Electoral Amendment Bill

Members, we come first to the Electoral Amendment Bill. We come now to Part 1. This is the debate on clauses 3A to 18, “Amendments relating to donations and loans”. The question is that Part 1 stand part.

Thank you, Mr Chair. It’s my pleasure to speak on the committee stage of this, the Electoral Amendment Bill, which the National Party is not supporting. The context, for those tuning in to this debate, is that the Government in its wisdom has set up an independent panel to consider a range of things relating to the electoral bill and the way that we run our elections, and that was supposed to be bipartisan—it was claimed to be bipartisan, although we in the National Party on the other side didn’t have any great engagement in the appointment of that panel. Nevertheless, in the meantime, before that panel is supposed to report back after the next election, the Government has brought through this legislation, changing some elements of the electoral law before that group have had their chance to have their say.

The primary change in this legislation in clause 4 is reducing the amount of money—or lowering the threshold—before party donations have to be declared, or the people who make the donation need to be declared, from $15,000 where it has been for nearly 20 years to $5,000. The original proposal was $1,500. So the first question I have for the Minister is what is the issue she’s trying to deal with here? Because the context is there are two thresholds in the electoral bill. One is a $1,500 threshold before people’s names need to be published in relation to donations for candidates. Bearing in mind that under the rules—the electoral rules—candidates can only spend $30,000 in the electoral period, a $1,500 donation would represent about 5 percent of the amount that they are entitled to spend, and the sense was that there’s a certain logic about a relatively significant donation within the context of what a candidate can spend being made public for transparency purposes.

When we come to the party vote, a party standing in a large number of electorates can spend up to $3 million or more than $3 million in the regulated period. And so a donation of less than $15,000, you know, $14,000, for example, would represent a very tiny fraction of that overall spend. So I wonder whether the Minister might clarify for us: does she think that it’s possible that a party’s policies would be altered in such a way because of such a donation, and what is she concerned about? And secondly, I’d like to know whether she sort of understands the desire of some people to donate to a party without necessarily having their name published—at a reasonable level, because obviously one has to draw a line somewhere and for 20-odd years, or nearly 20 years, $15,000 has been a threshold that people have understood. There are plenty of people around the country who, for good reason, don’t want to have their names published. They might be concerned that they may attract attention from people, they may be worried about future contracts, they may be worried about all sorts of things. I’d be interested to know from the Minister what she thinks about that.

And then, the broader issue is how does she think parties should be funded, because the natural sort of consequence of this legislation is it in essence makes it more difficult for political parties to raise funds given the reality that some people don’t want to have their names published widely, and so what alternative funding does she have in mind for political parties? Some questions to open up the debate for this clause. Thank you very much.

I just acknowledge my colleague the Hon Paul Goldsmith for his questions—and also all of the colleagues who have spent the last period of time engaged on this bill through the select committee process, and those who that have provided their submissions.

Just coming to the three questions that the honourable member just raised, in terms of the issues that we’re trying to deal with, broadly, the proposed changes are multifaceted: lowering the threshold for publicly disclosing donations and contributions from two parties from $15,000 to $5,000, as Mr Goldsmith rightly identified; amending the reporting requirements for party donations by reducing the threshold from $30,000 to $20,000 and requiring disclosure of donations above the threshold within 10 working days only within a general election year; requiring parties to report non-anonymous donations under $15,000; requiring parties to disclose their annual financial statements; and requiring candidates to publicly report on loans from unregistered lenders to support their campaign.

The issues that we are trying to deal with collectively is enhancing the public’s trust and confidence in our electoral donation system. Recent surveys have shown us that over 70 percent of those that have participated do not have trust or confidence in our electoral donation system.

The rationale for splitting out the difference or the variation for candidates and what’s required to be disclosed and the variable thresholds for party donations is based on, first, the current model, to which we are making amendments. But also, when we’ve come to consider the $5,000 threshold—I think that’s the one that my colleague focused on in particular—why that $5,000 threshold? What evidence is there to support that this would be appropriate, and what evidence have we seen that this might work?

I think that what we’ve tried to do, and the member will be aware that when we initially tabled these proposals, the threshold that we had proposed to set was at $1,500. Officials during that period of time engaged with all political parties’ secretaries to try to get a real understanding of the practical implications as well as the actual objective that we’re trying to achieve, which is enhancing that trust and confidence of the general public that you don’t by access to political decision-making.

The advice and feedback that came back through that process was that the $5,000 threshold strikes the appropriate balance between transparency, privacy, the compliance burden placed on parties, the right to freedom of expression, and sufficient donation revenues for parties. The existing threshold of $15,000 is also, arguably, an arbitrary threshold.

What we sought to do then was to look at the thresholds for disclosing the identity of political donors in comparable jurisdictions. We looked to Australia in terms of what the disclosure thresholds were there. In the Australian Capital Territory, their threshold was $1,000, same as in New South Wales and Queensland. We looked to Victoria; again, just over $1,000 was their threshold. We looked over to Canada at a very relatively low threshold; it’s $200 in Ontario, $250 in Alberta and British Columbia.

So what we’ve tried to do here is to approach the issues—the thesis that we were trying address: enhance that trust and confidence in our political donation system and then look at the evidence that would support a reduction, but also doing that in quite a practical way. We’re all politicians in this House and we all understand what it is to work with small community—often heavy voluntary basis within the communities. I always think about my own organising committee and think, practically, what will the onus be and the obligations be on those that are members within the political parties and what will the compliance measures mean for them?

We addressed that in quite a substantive way, and that was, indeed, the work that the officials had done prior to the bill coming into the House, making sure that the amendments would be workable and practical.

I come to that third question that the honourable member put to me. It was, how do we think political parties should be funded? Well, we’re comfortable with the way in which political parties are funded, that we seek donations from those that seek to support us. We’re comfortable with those that seek to support us being required to disclose their identities. We’re comfortable as decision makers to attest to the public, to the general public at large, that whilst we graciously accept support—and fiscal support at that—we don’t have any expectation, or we never purport, that that support for our political party ideology results in tangible power to impact our decisions as decision makers.

So at the member also rightly pointed out, we have established an independent electoral panel. They make choose to delve into these issues as to the way political parties are funded in the future, but it’s certainly not something I’m currently considering now.

Well, thank you to the Minister in the chair, Kiritapu Allan, for the answers to those questions, and a couple of things come out of that. First is the reference to a survey. Yes, a survey was done, I think by Victoria University, on this issue which does seem to point to a sense of public concern around electoral finance. I suppose the obvious question is: well, how is she clear that the concern isn’t around examples of parties allegedly breaking the rules and examples where large donations have been split up, against what the current will rules are. That might be the primary concern and cause of public concern rather than the particular threshold, which is not being altered by this legislation in any way. To split up donations was against the law previously and will be against the law afterwards.

So I’m not quite clear what the Minister is saying is in the sense that there is a broad concern around electoral finance and therefore we need to make these changes. Drawing that logic would be interesting. It may well be that a general lack of confidence may be related to a general lack of confidence in Government generally and the gap between promises and delivery. That may be a broader challenge for all politicians, that, ultimately, the task of all politicians is to win the confidence of the electorate and to fight for it. So it’s not clear to me from what the Minister says, and just because there are concerns out in the community around electoral finance—my guess is primarily because there have been cases involving allegations of people breaking the rules—doesn’t mean that this change is necessarily justified or required.

The other key question for the Minister is: does she not think a measure of bipartisan support for electoral law changes is desirable? This is clearly changing the electoral finance rules in a manner which we on this side of the Chamber claim, or are concerned, is skewing the system in favour of some parties over other parties given the history of funding and the way funding operates. We’ve heard quite a lot about the need for bipartisan support around constitutional changes and entrenchment and for changing the voting age, but when it comes to this area, which is an equally important part of how the rules are drawn up for how we conduct elections, how we finance them, this Government is just using its bare majority to change the system, arguably in its favour. I’d like to hear a justification from the Minister for doing that and how she thinks that that is appropriate, if she does.

There are a number of other, sort of, issues raised around how she thinks it will operate, because I think all New Zealanders are absolutely concerned to ensure that our system has integrity and that there is transparency. There’s no question around that; it’s just that the argument that we’re having here is what is the appropriate threshold. The Minister referred to other countries, and, again, I’d like her to tease out the difference between Australian states, for example, where they don’t have an MMP system, they don’t have a party vote system, which is the reason for the two different thresholds in this country. A lower threshold is appropriate in an electoral context where there’s relatively smaller funds being raised and a donation would have a relative significance, whereas the New Zealand context of the party vote is one electorate for the whole country, and therefore a donation, even of $10,000, is very small within the big scheme of things in terms of a party’s overall fund-raising. But those sorts of donations are significant, and, ultimately, it comes back to the need for parties to be funded somehow, and if this legislation makes it more difficult for parties to fund themselves, the logical conclusion is taxpayer funding.

Before I call the next member, can I just make this general observation to all members, as you’re thinking of your debate notes. This is Speakers’ ruling 52/4: “A member may not (1) impute improper motives to the Government; (2) suggest that the Government has received orders to put a bill through; (3) impute dishonesty to the Government; [and] (4) suggest domination by outside bodies.” There were several sentences there where it sailed close to some of those.

I am pleased to take a call in this discussion. I want to pick up on one of the themes that was touched on by the Hon Paul Goldsmith in his comments. He asked what I think is a legitimate question, which is, effectively, the link between the rules and the thresholds that are expressed in Part 1 of the bill and public confidence.

I want to come right to the heart of what I think is one of the main and most important changes that is in this bill, and that is, effectively, the shrinking of the difference between thresholds for local donations and party donations, and I have a question for the Minister as part of this. The question, effectively, is this: is the Minister aware of the fact that the current threshold difference that we have—that is, the difference between $1,500 at the local level and $15,000 for direct declaration—potentially creates a significant arbitrage incentive? And that is that there is a practice, that has been quite widely reported on in the media, of some local candidates being approached for donations that are above the $1,500 level that would have to be reported at the local level, sending them to the party head office where the threshold is $15,000—so these are donations between $1,500 and $15,000—and that the party head office then, effectively, bundles up the total amount of money that is received from that and donates it back to the local campaign as a global figure.

So we’ve seen—and this has come through public reporting, particularly through the National Party’s reporting—that a number of local campaigns receive back donations from the National Party head office, sometimes in the order of $30,000 to $40,000 that have come through donations that are between the $1,500 and $15,000 level, and I wonder whether the Minister thinks that that practice might have some impact on public confidence in the integrity of the current system, and whether she believes that, effectively, the closing of the arbitrage gap—which is currently $1,500 to $15,000, to $1,500 and $5,000—might help to mitigate against that practice, which I consider to be abuse, and I think might bring the current system into disrepute.

I thank the committee in advance. I think it’s easier if I just respond to questions as they come in. That means I won’t have too many bits of paper floating around. I know the member over there has a few questions as well. Look, I’ll start with the last one and then work my way through. I think that Minister Wood’s question goes to the heart of these reforms in the first instance. It was around closing the gap that had been identified, rightly, by multiple observations. And as we’ve been able to see through the public disclosure of campaign funding, where you could see that practice had meant that work-arounds had been pursued. That was indeed why we went to political parties with having the same like-for-like $1,500 dollars for individual campaigns and $1,500 dollars for party campaigns, because we wanted to make sure that those types of practices couldn’t be worked around in the way that the member has correctly identified.

So to the overarching question: are we satisfied that there is at least a closing of the gap? Yes. The reason that we didn’t expand or maintain the original proposal to have the like-for-like $1,500 disclosure at both candidate and party level was because of the feedback that we received, particularly, from all party secretaries talking about the administrative and procedural implications, which officials advised me on and we subsequently made decisions. So we have sought to close the gap by which exploitations of the system could be made.

If I come to the question by the member the Hon Paul Goldsmith with respect to the splitting of donations, it’s like and like in some sense, but the issue has been correctly identified by both sides of the Chamber. The bill doesn’t directly deal with splitting of donations to avoid that closure. That was one of the original intents, as I’ve just walked through. But, yeah, to that more fulsome point, the lower threshold makes it harder to circumvent those disclosure requirements by the splitting of a donation, and so the advice is that more people are likely to fall within the scope of that reduced threshold.

The more political question there was whether there is an attempt to screw the scrum, I think was the kīwaha. Was it “screw the scrum”?

💬 Hon Paul Goldsmith: Skew.

Skew. Screw the scrum—yeah, that would be a bit odd, wouldn’t it? Skew. So whether—[Interruption] I’d better not get into that today—the bill would advantage one political party over another, in short, the response is no. All registered political parties would be required to follow the requirements set out in the bill, if enacted, in the same way all registered parties must comply with all of the existing requirements in the Act. The bill contains flexibility to respond to the differing impacts of the proposals on smaller and larger parties, and, for example, the bill proposes that parties receiving less than $50,000 in donations and that also have no loans within a calendar year would not be required to obtain auditors’ reports for their returns. We’ve thought through those issues in some substantive detail.

The member also raised questions about whether that general sense of trust and confidence in our political party donation regime has been caused by party practices and particularly issues that have been evident in the media and also the subject of litigation. I want to get probably to one of the amendments that we’ve decided to introduce as a Supplementary Order Paper, whilst the committee was considering the bill, that responded to the New Zealand First Foundation case in particular. What we could see there and what was highlighted in the High Court’s ruling there was that the court raised a risk that parties may structure their financial affairs in a way that legally avoids Parliament’s intentions for the disclosure of donations and, further, that risk undermining the public trust in the integrity of our political donations regime, and it was something that went to the heart of why we’re introducing these reforms in the first instance, and it was something that we considered that needed to be addressed in advance of the next general election. In absence of doing so, it would completely undermine our political party donation regime. I won’t get into that in any length right now but to say—I think it was well traversed during the Justice Committee inquiry and I’m happy to take questions if there are more on it—we amended the existing definition of “party donation”, in particular, to make sure that the work-arounds that had been seen in the particular case and explored by the High Court in their determinations would no longer provide that work-around.

Finally, I think there was one question there just in terms of the way in which we seek to get support for these types of amendments. I think and I hope that it’s seen that we actively do try to get bipartisan support where it’s possible on these types of reforms. I know that the views were sought by the Ministry of Justice from all registered political parties, both in and outside of Parliament. I’ve obviously had discussions with political parties. The former Minister of Justice wrote to all political parliamentary parties, seeking their views on the proposals, and the concerns raised have certainly been things that we have taken into consideration when reworking the amendments. The best example of that, of course, is the raising of the original proposal of the $1,500 donation threshold for party donations and increasing that to $5,000.

I understand changes were made to the bill during the select committee process as a result of the submission from the National Party, which we acknowledge and thank you for your efforts there. One of those changes that we made was that the bill was clarified to ensure it didn’t impose any retrospective obligations on parties, and that’s something that we really have tried to do. But the overarching principle as to why this bill is in the ballot in the first instance is because there is evidence that says that New Zealanders did not trust the way in which political parties were receiving political donations. The public has the right to know who butters our bread, and these reforms in the round are intended to address exactly those issues that have been raised with us.

Thank you, Madam Chair. I want to acknowledge the Minister in the chair, the Hon Kiritapu Allan, for her replies and, firstly, as well, that she wrote to all parties—it’s great. There’s a bit of a habit of other Ministers of only writing to one side of the House. I really appreciate that. I think she’s mostly answered my questions around why this is happening now. The initial questions are that bipartisanship has been a little bit broken in this regard. I am still not clear of the urgency, and she has somewhat explained that. I suppose it’s as much a rhetorical question as an actual question to her: is that lack of trust and transparency that’s out in the community—which I’d probably actually agree with—actually related to donations, or is it constitutional overreach and other activities of any political party or Government of the day?

A second question is: why is this coming through now when there is also a review happening? If she wants to talk about trust and transparency, is there any desire within her ministry to finally release the submissions of political parties? I know the National Party’s position is already public. Is there any desire to release that from the likes of the Labour Party and others, simply because we are talking about trust and transparency?

She referenced, in the plural, that there’s been surveys indicating the need for this legislation. I’m aware of one survey. Now, it could just be a slip of a tongue, a solecism, but if there are surveys, I wouldn’t mind the Minister telling the committee what they are.

The final two questions—because I don’t want to waste the Minister’s time—is: what consideration was given to the right to privacy? She’s referenced, at least once—perhaps twice—the right to the freedom of expression, and I personally think that’s being challenged here. But what extent was the right of privacy explored by her and her officials? Under clause 4, as we drop the threshold arbitrarily—I think everyone’s agreeing with that; it is in an arbitrary drop—from $15,000 to $5,000, the right to privacy has been undermined.

The last question is around the question that the Hon Michael Wood raised—he was talking about arbitrage and systems that might go around. I’m just wondering: is she aware of, effectively, groups of people who unite together? It often happens, not just in the civil service, but often people, if I could use that as an example, in the civil service, paid by the Crown, paid by taxpayers, they, in turn, somewhat voluntarily, give money, over usually a yearly subscription to a group that they feel some unified understanding with. That group, in turn, often generously gives money—very generously gives money—every three years—whopping amounts of money, actually. To people like myself, it seems like a giant circle, because often, this group of people who unite together want a certain Government to remain in power. I’m just wondering, in that line of what Michael Wood was referencing: has she come across any reports of such groups where people pool their money together into this group, and that group, over the years, but often election time, gives whopping donations? I think—and I’m happy to stand corrected—if I’ve got the word right, they’re called “unions”, but I’d be happy to be corrected on that.

To the last question: no, I haven’t received any concerns, because all of those donations are declared.

To the second question that came before: look, I know that there’s been much reference to the Victoria University survey that was done that highlighted the issues that we were seeing play out both in this House, in the courts, in the media, that affirmed the sentiment that there was a dis-ease amongst New Zealanders about the way in which the finances of political parties were managed in an environment where trust and confidence is always at the forefront of our minds when we should be seeking to ensure that Government support its legitimacy. This is one area that we knew that we could address, it’s not an issue that reared its head overnight, and it was something that could be addressed and addressed relatively swiftly. That is why we are making these amendments. We’re making these amendments because they are simply the right thing to do.

You’ve also seen over the last few weeks that there’s been the findings of research conducted over the past year. I’ve just forgotten the authors’ names right now. Max—

💬 Hon Members: Rashbrooke.

—Rashbrooke and others have been looking into political party donations for the period over the last couple of years. It’s probably a crude synopsis, but, I think, their findings and through their extensive engagement with parties up and down the country, all political parties, civil group societies, etc., agree that this is a good first step but there is a lot more work that should be done to ensure that there is the requisite transparency that New Zealanders can rightly expect.

So why are we doing this now? It’s because New Zealanders deserve to know who is buttering our bread.

Third, there was one—I don’t know whether to respond or not; maybe it’s more in the realm of the political—comment about lack of trust and confidence, as a consequence of constitutional overreach. Look, I don’t think that this is at all—

💬 Simon O’Connor: Take the bait!

“Take the bait!” Ha, ha! I’m not in the mood. Look, I genuinely think that if we are concerned about the state of our constitutional arrangements in New Zealand, the biggest thing that we can do is take New Zealanders with us. They want to understand how we give our time, our energy, to stakeholders. They want to know whether money carries weight and buys access. We as a Government want to dissipate that perception, and, therefore, as a consequence, these amendments that we are making to the political donation scheme right now are the right thing to do.

Before I take the next caller, I do want to say this—especially to the last member who made his comments before he sat down and the Minister took over—I want to remind everyone in this Chamber of the Speakers’ ruling 52/4, “A member may not … (4) suggest domination by other bodies.” I would like the member Simon O’Connor to withdraw and apologise, because he did, towards the end, make a suggestion about domination and named a body, which I’m not going to name again.

💬 Simon O’Connor: Well, I withdraw and apologise.

Thank you, Madam Chair. I’d like to start off my contribution, first of all, to thank the Minister for coming to the Justice Committee for a hearing and to answer questions. That was a new approach for us, and one that managed to get us all through the Government’s Supplementary Order Paper and to support it, even though we don’t support the bill itself. So I just wanted to thank you and acknowledge you for that.

Minister, within the bill, in Part 1, there are a couple of things I’d just like to pick up on. One is where you’ve talked about the transparency and trust and confidence. You know, we’ve had the Victoria University survey, and Max Rashbrooke has written his article about it as well. One of the concerns that I’ve had—and my colleagues next to me have addressed this as well—is about whether or not it is about political donation, monetary donation, or whether it’s actually about the trust and confidence of what’s happening in the day, not only in New Zealand, but, of course, when we are looking at what’s happening across the world, and the way that other political parties have been operating, especially in areas like the United States, for example, and whether or not that has discouraged the trust and confidence of Kiwis in the way that our own political system may work. And then I ask the Minister whether it’s actually just about the political donations, or just whether it’s the way that Governments as a whole, worldwide, are working and operating at the moment that causes that decrease in trust and confidence.

Minister, when we’re looking at the support that the parties need to be able to operate during an election year, one of the issues that my colleague next to me raised is one that you may have missed, because you were talking to an official. It was about that right of freedom of expression for those that do give political donations, and being able to ensure that privacy is attained, in some way, for some people who just want to be able to express financial support for the political party of their choice, and whether or not we actually cease people feeling that they are able to financially contribute because of the fear of being named and shamed for doing so, and whether we have any ability to be able to protect some individuals—not necessarily companies, but the individuals who wish to financially support a party’s policies and then feel that they may be cancelled, named, or shamed, because of that.

Minister, while I’m on my feet, I’d also like to ask about the $40,000 fine that could be attributed to those parties who fail, within a reasonable time, to comply with section 207B of the Act—$40,000 is a lot of money, Minister. When we’re looking at the start-up of quite a few smaller parties that are wanting to come through, this is actually big bucks for them. My concern, Minister, is that it will potentially stop new political parties from arising and wanting to represent others within their community as well, because we are putting excessive rules and regulations upon them that they would have to comply with when they’re just trying to start out.

When I look at clause 4(3), Minister, I can see some of the work that will be involved by volunteers in having to comply with these massive amounts of reporting. It’s almost so bureaucratic it makes it untenable for some to be able to actually work their way through it all. I wonder, Minister, what your thoughts are this particular part, especially clause 4(2) and (3) and whether it would have a detrimental effect on others wanting to come to this House and represent people of our community as well, and whether we’re actually just keeping this for the bigger parties and the bigger minority parties instead of allowing everyone in New Zealand to have the opportunity to be represented in this House. Thank you.

I thank the member from the ACT Party for her considered contribution. You are right; I did miss that question with respect to the balance between privacy and that freedom of expression to be able to contribute. So turning to that question first, one of the things that we did closely through the development and evolution of the bill was to work with the Privacy Commissioner to ensure that we were striking the right balance. One of the caveats, I guess, or one of the safeguards that we also have available to us is that within the Electoral Act, there is the donations protected from disclosures scheme to address exactly some of those issues, where people can make donations up to $50,000 if they have a reason or rationale for not wanting to be disclosed. Those contributions go to the Electoral Commission and then are filtered out to the requisite party. But there are some checks and balances on that, and that’s one of the ways that we’ve sought to be able to strike that balance.

Turning to the second issue, just around the $40,000 fine if found guilty upon conviction. What we did there, I looked at a range of different thresholds to find schemes within the Electoral Act. What I did is I, essentially, pulled over what was already the existing fines schemes within the Act, noting that it cannot exceed that amount. It’s not a base amount of $40,000. We certainly wouldn’t want that to be seen as a barrier for participation in our democratic institutions. I guess the only real risk there that one would come up against is if they weren’t administering their affairs appropriately. A court would exercise their discretion if they were right at the egregious end of a breach that would warrant that type of magnitude of a penalty, but that would certainly be at their discretion. But, yeah, I didn’t want to introduce a new type of threshold into the Act, given we already had thresholds that had been tested and proven.

Thank you, Madam Chair. There’s been a comment made by the Minister of Justice this morning about New Zealanders deserving to know who was buttering our bread, and there’s been a number of food references, and there have been a number of kaikōrero in the House—speakers in the House.

So it brings me to clause 3A, the amended interpretation of the definition of “party donation”. So I’ve lead into this kōrero, this discussion, with reference to food. Many of our Māori communities koha kai by way of a donation. So Minister, I’ve made inquiries with my colleagues who did sit on the Justice Committee—I didn’t sit on it—but in my eye and my whakaaro, my mind and my thoughts, looking at this legislation, I know that, in many Māori communities—and this would have bearing and relevance not just to the Māori electorates but also the general electorates and the candidates—a koha or a donation is not always in monetary terms. It’s often, for many of our communities, by way of kai. But also it’s been identified that the definition of “party donation” means a donation, “whether of money or of the equivalent of money or of goods or services or of a combination of those”.

So Minister, how is this legislation going to address koha by way of donation to a candidate or to the party? Many of us have feasted at hākari when we’re at the marae or at a gathering of a public place, and that is a means of a koha or a donation in many instances. So I note, Minister, that there’s been no interpretation. It appears that there’s been no consideration as to how to define “koha” in a cultural context and whether advice was provided in terms of the information and the definition that’s supplied by the Inland Revenue Department, in terms of quantifying and also qualifying koha.

I can assure the member that we are not making any changes to the equivalency functions, and that unless any of us indulge in kai that exceeds the value of $1,500, then we should all be absolutely fine.

Look, if somebody wants to koha the equivalent of—oh gosh, what would that be these days?—maybe four pigs or four, eight, or 16 maybe, you’d be getting up to about that value where you’d want to note that that is the fiscal equivalent of a $1,500 donation to a candidate. So like you ordinarily would in any context, when you receive a koha at the marae, you note what it is, you look to its value because you know you’ll have to disclose that in your ordinary accounts—the same applies for parliamentarians and politicians, and nothing there changes.

Thank you, Madam Chair. Just a couple of questions: the Minister did very often refer to the fact that the people in New Zealand need to know who’s buttering the bread of politicians, and, of course, the obvious point to make is that there are a number of ways in which an individual can help a political party, and giving them some money is one way. The obvious other primary way is to volunteer and offer one’s services.

💬 Nicole McKee: Kaimahi.

To work, that’s right. So I’m sort of just wondering what the Minister’s not proposing in this bill—it doesn’t propose any changes to that, but, I mean, if somebody was to volunteer their time full-time, that would be worth a hang of a lot more than $15,000 or $5,000 or $1,500, but it’s not something that she and the Government regards as something that the people of New Zealand need to know from a transparency point of view. And so I’m just interested in the logic there behind her thinking.

Secondly, I heard the comments of the Hon Michael Wood around the gap between the party threshold and the electorate threshold and whether this opens a back door for donations from the party to electorates in order to confound the thresholds. And I suppose, again, the obvious point is, well, if people were worried about that there are different ways in which to remedy that. One simple option would be to limit the amount—

💬 Hon Michael Wood: Stop your National Party laundering, that would be one way.

CHAIRPERSON (Hon Jenny Salesa): I ask the member to withdraw and apologise.

💬 Hon Michael Wood: I withdraw and apologise.

Thank you, Madam Chair. So, I mean, the obvious point would be to say that another alternative would be to limit the amount that a party could donate to an electorate contest. That’s another way of doing it. So did the Minister consider other options, and isn’t that precisely one of the things that the independent panel that she pulled together is supposed to be considering? Minister Wood raises a potential problem, and so the question I have for the Minister is, well, did she consider other alternatives to rectifying that problem, of which there are many, aside from lowering the threshold which happens to have other consequences?

The second point I wanted to make was the Minister referred, very often, to the public polls and the concerns that the public apparently have in some of these polls around the electoral finance regime. I’d like her to comment also on other polls which show a very clear majority of New Zealanders do not favour a switch to taxpayer funding of political parties. And the point I’m making, the fundamental objection we have to this legislation, is by making it more difficult for parties to raise funds there is a logical sort of push or direction towards more taxpayer funding of political parties because parties have to be funded in some way or other. And she referred to Max Rashbrooke, who is clearly in favour of taxpayer funding of political parties rather than fundraising. So given the very strong public poll indications that people don’t favour that, I’d like her to comment on why she thinks some polls are relevant or helpful to her argument and others aren’t, and if she could give some comment on that, I’d be grateful.

Yeah, very clear: this bill does not contemplate taxpayer funding of elections, so it’s outside the scope and it’s not something I’m considering. Secondly, to the issue raised around the way in which services by individuals are quantified, so currently in these provisions that we aren’t changing, where a person volunteers their services that they would ordinarily charge for, those are considered political donations and need to be disclosed.

I move, That the question be now put.

Thank you, Madam Chair. Minister, my question here is on clause 8, which will be amending section 212. I’m going to be a little bit mischief here because I think, you know, if we’re worried about political donations, then we’ve got to think of the mischievousness that could evolve from that.

Minister, it’s about the loans in clause 8(1), and it’s about loans to candidates and loans to a party. In section 212, new paragraph (a)(i), talks about a loan for the use of a candidate’s campaign needs to be divulged unless it comes from a registered lender—in other words, like a bank.

So my question—the mischief question, Minister—is, what happens then if a candidate or a party then gets a bank loan but a potential donor pays off that bank loan, rather than giving their money to the political party? I just wonder whether or not that had been considered. What are your thoughts on that?

Yes, that’s a mischievous question. I can confirm—I’ve just confirmed with my official—that that is something that they contemplated, and it would be considered a political donation, by which it would need to be disclosed.

Part 1 agreed to.

Part 2 Other amendments