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Winston Peters at the 2017 New Zealand First Convention (Photo by Phil Walter/Getty Images)
Winston Peters at the 2017 New Zealand First Convention (Photo by Phil Walter/Getty Images)

PoliticsNovember 19, 2019

The NZ First donations scandal is very serious, and won’t let Jacinda Ardern hide

Winston Peters at the 2017 New Zealand First Convention (Photo by Phil Walter/Getty Images)
Winston Peters at the 2017 New Zealand First Convention (Photo by Phil Walter/Getty Images)

Leaks of NZ First Foundation records raise big questions about the party’s funding, and there’s every chance of more to come. A glance at history suggests the scale of the problem. An early election may not be a bad idea at all, suggests Danyl Mclauchlan

It’s happening.

During its time in government New Zealand First has fundraised aggressively. They’ve also taken very strong policy stands on behalf of specific industries and companies. But no specific donations have been declared; instead the party has been funded by loans from the New Zealand First Foundation, a mysterious entity run by two of Winston Peters’ most trusted advisers.

Those advisers are his lawyer Brian Henry, and Doug Woolerton, a former New Zealand First MP who now runs a Hamilton based lobbying company called “The Lobbyist”, which advertises the provision of “all ancillary services such as media strategies, speeches, drafting changes for legislation, submissions to select committees and personal introductions when appropriate”.

And now Waikato Times reporter Matt Shand has what almost every investigative journalist in the country has been sniffing around for: leaked records from the New Zealand First Foundation. His story on Stuff reports that the foundation has been accepting party political donations and paying for electoral expenses in a way that appears designed to avoid transparency or oversight.

Stuff doesn’t name the donors in the document – one source has told me that both Winston Peters and the donors could be horribly embarrassed if identities were made public. But Stuff says the foundation received 26 donations of $325,900 in just a five month period, adding: “Donors to the foundation include food manufacturers, racing interests, forestry owners and wealthy property developers.”

Winston Peters is the minister of racing. Shane Jones is the minister of forestry. If the food manufacturers are exporters then they might be impacted by Peters’ decisions as minister of foreign affairs. New Zealand First has publicly, repeatedly, announced that they were responsible for killing the Ardern government’s proposed capital gains tax. The public has a right to know that they were being funded by property developers.

We’ve been here before, of course. When Winston Peters was minister of foreign affairs and racing under the previous Labour government it was revealed that he’d taken donations from Sir Bob Jones, Sir Owen Glenn and the Velas, a wealthy family prominent in the racing industry. The donations were made through an organisation called the Spencer Trust, which was run by Peters’ brother. An investigation by Parliament’s Privileges Committee found that Winston Peters had attempted to conceal the donations and then lied about it, and the committee voted to censure him. The scandal dominated the 2008 election. John Key ruled out working with Winston Peters. Helen Clark didn’t. Labour lost, and New Zealand First was voted out of parliament.

There are two separate issues here. The first is whether New Zealand First has broken the electoral law. That’s a matter for the Electoral Commission, and if they decide the law was been broken they can refer the matter on to the police or the Serious Fraud Office. Peters says he is looking forward to discussing the matter with the Commission, and is “confident that New Zealand First has operated within electoral laws, now and for the last 27 years”.

The second is whether senior ministers in the current government could get caught up in accusations of corrupt practices. When you have companies and individuals making secret donations to a party that holds the portfolios in those industries, there is every reason for the public to ask questions about whether their government is behaving defensibly.

New Zealand First’s coalition partners have dreaded this moment for two years. The prime minister’s instinct will be to distance herself from the scandal and hope that it goes away. “We assume that the law has been followed.” “It’s a matter for the Electoral Commission.” “I am not responsible for the New Zealand First Party.” And so on. But the matter of whether or not she presides over a government linked to allegations of “corrupt or illegal practices” is not a matter for another party or office. The integrity of the government is the prime minister’s responsibility.

She could ask the auditor general to find out whether these donations influenced the spending of government funds. She could call for the Privileges Committee to determine how these donations were solicited whether they’ve generated conflicts of interest that were not disclosed, and whether they’ve caused ministers to mislead parliament. And she could suspend ministers from their portfolios while these investigations are being carried out.

It is safe to assume Winston Peters’ reaction will be to try and turn this story into a confrontation between himself and the media. Arguing about whether this is all “fake news” and reporters are “psychos” is a much more profitable story than whether or not political donations have been concealed. Peters knows that media outlets will almost always take this bait and make the story about themselves instead of anything substantive.

Labour’s concern will be that if it came to suspending a senior NZ First minister, or attempting to investigate their fundraising activities, the party is likely to retaliate by withdrawing confidence and supply from the government and forcing a snap election. But this is the latest – and most serious – in a series of leaks from within New Zealand First; a party that seems to be in an advanced state of fragmentation.

One of the things that led to the end of the Clark government was the endless drip feed. The allegations of secrecy and deceit swirling around NZ First just kept coming. And now this government is trapped in the same political hostage situation, with the same politician, facing accusations of engaging in the exact same practices. An early election might be worth the risk if the alternative is a year of ongoing leaks and allegations resulting in a contest that makes Simon Bridges prime minister.

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Getty

PoliticsNovember 18, 2019

Global storm clouds threaten our democracy. Let’s do something about it

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Getty

Former prime minister Sir Geoffrey Palmer QC has published two books with Andrew Butler calling for a written, codified constitution that sets out ‘in an accessible form and a single document the fundamental rules and principles under which New Zealand is to be governed’. A road trip and consultation attracted hundreds of submissions, but relatively little political pick-up. Here Palmer reflects on the process, explains why it’s so pressing, and where to next.

There are a number of reasons why elected politicians and political parties are leery of constitutional change. Perhaps the most obvious reason is that people who are elected tend to believe they should be able to legislate freely and without restraint.

We think that is true for many things, but not for everything.

Another difficulty is that very few New Zealanders understand the features of their existing constitution and how it works. They have difficulty joining the dots between the constitutional arrangements and the policy outcomes that affect their everyday lives. Yet the use of public power affects everyone.

There need to be restraints and check and balances. But it is hard to generate a bow-wave of support for change. This is understandable.

The current New Zealand constitution consists of a hodge-podge of rules, some legally binding, others not. It is formed by a jumble of statutes, some New Zealand ones and some very old English ones. Important things are done under obscure constitutional conventions, letters, patent and manuals and a raft of decisions of the courts. This is a ramshackle set of arrangements and we think it poses dangers to the future of New Zealand.

While most of it is written down somewhere, there is nowhere it can be located in a single place and readily comprehended. That is why it is called “unwritten”. There has never been a thorough public discussion properly led and adequately financed by the government as to what New Zealand’s constitutional arrangements should be.

We live still in the shadow of the constitutional arrangements bequeathed to us by the United Kingdom in the 1852 Constitution Act. This means our constitutional arrangements have a colonial tinge about them still.

Quite a lot of people think this is fine and even a virtue. But think on this. Only the United Kingdom and Israel have constitutions similar to ours. Few to be found at the moment would say that the United Kingdom’s Constitution is functioning well and there increasing calls for a written constitution there. Yet our constitution remains remarkably similar to that of the UK.

The world’s two leading democracies in historical terms are probably the United Kingdom and the United States. Both of them are faltering.

New Zealand is one of the world’s oldest democracies. We have been self-governing since 1857. New Zealand has many advantages.

The first is democracy, which is best understood of a form of self-government. But democracy is hard to get and easy to lose. We have a government that is under the rule of law and that is a useful protection.

We have a government that rules over a country that is not in a state of chaos or civil war. Neither is it a failed nation, as more than a score of other nations are. There is an absence of polarisation here. There is an absence of corruption.

We have relatively open government, although the Official Information Act urgently needs attention. We are free from gerrymandering, that is to say rejigging the electoral boundaries for political advantage by political decisions. But some storm clouds are appearing.

Western civilisation is witnessing its democratic values eroding. It is perhaps transitioning toward some new form of government that promises to be rather unpleasant. Both the United Kingdom and the United States have considerable polarisation and political turmoil.

There is in many western countries an increasing lack of trust in the political classes and in the political processes over which they preside. The litany of unhappiness is long.

Probably the biggest problem lies in the great disparities of income that have occurred in western countries in the last 30 years.

The media, which has traditionally acted as a vehicle of communication between the governors and the governed, has broken down. Its business models have been destroyed by the new technology.

To some degree it has been replaced by a social media that can be toxic and tends to be an enemy of representative democracy and not its friend. An example is Cambridge Analytica and the roles that played in both the election of both Donald Trump and the Brexit referendum in the United Kingdom. Facebook has just paid a big fine for allowing that to happen but what deterrent effect will that have?

We are heading towards an era of populism with authoritarian leaders. And these threats to democracy are emerging at a time of enormous future challenges to our public policy.

So far we are free of these trends in New Zealand, but we need to take steps to ensure that does not change.

The challenges facing government these days are infinitely complex, and the threats for the future are profound.

First, there is climate change. This is bringing terrible disruption with sea level rise and increasing extreme weather events. While the public has a better understanding of the issues now than was the case a few years ago, the problems have been evident since before 1990. The public do not appreciate the enormous economic and social consequences of the transitional change that will be required.

That is not the end of the environmental problems faced by the planet. Species extinction and environmental degradation generally has gone on at pace. And look at the water degradation that has occurred in New Zealand.

There is a lot of geopolitical instability in the world. There has been a revival of great power rivalry and not much leadership seems available to produce global solutions to global problems. These problems can be solved only by global cooperation. But global cooperation is reducing not growing.

Government in the years ahead is not going to be easy. There will be enormous challenges that will be difficult to meet, and they will shake the political system to its foundations.

What will be needed in these difficult times ahead is a firm commitment to the principles of democracy so that it doesn’t fade away in the exigencies of the minute.

A constitution, if you have one, can act as a brake on the slippery slide to polarisation and dictatorship. It cannot stop it, but it can put the brakes on. A proper constitution acts as something of a guardrail.

At present, our constitutional arrangements are something like riding a bike with no hands; you can fall off pretty easily. And what worries me most as a person who has spent much of his life working in, around and with the New Zealand constitution is the conviction that a democracy is a pretty fragile flower.

The petals can fall off quite quickly.

Andrew Butler and I have contemplated setting up an organisation to promote the idea of a written constitution in New Zealand to anchor our democracy.

Because it will not happen without a bow-wave of public support.

At 77, I am not sure that I have the energy or the desire to tramp the country leading a campaign of the sort that is required.

What Andrew and I are thinking about now is how to advance a constitutional reform agenda – is an association needed, a ginger group, or some other form of organisation? Should we engage in a big political lobbying campaign?

We are undecided at present on how to go forward.

A constitution has to live in the hearts and minds of the people. It would be great if we had civics that was taught properly in the schools. There are some signs that is starting to happen.

A proper understanding of our constitutional arrangements would be greatly enhanced by a written constitution. Its educative value can hardly be over-stated. It would be possible to teach students at school from a single document how the democracy works.

But, in our second book we made it clear that while a written constitution is essential, it is not a sufficient cure for our ills. There are a lot of other changes that are needed.

Elections are essential for any democratic country, they need to be regular, and they need to be fair. But they should occur only every four years. The three-year term means we tend to have in New Zealand too frequent elections and not enough attention to policy and good government. We need a four-year term.

There are some pretty big deficiencies in New Zealand electoral law. One of them is that not enough people vote. We propose that voting be compulsory as in Australia. We also propose the voting age be reduced to 16.

A great deal of finance is raised by political parties and spent. There need to be better controls over election financing and a whole new re-consideration of the dependence of political parties upon their donors. It is naïve to think that donations do not influence political parties.

The political parties themselves have many fewer members than they did 50 years ago. They are somewhat hollow shells, almost cadre parties, yet they exert enormous influence over the composition of the parliament. But they are hardly regulated at all.

I am not happy about this situation, having inhabited the parliament and a political party and observed first-hand what can go on. Elections and money are a real problem that need to be addressed.

But what is even more important is increased and superior citizen engagement with the political process that produces the policy outcomes. Somehow, we seem to have lost our way on this. Our current way of doing political business has in many ways gradually become more remote from the people whom it affects.

They are consumers of the outcomes rather than participants in the process.

Andrew and I have advanced the case in the second book for citizens’ assemblies and citizens’ juries to work through policies in a rational and properly supported way so we can secure outcomes that are more acceptable, that avoid confrontation and are more durable.

This means a whole different way of making policy but supporting systematic public discussion that leads to results with public buy-in for big policies. Ireland has shown the way on how to do this. No longer should discussions behind closed doors in Wellington be the way of developing big policies.

We also think New Zealand should become a republic. It seems very difficult to justify in this day and age that the head of the New Zealand state resides in England. And the difficulties the UK have had in recent times with the royal prerogative might indicate that it would be a good idea to get rid of it here. Who understands it?

The Treaty of Waitangi is an important part of New Zealand’s constitutional arrangement, but it is in a very untidy condition. That short document is not well understood and is heavily contested in some sections of the community.

It would be a good idea to start with the Treaty and try to sort out in a series of citizens’ assemblies what it should mean in the circumstances of contemporary New Zealand, and then write that into the constitution.

We also need to shake up local government and encourage it to flourish. It needs access to better funding and more independence from central government. New Zealand has one of the strongest unitary states in the world. Further efforts need to be made to make government more transparent and open.

The Official Information Act needs attention, but the Executive Government tends to be unenthusiastic about fixing it. Yet “sunlight is the best disinfectant” and will protect us against corruption.

This sounds an enormously ambitious agenda. It is. But we have never looked at our governance arrangements from the bottom up and it is time we did.

The above is an abridged and edited version of a speech delivered on Saturday at Pacific Women’s Watch New Zealand, Somervell Church, Auckland

 

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