Donations over $30,000 from the same source must be declared to the Electoral Commission within 10 working days. National overstepped the mark in declaring a total donation of $86,005 from Gallagher Industries outside the limit. I can sympathise as I missed a connection once when I was Labour’s Secretary. These days  the Electoral Commission doesn’t get involved – the penalty is a fine of up to $40,000 on summary conviction.

That’s a very serious accusation. As Mike Smith says, a late return can result in a $40,000 fine. So let’s see if National were late.

The Electoral Commission says that National received $66,705 on 20 December 2001 from the Gallagher Group Ltd. This was on top of an earlier $19,300 so exceeded the $30,000 threshold for reporting within 10 working days.

It was declared on 10 January 2012, 21 days later.

But the Electoral Act refers to working days, as quoted by Mike Smith. S210C(6) says:

A return must be filed under subsection (1) or (2) within 10 working days of the donation being received by the party secretary

Now what is a working day? Well the Electoral Act specifies that in S3:

working day means any day of the week other than—

• (a) Saturday, Sunday, Good Friday, Easter Monday, Anzac Day, Labour Day, the Sovereign’s birthday, and Waitangi Day; and

• (b) a day in the period commencing with 25 December in any year and ending with 15 January in the following year

The 20th of December was a Tuesday. Friday 23rd December was the third working day and Mon Jan 16th the 4th working day. Tuesday 24 January 2012 is in fact the 10th working day after the 20th of December 2011.

So National made the deadline with a fortnight to spare.

Mike may wish to amend his post.

WHAT THEY GAVE
(2008 donation in brackets)
* Engineering, Printing and Manufacturing Union: $40,000 (2008: $60,000)
* Dairy Workers’ Union: $25,000 (2008: $12,000)
* Maritime Union: $18,500 (2008: none disclosed)
* Meat Workers’ Union: $18,000 (2008: $25,500)
* Service and Food Workers’ Union: $15,000 (2008: $20,000)
* FIRST Union (not affiliated): $4000 (2008: nil)

Donations of over $30,000 must be disclosed within 10 days of being made, but those over $15,000 but no greater than $30,000 do not have to be disclosed until the party does its annual return by 30 April 2012.

The unions here have disclosed early in response to inquiries by the Herald, which is commendable.

In total they gave $110,500 of donations above the disclosure threshold in 2011. In 2008 it was $117,500 so not a lot of change.

National’s donations over $30,000 have already been disclosed and commented upon. It will be interesting to see in early May who else donated above $15,000.

Also of interest is a new requirement (proposed by me, amongst others) that for the first time parties have to reveal the number of donations they received below the individual disclosure limit – in bands. This will give us a more holistic look at how parties are funded, and will also be out in May.

Chinese New Zealand businesses, including one formerly owned by the businessman spearheading Shanghai Pengxin’s bid for the Crafar dairy farms, have boosted the National Party’s coffers by more than $100,000 in recent days.

Recent filings to the Electoral Commission show National received $50,000 on November 22 from Citi Financial Group, a Queen St foreign exchange and financial planning firm owned by Yan Yang and Qiang Wei.

The same day, the party got a $1600 donation from Oravida NZ, which also gave $55,000 on November 30.

Oravida’s directors are Jing Huang, Julia Jiyan Xu and wealthy but reclusive businessman Deyi Shi.

In September last year when it was called Kiwi Dairy, Oravida was bought from Terry Lee, a businessman associated with Shanghai Pengxin, which has applied for Overseas Investment Office approval to buy the Crafar farms.

It is good the disclosure regime is working. Transparency is important and media should report large donations

Turning to the Oravida donation, the key word is former owner. Terry Lee has not owned the company for 14 months, and the new owners have nothing to do with the Crafar farms bid as far as I know. Some people get very excited about former owners, assuming it means they are still in a position of influence with their former company, and/or wanting to advantage them. The prime example of this is how some go on about Steven Joyce being a former owner of the radio stations now owned by Mediaworks. What many do not realise is it was a hostile takeover, and shall we say no love lost there between the former and current owner.

So as far as I know there is no actual link to the Crafar farm bid. Ironically if someone associated with the bid for the Crafar farms did donate a large amount to National, my belief is that it would actually harm their chances as even if the OIO recommended approval, Ministers would be very wary of making a decision that could be perceived as influenced by the donation.

Incidentally what is a Chinese New Zealand business? Both businesses are New Zealand businesses. Oravida has three directors – two of whom live in NZ and one in New York. The ultimate shareholders all appear to be based in New Zealand also. CFG director and shareholders all appear to be New Zealanders also.

There is a difference between a business owned by Chinese living in China and Chinese living in New Zealand. Chinese living in China are foreigners. Chinese living (permanently) in New Zealand are Kiwis.

There’s a pledge from New Zealand First ahead of its annual conference that it will follow the rules on disclosing political donations.

The party was forced to correct its donation returns before the last election, revealing gifts which should have been declared.

Returns filed to the Electoral Commission show New Zealand First has lodged nil donations over the past two years.

Party Leader Winston Peters says next year’s contributions will be reported appropriately.

“We will be abiding by the law, as we have always done,” says Mr Peters.

As we have always done? What a blatant lie.

NZ First were never charged or prosecuted – that is correct. But that is because there was a six month (off memory) time limit for charges.

They did not abide by the law. Here is what the Electoral Commission said:

Although the 2007 return was materially false, no offence committed under section 214G(3) or 214G(4) of the Electoral Act 1993 as the Party Secretary had no intention to mis-state or conceal the facts

So the return was false, but no prosecution because only the party secretary can be held liable.

In respect of the 2005 and 2006 returns, the statutory time limit for any prosecution has expired.

And these were not trivial donations unreported. From 2005 to 2007, NZ First declared there had been zero donations over $10,000 when in fact there had been around $235,000 of donations.

And no that doesn’t include the $100,000 Owen Glenn gave to pay Winston’s legal bills. Likewise it does not include the revelation by the SFO that the Velas had also paid Winston’s electoral petition expenses to Bob Clarkson.

Yet Winston still insists they have always abided by the law.

• ACT – John Boscawen $52,335
• National – Susan Chou $100,000
• ACT – Louis Crimp $100,520

Boscawen is of course the parliamentary leader of ACT. Chou has donated previously to both National (2010) and Labour (2008) plus to humanitarian causes.

Louis Crimp is an Invercargill businessman, whom I’ve blogged on previously. He stood for ACT in 1996. He also recently donated $1m to St Johns, and other causes:

When Invercargill businessman Louis Crimp had a car crash he was so touched that the St John staff treating him were volunteers he later decided to give the Southland branch $1 million.

He will hand over the cheque today. The massive donation follows a string of monetary and land gifts the philanthropist has made to the community.

In 2007 Mr Crimp paid more than $1m for a city bungalow which had been renovated as a fundraising project for Hospice House in Invercargill, with almost $800,000 of that going to the hospice.

Mr Crimp has given $200,000 to the Southland SPCA since 2008 while, in May, he gifted a residential section formerly owned by the Mongrel Mob to the Habitat for Humanity organisation.

I applaud people willing to donate their money to support policies or parties they believe will be good for New Zealand.

Three parties have not filed returns, and are in breach of the law. The New World Order Party and The Workers Party. Technically also the New Citizen Party, but they onlyregistered in November 2010.

Parties have to disclose any donations over $10,000 (plus overseas and anon donations etc). Nil returns were filed by United Future, ALCP, Libz, Alliance, Kiwi, Democrats and Winston First. Of course we know that a nil return for Winston First can actually mean they’ve had hundreds of thousands of donations.

ACT

One donation of $19,000 from Margaret Alldred, who is also the Party’s Administration Manager.

Progressive

They’ve disclosed $$13,000 from the “Wigram Progressive Party”. This suggests that Jim’s local organisation was not a formal part of the overall party, and he kept the funds close to him locally.

Maori Party

Pita Sharples has donated $19,171.50, in fortnightly payments. Interesting that no other MP has donated over $10,000.

Labour

In addition to the already disclosed $25,120 from former party secretary Mike Smith (donations over $20,000 are disclosed as they are made, and don’t wait just for the annual return), they also had $16,500 from Ann Robinson and $15,100 from Karl Maughan.

I presume Ann Robinson is the glass sculptor of that name, and Karl Maughan the painter. I suspect they did not make a cash donation, but donated art works that were auctioned off for the amounts disclosed.

Greens

All nine MPs had to pay a tithe, which totalled $136,786.64. This is an average per MP of around $15,200.

National

National had total donations of $397,820.50. All but $17,820.50 of this had been previously disclosed (and I had blogged them previously). The $17,820.50 comes from Garth Barfoot, presumably the director of Barfoot & Thompson real estate agents.

These disclosed donations are only of the large ones over $10,000 in value. They may represent a small or large portion of a party’s overall funding. For example National raises around $4m over three years just from relatively small membership donations.

The new electoral finance law passed by National, will have some extra transparency around donations made in 2011 and afterwards. As well as disclosing the individual large donations (those over $15,000), parties will also have to disclose the number and total value of donations from $1,501 to $5,000 and from $5,001 to $15,000. But we will not see these until April 2012.

The Mayor of Auckland has been called on by one of his councillors to return a $3,375 campaign donation back to Auckland ratepayers.

The call comes after recent media reports of a donation to Mayor Len Brown from the Counties Manukau Pacific Trust. The charitable trust has been largely funded in the past by Manukau City ratepayers and continues to receive a $385,000 operating grant each year.

Auckland Councillor Jami-Lee Ross has written to Mr Brown saying he has a “moral obligation” to return $3,375 back to ratepayers. “This donation is highly questionable and, in my view, should never have been made. …

Mr Ross says the Trust’s connection to the city’s ratepayers is too close for it to have engaged in actively supporting election campaigns.

“There are very strong arguments that the donation is in effect public money, if not by definition, then by perception. The Trust’s own financial statements note that the Trust is considered a Council Controlled Entity.

“I have no doubt that the ratepayers of Manukau City would not have expected an organisation that has benefited so generously from Manukau City Council to be contributing to the election campaigns of political candidates. …

“Len Brown has a moral obligation to return the $3,375 back to the people that fund the Counties Manukau Pacific Trust. Doing so would be seen as testament to his honesty and integrity,” says Mr Ross.

The multiple links between the trust and the campaign, with an exchange of personnel, a probably illegal donation, and subsequent board appointments need investigating.

Also there is need of a culture change at the new Auckland Council for refusing to make available the donation and expenses return, unless you physically visit them. They won’t even allow journalists to take a photocopy.

This reinforces my view that the Electoral Commission should be placed in charge of all local body elections also. They have a good commitment to transparency.

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.

Suzhen Zhou has donated $150,000. This is on top of an earlier $50,000 donation, so Ms Zhou is now National’s largest donor. Her combined $200,000 matches the $200,000 she gave to aid relief after the 2008  Sichuan earthquake.

Team McMillan in Newmarket have also donated $50,000.

Last month Suzhen Zhou of Bucklands Beach donated $50,000 and Antoines Restaurant donated a whopping $105,000.

The Dom Post reports why:

The gift from Parnell’s Antoine’s Restaurant was made in June and disclosed under rules requiring any donations of more than $20,000 to be publicly disclosed within 10 working days of a party receiving them.

Mr Key lives about three blocks away from the restaurant.

Asked the reason for his largesse, restaurant owner Tony Astle said Mr Key was a customer he had known for several years.

“Well, I just love the prime minister. I’ve never really been a person to give money to parties, but I decided this time I would. We need them back again, we don’t need those other pretenders.”

I hope John tips well the next time he dines there!

Ms Zhou and her parter also donated $200,000 to aid relief after the Sichuan earthquake in 2008.

What is a bit interesting is that it comes from Mike Smith, who stood down last year as their long serving general secretary.

Normally when you retire from a job, the employer gives you a golden handshake. Not often the retiring employee donates $25,000 to their former employer.

It is possible the donation is on behalf of others. The law has a bit of a flaw in it, with a donation over $20,000 having to be declared immediately, but any contributors to the donation only get declared annually. We’ll find out by 30 April 2011 when the 2010 returns are due.

Note I am not suggesting any impropriety on anyone’s part. I’m all in favour of people donating to parties they support.

The party with the largest number of large donors is the Greens, who had $147,462 of large donations. In order they were:

1. Stuart Bramhill $19,500
2. Jeanette Fitzsimons $15,643
3. Metiria Turei $15,307
4. Russel Norman $15,250
5. Keith Locke $14,468
6. Catherine Delahunty $14,428
7. Kevin Hague $13,928
8. Sue Kedgley $13,868
9. Kennedy Graham $13,302
10. Sue Bradford $11,768

Mr Bramhill is a regular large donor to the Greens. I would have to check but think his total donations exceed $100,000 over time.

Next largest was ACT with one $20,000 donation from The Virtual Bucket Ltd. That company is owned by Roger Beattie of Christchurch. Mr Beattie is  well known entrepreneur who wants to farm wekas!

Third was Jim Anderton’s Progressives who banked $15,000 from Juken Nissho Ltd. Their declaration is technically incorrect as there is no company of that name. In 2004 they changed their name to Juken New Zealand Ltd.

It is a large company with $224 million turnover in 2009. They made a $165 million loss, but nice they could spare some money for Jim.

Fourth was the Maori Party, with co-leader Pita Sharples donating $11,142 in fortnightly installments.

Fifth was Labour with Phil Goff donating $10,063. I suspect Labour are still tithing their MPs a proportion of their salaries, and only Goff exceeded the threshold of $10,000.

National did not have any donors give over $10,000 in 2009.

I have included below my submission.

I would urge as many people as possible, regardless of your views on political finance, to do a submission. The last Government did not allow you to say what you think the law should be, until after it introduced a bill into Parliament – by which time it is much harder to get changes. You have an opportunity here to have your say and influence policy before Cabinet makes final policy decisions.

This is especially so, in the areas where the Government has not yet indicated a preference, but has put a number of options.

You can e-mail a submission to this address. The Government’s electoral finance reform page is here, and a pdf of the proposal document is here.

If you don’t want a compulsory system of registration and limits for “parallel campaigners”, then make a submission – don’t complain about it later, if you don’t submit.

If you do not want a seven month regulated period, make a submission.

If you think political parties should be able to spend their own money on broadcasting advertisements, then make a submission.

Politicians have vested interests in electoral finance law. Some want state funding. Others want to cut off private funding to their opponents. Many don’t like citizens being able to spend their own money criticising them.

Regardless of your views on the issues, have your say. The more submissions people make, the better. They don’t have to be anywhere near as long as mine. You can just state your opinion on one or two issues such as should there be compulsory registration for parallel campaigners and the length of the regulated period with a paragraph or two backing up each issue.

Submission from David Farrar in response to the Government’s Electoral Finance Reform Proposal Document

Principles

1. The Government proposes that the following principles both guide the development of electoral finance law and be incorporated in the purpose section of the new legislation: clarity, equity, freedom of expression, participation, transparency, accountability, legitimacy.

I support the addition of the new principle of clarity.

I did not see a need for the principles to be incorporated into the Electoral Act itself, but if they are, they should not be relied on as a substitute to clarity in the legislation itself.

State Funding

The Government is consulting on three options for reform of the broadcasting regime in Part 6 of the Broadcasting Act 1989. Under each option, the Government does not propose to change the total amount of funding that was allocated to political parties at the 2008 general election ($3.21 million) or the arrangement where the total amount of funding is set by Parliamentary appropriation.

I would ask the Government to reconsider that the amount of funding be set by Parliamentary appropriation. This would allow a future Government to increase the funding with no public consultation and as part of a Budget which is effectively guaranteed to pass.

I believe the amount of funding should either be set by statute, and then inflation and population adjusted, or be set at a level recommended by the Electoral Commission.

Status quo option – parties can only spend funds on election broadcasting, and can not purchase any broadcasting advertisements with their own money

Moderate reform option – parties can spend funds on any election advertising, and can purchase broadcasting advertisements with their own money

Significant reform option – parties can spend funds on anything they like (including admin), and can purchase broadcasting advertisements with their own money

I strongly support the moderate reform option, specifically both the provision to allow parties to decide what mediums they advertise in, and the provision to allow a party to purchase broadcasting advertisements with their own money.

Taking the latter point first, I believe the current law is an unjustified restriction of access to the airwaves. A minor party gets a far smaller allocation than a major party, and the current law doesn’t allow them to use their own funds to match the major party. This is not a level playing field. The restriction on buying broadcasting advertisements is a legacy of the past, when it was a much more relatively powerful medium.

The current law also prevents a party that forms just before an election, not only missing out on a broadcasting allocation but they also lose the opportunity to have any advertising in broadcast media.

In terms of what the allocated amount can be spent on, I think the moderate reform is sensible. The significant reform option would introduce full taxpayer funding of political parties. This is not something with public support, and nor it is desirable or necessary. Even worst, the fact the allocation is done by parliamentary appropriation, would allow governing parties to easily vote their parties more funding.

The current taxpayer funding is provided to parties specifically for the purpose of communicating with voters at election time. I submit allowing the parties the flexibility of deciding what medium to spend it on, is sensible, so long as it is spent on election advertising.

Finally, in this section I would repeat a point I made in my earlier submission. Parliamentary parties have a huge advantage over parties not currently in Parliament. They receive considerable free media over the electoral cycle, have MPs working to promote them, and benefit from parliamentary staff and parliamentary budgets. It would be desirable to increase the amount of funding available for parties not in Parliament, and decrease the amount of funding for parties in Parliament due to their considerable advantage.

Parliamentary Service funding

The submissions received in response to the issues paper showed that opinions were divided on whether the relationship between Parliamentary Service funding and election advertising needed to be clarified and how this should be achieved.

The Parliamentary Service Commission is considering these issues as part of the process for developing a permanent definition of funding entitlements for parliamentary purposes in the Parliamentary Service Act 2000. In addition, the Speaker of the House has recently convened a cross-party committee that has developed a public disclosure regime for Parliamentary Service funding.

The Government proposes to ensure consistency between the Parliamentary Service Commission‟s work and the work undertaken as part of the electoral finance reform by raising the suggestions made in the submissions with this cross-party committee for further consideration.

I reiterate that the simple solution here is for the Parliamentary Service to not allow expenditure on advertising for MPs or parties during the regulated period.

MPs and incumbent parties already have a huge advantage. They should not be able to spend parliamentary budgets on advertising during the regulated period, and most of all any advertising they do undertake should be counted as an election expense unless it is totally mundane such as electorate office hours.

Private Donations

The Government proposes to retain the regime governing donations to constituency candidates and political parties that was developed as part of the Electoral Finance Act 2007, and now forms part of the Electoral Act 1993.

In my earlier submission, I advocated a number of changes such as repealing the ability to make anonymous donations through the Electoral Commission, lowering the level for anonymous donations to $100, requiring more frequent disclosure, and requiring a party to publish its total income from donations, in bands.

I still regard these changes as desirable.

However I note that the regime introduced in the Electoral Finance Act two years ago has not yet been through a full parliamentary cycle. I am comfortable with the proposal to make no significant changes at this time. After the 2011 election, the donations section of the law should be more fully reviewed to see if further changes are necessary. Many submitters have made the mistake of concluding the regime does not work due to the low level of disclosed donations in 2008. This overlooks that it is likely significant donations were made in 2007, prior to the law change. Only after we have had a full cycle (2009 – 2011) of donation disclosures, will we be well placed to judge what level of changes, if any, are needed.

Campaign Expenditure Limits

The Government proposes to increase the expenditure limits that apply to constituency candidates and political parties (the Government is seeking submissions on the level of expenditure limits that should apply) and that expenditure limits be adjusted every general election to keep pace with inflation through a formula set in legislation.

As previously submitted, the current expenditure limits have not even kept pace with inflation, and are set so low that they actually prevent candidates and parties from effectively communicating to electors.

Ideally I would like the limits to be based on the cost of an effective advertising campaign to 2.5 million adults for parties, and 40,000 adults for candidates. The Electoral Commission asked an ad agency to calculate such things for its advice on the Electoral Finance Bill, so this can easily done. An empirical approach to setting limits is far preferable to just debating numbers without a context of what they can purchase in terms of advertising effectiveness.

I would note that in an electorate campaign you would expect a candidate to be able to do at least two direct mail letters, a couple of unaddressed pamphlets, a series of ads in local newspapers, and 100+ hoardings. I believe a spend of $50,000 to $60,000 (excl GST) in the regulated period is necessary for a new candidate especially to achieve adequate name recognition and profile. A low spending limit protects incumbents.

I support having a formula set in legislation for future increases. I would submit that the formula should take account of both inflation and population growth. Much of today’s marketing is personalized direct mail, and every extra voter is an extra cost.

For electorates, in the absence of detailed empirical research,  I would submit the formula should be $1.20 per adult in the average electorate. The number of adults would be based on number of residents aged 18 or older in the last census, divided by the number of electorates.

So for example the 2006 census had 3,103,360 adults, which spread over 70 electorates is an average of 44,334. At $1.20 this would be a spending limit of $53,200 for the 2011 election.

If population growth remains steady the adult population in the next census would have 3,370,640 adults. If, as is likely, there are 72 electorates that is 46,814 per electorate. In inflation has been 2% a year from, then the limit would go from $1.20 in 2011 to $1.27 in 2014 for a total limit of $59,600.

The national limit of $2.4 million was set in the early 1990s. Since then inflation has been 27% and population growth 14%. Adjusting solely for that would suggest the limit should be a minimum $3.5 million. If one also adds in the maximum allocation given by the Electoral Commission for broadcasting, that suggests a limit of at least $4.6 million for a party (including the broadcasting allocation) contesting all 70 electorates.

If one takes the current formula of $1 million plus x per electorate, and keeps x the same as the electorate limit, this would be $1 million plus $53,200 per electorate (for the party vote) which would be $4,724,000 limit for 2011 – very close to what it would be inflation and population adjusted.

I would then inflation adjust the $1 million, and inflation and population adjust the amount per electorate.

Regulated Campaign Period Options

commencement on writ day (i.e. a likely regulated period of approximately four to five weeks)

commencement on 1 August in the third year of the election cycle (i.e. a likely regulated period of approximately three to four months depending on the date of the election)

commencement on 1 May in the third year of the election cycle (i.e. a likely regulated period of approximately five to six months depending on the date of the election)

retain the status quo where the regulated period commences three months before the date of the election.

I do not support the status quo. This means that no one knows when the regulated period starts, until the election date is announced, which is often after the start of the then retrospective regulated period. Certainty is welcome.

A regulated period commencing writ day has problems also. It gives the incumbent Government a significant advantage as they know in advance when Writ Day will be, and can tailor their spending around this.

The proposal to start on 1 August is supported. It has the benefit of a fixed date, known in advance, but also means a regulated period of around four months which is in keeping with the traditional length.

I do not support a 1 May start date, and would prefer the status quo to this. This would see regulated periods of around seven months and for a three year electoral cycle, this would be over the top – almost 20% of the cycle. It would also mean that the Budget would get caught up in the regulated period, and parties should be able to promote the budget, and respond to the budget, without it being deemed an election expense.

If there is an early or snap election, then the regulated period should start on writ day, to avoid retrospective application of the regulated period.

Election Advertising

I am not responding in detail to this section, as the devil will be in the detail. I am broadly supportive of the intention to exclude as advertisements:

news and comment published or broadcast by the news media
personal correspondence between private individuals,
low cost merchandise,
personal opinions published on the internet, and certain websites

The Government proposes that on every election advertisement promoters are required to disclose their true name and full street address and suburb or locality (not a PO Box number) of either their residential address, or an address at which the promoter can usually be contacted during the day. Promoters are not required to disclose a private home address if they choose not to.

I support the requirement for transparency, and also that a private home address need not be used. I would propose that a name alone is sufficient on advertisements, if the promoter is registered with the Electoral Commission and their full contact details can be accessed on their website. This would encourage more people to become promoters. They can still be contacted for reasons of transparency should people wish, but don’t have to have their address on billboards and pamphlets all over town.

Parallel Campaigning

I do not support the option to have a “proportionate” regulatory scheme for parallel campaigners. Introducing scheme a scheme will be deeply resented by many as MPs restricting the ability of citizens to spend their own money criticizing them.

There is no documented problem to be solved. The case of the Exclusive Brethren in 2005 is not rationale enough. First of all, their spending was largely deemed to be counter-productive. The public, aided, by the media can be trusted to make their own judgements about the appropriateness of a parallel campaign.

Secondly any parallel campaign limits, would not have necessarily prevented the Exclusive Brethren campaign. They could have had all seven spokespersons register and spent say $100,000 each.

Thirdly the experience in the United States of political finance reform, is that more regulated you make it, the more loopholes get exploited and the effects are counter-productive.

Fourthly the existence of any sort of compulsory registration system for people to spend money criticizing the Government, or other parties, can discourage citizens from political involvement. The Electoral Commission itself noted this, when they referred to the chilling effect on political participation from the former Electoral Finance Act.

Finally, any sort of limit could prevent groups with legitimate grievances from pursuing them against the Government, by campaigning against the governing party. Proponents of such regulations always cite the example of the Exclusive Brethren, and they are a group not many in society feel affinity for, so some may conclude they should not be allowed to spend their own money campaigning.

But take another scenario. What if the Crown confiscated land or property rights off an Iwi, as they have done in the past. That Iwi might want to campaign against the party in Government which stole their land or property rights. Do we believe it would be a good thing to prevent an Iwi from campaigning against a party that legislated away its rights?

This situation could fit the Foreshore & Seabed Act. What if an affected Iwi wanted to campaign against the parties that passed the Act? Bad enough, they have their rights legislated away from them, but even worse is they can’t spend their own money campaigning against the parties that did this.

The current debate over an Emissions Trading Scheme could see some Iwi lose hundreds of millions of dollars of value from their lands. I submit it would be wrong to stop an Iwi from campaigning against parties that it believed had destroyed so much of their value.

Advertising by parallel campaigners on radio and television

Currently parallel campaigners are not allowed to purchase advertising on broadcasters. The Government has put forward only two options – to retain the ban, or to allow parallel campaigners to advertise on broadcasters only if they are subject to registration and spending limits.

I do not support either of those options, and would like the Government to reconsider the option of allowing parallel campaigners (many also known as citizens) to be able to advertise on broadcast media, without any compulsory registration for parallel campaigners.

My next option would be for the Government to have a voluntary system of registration for parallel campaigners. It would have no threshold for registering, but would have an expenditure limit. As an incentive to voluntarily register, a parallel campaigner could then gain access to broadcast media advertising. This would be a strong incentive. It would allow campaigners who do not wish to register to still campaign in other media, but to agree to an expenditure limit if they do wish to advertise on broadcasters.

Other “carrots” for voluntary registration would be the ability to have the Electoral Commission pre-approve an advertisement.

Failing either of those two options, I would opt for the status quo rather than have compulsory registration for parallel campaigners over a certain threshold.

Electoral Administration

The new stand-alone electoral agency will be tasked with publishing guidance on electoral finance rules and providing advisory opinions to political parties, constituency candidates, and the general public on electoral finance law – including whether publications amount to an election advertisement.

I strongly support the creation of the new agency, and the ability to rule in advance whether or not a publication is an election advertisement.

The Government proposes to retain the offences and penalties regime and time limits currently in the Electoral Act 1993.

A major weakness of the Act is that only individuals can be held responsible. Time and time again we see parties escape prosecution by blaming things on lapses between individuals. I would advocate that the penalties regime should include provision for a party itself to be held liable for breaches. Without this, the law remains somewhat toothless.

Insurance companies which stood to gain from the privatisation of ACC could have made donations to National’s election campaign and no one would ever know, Labour MP David Parker said in Parliament today.

Mr Parker did not say the insurance companies had donated, his point was that because most donations don’t have to be disclosed it wasn’t possible to know one way or the other.

Except he is wrong. Donations over $10,000 do have to be declared. This represents around 0.2% of total election spending by a party.

He was speaking during the first reading debate on the Electoral (Administration) Bill, which puts the agencies responsible for running elections under a single authority.

I hope he spent some time talking about the actual bill, rather than on matters not covered in the bill.

Mr Parker said Labour and National both spent $2.2 million on their campaigns during last year’s election.

Labour disclosed the source of donations worth a total $422,000 and National $130,000.

The level at which donations have to be disclosed is $10,000. Any donations below that remain anonymous.

No they are not anonymous – they are not disclosed. There is a significant difference.

Mr Parker argued the threshold should be $1000.

“Before the election, Merrill Lynch said if ACC was privatised…there would be $2 billion of ACC levies up for grabs and $200 million of additional profit could be earned by Australian insurers,” he said.

Hmmn so in this fantasy world, the insurers will gain $200 million of profits for a less than $10,000 donation. Sure.

If Mr Parker thinks donations buy policies, may be he could explain the $100,000 Labour got from the Vela family a few days before the election.

“We all know that the private insurers stand to gain from the privatisation of ACC. There’s no doubt about that. But what we don’t know is whether those same private insurers were contributing to the National Party.

Yes you do. You know they did not donate more than $10,000.

“I can never prove that they were, but it is wrong for our democracy to be tainted by that accusation.

This is so funny. He invents the smear, and then says it is wrong for the smear to exist.

Mr Parker said the lack of transparency around donations was “a glaring problem” in the electoral system.

In case anyone has forgotten, the laws around donations are exactly those passed by Labour just two years ago.

First Labour’s David Parker:

The Government is happy to consult on aspects of electoral law reform that suits it, and won’t look at changes to the donations regime that might disadvantage National, says Labour Electoral Reform Spokesperson David Parker.

First of all I must point out the Government in which Mr Parker served did no consultation on electoral law reform prior to introducing legislation. Yep, zero zip.

Mr Power has consulted all parties over the issues paper, consulted the public on the issues paper and is now giving both parties and the public an opportunity to give feedback on the proposal paper.

So the hypocrisy from Mr Parker is immense. It is also wrong.

The Electoral Finance Reform Proposal issued by Justice Minister Simon Power today shows he is determined to retain the regime governing donations to constituency candidates and political parties even though it became clear at the last election that the rules do not achieve transparency, David Parker said.

Mr Parker does not seem to know what a multi-stage consultation process is. That is because Labour never did them.

The first stage was the issues paper where people could havetheir say on issues, without any idea of the Government’s thinking.

The second stage is the proposal paper, where the Government says this is what we think should happen, but we want your feedback. In some cases they identify options.

The Government has said it proposes no change to the donations law, and the public and parties can give feedback on that before they make a final decision. That is consultation – again Mr Parker may be unfamiliar with the concept.

“Unfortunately, the current regime on donations doesn’t promote transparency. Labour included the regime in good faith in the Electoral Finance Act 2007, but it failed to achieve its purpose.

This is worth stressing. The regime Mr Parker is so bitterly complaining about is one his party passed into law less than two years ago.  Now how about the claim it has failed to get transparency:

“This was shown by the low rates of disclosure by both major parties. National disclosed the source of just $130,000 in donations and Labour just $420,000, though both spent more than $2 million each. This is clearly not transparent.”

Mr Parker is having 2+2=5. He is like the cop who demands tougher powers to search premises, and upon not finding any drugs there, cites it as proof they must be elsewhere and wants even greater powers.

The intent of the donations disclosure regime is to identify the source of any donations that could be large enough to be though to purchase influence. Personally I reckon you need $50,000 before you start to get inflluence but the the law for the last 15 years or so has been set at the lower limit of $10,000. I’ve yet to hear a convincing argument to break the privacy of supporters who gives say $1,000 considering that represents 0.02% of a party’s election spending. Even $10,000 is (for a major party) only 0.2% of a party’s election spending.

Even putting aside that argument, how about the complaint that very few donations were declared in 2008. Well there is a very obvious reasons for that. Many donations normally made in election year, were made in 2007 before the increased transparency (which I supported) requirements came in.

In other words if Mr Parker is patient enough to wait until the next election, he may find a higher level of donations disclosed.

Incidentially I do favour some tightening of the limits. I advocated getting rid of the provision for parties to received up to $240,000  in anonymous donations through the Electoral Commission. Mr Parker does not support getting rid of that, I believe.

I also think a disclosure level over a three year term, not just annually, should also be introduced. But that is a debate for another day.

David Parker said Labour strongly believed there should be public comment on potential improvements to the existing disclosure regime.

“But while the proposal paper seeks submissions on other issues, National has clearly already made up its mind on the donations regime because it suits their purposes.”

There are a number of areas where I intend to submit against the Government’s proposed option. That is the whole pointof seeking feedback on a proposal paper.

Finally I must point out how Labour responded when there was real proof of inappropriate donations. The Serious Fraud Office revealed that the Foreign and Racing Minister in the Labour-led Government had received tens of thousands of dollars in personal donations (to pay his court costs) from a source in the racing industry which had greatly benefited by the Minister’s advocacy of extra funding for the industry.

What did Labour do when the SFO revealed this? They complained bitterly about the actions of the SFO. ANd what did then PM Clark say in response to questions in the house? She said she had not had the time to read the report.

So in case anyone thinks there is anything remotely sincere about Labour’s position, think again.

Then we have Metiria Turei:

Metiria of course voted for the EFA and voted against abolishing it. The Greens never used their power to force Labour to consult on the EFB before it was introduced. Their credibility on these issues is much dented after that.

“It is vital that New Zealand’s democracy cannot be bought by big business.

Funnily enough if you look at the spending at the last election campaign, there was masses of spending by lots of unions but no spending from any businesses or business groups. The only purchasing of democracy has been from the left.

But the whole notion of “purchasing” democracy is bumper slogan politics, rather than rational analysis. The relationship between the amount a party spends and the vote they get is pretty weak. As an example Labour spent more than National last election and got whacked. ACT spent more than the Greens and got under half the vote.

“One of our key concerns is that National’s proposals will not stop political parties secretly giving money to third parties to run campaigns,” said Mrs Turei.

Now we get the paranoia. First they worry about third parties donating to political parties, but now they are worried about political parties having so much money they will give it away to third parties to spend.

I’ve yet to meet a political party that gives away its money. Do the Greens have any examples of when this has happened?

If a third party runs expensive ads in a campaign, I am sure the media will ask who is behind that third party, and where did the money come from. And if the third party refuses to say, well the public are pretty good with this stuff, and will tend to punish those involved.

In the 2005 election, the Exclusive Brethren ran a secret $1 million dollar campaign against the Green Party.

From their own money. Or is Metiria saying she thinks National were secretly funding the Exclusive Brethren?

“Another problem is that donations to political parties under $10,000 can be kept secret – the public has a right to know who is giving their MPs money.

Yes, but at what level. As I said $10,000 is 0.2% of an election campaign for a major party and maybe 0.5% for a minor party. Are the Greens saying you can get “favours” for such a small amount?

The Greens of course have an agenda. They find raising money a hassle, as do all parties. They think taxpayers should be forced to fund their political party. And the best way of doing that is setting the disclosure threshold for donations so low, that fewer people donate voluntarily so they can force everyone to donate to them compulsorily through their taxes.

“We are also concerned about the proposal to allow anyone to run electoral ads on TV and radio, as this would lead to the airways being saturated in electoral ads paid for by wealthy special interest groups,” said Mrs Turei.

Consider what they are really saying here. They are saying that in an election campaign, they do not want anyone who wants to criticise a party, to be able to do so through a broadcast medium. They are saying that only political parties should be able to have their voices heard on broadcast medium. Even worse they are saying that only political parties funded by the taxpayer can have their voice heard, while individuals or organisation who want to use their own funds, are banned from the airwaves.

Such defenders of free speech.

“We don’t want to end up like the US where negative campaign ads paid for by big business dominate the airways.”

Ironically almost everything the Greens propose takes us closer to the US system of political finance. It is the limit on donations to parties and candidates that has shifted the spending to the lobby groups.

Oh and their constant bogeyman of big business is tiresome. Again in NZ there were no business funded election ads, but plenty of union ones. And in the US last election the left massively outspent the right.

Again it would be nice to see some sensible analysis rather than slogans.

The Government’s proposals do not include the option of a fixed election date.

A fixed date would provide certainty for the public and political parties, said Mrs Turei, there is no good reason not to have one. The only reason not to fix the election date was to give an advantage to the Government of the day.

Now I agree with Metiria that there should be a fixed election date. But to be fair to the Govt, this is a consultation on finance issues, not wider electoral issues. A change to a fixed election date is a fairly major constitutional issue. It is one I support but probably needs its own workstream.

1. They have backed away significantly from their position on the provisions of the Electoral Finance Act, and are not supporting limits on third party expenditure etc or having the regulated period last all year.
2. Most of what they argue for is reasonably self serving – it is what is good for Labour. In my submission I have argued for many things which I doubt National would find desirable (such as banning anonymous donations over $100 and requiring parties to published audited accounts). So Labour’s submission should be regarded very much as an affected party. That does not mean their arguments have no value.
3. They make many assertions without evidence or proof. An example if their call for state funding when the evidence of 2008 is that it is not needed as both National and Labour raised enough money privately to spend to the limit.

Now into details.

Election rules should not advantage one party over another, nor should they place inequitable barriers to the formation and entry of new parties into Parliament.

Labour claim this, but the actual details of their submission do not match this. Current parliamentary parties have a huge advantage over those not in Parliament yet Labour proposes they be given even more additional state resources and further that parties not in Parliament be banned from purchasing broadcasting time.

Voter registration is one barrier to participation. From 2002 voters have been able to register up till the day before an election, and this has been an important step in improving participation. However, given that voter registration is compulsory, it should also be available on election day itself provided the normal statutory criteria for residence are met.

Good God. Never before have I heard voter registration be called a barrier to participation. That is like calling school enrolment a barrier to eduction.

Recent New Zealand political history has seen a number of occasions where significant sums provided to political parties across the spectrum have raised questions about their purpose in relation to the purchase of influence.

Yes the most recent was the revelation by the Serious Fraud Office that certain racing interests had personally paids debts on behalf of the Racing Minister in Helen Clark’s Government. Labour slammed the SFO for revealing this, and Helen Clark said she would not read the SFO evidence as she had better things to do.

This gives you some idea of how genuinely concerned Labour is by corporate influence in politics.

To better ensure transparency, the threshold for declaration of donations should be reduced to $1000 for both constituency candidates and for political parties.

The argument outlined in the Issues Paper that lower thresholds would be an unjustifiable imposition on freedom of speech is weak and contrary to the principle of transparency. It confuses the right to say what you think with the right to buy policy outcomes without disclosing your interest.

This is an example of Labour failing to back up their assertions with a shred of evidence. What evidence do they have that the current $10,000 limit allows people to buy policy outcomes? Are they speaking from experience?

They need to justify why the disclosure level should be lowered from $10,000 to $1,000.  In other words why should someone not be able to privately donate $1,500? Do they seriously assert you can buy policies or MPs for say $1,500?

$1,000 represents around 0.05% of a major party’s total election year expenditure. Are Labour really saying funding 0.05% of annual expenditure gets influence?

I’m not saying that $10,000 is the perfect limit – but I want a rational reason why why donors who give less than that should sacrifice their privacy?

The current provisions on protected anonymous donations should remain.

This is very self serving of Labour. Having railed against big undisclosed donations, they now say they want to continue the regime where a major donor can give $36,000 to them anonymously through the Electoral Commission. I advocate there should be no anonymous donations (above a minor level such as $100) as it is near impossible to prove or disprove that the party doesn’t actually get to know who donated the money. The protected anonymous donations regime should bs scrapped.

So everyone should remember this – Labour’s official position is to allow for $240,000 of anonymous donations per political party. They are for anonymous donations – not against them.

Overseas donations should be banned completely (except for New Zealand citizens, residents or voters for the time being overseas).

I have no problems with donations from any legal source, so long as they are disclosed if significant. It is ironic that we will accept $127 million donation of art work from Julian Robertson, but claim it is corruption if he donates $1,100 to a party. People can care about New Zealand without being citizens.

But having said that, I’m not greatly fussed either way. However if one is to ban overseas donations – ban all of them – can anyone not on the electoral roll(and over 18) from donating.

There should there be a limit on donations from a single source of $100,000 over a three year period. This limit should be inflation adjusted every three years.

This is from the party that took $500,000 from Owen Glenn. Think that would be their position if he still liked them?

Again Labour fail to make a case for their preference. What is the harm done by someone openly donating $120,000 (say $40,000 a year) to their preferred party. Transparency is crucial, and these should be publicly disclosed so the public can decide on whether or not they have a problem with said donations. Trust the public I say.

If Greenpeace International wanted to donate $150,000 to the Green Party, I would say let them. We should all know about it – so we can decide what we think that means in terms of desirability of supporting the Greens.

Political parties should be required to provide annual audited accounts with itemised categories of donations income so that actual income can be compared with declared donations.

Now this one I agree on, and in fact am very pleased to see Labour advocating it. After the NZ First funding revelations I concluded some sort of audited accounts with donations grouped by size is desirable. I only want the names of those who donate more than $10,000 (as that is level influence may be a factor) but it would be useful to see how many donations between say $1,000 and $10,000 are received. This allows the public to decide if (for example) NZ First’s claims of being all funded by cake stalls was the reality or not.

In election year, donations received by a party after its last annual return to the Electoral Commission should be publicly declared through the Commission on a regular basis after they are received, and up to and during the regulated election period.

This is one issue I forgot to cover in my submission. I actually think donations should be declared monthly during the whole three yearly cycle, and weekly or daily during the last month – we should know about donations when they are made, and always in advance of an election.

So I agree with Labour here, but think they do not go far enough.

The Labour Party believes that the corollary of tightened controls on private funding of political parties – with the greater disclosure and compliance requirements involved – is some provision of public funds for political parties.

Again Labour have failed to prove there is a problem. The Electoral Finance Act brought in much tighter controls on donations, yet both Labour and National spent to the limit. Both were able to raise all the money they needed privately.

Labour want state funding on the basis, there *may* be a problem in the future with inadequate private funding. Not good enough. The 2008 election has shown that there was no shortage of private funding, and Labour’s attempt to gain (even greater) state funding is sheer opportunism.

Both the registered party and parliamentary party contribute to the formation of policy on which the voters base their choice. The accountability provisions in the Electoral Act also devolve to the registered extra-parliamentary party.

Public funding would contribute to the independence of the extra-parliamentary party by providing a balance and the avoidance of parliamentary capture.

This is hogwash. The opposite is the case. One of the few accountabilities that the main party has over the parliamentary party is that they raise the money. This is why parliamentary parties suffer consequences if they ignore their membership.

You bring in state funding, and it allows the parliamentary party to marginalise even further the organisational party.

In our view, a base level of public funding should be available to parties who meet the statutory criteria of 500 members and contesting seats in Parliament. Currently the only available form of public funding for such parties is provided through the Broadcasting Act 1989, which on its own is clearly insufficient.

Parties outside Parliament are massively disadvantaged. But giving Labour $800,000 a year and the Alliance $2,000 a year is not going to change that – in fact it will make it far worse.

My proposal to help parties outside Parliament, is that the broadcasting allocation be restricted to non parliamentary parties only. The parties in Parliament get three years of broadcasting exposure through the media for free.

Broadcast advertising is the primary means that wealth-based electoral systems use to influence opinion.

What decade are they in? How many people even watch TV ads now? Heard of My Sky. Broadcast advertising is no longer as dominant as it once was.

The limitation of broadcast advertising to allocated public funds is an excellent feature of New Zealand’s political system and should be retained.

Far from being excellent, it is a travesty. If a party registers late in the piece they are banned from broadcast advertising. The current rules not only give National and Labour more money for broadcast advertising – but they ban the other parties from being able to spend as much as them with their own money. This is not a level playing field – it is one that favours the two main parties massively.

It may be preferable for the cost of the time allocation to be added to the broadcasting allocation and the time allocation discontinued and replaced with funding that can be used to buy time as best suits the parties. This would allow for freer use by political parties of the resource for broadcast advertising.

Here I agree. But again the hypocrisy – they are saying a party should not be allowed to (for example) spent $50,000 less on billboards and $50,000 more on radio advertising but they are saying parties should have freer use of broadcast advertising. Inconsistent.

Political parties should not be able to purchase broadcasting time with their own resources. This will only serve to advantage parties with access to money.

Nonsense so long as you still have an overall spending limit. The current law gives National and Labour a bigger spending limit that all the other parties as they can’t purchase broadcasting time beyond the allocation. This is about protecting Labour’s statutory advantage.

It must be made clear in the Electoral Act that no spending authorised for parliamentary purposes by Parliamentary Service rules can be counted as election expenses under the Electoral Act.

And this is what they tried to do with the Electoral Finance Act. They want to have the pledge card not count as an election expense. They want to be able to spend say $1.5 million in the final week of the election on “parliamentary publications” and not have it count as an election expense.

I go the opposite direction. During the regulated period, there should be a ban on parliamentary funding of advertising except essential advertising such as office hours.

You see what I mean about how self serving Labour’s submission is. They want to keep their anonymous donations. They want more state funding. They want to stop competitors from buying broadcasting time and they want to be able to spend thir parliamentary budget as late as they like durign an election campaign and not have it count as an expense.

The current limits for constituency candidates ($20,000) and political parties (a maximum of $2.4 million, if all electorates are contested) should be retained but be inflation adjusted (from the 2008 limits as a base) before the 2011 election.

Again Labour make assertions with no emperical basis to them. Mr argument is that the spending limits should be set high enough to allow an affective communication with the public, yet below the level at which you may be seen as “drowning out” others.

$20,000 is totally inadequate for being able to communicate with 45,000 voters. It doesn’t even allow one direct mail letter.

The 1996 limits should at a minimum be adjusted for inflation and population growth. Ideally though, as I submitted, there should eb an attempt to actually calculate what is a reasonable or desirable amount of communication from candidates and parties, cost it and then set the limit high enough to allow that. Don’t guess at what the limit should be – calculate it.

The extension of the regulated period in the Electoral Finance Act to the beginning of the calendar year in which an election takes place added greatly to compliance requirements.

And whose idea was that? Credit I suppose for admitting it was a disaster.

Considering the pattern of the last 25 years, a reasonable fixed date for the start of the regulated period would be 1 May of election year.

I am not against a fixed start date but 1 May is far too early. You have not even had the budget by then. I like the proposal of 90 days before the term of Parliament expires – which will be a known date. If a fixed date I would never go earlier than 1 July.

Provision would need to be made for where a particularly early election was called. We suggest that in the case of an election date being announced earlier than 30 April, the regulated period begin the day after the announcement.

Yes, The regulated period should never be retrospective.

The atomistic redefinition in the Electoral Finance Act (section 5) of “any form of words or graphics, or both” proved problematic.

And we warned against it.

The true name and address of those who promote election advertising should be disclosed.

Yes, but this need not be on the advertisement. The Electoral Commission could have on its website contact details for political parties, candidates, and registered third parties.

Where the third party campaign is issue based and does not seek to promote a vote for or against a particular party or candidate, we do not propose any spending cap but do propose transparency above, say, $100,000 of spending.

This is a better position than the EFA. Transparency is key I agree.

However they seemed to have not covered what rules should apply to advertisements against a party or candidate? Are they sayign these should be banned?

I think everyone accepts you can’t advertise urging a vote for National without National’s permission. But what say you wish to advocate people do not vote for ACT? Are Labour saying this should be banned?

Consequently, parallel campaigners should be regulated if they propose to spend over a specified threshold, say $100,000. They should be required to register with the Electoral Commission, and a list of all such parallel campaigners should be made public, as should their donors.

As I said this is an improvement on the EFA.

The financial agent provisions from Electoral Finance Act should be
reinstated – accountability is only possible if responsibility is clearly
defined.

I tend to agree. But I also worry that parties often get off the hook by claiming x did this without y knowing, so hence no prosecution. This helped get Labour off the pledge card. I propose that parties themselves can also be held liable for breaches. So if they have crummy systems which leads too a breach, they get pinged.

Consideration should be given to reforming and amalgamating the electoral oversight agencies, and giving the oversight agency power to obtain further information about parties’ accounts. This is especially the case if additional state funding is made available to registered parties.

Amalgamation is well overdue.

The role of the Police should be retained for prosecution referrals.

No no no no no do. They don’t want the job. They don’t dedicate sufficient resource to it. They don’t have the expertise and in 2005 especially they made some appalling decisions.

Wow this is a long post. I am looking forward to the pubishing of the other submissions, or a summary of them.

Anyway for those interested my submission is here – electoral-finance-reform-submission-form-final-dpf.

The very high level summary of what I advoctaed is:

1. Agree with six principles but under equity makes it “manifestly unfair” rather than merely unfair. Also add 7th principle of simplicity.
2. Ban all anonymous donations (except those under $100 as not practical to record every cent), and abolish protected donations regime through Electoral Commission.
3. Retain transparency and disclosure of donations through an intermediary such as a trust.
4. Proposed disclosure threshold for donations remain at $10,000/year but also require disclosure if donations exceed $25,000 over a three year electoral cycle.
5. No limit on donations from a single source.
6. Donation levels should be inflation adjusted.
7. No restriction on who can donate, so long as significant donations are disclosed.
8. Against any additional public funding of parties or their campaigns
9. Would ban all advertising from parliamentary or Government funds during the regulated period, except essential advertising approved by Auditor-General.
10. Restrict the current broadcasting allocation to parties not in Parliament as parties in Parliament already have a massive advantage with their media profile, their MPs, their parliamentary staff and their parliamentary budgets. Suggest $200,000 per non parliamentary party be allowed.
11. Political parties (and third parties) should be allowed to purchase their own broadcasting time and advertisements.
12. TVNZ and RNZ should not be required to give away free broadcast time for party broadcasts.
13. Advocate new additional transparency requirements for political parties – that they report a summary of all donations received by band – ie x donations from $0 to $100, y donations from $101 to $1,000, z donations from $1,001 to $10,000  etc. This will allow an overall picture of how a party is funded and would have exposed the false imagine NZ First portrayed as solely funded by cake stalls etc.
14. Campaign spending limits should be based on emperical evidance of what amount of money is needed to effectively communicate with all voters. Suggest $50,000 for electorate campaigns and $5 million for party campaigns. Note this includes the broadcasting allocation so effectively moves the limit from $3.5 million to $5.0 million – which is what it would be anyway if it had been inflation and population adjusted from 1996 when last set.
15. Spending levels should be inflation and population adjusted.
16. Would like a fixed election date and regulated period to start 90 days before that. If not possible, then have regulated period start 90 days befroe expiry of the House or on a fixed date such as 1 September. Must not have a retrospective regulated period.
17. Have a narrow definition of election advertisement so it does not capture personal communication of views etc.
18. Generally exempt communications on the Internet as this is information people seek out. Exception is paid advertising on the Internet.
19. Require advertisements to be authorised but allow names and addresses to be listed on Electoral Commission website.
20. Have a voluntary registration regime and spending limit for third parties or parallel campaigners. Provide incentives for third parties to register – such as binding rulings on advertisements, but not make it compulsory as experience of EFA is this is hugely resented.
21. Suggest threshold for registration (if compulsory) is $50,000
22. Spending limit (preferably voluntary) to be 20% of a party’s limit or $1 million.
23. Combine electoral agencies and let them take cases direct to Court without Police.
24. Allow electoral agency to give binding rulings like the IRD
25. Also allow agency to impose automatic fines for minor breaches such as late returns.

The Ministry of Justice will pubish a summary of submissions in the near future and in August a proposals paper. Will be very interested to see them.

Parties are not obliged to list all income. This is not a loophole – it is a deliberate design. They are only obliged to list donations abover $10,000 – the level at which it is though influence might be purchased.

Personally I am interested in the notion of whether or not a party should disclose its total income in bands (such as x donations over $10K, y donations between $1k and $10K, and z donations under $1k) but this would be a radical change to our current laws.

Anyway let us first look at what the ODT says:

The general election last year was the only one in our history to be conducted under the mysterious fog of the Electoral Finance Act, a piece of legislation brought in by the Clark government at the behest of the Green Party as an exercise in forcing disclosure of funding sources, and in hope of nobbling political opponents, but which no-one – least of all its architects – fully understood.

The intention indeed was to silence the critics. And the Greens remains supporters of the oppressive law which made it illegal to say “I don’t support the Green Party” on a non-blog website unless you disclosed your name and address.

The distance between what the major parties spent on their election campaigns and what they listed in their donations returns is so great as to suggest sufficient loopholes still existed to legally exploit.

It is not a loophole. For example National receives between $1 and $2 million a year in small donations from its 40,000 or so members. That is not some bad thing exploiting a loophole – that is a good thing.

Likewise what could well be the case with many parties is that they received many donations at just below the disclosure limit. Parliament has said we only need to know your identity if you give over $10,000. So it is not surprising many donors then give under $10,000.

The commentators who call this a loophole reveal an ignorance of the law. It has never been a law to disclose all income – political parties are in fact private bodies. It has been a law to reveal large donations over a certain limit.

So complaining that donations revealed does not match expenditure revealed is like complaining that your household expenses are larger than the interest from your investments – and overlooking yur salary. They are not comparing apples and oranges.

The EFA also supposedly prevented secret trusts from making large donations without declaring the source, but herein lies a conundrum: there was nothing to prevent one entity making many donations which were under the $10,000 disclosure barrier.

Yes there is. The ODT does not understand the law. All donations from a source are totalled up. You can not avoid the $10,000 disclosure barrier by say giving $5,000 a month.

There are some loopholes to the donations regime – such as different companies with the same shareholders all donating – but that is not the same loophole as the ODT claims above.

The need for transparency is the one aspect of the EFA which must be retained when the cross-party committee eventually reaches its recommendations.

That means all donors to parties should be named, and that what constitutes electoral advertising is clearly defined, including publicity by a government in office during an electoral campaign.

I hope they don’t mean all donors. Forcing parties to reveal every $50 donor will effectively out tens of thousands of party supporters and infringe their right to privately support the party of their choice. The disclosure level should be at the level of which infleunce could be suspected by the size of the donations.

Mike Smith, Labour’s party secretary, admits failing to disclose $25,000 from Meatworkers Union; says omission was an oversight Labour acknowledges it made a mistake in the filing of its donations ahead of last year’s elections.

Labour’s Secretary Mike Smith says he is personally responsible for failing to disclose donations totaling $25,500 from three branches of the New Zealand Meatworkers Union. He says the omission was an oversight and is in breach of the Electoral Act which requires that donations from the same donor of more than $20,000 be declared. The donations should have been declared last year.

The incident follows other instances of Labour being found to have breached the laws under the now-scrapped Electoral Finance Act.

The parties that have breached the law the most often are Labour, Progressives, Greens and NZ First – the very ones that voted for it.

1. Labour got $431,917 in big donations. Their biggest individual donor was the Vela Family who gave them $100k. The unions gave $117,500 and individuals (mainly from arts/culture sector) gave $134,830. Also a total of $60,000 from corporates and lobby groups, $10,587 from Helen Clark and $9,000 anonymously through the Electoral Commission.
2. ACT got $315,906 in big donations. John Boscawen gave $101,000, Alan Gibbs $200,000 and $14,906 from Virtual Bucket Ltd!
3. National got less than half as much as Labour in big donations. They got $207,001. John Key put in $30,000, some other individuals $30,001, $70,000 from corporates and a lobby group, and $77,000 anonymously through the Electoral Commission.
4. Greens were 4th largest for total big donations on $184,693. These were all individual donations with MPs putting in 70,725 and others $114,238.
5. NZ First got (assuming this return is accurate – the last three years were not) $111,999. The Velas gave $100,000 to their favourite boy and Sir Patrick Hogan also gave his thanks with $11,999.
6. The Family Party had $88,044. Destiny Church handed over $10,926, Paul Adams $41,037 and an Elias Kanaris $36,081

National’s level of “big” donations is very small. Part of that will be that some gave in 2007 (2011 will be interesting) but part is that the vast majority of National’s revenue comes from smaller donations. The members alone contribute between $1.5 and $2.0 million a year in small donations I would estimate.

Also somewhat amusingly, NZ First broke the law – again! They received a $2,190 donation from a foreigner on 22 October 2008. As it exceeds $1,000 it has to be paid to the Electoral Commission within 20 working days. They only paid it over on 12 December 2008.

Labour also received an overseas donations in excess of $1,000. They got $10,000 which they had to give up.