minister to do. Did she do any of the below?

1. Seek legal advice from the Cabinet Secretary or the Solictor-General as to whether she had an obligation to disclose Glenn’s revelation that he had donated $100,000 to assist Peters.
2. Inform the Electoral Commission that she has information which warrants investigation as to the accuracy of NZ First’s 2005 return. OR
3. Inform the Registrar of MPs Pecuniary Interests that she has information which warrants investigation as to the accuracy of Winston Peters’ 2005 return.
4. Inform the Secretary of Foreign Affairs that Owen Glenn had told her that he had donated $100,000 to assist the Foreign Minister, and that this created a conflict of interest for Peters in determining whether or not to appoint Glenn Consul to Monaco

Just as bad, she sat there while Winston Peters did his infamous “No” press conference, knowing that Owen Glenn had told her it was yes.

And even worse on the 18th of July, when Peters announced the $100,000 donation, she knew conclusively he was lying as Peters said the first he knew about the donation was earlier that day when Henry told him. But he knew, at a minimum, back in February when the PM told Peters what Glenn had said.

People need to understand that the entire last six months has been a charade. When Winston Peters pretended to be angry at the allegations, Clark knew that Glenn had told her that he has donated.

Even when Peters outrageously slandered the NZ Herald, accussed them of fabricating the Glenn e-mail, and demanded Murphy and Young resign, Clark stayed silent. It was an inaction unworthy of the highest office in the land.

Peters was actively considering Owen Glenn for a diplomatic appointment. Clark had been told by Glenn that he had donated $100,000 to assist Peters. This created a huge conflict of interest. But it seems Clark sat on this information. Doing so undermines the integrity of her Government.

And finally we have the hypocrisy. The rhetoric about how we needed the Electoral Finance Act to stop secret donations to political parties. And two months after that law was passed, Helen Clark learnt of a huge $100,000 secret donation. Even worse she learnt of it from a man seeking favours from the Minister he claimed to have donated it to benefit. But did she do anything at all? Did she demand the donation be revealed as she had just spent six months vowing that such donations be exposed? No she just sat there and asked no questions, and allowed Peters to keep denying it.

As I understand it, Helen Clark has suspended Winston Peters only from his portfolios, but not as a Minister. In other words he still gets his normal pay, his housing and transport allowances, his office, his ministerial funding and most importantly of all his staff, except the portfolio specific ones.

This means he gets to run his election campaign with full Ministerial resources, and they don’t even have any Ministerial duties to attend to.

John Key makes clear that his ruling out Winston is not tied to the SFO investigation:

Mr Key said questions still remained around the 2003 parliamentary inquiry into the scampi fisheries quota and whether Mr Peters had misled the public in relation to the Glenn donation.

He also questioned Mr Peters’ assertion today that Sir Robert’s donation had found its way to NZ First. If that was the case then why was it not declared, he said.

Mr Peters’ credibility had been severely dented and he would now find it hard to trust his word.

“We’ve had so many instances now where Winston Peters’ version of events just doesn’t stack up with the version of events presented by others.

“Really the call we made on Wednesday to effectively cut Winston Peters and New Zealand First loose wasn’t a call we made easily or lightly. We did it with the full knowledge it may well cost National an opportunity to be in government,” he said.

“I would find it enormously difficult trusting the word of Winston Peters.”

Key picks up a point I have made previously. The Herald today says:

The statement, several pages long, was generated by the trust and showed incomings and outgoings. It showed money from the Vela brothers and Sir Robert Jones going in, then being paid to New Zealand First.

If this is true, then NZ First have filed false donation returns for years on end.  As Winston Peters was railing against secret trusts, he had one which was funding NZ First. If what Peter WIlliams says is true, then how did the Auditor for NZ First ever sign off the donation returns? Or is there some explanation as to how Bob Jones gave $25,000 to the Spencer Trust, the Spencer Trust gave it to NZ First and NZ First does not declare a donation from the Spencer Trust?

Key again makes his stance clear in another Herald story:

“From our point of view,” he said, “the appointment of a minister to Cabinet has to be done on the basis that as Prime Minister I can look that person in the eye and have confidence that I can rely on their word.

“In the case of Winston Peters, I’m just not confident I can do that.”

Yet Helen is. How can anyone in NZ really think Peters was telling the truth when he said in July 2008 that he only first knew of the Glenn donation that day? I mean Helen Clark told him about it in February 2008, even if he didn’t actually know about it since it was solicited in 2005.

Clark has damned herself with her revelation today. But she has halped damn Peters also.

Now only a moron would believe Peters insistance he knew nothing of the $100,000 donation until Brian Henry told him in July. But let us pretend for a second we are all morons and Peters did not solicit the money from Glenn, and did not thank him for it.

Helen Clark has said she told WInston in February, that Owen Glenn told her he had donated. Now even if one beleives Peters knew nothing up until then, as of February he conculsively knew Owen Glenn was so insistent he had donated her had told the Prime Minister of NZ he had.

Now after being told that, he went on to do his infamous No press conference, despite knowing that Glenn thought he had donated.

And after the Herald published the e-mail from Owen Glenn, he accussed the NZ Herald fo fabricating it, despite the fact he absolutely knew Owen Glenn did think he had donated.

This kills Peters credibility, if he had any left to kill. He says the first he knew of it was when Brian Henry told him. This is untrue. Even if you do not believe he solicited the donation, Helen Clark has said she told him about Glenn’s belief in it some months earlier.

Just as bad, is that Helen Clark sad there throughout the No press conference and the attacks on the NZ Herald saying nothing, despite having been told by Owen Glenn. She even said nothing when Winston Peters sain in July this was the first he knew of the donation – something she knew was false, as she had told him about it.

Tumeke’s slush fund diagram is going to have to become a billboard at this rate. Phil Kitchin at the Dom Post reveals the “National Campaign Account” for NZ First and how in 2003 there was a $10,000 cash donation made anonymously.

Cash donations of that magnitude are almost unheard of I would say. So the known funding sources now are:

1. To the Spencer Trust
2. To Brian Henry for legal bills
3. To NZ First directly, breaking large donations into a series of small ones
4. To the Winston Peters Fighting Fund
5. To the National Campaign Account, as cash

There are also allegations of some highly unusual practices involving cheques which are never cashed. The list may grow further yet!

So many articles, so where to start. First is the Herald editorial on racing:

When Winston Peters was appointed Racing Minister in 2005, he was warmly welcomed by leaders of the industry. “He’s going to be good for racing,” said high-profile breeder Sir Patrick Hogan. Even he, however, may not have realised the degree of beneficence.

To the contrary it is possible the degree of beneficence was precisely known!

Then we have Fran O’Sullivan who calls Peters a coward basically:

If Winston Peters was man enough he would apologise to leading New Zealand political journalists for the outrageous way he attacked them for questioning whether Labour’s major donor Owen Glenn had contributed anonymous funds to New Zealand First.

New Zealand now knows the vile allegations and innuendo that Peters accused journalists of spreading early this year were not that far off the mark. But Peters’ continuing reliance on bravado and counter-punches instead of confronting the real issues means his political reputation is punctured.

Peters actually suggested the NZ Herald had fabricated the e-mail from Owen Glenn.

It’s abundantly clear that Peters’ political interests and those of his party have been served by plenty of cash from wealthy donors, contrary to the public picture he has painted.

The claims he made early this year that New Zealand First had had no big-business backing since its inception have been exposed as fatuous.

Indeed, it is quite possible the NZ First receives a greater proportion of its income from big business than any other party, if you include the Spencer Trust and Brian Henry in the mix.

The cost of the Selwyn Cushing lawsuit has been estimated to be $445,000. Where did the money for that come from?

But unfortunately the Peters donations furore does obscure the real scandal the NZ First leader continues to duck. The party’s refusal to send a cheque to the Crown for the $158,000 in unlawful spending at the 2005 election is breathtakingly cynical.

Doling out this money – which rightfully belongs in taxpayer’s coffers – to a swag of unnamed charities doesn’t cut it for a politician who made his name on challenging commercial malfeasance. He should not be let off the hook.

Indeed. And now John Armstrong:

He answered questions with questions. He deemed questions which he considered outside the committee’s terms of reference to be irrelevant and therefore not to be answered.

It was less the Spanish Inquisition and more like A Game of Two Halves.

As always, everyone else made allowance for Peters’ verbal pugilism – just as the teams on the television sports quiz tolerate Matthew Ridge’s exhibitionism. MPs are so accustomed to Peters’ stroppiness that no one on the committee would have found his behaviour out of the ordinary.

Yet any member of the public delivering the string of insults to committee members which Peters did would have been called to order.

Peters claims of a Spanish inquisition just shows how unused he is to the idea of accountability. He has for 15 years run his party without question. He has secret trust funds which his staff solicit money for, and his party president and deputy leader know nothing about.

He was not bound by the normal laws of politics. He freely broke them without penalty. That has changed – dramatically so in the last month as NZ First has been found to be as solicitous of donations from the wealthy as other parties that it so long accused of being venal and corrupt.

If Peters tries to take the moral high ground again, then laughter is the only appropriate response.

The Dim-Post also sums things up well:

What is interesting about this arrangement is that Brian Henry is a scion of the famous Henry family who, along with the Fletcher’s and the Todd’s, were one of the wealthiest and most influential industrial dynasty’s in New Zealand history. Wikipedia has an extensive entry on the family.

So this is yet another case of Peter’s benefiting from the largese of the super-rich, a group he still claims to be waging a one man war against. There’s no way of knowing the value of Mr Henry’s legal services to Peters over the years but it seems reasonable to assume the amount runs to many hundreds of thousands of dollars.

Winston Peter’s claims to have been the prey of a conspiracy of secretive, elite businessmen but with the New Zealand First leader recieving clandestine donations from Owen Glenn, the Vela family and Sir Robert Jones and free legal services from an industralist heir it looks more and more as if Mr Peters is a member of a covert super-rich conspiracy rather than a victim.

What more can one say?

The founding director of the SFO, Chas Sturt, has said that the SFO should use its power to compel documents:

The Serious Fraud Office should be using its special powers to investigate the Winston Peters donation controversy, says its founding director, Chas Sturt.

Mr Sturt said the publicly available information about donations intended for Mr Peters’ NZ First party met his “smell test” – making it suspicious enough for the SFO to use the statutory power that can force documents to be produced. Mr Sturt said this would allow SFO investigators to check the “paper trail”.

Now Mr Sturt has some history with Peters, but he is right that independently checking the paper trail is crucial with these issues.

But the SFO has not ruled out using those powers, if it decides to launch a full investigation. It may find there is enough evidence already out there to launch a full investigation, without invoking their powers at this stage.

If however they do decide there is nothing to investigate, then the non-use of their powers to verify information could seem unusual. But from all accounts they are taking their duty very seriously, and have been doing in depth interviews with relevant players.

Very pleasing to read in the Dominion Post that Owen Glenn has said he will co-operate with both the Privileges Committee and any SFO investigation:

Mr Glenn last night revealed that he had already provided written statements to both the SFO and parliamentary privileges committee, which is conducting an inquiry into whether Mr Peters breached Parliament’s rules by failing to disclose the donation.

Mr Glenn would “cooperate with each body, as may be necessary”, a statement from his office said.

Good to see him doing the right thing.

But in a new development on Monday, Mr Henry disclosed that he personally footed the bill for $40,000 in costs awarded against Mr Peters after the electoral petition failed – which might also be considered a gift that should have been disclosed.

In a twist yesterday, however, Mr Peters said Mr Henry had now had a chance to check his records – and discovered that he had since been reimbursed by Mr Peters.

It would be useful for a copy of those records to be given to the Privileges Committee. If it was all reimbursed within the same year, then indeed there may not be a debt paid off on Peters’ behalf. If it was not all reimbursed within the year, then there may be issues.

The NZ Herald reports:

The immediate past president of the Bar Association, Jim Farmer, QC, says the Law Society could be interested in the way Mr Henry is paid. …

Mr Henry told the committee that none of Mr Glenn’s $100,000 was used to pay for the $40,000 paid to Mr Clarkson’s solicitor for the costs settlement in March 2006.

How can he know this? If $100,000 from Glenn went into Henry’s bank account and he paid $40,000 to Clarkson from the same account, then it is all mixed in together. Possibly the $100,000 went into his business account and he paid the $40,000 from his personal account – in which case that conclusion would be more warranted. This would be the correct way of doing it, as the $40,000 Henry paid is not a tax deductible expense. It was not a debt he owed, so he should have paid it out of his after tax income, not his pre-tax income.

And while they are not issues for the Privileges Committee, I have received expert advice that the $40,000 payment was a gift to Peters and should have had gift duty paid on it by Henry. If Henry failed to pay gift duty on it, then Peters is liable for the gift duty.

Dr Norman raised the question of the $40,000 costs and said yesterday he had received a tip-off that it could be an interesting line of questioning. He said the $40,000 payment was more clear-cut than the Owen Glenn donation. “It’s absolutely black and white.”

Mr Peters had a personal debt and Mr Henry paid for it, he said.

“If you have got a debt and someone pays it for you then you should declare that someone had paid it, even if you don’t know who did.

Russel Norman is quite correct that the $40,000 is black and white compared to the other issues.

“There is just some pool in which debits and credits seems to float. It’s incredible – in the order of hundreds of thousands of dollars both ways – and it is very hard to prove anything.”

One question is why is it done in this way? Why not set up a legal trust with some trustees to fundraise for the legal bills? Have WInston declare his beneficial interest in the trust. That is how Nick Smith did it, and would seem to be a far more appropriate way to do it.

Dr Farmer described the relationship as “extremely unorthodox”.

Being paid by some third party [Owen Glenn] and the client not knowing was unheard of, he said.

So was the personal payment of $40,000 by Mr Henry.

“I think it might be of concern to the Law Society,” Mr Farmer said.

“Is it right for a barrister to receive $100,000 from a third party where there has never been a fee note rendered to the solicitor instructing him? I would have thought the Law Society would have real concerns about that.”

The president of the Auckland District Law Society, Keith Berman, said it was also very unusual.

“The issue which is uncertain is whether Brian is handling money on behalf of a client or just receiving money in payment of a bill. But as I understand it, he doesn’t issue a bill.”

Interesting issues indeed.

Tracy Watkins writes in the Dom Post:

But Mr Henry’s disclosure that he personally paid the $40,000 in court-ordered legal costs against Mr Peters means it could be considered a gift.

Mr Peters and Mr Henry were at odds over who made the payment, with Mr Peters suggesting he had paid it himself.

How can you not know whether or not you paid $40,000 to Bob Clarkson? If it was $400 maybe, but $40,000?

Observers at the Committee were unanimous that Brian Henry performed very well. They also signalled out Russel Norman for praise, saying he asked the key question on the Clarkson costs. And despite what some feared, National MPs were not shy in putting questions to Peters and Henry – especially Brownlee and Mapp. Labour MPs I am told either said nothing or asked patsy questions.

A few more thoughts:

1. It would be an incredibly bad look for Owen Glenn to refuse to take part by video-conference, considering he was honoured by the NZ Government, has a business school building named after him, and is so attached to NZ he wants to be our Consul to Monaco. Any refusal to testify will imply cover-up and guilt by Glenn – even if he has done nothing wrong himself (which I think is the case).
2. There is little doubt Henry paying a $40,000 debt to Bob Clarkson on behalf of Winston Peters is payment of a debt which should have been disclosed. Ignorance of your own chequebook is no defence.
3. Other payments by Henry on behalf of Peters may count as a gift or payment of a debt? It is one thing not to charge for your time, but who paid the court filing fees in the defamation case? These fees can come to many thousands of dollars.
4. Could Brian Henry have paid off the $40,000 debt to Bob Clarkson without Owen Glenn’s donation? It is one thing not to charge for your time, but quite another to pay actual costs. If the Glenn donation preceded the payment to Clarkson (and I understand it did) then Glenn is still the person who effectively paid off that bill. Not necessarily from a legal aspect, but in a practical sense. If someone gives me $100,000 and I use $40,000 of it to pay off my mate’s debt, then that debt relief came about because of the donation.
5. Does Henry paying the $40,000 debt to Clarkson constitute a gift to Peters on which gift duty should be paid?

Both the Dom Post and NZ Herald editorials are on Winston Peters and the Privileges Committee. First the Dom Post:

…Prime Minister Helen Clark should be telling Mr Peters to abandon his usual policy of evasion, bluster and bullying, and answer clearly and honestly the serious questions that surround the funding arrangements of his party.

She should start with telling Mr Peters that his continued presence in her Government depends on him being able to satisfy the privileges committee that he has done no wrong, and at the same time, tell her members on the committee that she expects them to pursue the issue with as much vigour as the Serious Fraud Office is. With 48 per cent of those polled saying he should be stood down, and only 37 per cent wanting him to stay, he is a liability now, and Miss Clark should be minimising the collateral damage to her party by stopping his shenanigans or stopping his enjoyment of the baubles of office.

Alas, I suspect the Labour MPs will ask few questions, or patsy ones if they do.

Now the Herald:

Parliament polices itself through a “privileges committee” of senior members from the different parties. Tonight, the committee begins an inquisition of Winston Peters that should raise questions of financial accountability that he has chosen not to answer in public. The hearing tonight will be open to the press at his request, but neither he nor his lawyer, Brian Henry, is taking the exercise very seriously. Mr Henry has said, “Nothing about the privileges committee bothers me at all. It could be a bit of fun.”

I hope MPs will ask detailed questions, which will allow them to come to a conclusion. At a minimum they need to get very clear details of why the money was donated, who it was paid to, what accounts did it go into, and what bills were covered by it.

The questions these facts raise are too serious to ignore even if the attention is working to Mr Peters’ political advantage. In many other political systems they are questions no public figure could ignore; courts and constitutions would hold him to account. Here we have only the privileges committee, unless the Serious Fraud Office, which Labour and NZ First are about to abolish, decides to investigate.

The MPs on the Privileges Committee need to, in my opinion, ask detailed foreesnic questions over the money, and not let it get distracted by theatrics.

An issue that should also be canvassed is if the rules around the Register of Interests are so flimsy that a $100,000 donation from person seeking a diplomatic appointment from the Foreign Minister, need not be declared by the Foreign Minister if it goes towards his legal bills, then what use is there in having a Register? Can anyone argue that this sort of situation should not be disclosed?

A viewer alerted me to this question from last year:

R Doug Woolerton: Does the Minister agree that any law, including electoral law, requires the participants to do what is morally right as well as what is legally right, and does she think that this is the reason the National Party is having so much trouble interpreting the Electoral Finance Bill?

Now maybe Doug Woolerton might like to explain for us how NZ First is doing what is morally right by operating a secret trust fund that donors pay into, so that not only is the identity of the donor hidden, but the identity of the trust itself is hidden from both the party and the public.

The Herald on Sunday reports that two investigators from the Serious Fraud Office met Sir Robert Jones during the week, as part of their work in determining whether to launch a full formal investigation.

The Dom Post reports that the Privileges Committee is initially calling Winston Peters and Brian Henry to testify.

I am somewhat surprised by this. Winston, by his own words, says he knew nothing about the donation/gift, so I don’t know what value there will be from questions to him.

Surely the most important things is to first establish the facts around the donation – who was the cheque from, who was it made out to, what was it intended for, what account was it paid into etc. Once you have the facts then it would be more useful, in my opinion, to seek explanations.

Rodney Hide is worried that Owen Glenn may not be asked to testify. I can’t imagine how the Committee could expect to have any credibility if they do not invite Mr Glenn to testify, so I’m not that worried. I am sure they will issue appropriate invitations in due course.

The Dom Post cites a “well-placed NZ First source” that NZ First has banked at least one cheque bearing the Simunovich name.

And the problem for Winston, if this is true, is:

Mr Peters was asked in 2004 if his party had received donations from Simunovich Fisheries when it was revealed that his adviser, former National MP Ross Meurant, was also working for Simunovich. “I’m saying no,” Mr Peters said.

The Hive recalls previous issues with Smunovich.

We also have the latest response from Helen Clark’s Minister of Foreign Affairs:

WP: Got your tape rolling, Phil?

WP: I told you I’m not talking to a lying gripper

WP: You know what that is? That is a lying wanker who won’t let go. See you.

Helen Clark promised new standards for her Government when she was elected. This is obviously what she meant. This is not Muldoonism. This is far beyond anything Muldoon did.

For the Privileges Committee to do its job, and reach a fair conclusion on whether the $100,000 Owen Glenn donation should have been declared on the MPs Register of Pecuniary Interests, they are going to need to be able to answer the following question:

1. Who or what was the $100,000 paid to?
2. Why was it donated?
3. Who knew about it?

That is not an exhaustive list. But even off that, what sort of evidence would you want, so one could make a fair conclusion.  Rodney Hide has suggested that Owen Glenn should give evidence – maybe by video conference. It is almost unthinkable that one can resolve this issue without hearing from the donor. I would expect evidence to include the following:

1. Testimony from Owen Glenn on why he donated, who he thought he was donating to, and who did he discuss the donation or the possibility of a donation with?
2. Testimony from Steve Fisher as to why he said it was vital Glenn did not contradict Peters?
3. A full forensic investigation of the money -
   1. Who was the cheque/draft made out to?
   2. Into what account was it paid?
   3. Was it the Spencer Trust?
   4. Was the money passed onto someone else?
   5. What bills were paid with it?
4. Was the $40,000 damages to Clarkson (which is beyond dispute a personal debt) paid for by way of donation – whether Glenn or someone else?
5. Does Peters personally make up any shortfall in the costs for his legal actions?
6. Would Peters have paid over time at least $500 more to Henry, if the donation had not been made?
7. How many donations of greater than $500 have been made towards the legal fees?
8. Expert advice from the Law Society regarding barristers fees?
9. If money was donated to a formal trust (such as the Spencer) is Peters a beneficiary of it, which requires a declaration on the Register?

As I said this is just an initial list.

The Speeaker has ruled that there is a question of privilege over the $100,000 gift from Owen Glenn to pay off Winston’s legal bills, so the Privileges Committee will hold hearings on this.

It would be imprudent to speculate on what the conclusion will be, as that will or should depend on the evidence. But it does mean this issue will be in the public domain for some time to come.

Apart from the televised hearings of the Privileges Committee, the report back to the House will be subject to a debate – normally two hours or so.

The NZ First funding scandal got me interested in the overall picture of declared donations and expenses for our major political parties. More specifically I was interested in the linkages between declared donations and declared election expenses.

I had no expectation that there would be 100% correlation. Because a party generates much income that isn’t declared – only donations over $10,000 tend to be. And likewise only campaign expenses are declared, not the total costs of running the party.

But do most of the parties have some consistent ratio of declared donations to declared campaign expenses? Did any party have a very low ratio which might suggest a deliberate strategy to (legally) conceal large donations by breaking them into bits or having them never put through the party’s accounts?

Now it is important to stress that it is not bad per se to have income from non declared sources. National for example brings in up to $1 million a year just from membership subscriptions and donations. That is a good thing.

Now to the data, which is taken from the Electoral Commission website. Records only started in 1996. I have excluded 1996 as we don’t have donation returns for the full 1994 – 1996 period (law was only changed in 1995). So I have covered the periods 1997 – 99, 2000- 02, 2003 – 05 and 2006 – 2008. We don’t yet have expense returns for 2008 but I have included 2008 as we now have continous disclosure for amounts of over $20,000. This means everyone’s ratio is higher than would normally be the case, but as I am looking at the differences between them, it isn’t a huge factor. I wanted it to be as up to date as possible.

The Maori Party have only had expense returns for one election, so they are artifically high. If you exclude post 2005 their ratio is 52%.

National and Labour are very close to each other. If you exclude post 2005 elections National are at 80% and Labour 67%.

The Alliance is the only non current party in there. I included them as they are probably the closest to NZ First as a larger third party. Over the last three elections they have both spent similar amounts – $884K for the Alliance and $827K for NZ First. And during that time the Alliance has declared $711K of donations (including donations to Democrats when they were part of Alliance).

Then in order we have the Greens, United, Progressive and ACT at 54%, 47%, 42% and 35% respectively. A reasonable degree of difference, but all within that one third to one half range.

Finally we have NZ First. Since 1997 they have declared $827K of expenses but declared only $45,000 of large donations – a ratio of 5% – just 1/7th of the next lowest party ACT at 35%.

So what conclusions can one draw from this? Well remember the data is not complete. But there would seem to be two main conclusions one can draw – but competing conclusions. They are:

1. That NZ First is the only party that has never ever attracted large donors. That they are entirely funded by small donors and have had only one quarter as many large donations as the miniscule Progressive Party and one sixteeneth as many large donations as the Alliance.

   OR

2. That since 1997 NZ First has had a deliberate strategy of concealing large donations by means such as having had them broken up into smaller parcels, or channelling them through associated trusts who do not pass them onto the party but spend them at the discretion of the unknown trustees.

I will leave it to readers to decide which conclusion they think is most likely.

The Press is impressed with Rodney:

It is now obvious that New Zealand First has no intention of publicly accounting for its secret funding and that, of the other parties, only ACT is willing to press the issue. …

Winston Peters had the perfect opportunity to retrieve something from the ashes when he made a statement to Parliament on Wednesday. Under standing orders he was entitled to be heard in silence and not questioned, but he squandered that opportunity by failing to clarify the issues or answer the serious questions. Instead, Peters made a rambling and confusing attack on the media, his political opponents, and shadowy evil forces he alleged were out to get him. …

Labour does not want to drive New Zealand First to the wall at this time when that would scupper the Government and perhaps prevent the re-establishment of the coalition after the election; National is keen to maintain good relations with NZF in the expectation that the Center-Right (which includes NZF) will emerge from the poll best placed to form a government. They are both praying that the electorate will eventually solve the Winston problem and remove the troublesome politician from their concerns.

The improbable figure of Rodney Hide arises from this wasteland of principle to carry the fight against NZF and its failure to account. His request to the Serious Fraud Office for an investigation takes the issue out of the hands of the politicians and places it in the hands of an independent organisation with considerable powers. The SFO can require that evidence be produced, and it is outside the authority of the Attorney-General.

If the SFO does investigate the NZF donations, the result will be the thorough scrutiny that the issues need if the political process is to escape the charge that it shelters unethical and perhaps illegal practices.

Hide, of course, has more than just a principled interest in this business, as the unedifying abuse between him and Peters in the House last week showed. But Hide has plainly enunciated the principles involved, the justified annoyance at their possible disregard, and has made the only significant effort to have them vindicated.

If he succeeds, and Peters is forced to face the consequences of his actions, no sympathy need be expended. Peters in this scandal has confirmed his reputation as the most cynical of New Zealand politicians, a harmful influence on the nation’s public life and an unfit participant in government.

It will be delicious if the outcome of Peters’ refusal to answer the most basic questions on this issue is a boost for Rodney Hide and ACT, and oblivion for Peters!

The Herald on Sunday editorial calls for the winds of change:

New Zealand First leader and Foreign Affairs Minister Winston Peters has exceeded even his own characteristically pugnacious standards in the past week as he has continued to deflect questions about the cash donations made either to him or to his party. Promising much but delivering nothing in terms of clearing the air, he has engaged in behaviour which has been at times hard to distinguish from the paranoid and irrational.

Except that Peters is just acting – the whole thing is just a charade to him.

It is difficult not to see Peters’ actions as those of a man committing slow political suicide. His party’s poll ratings (which is to say his; there has never been a significant distinction) are averaging barely 3.5 per cent, a long way from the threshold that would ensure its return to Parliament (he seems beyond unlikely to recapture the Tauranga seat).

National’s Tauranga candidate Simon Bridges is a very happy man. Peters may or may not fool 5% of the electorate into believing his protests he is victim of a media conspiracy, but he will not fool 40% of Tauranga voters.

But what is much more likely is that his behaviour is both shrewdly calculated and tactically astute. Fighting for his political life, Peters is interested in appealing only to the small number of voters – most of them lapsed NZ First loyalists who are making eyes at National – who can push his party over the threshold. If he alienates and exasperates the rest of the country, generous wealthy donors, his political opponents and even his coalition partners in the process, that is neither here nor there.

Spot on. He is not worried about the 90% who will never vote for him. He is just trying to lock in half or more of the 10% who might vote for him.

Until now, the Prime Minister has adopted a legalistic wait-and-see approach, saying she must let matters run their course. It is notable that her endorsements of Peters, never warm, are becoming steadily cooler. But it is intolerable that she should allow one of her ministers the freedom to manipulate the democratic process.

Clark will be laughed at if she tries to campaign on transparency or accountability.

Up to now, she has had to consider the implications for the coalition’s stability of alienating Peters, but this week, as the last of the Budget legislation is passed, represents the last procedural opportunity for NZ First to bring the Government down and force an early election. Come Friday, the PM could, and should, sack the minister and expose him to the chill electoral winds that are blowing his way. It would be a good thing for the country if those winds, once and for all, blew him from the political stage.

She made pretty clear on Agenda this morning, she would not be doing that.

Duncan Garner blogs the questions he wants answered:

1. Who set up the Spencer Trust?
2. Who donates to it?
3. What is the money spent on?
4. Does New Zealand First receive money from the Trust?
5. How much?
   
6. Why isn’t it declared? (Donations to parties over 10k must be declared)
7. What else does the Trust spend its money on?

And none of them answered.

But Winston will not answer these questions. He can’t. Answering them will only confirm what he and his party are up to. His MPs are in the dark – they know nothing. They trudge to Parliament each day – grasping some pre-written patsy question to ask their leader.

Like, why did Condi Rice come to New Zealand and would it have happened under any other Foreign Minister? How embarrassing for them. What sycophants.

They owe their jobs to Peters. None would make it under their own steam. Barbara Stewart. Ever heard of her? Now Peters is making his MPs look like the hopeless docile poodles that they are. And these people call us meercats!

I understand several gallery offices now have pictures of meerkats up on their walls. One journalist told me of an e-mail they got complaining on behalf of the meerkats with the comparisons to the media!

A member of the press gallery, taken from Wikipedia.

Peters now has no credibility. He does not believe in being accountable. His only defence is attack. He has promised on three occasions this week to ‘clear things up’. He hasn’t. What are you so embarrassed about Winston?

Journalists are asking legitimate questions. Peters hopes his loyal 5% still agree with him. And unlike Helen Clark, Winston doesn’t need to appeal to the masses. He needs 5% percent. This will be hurting him in Tauranga. I don’t think he can win the seat. Can he get 5% – perhaps not, though it’s too early to write him off.

I think Peters is now toast in Tauranga. Their chance of survival is making 5%. It is possible that there are enough stupid people to get a boost in the polls from his antics. But will he retain that support (if he even gains it) through until the election?

And Duncan concludes on trusts:

Trusts by their very nature are set up to hide things – established to protect people, their money and assets. National has the Ruahine and Waitemata Trust. The Labour Party also declares a legal trust fund for those who want to give to the party on the quiet.

But all these trusts are declared. They have been for years. Peters has kept his quiet. Even from his own people. Only a select few knew about it.

The point here is 25K was solicited from Sir Bob Jones by Winston Peters and his party hacks. Jones has a right to know if it ever went to the party. And so does the NZ public.

The Spencer Trust looks like a secret slush fund. And the Right Honourable Winston Peters doesn’t deserve the title.

I do not think the media will stop asking questions on this, even though there is no chance Winston will ever usefully answer them.

Tim Selwyn at Tumeke has done a new and improved version of his NZ First slush fund diagram. It is very well done – easily up to the standard of a newspaper. You can click through for the full size version.

Oh I do love journalists who do research. Fran O’Sullivan has found these quotes:

Where’s the audit trail? Precisely into which account went this cheque?”

“On whose behalf was the cheque to be held and what happened to this money? Is there any significance that … was in serious financial trouble?”

“Why is the Serious Fraud Office taking so long to find the answers to these questions?”

“I say the whole thing stinks.”

Fran tells us that we might expect these to be quotes from Bob Jones or Rodney Hide asking about the investigation of NZ First finances. But in fact they are quotes from the Rt Hon Winston Peters in 2002 demanding the SFO get to the bottom of National’s funding.

Fran notes:

This is the real reason why Peters should be judged guilty by his political peers of the “H” word – hypocrisy.

By failing to publish a clear audit trail showing just how Sir Robert’s $25,000 donation found its way from the Spencer Trust into NZ First’s coffers, or the way in which the amount was disbursed on NZ First’s behalf, Peters invites a tsunami of disbelief which might easily be turned back by a simple disclosure.

As to whether the SFO will investigate:

The SFO, which is now deciding whether it should formally investigate Hide’s complaint, will tread carefully.

But it must be consistent.

It launched a formal investigation into National Party donations in 2002 after a former official – assured of anonymity – revealed the party still had unanswered questions over discrepancies between the amount its fundraiser had expected from Fay Richwhite interests and what arrived in the party’s accounts in 1996. …

The SFO ultimately cleared the National Party of any wrongdoing.

If Peters, his party and his lawyers have nothing to hide they should demand answers to the questions.

Otherwise they lay themselves open to new claims that “the whole thing stinks”.

The SFO decision will be pivotal.

Fairfax have out together a good mixture of bloggers at their Business Day site. They have Nick Stride and Nick Smith from the Independent. Shareholder activist Bruce Shepherd, professional protester John Minto, Vernon Small from the Dom Post and the pugnacious Bill Ralston. Most of these blogs are now added to the blogroll.

Bill blogged yesterday on Winston’s latest allegations:

He claims he is being persecuted by a media conspiracy. In the House, referring to the time when I headed news and current affairs, he alleged: “TVNZ have had two private investigators, detectives, sniffing around since they were sued for defamation some years ago, an action which is still alive today.”

This is completely untrue. In my time at TVNZ we never hired any private detectives to investigate him. Winston is fond of calling people ‘liars”. I will simply call him “mistaken”.

Winston has repeated this ridicolous claim several times now. Journalists should call him on it, and to use his own language ask for substantiation? Apart from his fevered imagination, does he had a shred of proof that TVNZ has hired private investigators against him?

If Helen Clark or John Key made an allegation like that, and could not back it up, they would be hounded out of their jobs.

Ralston then turns if TVNZ hiring of Phil Kitchin a few years back:

Winston might want to pause here and think hard about the multiple Qantas Award winning Kitchin’s track record. I hired Phil after a story he wrote broke open the Pipi Trust and exposed then MP Donna Awatere Huata’s fraudulent activity. Donna and her husband went to jail as a result.

Kitchin came to work at TVNZ and broke the Louise Nicholas story (simultaneously published in the Dom Post).  A couple of former police officers and other sexual offenders are still doing time as a result of that investigation.

In fact Kitchin’s investigations in various TV and print stories have put several people behind bars, including the murderer of a small baby, and sparked those things Winston once loved – police investigations and Commissions of Inquiry.

Yes Winston has called for such things in the past. And there is one thing Winston has called for which I think is a good idea. Winston would agree it is also, as it is one of NZ First’s 15 fundamental principles:

An independent anti-corruption commission will be established to enable New Zealanders to have confidence that their institutions are working properly.

I think that is one NZ First policy which is well overdue for implementation!