Bridges calls for investigation into National’s handling of electoral donations

Written By: - Date published: 9:29 am, November 29th, 2019 - 24 comments
Categories: election funding, elections, electoral commission, electoral systems, national, nz first, same old national, Simon Bridges - Tags:

The problem with shooting your mouth off and barking at every passing car is that sometimes there will be unintended consequences.

Like when Simon Bridges asked for an investigation into New Zealand First’s handling of donations.  Fair call.  It looked like NZ First might be rorting the system and if we want transparency then this sort of set up should be investigated.

The Winebox papers leak has revealed the model used for the establishment of the NZ First Foundation. Surprise, surprise it was the National Party’s Foundation.

From Guyon Espiner at Radio New Zealand:

One of the leaked documents is called ‘Proposal to Establish a Strategic Fund Raising and Management Vehicle for New Zealand First’ and lays out the reasoning for the Foundation.

It says the “generally weak” state of electorates and a “lack of success” at board level in raising funds meant a new business model was needed to bring money into the party.

“The precedent is clear. It is the National Party’s National Foundation. In essence this proposal suggests a cloning of that model into the New Zealand First Foundation,” the document says. “There can be little doubt that the model is legally sound and is operated in a manner that meets all legal and ethical obligations.”

The proposal says the fund would be a “legally established autonomous organisation that would operate independently of and at arms length” to the board.

The idea was to set up a capital protected fund. “This means contributions will never be removed from the fund. Instead they will be invested with the proceeds ensuring a stable and diverse revenue stream to support our activities and the capital will continue to benefit our party for the long term.”

This mirrors the National Foundation’s statement that it will do the same.  From its website:

We have established the National Foundation to strengthen the financial future of the National Party. It will operate as a capital-protected fund. This means contributions will never be removed from the fund. Instead, they will be invested with the proceeds ensuring a stable and diverse revenue stream to support our activities, and the capital will continue to benefit our Party for the long term.

One aspect that I do not think has been commented on yet is that it appears to me the arrangement avoids disclosure requirements for contributors.  The contributions regime states that where a donation is made up of contributions from different individuals then their identity should be disclosed if the amount given by an individual exceeds the prescribed amount.  But in this scenario the contributors are never giving to the party.  They are giving to another entity that is investing the money and paying the profits to the party.  No sum made up of contributions ever heads the party’s way.

It appears to me the overseas donation rules are also avoided.  Again it is not the overseas money that is being paid to the party, it is the profits earned from the overseas money by the Foundation.  As long as the Foundation’s identity is disclosed along with normal rules this is the only requirement that has to be met.

So Bridges is right that there should be an investigation.  But the National Foundation should be included, to make sure that the Electoral Act donations requirements are not being avoided.

Just in case.

24 comments on “Bridges calls for investigation into National’s handling of electoral donations ”

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  1. tc 1
    29 November 2019 at 9:46 am

    And here we are Soimon. Now run along and play with your dog whistle but thanks for pointing this out.
    The adults can step in now with some long overdue sunlight just in time for the GE.

    Oh and who was it that tinkered with the EFA again….

    • cleangreen 1.1
      29 November 2019 at 4:35 pm

      Brillliant tc. 100% slammed Mr Bridges into the hollow chamber.

    • mickysavage 1.2
      29 November 2019 at 8:23 pm

      Yep I have tried to write a post about the EFA and the crap the Nats threw at it and how it compares to what is happening now but it needs more head space than I have. And I accept I have a bit of history on the subject but this means that I probably know most of the tricks …

      I suspect the simple solution is to ban all donations over $500, make it effective, and have state funding.

  2. Tiger Mountain 2
    29 November 2019 at 10:43 am

    This seems to distill down to another attempted “wack” on NZ First.

    Have most journalists consigned NZ National’s Waitemata and other blind Trusts to the memory hole now?

    • tc 2.1
      29 November 2019 at 12:58 pm

      Don't forget all those trusts that evaporated after the new govt rolled out some changes.

      NZ's MSM are an extension of nationals spin machine except this issue blows back hard on them with some diligent positioning from the gov't.

  3. ianmac 3
    29 November 2019 at 10:53 am

    They cant have one Foundation being legal and the other illegal can they?

    But surely even Bridges cannot call for an own goal – can he?

  4. greywarshark 4
    29 November 2019 at 11:16 am

    Money is always a problem to the political parties representing the mass of the people who haven't got much to spare. Each party has to think about it in a hard-headed way – why should people question the legality checking for methods; they are either ignorant about practicalities, or mendaciously playing on the general public's ignorance.

    In the past Labour gave honour to Mike Williams for coming up with ideas for donations, like the then new regular bank transfers also supporters weekly envelope.
    https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=230779
    2001 Labour's shadow man

    …Starting by reading every book in the Auckland library on political fundraising, Williams instigated three practices. The most important, he believes, was a pledge system, where people committed a regular amount to the party. Automatic bank transfers were new. He used them to the party's advantage. "There's still cashflow coming from that, still people in that system signed up by me," he says.

    He also inaugurated a system using the party's membership list to send letters with prepaid envelopes to members, asking for donations.

    He and Anderton also started visiting businesses. "It really plugged us into the business community. The first thing you demonstrated was that you didn't have horns. The second thing was that we started getting money."

    Finally Williams introduced systematic canvassing and direct-mailing to New Zealand politics. "We'd print out the electoral roll in street order. You'd go along and say, 'Are you a Labour supporter?' in marginal electorates. Systematically knock on every door."

    • ianmac 4.1
      29 November 2019 at 12:10 pm

      But but Grey. I am confused. I understand all that you say from the above.

      But what do you think will happen next? The Espiner column seems to suggest that NZF and National is the same. Seems to be huge to me. I can find no MSM further expose.

      • greywarshark 4.1.1
        29 November 2019 at 2:33 pm

        NZFirst and National the same? True, they are all politicians and tend to be heavy in the head and light on their feet in that order. It looks like Guyon has dug up a tasty morsel that must surely exonerate NZFirst from any possible duggery and no skulls. It would be funny wouldn't it if the big expose' showed that NZ First had copied the legals from the National Party songbook. Which?

        I Did it My Way?
        I think Money money from Cabaret – a rousing little number.
        Money Pink Floyd
        Money for Nothing Dire Straits
        You Never Give Me Your Money Beatles

        Or Paul Metsers’ sad yearning little NZ reality song about digging for gold. 'Here's to the gold I never have found, down in the deep underground. etc'

        • ianmac 4.1.1.1
          29 November 2019 at 2:51 pm

          But. but. but surely this must be askew somewhere. Remembering the onslaught of wide ranging criticism which rushed out for more than a week with the well known rushing to claim the NZF scalps, (I don't vote NZF) and the scream to involve Jacinda, and now? Silence. A movie would declare this a ridiculous script.

          "It ain't necessarily so
          It ain't necessarily so
          The things that you're liable
          To read in the papers
          It ain't necessarily so."

          • greywarshark 4.1.1.1.1
            29 November 2019 at 3:10 pm

            Pretty good ianmac – we have to keep an upbeat profile as we fight our way to the next election.

            You could change the words to update:

            ‘The smoke from the vapers
            Masks the news in the papers
            It ain't necessarily so.’

  5. Tiger Mountain 5
    29 November 2019 at 12:46 pm

    Soymun does seem to have snookered himself, and Nat HQ, here. Mr Espiner came over as somewhat of a National fanboi on Morning Report, but he does dig up some useful info in his new role.

    • tc 5.1
      29 November 2019 at 1:01 pm

      Gluon's a total nat fanboy but he's smart enough to know soimon's digging alongside some skeletons the hollowmen will not want exumed.

      Could give momentum for serious change which is the last thing nats want on electoral financing.

  6. Sabine 6
    29 November 2019 at 12:57 pm

    Public Fincance is the only answer. Maybe Labour can start talking aobut this? Or is that too risky and its easier to drive in a care with an american celebrity who is on the look for a new home?

    • tc 6.1
      29 November 2019 at 1:05 pm

      would you prefer she had a monologue on letterman ?

      • Sabine 6.1.1
        29 November 2019 at 1:15 pm

        no i would prefer that she would tackle some issues now.

        Seriously, i would prefer of Micky Savage to post a nice little write up of how the Laobur Party is -despite it maybe not going anywhere – putting forward a proposal for public finance.

        But then, hey…….it made for good tv, everyone feels good about themselves, some tv stars got a bit of publicity and hopefully we get some tourists from the US (those that still have some money hopefully) and yei us. Right?

        edit: And i would expect a proposal to not go far, however it would be nice if it were put forward for discussion. Just for once, do something even if it fails. At least then the Labour Party would be on record of supporting such legislation. But then maybe that is the issue as to why Labour is not doing it.

        Edit2: I had no use for the Hairpuller on Letterman either. Equally cringe worthy.

  7. Karol121 7
    29 November 2019 at 3:37 pm

    1. Always DO sober what you said you'd do drunk. That will teach you to keep your mouth SHUT. (I borrowed this from Ernest Hemingway).

    I am aware of a number of lawyers around who like this particular piece of “poetry”, and who occasionally use it when in conversation with both clients and colleagues.

    2. A general rule for lawyers: "When examining a witness or making a public accusation, as best you can, avoid ASKING any question which you do not already know the answer to". Rhetorical wisdom.

    If only Mr Bridges could take note of the rules observed by many other legal practitioners, considering that he is one.

    I'm not a lawyer. I am also not a salaried member of parliament chewing up taxpayer funds by the minute for the purpose of self interest project promo.

    3. "Let he who is without sin cast the first stone"

    (I borrowed this one from the Bible which contains a number of wise words also applicable to the 21st century, and to be found in John 8:7)

    Self explanatory, and it can also apply to political parties and members of parliament, irrespective of religious belief, or none whatsoever. Even his photo buddy, Alfred Ngaro would surely understand the context.

  8. Sacha 8
    29 November 2019 at 3:59 pm

    But in this scenario the contributors are never giving to the party. They are giving to another entity that is investing the money and paying the profits to the party.

    Thank you for finally explaining how it works. Dodgy bastards, all.

    • cleangreen 8.1
      29 November 2019 at 4:41 pm

      Yes

      'dodgy all' is about right,

      And who started this diverting of funds rather than direct party donations?

      Smells like the John Key'ism style to me?

  9. Paaparakauta 9
    29 November 2019 at 7:08 pm

    Patriotism used to trump any argument exposes the moral and conceptual flaw at the heart of the National party.

    Boswell, James (1986), Hibbert, Christopher (ed.), The Life of Samuel Johnson, New York: Penguin Classics, ISBN 0-14-043116-0.

  10. Incognito 10
    29 November 2019 at 9:46 pm

    There can be little doubt that the model is legally sound and is operated in a manner that meets all legal and ethical obligations.

    Whoever wrote that is an oxymoron.

    We know how National ascertains legality: if it is pretty legal, it gets the tick.

    However, what are or were those ethical obligations? What is or was the benchmark and who determined that?

    To state that there can be little doubt that it meets all obligations sounds hopelessly naive and ignorant at best but more like the hubris of an arrogant twat.