Political donation reform underway as Greens call for loophole closure

The government has introduced a bill lowering the threshold for making political donations public as the Green Party calls for an alleged “loophole” to be closed.

The Election Amendment Bill, proposed to the House on Thursday, among other things, wants to change the law requiring disclosure of donors who provide more than $5,000 to political parties. The threshold for anonymous donations is $15,000.

Separately, Justice Minister Kiri Allan this week: sought advice from civil servants after a Supreme Court ruling on the New Zealand First Foundation opened a claimed “loophole” in the donation regime.

The Green Party has now called on the government to use the bill to close the loophole before the 2023 elections.

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“A way to circumvent election donation rules has been pointed out, and the government says this is something to look into, but not urgent,” said Golriz Ghahraman, the party’s spokesperson for justice.

“What we’re seeing is that the government is essentially happy that next year’s elections may be undermined or corrupted by this issue.”

The amending law, if passed into law, would lower the disclosure threshold for donations of $5,000 and above, and for multiple donations from the same donor to $20,000 and above, from the existing $30,000 threshold. However, this disclosure would not take place until an election year.

Parties should also disclose donors who have provided less than $1500 if the donation was not made anonymously.

There would also be a requirement to disclose the total amount of monetary and other donations, all loans received, and the financial statements of a political party.

Allan said all political parties should want transparency.

“We know that money is being talked about and that New Zealanders have a right to know who is funding our political parties,” she said.

She disagreed with criticism that the bill would penalize smaller political parties.

ACT leader David Seymour said that, according to his party’s calculation, if the donors who gave between $5,000 and $15,000 for the 2020 election were to lower their donation to the new anonymous threshold for the new bill, it would be 1.2 million dollars less for parties.

“That 1.2 million less means less advertising, fewer meetings, less promotion and less debate for New Zealanders in an election.”

Seymour said Labor was trying to “bottle the scrum” by changing the rules in its favor. The National Party has also accused Labor of this.

“If you’re concerned about people trying to get around the law with all sorts of dodgy schemes bringing people to court, this will encourage more of that,” he said.

Ghahraman said the Greens welcomed the government’s bill but should prioritize more comprehensive electoral reforms.

“We would like the government to add to this bill the issue of donations going through entities other than political parties to circumvent our election donation rules…so that we can address the issue before next year’s election, rather than after. “

A Supreme Court judge last week ruled that two men were not guilty of solicitation by deception, as alleged by the Serious Fraud Office, for their association with a trust – the NZ First Foundation – that collected donations to support NZ First that did not were publicly registered as party donations by the party.

Justice Pheroze Jagose ruled that the collected donations were not party donations as defined in the Elections Act.

Ghahraman said this was a loophole.

The National Party has also said that if a loophole is exposed, it should be closed.

Allan previously said she would receive advice in response to the court’s ruling on Friday and that it would then go through the cabinet process.