Electoral Finance Bill — Second Reading 
Electoral Finance Bill — Second Reading 
[Volume:643;Page:13388] 
Electoral Finance Bill 
Second Reading 
Debate resumed. 
R DOUG WOOLERTON (NZ First) 
: 
 New Zealand First is in favour of the Electoral Finance Bill for many reasons but I will talk about just a few things. The National Party has made a big issue out of free speech. It has made a big issue out of the idea that Labour intends to look after itself. It has made a big issue about New Zealand First’s involvement in the last election and the fact that we had a bit of a problem with spending on a pamphlet. It has made a big issue out of those sorts of things. 
Many submissions were heard on this bill—nearly 600 in fact. Over 100 were heard orally and we worked for long hours. Many submitters wanted to know one thing specifically. They were concerned—and I guess they had a right to be—about who donated to political parties who were the real backers of political parties what they stood for and what they expected when their party of choice was elected to Parliament. I think that those submitters have a right to be concerned about those issues and that they are things that will go on into the future of politics. 
But this bill makes a very very good attempt at attending to those problems. It makes a big attempt at making sure that transparency is the order of the day that secret trusts are attended to and that donators are identified. I think that is fair enough and here is why. In the 2005 election donations over $10000 were made to the New Zealand National Party from a Bell Gully trust account PO Box 4199 Auckland a donation of $62000; a Buddle Findlay trust account PO Box 1433 Auckland a donation of $25000; J. Benton—presumably that is a private person and God bless him or her for identifying himself or herself—a donation of $25000; a Jones Young trust account— 
Chris Tremain 
: Hang them! Hang the man! 
R DOUG WOOLERTON 
: I do not think there is any need to hang any of these people. I just want to make sure that people know how much money the National Party spent at the last election and why there are concerns by the general public about where money for political parties comes from. This is why. It is because one party in particular is concerned absolutely with secrecy. 
I will go on. Donations to the National Party included those from a Jones Young trust account Shortland St Auckland of $100000; a Russell McVeagh trust account of $50000; Sky City management—at least it was identified—of $60000; the Ruahine Trust PO Box 2244 Auckland of $249948; and the Waitemata Trust PO Box 2244 Auckland. As a former official of the National Party I can tell members that I am well aware—well aware—of the Waitemata Trust. Its donation to the National Party was $1254845. Toll Holdings—and God bless Toll Holdings for identifying itself—donated $25000. The Westpac Banking Group donated $30000. The total amount of donations from that list was $1881793. 
Chris Auchinvole 
: But where is the secret? 
R DOUG WOOLERTON 
: But those are the secret trusts. [ 
Interruption 
] 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: The member will be seated. What I want is what everyone wants in this world and that is order. Chaos may be fruitful in furthering some forms of management but will not be the parent of good order here. 
R DOUG WOOLERTON 
: I say to those members opposite—and it might surprise them—that I am not concerned about secret trusts at all but the public of New Zealand are concerned about them. They are the ones who are concerned. Through the submission process the public of New Zealand told the select committee that they are concerned about secret trusts. Those trusts are the public’s main concern and to the extent that it can this bill is attending to that problem. 
But that is not the whole of the issue. Much has been made by the National Party in recent weeks and by the  
New Zealand Herald 
 I might say about political parties using public money. Much ado has been made about the Labour Party using public money and about New Zealand First United Future and others using public money. But the biggest beneficiary of public money in this Parliament today is the National Party to the tune of $7 million—$7 million has gone to the New Zealand National Party for its use. Yet National members have the temerity to go out in public and make out that they are the Goody Two-Shoes around here. They have the temerity to do that when they are the biggest beneficiaries of public money. And that sum has just been increased. 
I am not often here quoting newspapers but I want to read to members a little bit from Colin Espiner of the Christchurch  
Press 
. 
Chris Auchinvole 
: Is that a secret newspaper? 
R DOUG WOOLERTON 
: The members opposite are yelling out about secrecy. I have done all of that bit and told members that I am not concerned about that; the public is. 
I want to read this from Colin Espiner of the Christchurch  
Press 
. National members were waving the  
New Zealand Herald  
around the other day so here is a little bit from the Christchurch  
Press 
. Colin Espiner said: “What particularly annoys me is the bleating from the National Party over this.”—“this” being the Electoral Finance Bill—“The Nats escaped virtually scot-free from the AG’s report by sheer luck.” I can expand on that if people want me to but I will do that further on in another speech on another day. “The party had spent most of its leader’s budget on political advertising earlier in 2005 believing the election would be in July.” And I know the reasons for that. “The AG only looked at the last few months leading up to the September polling day.” Those are not my words. 
Colin Espiner continued: “Don’t believe that National won’t spend every penny of the almost $7 million it receives from the taxpayer for ‘parliamentary purposes’ either. National gets more than any other party (because ministers of the Crown don’t count in the funding formula meaning Labour loses out) and recently received an increase in its budget of $668000—the most of any party.” We would never know that by the way the National Party has been campaigning on this issue recently. And he went on to say: “If National really believed this law was a travesty it would hand this money back and refuse to use its leader’s budget for any purpose the AG originally deemed to be unlawful—including hiring expensive Australian election consultants push-polling and billboards featuring its leader.” 
Colin Espiner concluded: “It won’t of course. But National is relaxed in opposing this legislation confident in the knowledge that it will pass anyway and because its leader could himself bankroll National’s entire election campaign if necessary.” Quite frankly I think he should do that because at least New Zealand would then know where the National Party’s money came from. At least and at last New Zealanders would know who the backers of the National Party really were. At least and at last New Zealanders would know what the real agenda of the National Party would be if it were ever to gain the Treasury benches. 
METIRIA TUREI (Green) 
: 
 Tena koe Mr Speaker. First I want to thank the Justice and Electoral Committee staff in particular who worked very hard on this bill; the advisers both from the Ministry of Justice and the Electoral Commission who did a huge amount of work; the other members of the committee particularly those from United Future New Zealand First Labour and ACT; and the chair Lynne Pillay who did a very good job of managing a very big issue and a very difficult committee because of the National Party members’ obnoxious and obstructive behaviour. In fact I have not seen anything that bad since I sat on the select committee considering the foreshore and seabed legislation a number of years ago. 
Modern New Zealand has been built on the principle of democracy and the struggle for equity. But democracy does not happen in a vacuum; it happens in our society which is increasingly characterised by the inequality of wealth. That inequality of wealth can have a significant impact on our democracy. If democracy is to function properly then we must protect the equality of the ballot from the inequality of the wallet. We must ensure that there is a level playing field in election campaigns. We must know who is providing the money in election campaigns so we can track its influence. And we must protect the right to freedom of speech for all citizens. That is why most Western democracies similar to New Zealand’s have rules that limit election spending by both political parties and interest groups and why the Greens believe that New Zealand should do so also. 
New Zealanders have established a very unique series of rules and regulations that make sure everyone gets a fair go. We have a cap on how much a party can spend on the election campaign campaigning for the party vote and we have a restriction on the free speech of parties but it is a restriction to prevent wealthy parties from dominating the political space. Political parties are not even allowed to buy ads on television and radio except with the money allocated to them by the Electoral Commission—a restriction on the free speech of parties but a restriction so that wealthy parties do not dominate television and radio with expensive advertising. These are good rules that mean we have something of a level playing field in our elections because without a level playing field there is no democracy. 
In 2005 real problems emerged with an uneven playing field and we must deal with them. One of those problems was exposed by the Exclusive Brethren in the National Party’s campaign. The Exclusive Brethren ran a million-dollar advertising campaign that was effectively a “Vote National” campaign. According to a publication of Nicky Hager’s just yesterday the National Party’s campaign manager Steven Joyce secretly met with the Exclusive Brethren in May 2005 where he proposed the “Change the Government” slogan which the Exclusive Brethren used in its pamphlets because this fit perfectly with the National Party’s slogan “The only way to change the Government is to vote National.” 
The Exclusive Brethren’s million-dollar “Vote National” campaign was not included in the cap on the National Party’s spending and it was purposely hidden from public view by the Exclusive Brethren and the National Party; it was purposely hidden. It was only through the investigation by the Greens and particularly Rod Donald that this rort was exposed. Our electoral rules failed New Zealanders in 2005. The Greens did not fail New Zealand; we protected our transparency and exposure by exposing the National Party rort. The Exclusive Brethren’s desperate attempt to keep its identity secret with National’s collusion was a direct assault on the transparent and open democratic process. Every New Zealander should be horrified at that assault. 
The Exclusive Brethren and the National Party’s campaign demonstrated a huge loophole in our law; it must be closed. If we do not close it then spending caps on political parties are meaningless. If we do not close the loophole secret groups working with political parties will continue to manipulate the election outcome by attempting to buy it. 
The Greens want our lawmakers to owe their allegiance to the voters not to those who fund their election campaigns. To keep our MPs from being beholden to wealthy interest groups we not only restrict how much our parties can spend on campaigning but also we have rules to make the parties tell us who is providing their money. We want to see if a party’s funders affect the way in which it votes in Parliament and the way in which it makes decisions if it is in Government. If a party receives a donation that is over $10000 it has to declare the identity of that donor to the public and any anonymous donations must be truly anonymous. 
But again in 2005 problems were exposed in the transparency regime by the behaviour of National and to some extent Labour also. We have seen a massive increase in the flow of secret money into National Party and Labour Party coffers. Over the 3 years from 2004 to 2006 for donations of over $10000 Labour received $400000 in anonymous donations and the National Party received $2.2 million in secret trusts. I thank my colleague Doug Woolerton for describing how that money arrived in the National Party coffers. Senior officials within National knew who had given it money but chose not to tell the public—they kept it secret. They did not tell anyone but again it was exposed by Nicky Hager in the article. 
Groups like the horse-racing lobby and the Exclusive Brethren provided independent pro-National advertising. Some of the rich Business Roundtable supporters funded the biography of their leader Don Brash which just happened to come out in election year. The Maxim Institute spent large sums on pro-National publicity and so on and so on. All of this was on top of the anonymous donations from the Business Roundtable giving National probably the biggest campaign budget in the history of New Zealand elections. So in spite of the intent of the law to make parties like National reveal the source of their money it is currently legal for the National Party to know who its secret donors are and to keep it secret from the public. This is a loophole that must be closed. 
The Greens insisted on an anonymous donations regime that will restrict the ability of both National and Labour—and indeed the ability of every political party—to raise money through anonymous donations. Our policy is that all donations over $1000 should be identified as to their true source and secret trusts like the Waitemata Trust and Te Maru o Ruahine Trust do not count as a true source. They should not be listed as anonymous; nor should they be hidden by the secret trusts that the National Party used. 
In the negotiations around this bill we made significant progress towards the Greens’ policy. We have introduced a system that will limit political parties to a total anonymous donations income for those over $1000 to only 10 percent of their spending cap over the 3-year electoral cycle. This will cut Labour’s anonymous donations income by half and it will cut the National Party’s anonymous donations through secret trust income by 90 percent. We have all heard the National Party’s gnashing of teeth over this bill. That is simply because it is fiercely opposed to any law that will prevent it from circumventing the basic democratic principles of transparency and a level playing field. It will not be able to have a secret group run a “Vote National” campaign for it or have its campaign funded from secret money. 
National and the Exclusive Brethren exploited the loopholes in 2005 and it is quite right for Parliament now to close those loopholes in favour of transparency and a level playing field to protect our democracy. To ensure we have a fair democracy we must protect freedom of speech for voters and interest groups while imposing rules to stop the buying of an election. It is quite right that that is a difficult part to get right. 
The Green Party has a record on human rights that is second to none in this or any previous Parliament in New Zealand. Even where such a standard is highly unpopular and attracts attacks we have stood firm on human rights. The Terrorism Suppression Act is one example Ahmed Zaoui is another and the foreshore and seabed legislation is another example too. We will defend New Zealanders’ human rights against any attacks. If the Green Party believed for even one moment that this legislation was a breach of human rights we would not support it; we would not. 
I recognise the Human Rights Commission had problems with the legislation and we chose to work constructively with ACT with United Future with New Zealand First and with Labour to fix those problems so that there would be no issues around human rights and we succeeded by working constructively on the principles of transparency a level playing field and equity in participating in our parliamentary democracy. The Green Party is very proud of its role in protecting the freedom of speech for New Zealanders and introducing rules to ensure a fair election. Thank you. 
Hon PETER DUNNE (Leader—United Future) 
: 
 When the Royal Commission on the Electoral System reported in 1986 it said: “It is illogical to limit spending by parties if other interests are not also controlled. Supporters or opponents of a party or candidate should not be able to promote their views without restriction merely by forming campaign organisations ‘unaffiliated’ to any party. … Nor should powerful or wealthy interest groups be able to spend without restriction during an election campaign while [the parties] are restricted.” That quote is at the heart of this legislation and I suspect that the principle it outlines is one that everyone in this House would actually agree with. We legitimately regulate the spending of political parties during an election campaign so that they cannot be seen to buy an election. It is entirely appropriate to pick up the royal commission’s recommendation and say that where third parties—outside groups—who seek to become involved in the election campaign are concerned there should be some constraints on the type of expenditure that they can undertake as well. 
The problem we have got into is that politics has actually intruded into this argument. Everyone is seeing this issue not from the point of how to make the electoral system work fairly but of how it affects them. The consequence of that has been the unseemly debate that we have seen since the last election. I have not heard anyone at any time get up and say that the restrictions on political parties should remain but that there should be no restrictions on any outside group. No one has advanced that proposition. So why is it when legislation that seeks to give effect to that proposition comes before the House we split asunder. The reason as I said before is nothing to do with principle but everything to do with grubby day-to-day politics. 
The people of New Zealand have a right to know that the electoral process is fair and that the propositions being advanced by parties at election campaigns are ones that they can make a judgment upon and vote upon without that process being fettered by unhealthy money dirty money call it what you like coming from other sources. By and large—and I suspect this is the reason the matter was not tackled long ago in 1986—New Zealand campaigns have been free of that influence until the last election. It was when the Exclusive Brethren’s campaign became public that a great deal of angst occurred amongst ordinary citizens who said: “This is not right. Although these people have a right to express their views the anonymity and the devices they are employing cut across what we have long regarded as being fair play in the electoral system.” That is what this bill seeks to correct. It seeks to give effect to the recommendation of the 1986 Wallace royal commission which has lain on the Table of this House for 21 years. 
A lot of things have been said over the last 5 months since this bill was introduced that have been fuelled in some senses by various interests that are patently untrue. Let me debunk them. This bill does not limit the rights of free speech of any New Zealander to express a political opinion at any time. It says that if an individual or group of individuals acting as an organisation wants to become involved in the election process then they must register and that they are limited in terms of the amount of expenditure they can carry out. But their right to express an opinion is not tampered with. Their right in private or public conversation or street corner or public meeting to express an opinion is not tampered with. Their right as an organisation to lobby on behalf of their interests or their members for policy positions is not tampered with. But where they seek to say “we want to be part of the election campaign” campaigning for a particular party or group of parties as a way of getting around the expenditure limits placed upon those parties then quite properly the principle espoused by the royal commission comes into effect. 
Chris Auchinvole 
: Oh this is unrealistic. This is totally unrealistic. 
Hon PETER DUNNE 
: I want to remind the member opposite that by opposing this bill he is really saying that supporters of a party or candidate should be able to promote their views without restrictions merely by forming campaign organisations unaffiliated to any party. In other words the parties will be controlled but their friends and supporters can go out and set up a parallel organisation and not be controlled. That is what the member is arguing. That is of course an invitation to stupidity. It is a situation we have seen all around the world which other democracies have dealt with by making changes of this type. When one looks at the international environment in fact what is happening here is about the mid-point of change that is considered right by countries around the world. 
There has been some debate about the regulated period but the point about it is as we have seen in the past with a short regulated period and no control as we have had historically that there is a huge amount of expenditure either committed or carried out during the pre-regulated period to spill over into that campaign period. That is a cynical manipulation of the system—legal at the moment but cynical none the less. The notion of a regulated period whether it is 12 months a lesser period or whatever is about saying there is a point at which the electoral clock starts ticking and there is a point at which the activities of those who want to operate in parallel with political parties come under the same broad ambit. 
Members cannot have it both ways. Members cannot say it is perfectly proper to place controls and high standards upon political parties taking part in election campaigns while at the same time turning a blind eye to what might happen elsewhere. Individual citizens will express their views and they will continue to do so in a free and unfettered way. But it is incredibly naive to think that there will not be organisations formed as we have seen to get around the law. That is exactly what has happened to date and that is what made the original recommendation of the royal commission so important and what makes this legislation timely and relevant. 
I want to say this though. This bill I think has not been through the best of processes and the problem with that is that the National Party and the Labour Party have been equally guilty for different reasons. One side wanted to stitch up the numbers first and the other side took the view that it was simply going to oppose whatever was proposed because it did not like the idea of some restrictions. The consequence of that has been a situation that I think is most unsatisfactory. With an election next year the problem we now face is a very difficult choice. If we do not pass legislation of this type at this time we will actually get the same situation as we had in the last election all over again. The one thing on which most people who have expressed a view on what went on at the last election agree is that that was unsatisfactory. So what this House ought to be concentrating on is not the argument about who did what when but on this legislation; looking at it thoroughly in the Committee stage and then determining whether it is in the best shape to proceed. 
United Future will support the second reading of this bill. We will examine the bill as it proceeds through its Committee of the whole House stage and then take a view as to what we should do when it comes to the third reading because there are issues to be considered. We want to see what the debate in this House is about and where the bill ends up. But it is important that we progress the issue to prevent a repetition of what was a most unsatisfactory election process in 2005. 
Debate interrupted.