Speaker by Various Artists


From Corruption Guard our State

by Graeme Edgeler

The Electoral Finance Bill is a creature of the 2005 election – without it, and all its controversies and rancour, we probably wouldn't be looking to amend the law. The election showed our electoral laws were crying out for reform, and in assessing the Electoral Finance Bill and considering changes that ought to be made to it, it's sensible to measure it against the problems of the last election.

1. Anonymous Donations and Secret Trusts

Our law already requires parties to declare every donations they receive over $10,000 – but it doesn't work. Donations can be given anonymously, or can given to someone (or something) else to give to the party. We don't know the names of the big donors to our political parties – we only know the names of the intermediaries they use to funnel their cash to our politicians.

It's not good enough. And after months of promising action, and Labour's repeated derision of National as filled with hollow men, the crackdown on secret trusts and anonymous donations was missing in action. The glass isn't half full – it's empty.

There is one real improvement – it's proposed that donations over $20,000 will have to be declared individually within 10 days of receipt – throughout the electoral cycle. We'll know who the big funders of the political parties are before we vote. This could be a major advance over the current law – which currently only provides for an annual return, months after the election. But unless our lobbying and your submissions force a government back-down, it's likely those big funders will be anonymous or secret trusts. Hard questions can be asked during the campaign, however.

Fixing anonymous donations isn't something that's “too hard”. The Electoral Finance Bill has brilliant disclosure and donation rules for third parties – all some enterprising politician or select committee needs to do is copy and paste.

2. The Campaign by Members of the Exclusive Brethren Church

For the most part, this was perfectly legal, but there are some good reasons why a campaign of this magnitude shouldn't be allowed to happen in the future (least of all so anonymously, and so late in the campaign). Third party campaigns of this type (and much smaller ones too) are the one thing the Electoral Finance Bill really gets stuck into – the limit is too low, definitions are too broad, and many of the effects of the bill as currently written are perverse. Whatever you think about the idea of regulating third party speech in election year, you've got to agree that the Government's bill would curb it substantially – the cure, as currently drafted, may be worse than the disease, but it's undoubtedly a cure.

The limits on free speech are excessive, but with them toned down substantially, we'll get to see who's behind and who's funding any third party advertising in election year – which is a very good thing.

3. Misuse of the Parliamentary Leaders' Funds

This wasn't just the pledge card, but spending from just about every political party in Parliament. Indeed, we found out some time after the election that this has been going on for years. The Auditor-General found a number of parties had spent money given to them for Parliamentary purposes on things that weren't Parliamentary purposes. It's not dealt with at all in this legislation, but that's neither surprising nor disappointing – this actually had nothing to do with the election, and nothing to do with electoral law. It was about the proper and lawful scope of parliamentary appropriations, and could have arisen at any time. We'd like it looked at, but this bill isn't the place for it.

4. Labour's Breach of the Election Spending Cap

The 2005 election saw Labour release a pledge card and some brochures – it was authorised by Heather Simpson (from the PM's office) rather than Mike Smith (who as secretary of the Labour Party was required to authorise all Labour Party election advertising), and Mike Smith didn't want it included in Labour's spending calculation. The Chief Electoral Officer told him they had to be included and it pushed Labour more than $400,000 over their $2.38m limit. There can be very little doubt that this was an accurate assessment of the legal situation, but Labour tried to argue that the Parliamentary rules (which they said allowed the pledge card) overrode the Electoral Act.

The law won't really change. That argument was bunkum in the past, and remains so. The problem wasn't the law, it was enforcement – the police didn't know what they were doing, and didn't particularly care. The law will be clarified to make legislatively certain that something can be a party advertisement even if it doesn't expressly seek votes, although that was the understanding anyway.

5. National's “American Bag-man”

It turns out there was no American bag-man arranging secret funding for National at the last election, but if you'd listened to Labour before the election you'd be forgiven for thinking they think there's something wrong in foreigners influencing our elections.

We certainly thought that: Cabinet even agreed to end donations from foreigners. But this too is missing. It's not as big a disappointment as the absence of transparency in donations, but given this is the best opportunity to clean up our lax election finance laws in the last 15 years, and will probably be the best opportunity for at least another 10, it is a glaring omission.

6. National's Broadcasting Limit Breach

Our political parties have separate limits for spending on broadcasting, and someone involved in National's campaign failed to make perfectly clear to someone else that their $900,000 limit included GST. They ended up getting more than $110,000 broadcast advertising than they were allocated (still around $80,000 less than Labour, which didn't break this law) and potentially faced a $100,000 fine. No-one was charged (the police couldn't decide whether someone in National, or within their advertising agency was actually at fault), and National had some trouble trying to paying its debts.

The Broadcasting Act is left largely untouched by this legislation – the political representatives are removed from the body that distributes the cash, which is good, and the process for filing complaints under Broadcasting Standards is simplified, but that's it. There's not even a change to the law to allow a party in National's post-election predicament to pay up – although that may be because those in officialdom finally realised that the law doesn't actually prohibit it.

The particular problem the police faced in sheeting home culpability to a particular person should be solved by a requirement that all election advertisements be approved a single individual appointed by each party, but most of the other more minor advances in the Electoral Finance Bill sadly don't extend to the Broadcasting regime. Parties will still have differing spending limits, and politicians who breach these rules won't risk their seats in Parliament (unlike politicians who breach some of the rules in the Electoral Finance Bill). Many opportunities have been missed in this lacklustre tidy-up of our broadcasting rules.

7. Police Incompetence in Electoral Law

Any proposal to move the responsibility for enforcing New Zealand's electoral laws into a single independent body has been shunted (along with public funding and, if the Government gets its way, disclosure) to a review that will report after the next election. Unfortunately, any prospect that enforcement of electoral law might be placed with a single body that actually knows what it's doing around electoral law seems fraught, with the Attorney-General saying in question time last week:

The New Zealand Police is the appropriate agency to enforce the law in any circumstance. That is absolutely clear.

There's clearly still work to be done on this one, but one positive is that search warrants will be available in relation to illegal practices, which isn't currently the case.

8. Time for laying prosecutions

Months after the last election, as the police investigation into the various irregularities in the election was nearing an end, the suggestion arose that they might be too late to charge anyone with any breaches.

In the end, I don't believe the Police would have been out of time to charge someone in Labour for its overspending (the clock for that breach starts from when the last bill is paid, not from the date of the election), but they were almost certainly out of time if they'd wanted to charge either Heather Simpson or a member of the Exclusive Brethren church for issuing advertising without a correct authorisation (that clock starts when the advertising is released), and also out of time had they found someone to charge over National's broadcasting breach (that clock started when the advertising was “arranged”).

There's currently a six month time limit for laying prosecutions – with the six months starting at different times for different offences. But given any investigation of overspending offences is only likely to begin after a party files it expense return months after the election, time can be tight.

This sees a good change too – the six-month time limit for bringing prosecutions under the Electoral Finance Bill will only begin once a prosecutor has enough evidence to lay charges (with an overall maximum of three years).

9. Peters v Clarkson

As the cost for their support of the Electoral Finance Bill, New Zealand First got agreement to overturn some of the findings in the Peters v Clarkson electoral petition. Now Bob Clarkson didn't do too much wrong – indeed, when he was told that some things he hadn't thought would have to be counted toward his $20,000 limit might have to be, he stopped spending (as Labour should have) – but the race for Tauranga in 2005 did raise some issues.

Bob Clarkson is a pretty big businessman in Tauranga, and has done lots of printing and advertising in the electorate for years – so he gets it done cheaper than someone who only advertises a little or for a few months every three years. He wasn't given mates' rates – he paid as much as he would have paid to have advertisements about construction – but that was still less than his opponents could get their advertising for.

It's not the biggest deal, but it levels the playing field a little bit, and is a positive move.

It's not even a mixed bag.

The 2005 election raised substantial concerns over the robustness of our electoral laws and our democracy. Only one of the major concerns has been dealt with: so incompetently that it threatens to overshadow other areas in great need of reform. The Electoral Finance Bill is an important start – it's the vehicle through which we can impress upon politicians the need for a hard look and urgent action on the raft of issues raised at the last election – and problems raised worldwide we shouldn't have to experience first-hand before we insulate our democracy.

But this will only happen if our politicians get the message that we take our democracy very seriously. You may have some ideas about what's needed; the Coalition for Open Government does, and recommends you look at its primer on the five most important things to discuss in any submission.

A submission needn't be long -- it can say as little as “We encourage you to ensure the law bans secret contributions to political parties”, and can even be made on-line.

Don't wait – you can only have your say until 7 September.

Graeme Edgeler
Coalition for Open Government

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