3 Dec 2019

Foreign donations ban bill not robust - Nick Smith

From Checkpoint, 6:15 pm on 3 December 2019

The government is moving under urgency in the house to ban foreign political donations of more than $50.

The move was only announced on Tuesday, but the government will be looking to hold all three readings of the bill on Tuesday afternoon.  

It means it will also skip the Select Committee stage, where the public can give their feedback.

National says bill falls short of what is needed and can easily be worked around, but it is still supporting the bill.

The bill will also put the onus on party secretaries and candidates to take "reasonable steps" to make sure donations are not from foreign sources.

Nationals' spokesperson for electoral law Nick Smith told Checkpoint's Lisa Owen it is frustrating to be stuck in Nelson facing plane delays, and not in the House of Parliament as the bill is passed under the urgency.

"There's no good reason at all," to rush the legislation under urgency, he said.

"My problem is … when you've got a select committee process underway looking in huge detail at these issues."

Passing the bill under urgency does not allow the Electoral Commission or other experts to ensure the legislation is robust, Mr Smith said.

"It's very easy to set up a trust or a company or some other way to get around the new limit of $50 that's proposed in this bill. So it's not particularly robust.

"This to me looks like an exercise in politics from a government that's under real pressure with the scandal that's wrapped it around the New Zealand First Foundation, rather than being a serious attempt to protect New Zealand's democracy and make our rules fairer.

"If we're really serious about dealing with these risks then we need to do so in a more comprehensive way.

"There are some anti-prevention measures, so if people do use trusts or companies, there is some limited power for the Electoral Commission to check it."

Mr Smith said a key issue is whether it is a New Zealand citizen or resident donating money to political parties.

In 2017, the National Party received a donation of $150,000 from a company called the Inner Mongolia Rider Horse Industry (NZ) Ltd.

Mr Smith said in that case the donation was disclosed for people to see what is there.

"One of the issues in this whole realm is making sure you've got the disinfectant of sunlight, so people can see those donations.

"A number of countries have different rules around whether it's a trading company in New Zealand or what those different rules are around how they might be able to donate.

"For instance, you've got a company like Fletchers - a very New Zealand company, but actually has a majority of foreign investors. You need to resolve those sorts of details if you're going to do this law robustly."

Mr Smith thinks the bill is being rushed as the coalition government is sensitive around the questions raised by media over the New Zealand First Foundation.

The National Party also has a foundation, but Mr Smith said donations that go into it are considered donations to the National Party and are disclosed.

"The disappointment I have is on a number of occasions I've personally offered to Andrew Little to work with him.

"Every single electoral bill under the last government was progressed on a cross-party basis by the previous ministers of justice. This is now the fourth bill that's been done with no consultation, and that in my view is not a good way in which to do our electoral laws, particularly when we have no constitutional wider protection.

"This is simply the government of the day using its majority to ram legislation through, rather than really good process around electoral law."