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The Devil is in the Details

Dave Crampton



Censorship, Free speech and Labour’s Electoral Finance Bill
THE Electoral Finance Bill, planned almost immediately following the 2005 general election, was initially welcomed by public lawyers and free speech advocates in New Zealand alike. It was heralded as a way to introduce transparency into our electoral system, identifying political donors, controlling party spending, and limiting the potential for third-party interference. However, when the Bill was introduced, these supporters were shocked. The Bill was barely recognisable from what had been first proposed; its first two goals were ripped from the page and implementation of the one remaining – control of third parties – vastly overstepped what had been expected.

The Bill’s definition of an election advertisement and the alteration of laws on political expression in an election year means we may not have the unfettered right to express a political opinion. The definition extends to “any form of words or graphics that takes a position or a proposition with which a party or candidate is associated.” That could include email, placards, press statements, YouTube videos, some websites and letters – even select committee submissions that are sent to the media. Letters to the media and personal blogs with no advertising are exempt. Under Clause 53 of the Bill, any ‘advertising’ published during an election year must carry the author’s name and residential address. If the definition of political opinion given above were to be interpreted literally, chalk on the street, YouTube videos, and even text messages would be caught.
If the Bill were to pass unchanged, from January 1 next year the Electoral Finance Bill would make it illegal for anyone other than political parties to spend more than $60,000 in an election year to express a political opinion. If any group or individual wants to spend more than $5000 (or $500 in any given electorate), they’d have to register with the Chief Electoral Officer to do so.
Grey Power National President Graham Stairmand says the Bill means they will not be able to comment on anything for a whole year, with the limits on election spending being extended from the current three months before polling day back to January 1 of an election year. He says it is only fair New Zealanders are able to comment on what is happening in their communities. It is telling that these comments are coming from Grey Power, probably the least controversial high profile interest group in New Zealand. The Bill will make it difficult for groups such as Plunket and the Sensible Sentencing Trust to take a public position during an election campaign, and could effectively shut down groups from simply doing their jobs.
Critics of the Bill say it is ludicrous that organisations like the Sensible Sentencing Trust and the Family First lobby group will not be able to spend more than $60,000 on issues they live and breathe – or $5000 if they don’t register with the state – for up to 11 months before an election. This even includes comments on candidates or the state of MPs’ marriages.
The $5000 and $60,000 limits only apply to third parties, not to political parties themselves. The current limit for party spending is $2.4m in the three months before polling day.
However, government departments are likely to be considered exempt from the Bill. That means that the party in power will be able to exceed the limits set for campaign spending, by advertising pre-existing policies as the internal policy of the department, rather than as a campaign platform. Although there are checks in place to prevent this, such as the office of the Auditor-General, boundaries are occasionally crossed as it is. It would not be unfair to say Labour is introducing legislation designed to favour the incumbent.
In addition, anonymous donations to political parties are not regulated under the Bill. Reining this in was stated as one of the main goals of the Bill, reflecting Labour’s concerns over anonymous contributions to National’s 2005 campaign, particularly through the Waitemata Trust.
However, when it became apparent to Labour that they would face similar difficulties running a campaign without anonymous donations, and when support for state funding for political parties was found wanting, this part of the Bill was dropped.
Adding insult to injury, the cap on anonymous donation to political parties is $10,000. Compare this to the limit of $500 given to private citizens, before the law requires it to be handed to the state.
The current rules regarding anonymous donations raise serious concerns about political transparency and accountability. Requiring donors to make their identities known allows the public to see where the money is coming from, and prevents the possibility of American-style vote buying. If the public determine that a party is giving too much ground – in the form of favourable legislation – to those funding their campaigns, they can decide not to vote for them in future. If you don’t know where the money’s coming from, that’s impossible.
Steven Price, lawyer, adjunct lecturer at Victoria University and a spokesperson for the Coalition for Open Government (COG), believes Labour has made a monumental blunder in refusing to limit anonymous donations to political parties, despite initially promising to do so. Price recognises the goals of the Bill – attempting to catch up to new technology and plug areas the law at present does not cover – but feels that the Bill, at least as it currently stands, is overstepping its boundaries tremendously. He is unhappy with what he sees as the Bill regulating free speech for ‘third parties’ without applying the same disclosure rules to political parties.
“The current law allows parties to receive huge donations from wealthy donors funnelled through secret trusts, without telling voters where the money’s really coming from,” Price says. “This bill does almost nothing to change that.”
Price is not alone in his opinion. His former student Graeme Edgeler, a barrister since 2005, adds that the bill will make it illegal for anyone other than registered political parties to spend more than $60,000 talking to the public about policy issues. “We’d like to see the $60,000 increased – to $100,000 or $150,000.” Edgeler is astounded that people will still be able to give anonymous donations of any value to the Labour or National Party’s coffers under this bill. In fact the move caught many people unawares, including the COG which was all set up to support the Bill. “We were so surprised,” Edgeler says. “Everyone thought that the Bill was going to tighten up on anonymous donations and secret trusts – like the Waitemata Trust that funded the National Party $1.1m at the last election.”
“It makes no sense – if a third-party gets a $600 anonymous donation they have to give it to the government, but political parties, we have no idea who is funding them, third parties can give all their money to a trust which can give a party a $1m donation. The political party knows who is giving them the money – we don’t. That’s ludicrous.”
National Deputy Leader Bill English is leading the charge against the Bill in Parliament, and says the Bill should be scrapped, not reformed in Select Committee as Helen Clark has stated should happen. He maintains that if a registered third-party wants to express an opinion they’ll have to appoint a financial agent to be responsible for election-related expenses – and probably an auditor. Although he’s only half right – a financial agent is only necessary if exceeding the $5,000 cap ($500 in an electorate), and an auditor at $15,000 – you do wonder if these should really be requirements to simply express an opinion.
English has said that anything National spends in an election year under the new rule will be considered campaign spending, but the government will be let off promoting its policies as that isn’t considered to be campaigning. He thinks the rules are illogical.
“What the Government has done in drafting this bill is essentially to marry together the broad Canadian definition of an election advertisement with the long election period in the United Kingdom. This cherry picking of rules doesn’t reflect the internal logic of either the Canadian or the UK system, and has resulted in a muddied and incoherent proposal.”
Another strange result of the Bill is that if any organisation other than political parties or incorporated societies has members that are ineligible to vote because they are under 18, such as church groups, they won’t be allowed to register and spending will be capped at $5,000. That means that a group like the Destiny Church can spend a maximum of $5,000, compared to the $2.4m maximum for Destiny Political Party. Worse, if a registered organisation that has spent $5,500 on political opinion in an election year registers their first under 18-year-old member, they’ll have to be deregistered and will not be able to spend any more until after the election.
The latest appalling implication is that under the Bill, no one can register as a third-party once an election writ has been served. But candidate nominations don’t open until after writ day, meaning that all third parties intending to register who may want to have a say on a particular candidate will have to register before even knowing who any candidates are. In addition, were any election candidate, including sitting Members of Parliament, to publicly criticise a lobby group who wanted to fight back, the group will be restricted in how they do that because they will not be able to subsequently register as third parties.
But even if you are not intending to engage in political debate you may be caught, due to how the Bill defines election expenses. Edgeler doesn’t think it is fair that someone who is engaging in policy debate or even just doing his or her job with no interest in vote winning should be pinged, “If it is not about the election, you should be able to do what you want.”
Another concern is a potential clash with the Bill of Rights Act. Although the Crown Law Office has said there is no breach, while legal commentators are equivocal as to whether this is in fact the case, this needs to be taken in context. The Courts will be required to interpret the Bill in such a way so that it is consistent with Section 14 of the Bill of Rights Act, which says, “Everyone has the right to freedom of expression, including the freedom to seek, receive, and impart information and opinions of any kind in any form.” The Courts will be prepared to go to substantial lengths twisting the words of the Bill to ensure it does not interfere with these rights in a way that cannot be justified “in a free and democratic society.”
But what to make of all this controversy? The Labour Party has said that it did not expect the Bill would be interpreted as widely as it has, and many of the implications addressed above were not their intention. It would seem that the mess of the Electoral Finance Bill is more a result of bad drafting than intentional gerrymandering. Still, if concerns are not dealt with appropriately, that bad drafting will become law. Following the Select Committee hearings, the Bill could, and hopefully will, appear totally different. Price emphasises the importance of not throwing the baby out with the bathwater; the Bill could still potentially be salvaged. The likelihood of this depends, at least in part, on the level of public outrage expressed at the way it looks now.

By Salient Feature Writers Dave Crampton and Matthew Proctor