Upheaval of political fundraising rules will limit secret donations

Secret donations to parties will soon be limited to $ 5,000, in a dramatic upheaval of political fundraising rules.

Currently, the identities of those who contribute less than $ 15,000 to a political party can remain anonymous. But new rules, to be introduced before next year’s general election, will require parties to publicly mentioned supporters who donate more than $ 5,000.

Parties will also be required to disclose the number and total value of party donations below $ 1,500, which is not made anonymous. They must disclose gifts that are ‘in kind’ or non-cash, such as artwork, and declare loans to candidates of unregistered lenders and publish annual financial statements.

But the new rules will not tackle ‘cash for access’ schemes – which allow wealthy citizens to pay for an audience with ministers and political figures.

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Earlier this month, Stuff revealed that both Labor and National are asking the rich for an audience with key political figures, including leaders Jacinda Ardern and Christopher Luxon.

The rules for larger donations are also changing. Currently, parties must report all donations from a single donor in excess of $ 30,000 within 10 business days of receipt. Now the threshold will be reduced to $ 20,000 – but these donations only need to be declared within 10 days during an election year.

National, Labor and New Zealand First are currently involved in court cases centered on donations – and critics have long argued the law needs to be tightened to prevent abuse.

Luxon’s National Party strongly objected to many of the proposals and warned of a “cooling effect” on democracy and problems implementing the changes in an election year.

But Justice Minister Kiritapu Allan said the reform was substantial but necessary to restore public confidence in politics.

“There is a real trust and confidence issue that we have to confront,” she said.

“We have seen a whole series of issues attributed to how to undermine and circumvent these rules that were intended to make political donations to political parties in New Zealand transparent.

“The biggest proposal is really to make sure that New Zealanders know who is donating large sums of money to any party. I feel it is a cornerstone of a transparent democracy.

“Money speaks, and New Zealanders who vote for me in this office deserve to know where I get those funds.”

Originally, officials suggested lowering the threshold for public disclosure to $ 1,500 – a move that would bring it in line with the candidate limit.

For some time, there have been concerns that donors could channel a larger amount of money through a party without announcing it, with the expectation that the money would be transferred to the campaign of their favorite candidate.

The government has also decided not to impose a proposed ban on anonymous donations.

Allan said the government should offset the increased administrative burden on parties, which are largely run by volunteers.

“You have to balance it with the practical aspects of who does the work. The volunteers who have to process many of these donations – they have to be manageable. ”

Allan also announced that his overseas voting rights for next year’s election will be temporarily extended to take into account Covid-19 travel restrictions and quarantine requirements.

Citizens and permanent residents are currently losing their right to vote if they stay abroad for more than three years – or one year for permanent residents. The limits will extend to six and four years, and apply only to the 2023 vote.

An amendment bill on the election will soon be submitted to parliament, she said.

The review is part of a broader revision of the electoral law that included the voting age, three-year terms and the dress code rule. An independent panel will report back by the end of the year.

the changes

• Political parties must report to the Electoral Commission, and publicly disclose the identities of donors who donate more than $ 5,000 (per calendar year); currently the threshold is $ 15,000.
• Currently, parties must notify the Commission within 10 working days when they receive more than $ 30,000 from a single donor within a 12-month period. That threshold is reduced to $ 20,000, but the 10-day rule only applies during an election year.
• Parties must now report all non-anonymous donations under $ 1500. Currently, parties or candidates do not have to disclose the total volume or amount.
• Parties will have to disclose their annual financial statements – at present they do not.
• Candidates will also have to publicly report loans they have received from unregistered lenders to support their campaign.