Local Electoral Amendment Bill (No 2)

They say that politicians are like nappies. They need to be changed periodically, and usually for the same reason. For that reason, the laws that we have governing the election of politicians, whether they are central government or local government, need to be laws that promote and encourage integrity and transparency. If there is one thing that has been lacking from the local government laws up until recently, and certainly during 2010, it is integrity and transparency. So we welcome the arrival of this bill and the opportunity to give closer examination to it, because it does something that we did not previously have in place, and that is to bring a level of at least transparency, with integrity being the by-product of it, to local body elections.

Let us remember that what lies at the heart of this bill is the provisions that require greater and better disclosure of donations, and better accounting of expenditure by candidates, and there are other provisions too that relate to declarations to be made by candidates, for example, of not only the positions they are standing for but the ward or the area that they live in, and those sorts of things. We are confident on this side of the Chamber that this bill will go some considerable way to preventing what we saw in the 2010 mayoral election at least, in so far as the city of Auckland was concerned, where we had money exchanging hands, accounted for in different ways by different candidates, and, indeed, behaviour by at least one candidate that was nothing short of an outrage.

One of the remaining issues that we had with this bill as it left the Justice and Electoral Committee—and, indeed, the report of the committee noted this—related to donations in kind, of a certain level, and I think under $300, where a donation of that sort was made on a recurring basis to a candidate. Under the bill at that point, in the interpretation of the relevant clauses of the bill, there was an apparent loophole. I am pleased to see in Supplementary Order Paper 198 in the name of the Minister of Local Government that he has gone to now correct that with new section 103A, inserted by clause 27, in the legislation, which I think will fix or at least fill the gap that was left in the bill at the time that it left the select committee. On that basis we are confident that this will achieve the objective set forth, which is to ensure that local body elections, and we have them this year, will now be conducted with a level of integrity and transparency that we are used to in central government elections, in the general elections that we have every 3 years, but that we have not seen in local body elections.

Perhaps the reason for that is that local body elections were conducted in a very tame way—I would like to use the term “gentlemanly”, but it is sexist in these respects. They were conducted in a way that everybody—candidates and those administering the elections—respected what it was all about, which was putting themselves up for public office, winning the confidence of the local citizenry of their area, and generally behaving in a reasonable and sensible way. That habit, if you like, that practice and that culture very much evaporated in Auckland in 2010, and the need for this legislation was absolutely paramount. The Government has seen the need for that. We have all seen the need for that over the fiasco of the donations, and so on, to candidates in that election. This legislation will now address that problem. It will make a big change. It will be good for all candidates in the local body elections this year, and ongoing. It may well be that there are some things in these provisions that we can now look to for general elections, to make sure that those standing for election to Parliament might actually consider and get the benefit of them, in terms of a greater transparency.

These are good measures, and this is a good bill. The Minister’s Supplementary Order Paper makes the changes that we think are needed to close out and make this a good piece of legislation that we will happily support.

I would like to start my contribution in this Committee stage on the Local Electoral Amendment Bill (No 2) by thanking the Justice and Electoral Committee for, I think, a very constructive approach and process on this bill. I very much enjoyed being part of it. I think there are a number of sensible amendments recommended by the committee by consensus that improve the bill and strengthen it. They are a good example of how the select committee process can work collaboratively, and how it should work more often, in this Parliament to improve legislation.

Broadly speaking, this is a good bill that the Green Party supports. It brings some of the provisions governing candidate donations for local body elections more closely in line with the equivalent provisions governing general elections and parliamentary candidate donations and returns. It has obviously been prompted by a very high-profile example in the 2010 Auckland mayoralty elections, with the Hon John Banks and his memory lapses around the anonymous donations that he received. It is timely for that reason, but also, regardless of that example, these are important changes that we think need to be made in the interests of transparency and fairness. Probably the most significant change that the bill makes is the change to the anonymous donations provisions so that anyone who works with a candidate now and who knows the identity of someone who makes a donation of more than $1,500 to that candidate must declare the identity of that donor to the candidate, and that candidate must therefore record that donation in their return of expenses and donations. I guess that is what we might call the “John Banks provision” in this bill, and it is a good change. It is a change that we in the Green Party support.

However, we think the bill does represent a missed opportunity to more properly align the local electoral rules with the rules for parliamentary elections. In the second reading debate speakers on both sides of the House talked about this being the object of the legislation, yet if that is indeed the object of the legislation, there is much more we could do that would align the provisions governing the two types of elections. It is a missed opportunity that the bill does not actually do more in that direction.

However, on that note we are pleased to see the Minister’s amendments set out in Supplementary Order Paper 198, which do bring the bill a little bit closer to alignment with the provisions in the Electoral Act, by requiring donors to disclose, when a donation is funded from contributions, the name and address of every contributor who makes a contribution of more than $1,500 and the amount of the contribution, the total amount of contributions received from contributors who make contributions of more than $1,500, and the total amount of all other contributions. That requires the candidate to disclose in their return of donations and expenses the identity of any donor who has made contributions in excess of $1,500. And those are contributions in cash or in kind. So it makes clear in the Minister’s Supplementary Order Paper that that contribution could be a monetary donation, but it could also be a donation of goods and services. It is a good amendment. It does, as the previous speaker, Andrew Little, said, fill a gap that was left after the Justice and Electoral Committee had considered the bill, and we commend the Minister of Local Government, the Hon Chris Tremain, for bringing the amendment to the Committee. The Green Party will support the Minister’s amendments.

But we think there is still much more that this bill could do to align provisions for local body elections with those governing general elections. Supplementary Order Paper 200 in my name puts forward a set of more comprehensive changes that would enhance the fairness and transparency of local body elections and candidate expenses and donations. The measures in my Supplementary Order Paper mirror the provisions of the member’s bill in the name of my colleague Denise Roche, which had been in the ballot for some time, actually, before this legislation was introduced to the House and that would, we think, be a better way of both addressing the concerns regarding John Banks—and fixing up the provisions around anonymous donations—and actually making some more comprehensive and wholesale changes to the law governing local body elections.

Our amendments would more effectively regulate the influence of wealth in local body election campaigns and they would promote transparency and accountability. They would do that in a number of ways. The main provisions in my Supplementary Order Paper before the Committee at the moment are to introduce a cap on donations by any person or group of a total of $5,000; to lower the threshold for the disclosure of anonymous donations to be declared down to $500 from the $1,500 proposed in this bill; to introduce a ban on overseas donations; to introduce a pecuniary interests register for members of local authorities, much as we, as members of Parliament, have to file our pecuniary interests register; and, perhaps most important, to regulate third-party spending in local elections.

I want to spend a bit of time talking about the need for the regulation of third-party spending and about what a glaring omission it is that this bill does not address third-party spending. If we think about the Auckland mayoral elections in the post super-city environment, we see that we have a hugely influential position in terms of a local body election that candidates are running for. There is a lot at stake in terms of who the mayor of our largest city will be. There are a lot of interested parties that have a stake in the outcome of who the mayor of our largest city is. There are a lot of organisations that may wish to actively campaign either for or against a particular candidate or ticket in those elections. Although that is particularly apparent in Auckland, in the super-city, those very same issues are at stake in many local body elections around the country, where local groups, organisations, businesses, or individuals have an interest in the outcome of the election and may, indeed, wish to campaign and spend their money campaigning towards a particular outcome in that election.

There is very little in the current regulations or provisions that actually regulates the spending activities of third parties in local body elections, and there is nothing in this bill that would rectify that. Some might argue—indeed, some have put this argument to me—that local body elections are lower profile and less likely to attract substantial third-party spending and campaigning and that there is, therefore, no need for this kind of provision. That may well have been the case in the past, I think, but with the greater amalgamation that we have seen in Auckland and that we are, perhaps unfortunately, likely to see more of around the country, I think we are likely to see only more interest and third-party activity in local body campaigning. Indeed, we are seeing it already. I have used this example in the second reading debate, but we know, for example, that there is a wealthy individual in Hamilton who plans to campaign against every single incumbent councillor on the Hamilton City Council, and there is absolutely nothing in the current provisions to stop him from doing so or to in any way restrict what he can spend in that campaign. That just does not seem right, if we have a piece of legislation like this, which looks to set spending caps and actually regulate local body electoral campaigning in some way.

We also see the increasing use of campaign tickets to campaign in local body elections. Again, there is nothing to restrict third parties from donating to the campaign ticket, and if a donation is not allocated to an individual candidate on that campaign ticket, there is no limit on what can be donated, what has to be disclosed, or how it can be spent. So that is a real gap in this bill. It is a gap that the Justice and Electoral Committee recognised, and we said in our report that further amendments to regulate third-party spending were absolutely necessary to prevent inequities in the future, yet we have not seen them come through the select committee, due to time constraints. The chair of the committee did actually express some hope in the second reading that the Minister of Local Government would bring amendments to that effect in this Committee stage. I note that that has not happened, and I am very disappointed to see that. So, in the absence of amendments from the Minister to make this change, I urge the Committee to support instead our Supplementary Order Paper 200, because it does bring in regulations for third-party spending, which are so needed, and also it does more closely align the provisions governing local body elections with those governing parliamentary elections.

The other area of concern, which my colleague Eugenie Sage will speak about when she speaks to her Supplementary Order Paper 201, is around the provisions that this bill makes to allow the Minister to postpone or adjourn local body elections. We are concerned, in light of the experience at Environment Canterbury, that that is not an appropriate mechanism. Although it might be necessary to allow an adjournment to take place, it should be the electoral officer and not the Minister who does that. My colleague Eugenie Sage will speak to her Supplementary Order Paper to that effect later in the debate. For now, I would like to urge the Committee to consider the importance of regulating third-party spending in local body elections, and ask members to look closely at my Supplementary Order Paper 200 and the provisions within it.

I am very excited about this Local Electoral Amendment Bill (No 2). I want to start immediately by going to new section 103A in clause 27, which talks about a definition of the word “anonymous”. What is an anonymous donation? It would be fairly obvious to almost anybody at home listening in on the wireless or watching on TV what an anonymous donation is. It is clearly a donation that someone does not know where it has come from. The bill, helpfully, gives us a definition of an anonymous donation: “ ‘anonymous’, in relation to an electoral donation, means a donation that is made in such a way that the candidate who receives the donation—(a) does not know the identity of the donor; and (b) could not, in the circumstances, reasonably be expected to know the identity of the donor”.

So if somebody has lunch or dinner at a flash restaurant with someone and they give them an envelope with a cheque for 25 grand in it, the candidate could reasonably be expected to know who was the donor. It is not an anonymous donation. But actually it gets better than that. If a candidate was flown by private helicopter to a donor’s house—mansion, in fact, with its giraffe—and given a donation there, and that donor was to then put on a fireworks display for the whole city, that is not an anonymous donation. That is a donation that a candidate could reasonably be expected to know about.

So this, of course, is completely unnecessary. The only reason we are debating what actually is an anonymous donation is that John Banks filed a return that he knew was not true. He filed a return that he knew was not true, and claimed that he had received anonymous donations, even though he had personally solicited them and had personally been given them. He broke the law and he got away with it. He got away with it only because the time frame for a prosecution had lapsed—

Progress to be reported presently.

House resumed.

The Chairperson reported the Social Security (Benefit Categories and Work Focus) Amendment Bill with amendment, the Student Loan Scheme Amendment Bill (No 2) with amendment, and progress on the Local Electoral Amendment Bill (No 2).

Report adopted.