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Posts Tagged ‘Simon Bridges’

National and petrol taxes – when journalists gets it right

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It’s not often that it happens, but every so often one will stumble across examples of journalism that probes deeper than the immediacy of the here-and-now, and actually takes a step back in very recent history to put political events and utterances into context.

National’s desperation to remain relevant involves a two-pronged strategy to promote Simon Bridges as Prime-Minister-in-waiting and to portray the current coalition government as tax-and-spend and wasteful with our tax-dollars.

With Mr Bridges at 6% in the polls, the first of National’s strategy is stuck firmly in a political mire. The public do not seem to like and/or trust the current National leader. His constant barking-at-every-passing-car and relentless negativity (without proposing alternative solutions) is problematic and his hyper-critical, carping style is a major turn-off with voters.

The second prong of National’s grand strategy – to throw as much mud as possible at every part of the Coalition’s activities – continues at full-throttle. It’s success is yet to be determined.

National’s current attack focuses on  petrol prices, with the Opposition and it’s leader blaming the Coalition for high fuel prices. This despite Gull NZ’s general manager, Dave Bodger, stating that lack of competition was the deciding factor in fuel pricing, not government taxes;

“That restricts the supply, which inflates the price, especially if you look in parts of the South Island and areas where there’s not as great competition; the consumer is paying a lot more than they are in other places.”

The Commerce Commission’s recent investigation and report into the fuel industry criticised excessive profit-taking by some petrol companies. As Commerce Commission chairperson, Anna Rawlings stated unambiguously;

“Our preliminary findings suggest that many fuel companies are earning returns on investment that are higher than what we would consider a reasonable return to be.”

Those facts did not prevent National from issuing countless press statements and bombarding social media to smear the Coalition as culpable for high petrol prices;

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Fairfax/Stuff journalist, Henry Cooke, reported Simon Bridges’ attack-point verbatim;

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“I agree with Jacinda Ardern that New Zealanders are being fleeced, but the reality of this is the biggest fleecer isn’t the petrol companies, it’s Jacinda Ardern and her Government. Jacinda Ardern is the fleecer-in-chief.”

But then, Mr Cooke, took a further step. He delved into the past and with a few clicks of research, offered readers some further salient facts;

He said fuel taxes were rising by 24c over this Government’s term, compared to just 17c over nine years of National. But this figure included the 11.5c Regional Fuel Tax which is only charged in Auckland – where fuel is typically cheaper than other parts of the country – and did not include the GST rise his Government brought in.

National raised fuel taxes six times over nine years in Government, raising the price by 17c in total. The National Government also increased GST from 12.5 to 15 per cent.

The Labour Government has raised the excise by 7c so far this term and will raise it by another 3.5c in July next year. 

Which helps put current fuel excise rises into some context, when a journalist reminds readers that National was not averse to doing precisely what it self-righteously condemns the Coalition government for doing.

Not forgetting that as well as raising GST (despite promising not to do so), National’s tax-grab reached deep into the pockets of newspaper boys and girls, in a desperate effort to balance their books and make up for billions of dollars squandered in two tax cuts.

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Simon Bridges’ hypocrisy was underscored when Henry Cooke finished his story with the National Party leader’s comments;

Asked if he would cut excise taxes if elected he was non-commital, saying he would need to have a better look at the books when coming to Government.

He stood by the general user-pay system in transport, whereby fuel taxes fund major new roading infrastructure, rather than the general tax take.

The public’s collective eye-rolling at Mr Bridges’ “bob-each-way” explains why he is on 6% in the polls. This is not a politician who “means what he says, and says what he means”.

The following day, on Radio NZ’s deputy political editor, Craig McCulloch, also took National to task on its criticism over fuel excise taxes.

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On Checkpoint, on 21 August, Mr McCulloch  presented listeners with a refresher course in recent political history;

“By the end of it’s three year term, the [Coalition] government will have put up petrol taxes by ten and a half cents, not including the eleven and a half cent regional fuel tax in Auckland.

When National was in charge it put up taxes by seventeen cents, but over a much longer nine year period. But National also increased GST from 12.5% to 15.”

Embarrassing stuff.

Mediaworks/Newshub had also pointed out the same hypocrisy from Nation, but a few months earlier. Dan Satherley and Lisette Reymer reported in early July;

Between 2008 and 2017 National raised petrol taxes six times, usually by 3c – Simon Bridges was Transport Minister for three of those years. They also increased GST from 12.5 to 15 percent.

But more conspicuously, despite considerable media exposure; spending considerable effort and money on wide-reaching social media propagandising, aside from the Auckland regional fuel tax,  National leader Simon Bridges has refused to state if he would repeal the Coalition’s fuel tax excise increases;

“Right now, in the Transport Budget, they have dramatic underspends. I wouldn’t put the [taxes] on, my inclination would be to not have them, but if you are already there and they are already there, there is no way I am putting more on.”

That’s because last year, Mediaworks/Newshub pointed out that National and Labour have both increased fuel excise taxes by almost the same amount. (Though it is unclear from  the infograph below if Mediaworks/Newshub have factored in National’s GST increase in 2010.)

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It’s a fair bet that National will not be using the above infographic in any of their attack ads. Too close to the inconvenient truth for one thing.

It’s also a fair bet that National will retain the Coalition’s excise fuel tax increases; add a few of their own; and then offer a “neutral tax switch”. That’s because National believes in user-pays for most, if not all government services. In 2014 the NZ Labour Party kindly put together a list of just some of those government service fees increases;

  1. GST increase from 12.5% to 15%
  2. Increased taxes on KiwiSaver
  3. Compulsory student loan payment increase from 10% to 12%
  4. Increased tertiary fees
  5. The 2012 ‘Paperboy’ tax
  6. Civil Aviation Authority fees rise
  7. Additional fuel tax increase of 9 cents with annual CPI increases locked in for perpetuity
  8. Road User Charges increased
  9. New annual student loan fees introduced
  10. Massive unnecessary ACC levy increases
  11. Prescription fees increased by 66%
  12. New online company filing fees imposed on businesses
  13. Creeping expansion of the scope of Fringe Benefit Taxes – National tried to tax car parks and plain-clothes police uniforms
  14. Lowering of Working for Families abatement threshold and increasing the abatement rate, taking money out of the pockets of families
  15. Imposing a $900 Family Court fee

Whether fees for DoC huts and tracks, the Family Courts, ACC, roading, etc, National has never been averse to loading costs of those services onto individual users – whilst then cutting income taxes.

This is precisely what they did from 2009 to 2017.

We can expect more of the same from National should they be returned to power.

In the meantime, kudos to Henry Cooke, Craig McCulloch, and other journalists, for  delving into National’s past track record on this issue. This is the sort of journalism the public rightly demand – not simply cutting-and-pasting Party press releases.

The media should now press Mr Bridges harder on this issue: will he repeal Labour’s fuel excise tax increases or not? It’s a simple enough question. After all, he was 100% adamant that National would scrap any Capital Gains Tax if it became government;

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If Simon Bridges wanted the increased fuel excise taxes dumped, there is no reason on Earth why he wouldn’t commit. The fact is that National supports user-pays charges and their claims of being champions for “Kiwi battlers” is populist rubbish. National’s plans are blindingly obvious;

  • increase user pays charges, excise taxes, etc
  • cut personal income taxes – especially for the wealthy

Hence why Mr Bridges has said repeatedly;

“We will not introduce any new taxes during our first term.”

The caveat, Ifs, Buts, and fine print underlying that statement should not be lost on anyone.

If the (current) Leader of the National Party cannot be straight up with voters as to what his intentions are (on any issue!), then he cannot be trusted to lead this country.

For Simon Bridges, the timer on his political career is counting – downward.

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Postscript 1

Fuel prices in New Zealand Aotearoa from 2005 to 2019:

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A bit embarrassing for National: fuel was more expensive during their term in office. New Zealanders cannot afford a National government it would appear.

Postscript 2

Interesting to note that National’s spin doctors appear to have ‘borrowed from my “That was Then, This is Now” memes on which to base their own “What she said, What she did” propaganda;

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But we’re all aware by now that National is not averse to ‘borrowing’  from other peoples’ creative efforts – without paying.

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References

NZ Herald: Latest political poll – National rises against Labour, with 45 against 43 in 1 News Colmar Brunton poll

RNZ: Fuel prices – Government urged to free up wholesale market

Fairfax/Stuff media: Jacinda Ardern says New Zealanders are being ripped off over petrol

National Party: Axe the Tax

Twitter: National Party – petrol prices – taxes – 5.52 PM, Jul 24, 2019

Twitter: National Party – petrol prices – taxes – 6.26 AM, Aug 23, 2019

Twitter: National Party – petrol prices – taxes – 7.15 PM, Aug 21, 2019

Twitter: Simon Bridges – petrol prices – taxes – 2.49 PM, Aug 20, 2019

Twitter: National Party – petrol prices – taxes – 10.25 AM, Jul 1, 2018

Twitter: National Party – petrol prices – taxes – 9.40 AM, Jun 30, 2019

Twitter: National Party – petrol prices – 4.05 PM, Aug 29, 2018

Fairfax/Stuff media: Petrol prices – Simon Bridges says Jacinda Ardern is ‘fleecer-in-chief’

Fairfax/Stuff media: Key ‘no GST rise’ video emerges

Fairfax/Stuff media: Young workers out of pocket

RNZ: Blame game in Parliament over high petrol prices (audio-link)

Mediaworks/Newshub: Fuel tax hike – How much it might cost you

Mediaworks/Newshub: National’s Simon Bridges refuses to say he will overturn new petrol tax increase

TVNZ/One News: National promise no new taxes and repeal of Auckland fuel tax in first term

Mediaworks/Newshub: Fact check – Who taxed your petrol the most – Labour or National?

Fairfax/Stuff media: Trampers torn on price hike for New Zealand’s Great Walks

RNZ: DoC fees rise

Labour Party: At least 15 new taxes under National

Scoop media: National would repeal Capital Gains Tax

National Party: National would repeal Capital Gains Tax

Twitter: Simon Bridges – no ifs no buts no caveats – 6 March 2019

Twitter: Simon Bridges – tax cuts – 2.58 PM, Jan 30, 2019

Otago Daily Times – National: No new taxes in the first term

NZ Herald: National Party found guilty of Eminem copyright breach

Addition

Fairfax/Stuff media: Intolerance fed by wrong and hateful assumptions is all the rage right now

Fairfax/Stuff media: National’s ‘desperate’ attack ads to be investigated by Advertising Standards Authority

Previous related blogposts

That was Then, This is Now #28 – John Key on transparency

Simon Bridges: “No ifs, no buts, no caveats, I will repeal this CGT

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This blogpost was first published on The Daily Blog on 25 August 2019.

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Judith Collins – Foot in Mouth Award? Or something more sinister?

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Former Police, Corrections, and Justice Minister in the previous John Key government, Judith Collins, has been ridiculed on social media after posting a comment on Twitter that was patently untrue;

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Wrong!! National did not remove Prisoners’ ability to vote. Parliament voted through a Private Member’s Bill not a Govt Bill. Note where NZF voted. Restoring prisoners’ right to vote still not a priority – Andrew Little | Newshub

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Ms Collins stated-as-fact “National did not remove Prisoners’ ability to vote. Parliament voted through a Private Member’s Bill not a Govt Bill. Note where NZF voted“.

Twitter posters were quick to point out that the Electoral (Disqualification of Sentenced Prisoners) Amendment Act 2010 was indeed a National government Bill. The Bill was introduced by then-National MP, Paul Quinn, on 10 February 2010.

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Mr Quinn’s Bill passed it’s third reading on 8 December 2010, with National’s fiftyeight MPs and ACT’s five MPs voting it into law.

Labour, the Greens, the Māori Party, Jim Anderton (as the Progressive Party), and Peter Dunne (as the United Future)  voted against the Bill. Contrary to Ms Collins advising people to “note where NZF voted” – New Zealand First was not even present in Parliament at the time.

The Bill received Royal Assent from the Governor General seven days later, formally becoming the Electoral (Disqualification of Sentenced Prisoners) Amendment Act 2010.

Ms Collins was wrong in almost every respect in her August 12, 2019  Twitter post: the law was National’s from beginning to end.

Her blunder (or wilful misrepresentation) was compounded when her Leader, Simon Bridges, publicly confirmed Ms Collins’ “tweet” as mis-information;

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It’s our law – we believed in it then and we still believe in it so we will oppose change. Quite simply if you do a crime that’s serious enough for jail you lose a number of rights, including most importantly your liberty, but also we think it’s right while you’re in prison you lose that right to vote.”

Simon Bridges’ statement owning the 2010 law change made Judith Collins look like a complete fool. She was lucky that her Twitter post did not gain wider media and public traction. (Those two really need to talk more often.)

This is not the first time Ms Collins has publicly mis-represented an issue. In August last year, Ms Collins used social media to promote a bogus ‘story’ from a fake news site;

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The mainstream media coverage was brutal in condemnation;

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Ms Collins was unrepentant, resorting to verbal gymnastics to defend her ‘right’ to spread lies;

I still share them because, actually, I don’t believe in censorship on people’s ideas.”

And politicians wonder why the public do not trust politicians?

National’s current Leader, Simon Bridges, made no attempt to reprimand his MP, saying;

“I’ve liked things before, actually genuinely accidentally. I think when you’re scrolling through things, you know that’s created its own little controversy. I think in this case Judith Collins feels strongly about the issue, that’s legitimate. But it is a wrong source, she acknowledges that, and we should in general try and get them right.”

The reason that Mr Bridges failed to tell Ms Collins to remove her fake news post was simple and had little to do with fearing a challenge from his errant MP.

Ms Collins, along with every other National MP and Party apparatchik are presently engaged in a Trumpesque campaign to win next year’s election. Whether this involves half-truths or shonky data, or outright spread of lies – National will do whatever it takes to win.

As Chris Trotter wrote this month (15 August 2019);

“And so it begins, the National Party’s simultaneous descent and ascent. Downwards, into the dark territory of “whatever it takes”. Upwards, into the glare of electoral victory. It’s happening because the party’s present leader has convinced himself that it is only the first movement which makes possible the second.

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That is no small matter. Once truth and propaganda become fused in the minds of one’s followers, debate and discussion become redundant. If one’s opponents are all outrageous liars, then engaging with them in any way is pointless. Rather than waste its time, a political party should, instead, target all its messages at those who have yet to grasp the full mendacity of the other side. Tell these “persuadables” the truth – your truth – before the other parties tell them theirs.”

Whether Ms Collins knew that her comments regarding the Electoral (Disqualification of Sentenced Prisoners) Amendment Act 2010 was true or not is utterly irrelevant.

National has entered into a propaganda blitz. They will use half-truths, exaggeration, out-of-context material, distortions, and outright fabrications to win next years’ election.

Whatever it takes.

They will use dog-whistles; throw ‘red-meat’ to bigots; demonise every group that their conservative base despises.

Whatever. It. Takes.

Thus is the style of election campaign strategy set from now till Election Day: Whatever it takes.

With an under-resourced mainstream media, it will be a Herculean task for journalists to keep track of National Party propaganda. It may take a day to fact-check assertions from National MPs – and by then, party apparatchiks will have moved on to the next part of their diabolical strategy. (Though on 29 July, on Radio NZ’s “Morning Report Gyles Beckford challenged National leader Simon Bridges with dogged determination we rarely hear these days. )

Fortunately, they will still fail. New Zealanders, for the most part, don’t take kindly to Trumpian-style politics. And Simon Bridges is certainly no flamboyant Trump.

The only certainty is that Simon Bridges will not be leading the National Party in 2021.

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References

Wikipedia: Judith Collins, Former Police, Corrections, and Justice Minister

Twitter: Judith Collins – Prisoner Voting – 8:59AM August 12, 2019

Parliament: Electoral (Disqualification of Sentenced Prisoners) Amendment Act 2010

Parliament: Paul Quinn

Parliament: Electoral (Disqualification of Sentenced Prisoners) Amendment Bill — Third Reading

Wikipedia: NZ First – 2008 General Election

Radio NZ: NZ First tightlipped on prisoners’ voting rights

Twitter: Judith Collins – Fake News Twitter – 12:36 PM  Aug 6, 2018

Mediaworks/Newshub: Judith Collins defends her fake news tweet to Jacinda Ardern

TVNZ: ‘I don’t believe in censorship’ – Judith Collins stands firm over tweeting from ‘fake news’ site

Fairfax/Stuff media: Judith Collins defends linking to fake news article on France consent laws

Fairfax/Stuff media: Judith Collins digs in heels on fake news story

Radio NZ: Collins on fake news tweet: ‘I don’t believe in censorship’

NewstalkZB: Judith Collins slammed for retweeting fake news

Radio NZ: Collins’ fake news blunder a Bridges fail

Twitter: National Party – manufacturing graph – twitter – 5.24 PM  Aug 16, 2019

The Daily Blog: Chris Trotter – Simon Bridges Leads National Down Into The Dark

National Party: Tell them to go home, Prime Minister (alt.link)

Radio NZ: Simon Bridges criticises govt’s cancer treatment spending

Other Blogs

The Daily Blog: Prisoner Rights Blogger wins for Human Rights

Green:  Prisoner voting ban needs to be repealed

The Green Blog: Prisoner voting disqualification and the Bill of Rights Act

Public Address: Fact-checking Parliament – more prisoners can vote than they think

Werewolf: Robbing the Vote

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The Daily Blog: The madness of Judith Collin’s fake news tweet

The Standard: Is Judith Collins willing to denounce the use of fake news?

The Standard: Of course Judith should #DeleteTheTweet

Previous related blogposts

Twelve fun facts about National’s failed housing policies for Parmjeet Parmar to consider

Democracy denied – Labour’s saddest failing

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This blogpost was first published on The Daily Blog on 19 August 2019.

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Recycling – National Party style. Something embarrassing about Mr Bridges conference speech uncovered

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Current Leader of the National Party, Simon Bridges gave the usual rah-rah speech to the Loyal & Faithful in Christchurch today (27 July). With National’s party polling and his own personal popularity sliding steadily in the polls, Mr Bridges has not much left to reverse his fortunes.

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The entire Conference was geared toward promoting Simon Bridges to the public.

Even his wife, Natalie Bridges, was pressganged to put in a good word for her husband;

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However, it was Mr Bridges’ speech that really stood out – though not for the right reasons.

When this blogger heard certain parts to it, there was a sense of deja vu. It was as if I had heard the speech before. In fact, listening to other parts of it, I was sure I had.  From eleven years ago.

 

 

 

 

 

 

 

On 30 January 2008, then leader of the National Party, John Key gave his own “State of the Nation” speech, whilst still in Opposition. Mr Key said;

“So the question I’m asking Kiwi voters is this: Do you really believe this is as good as it gets for New Zealand? Or are you prepared to back yourselves and this country to be greater still? National certainly is.”

 

 

 

 

 

 

 

 

On Saturday, Simon Bridges said;

“We cannot and will not sit back and think this is as good as it gets. You deserve better, you deserve and are entitled to expect a government that delivers.”

 

 

In 2008, John Key said;

“Why are grocery and petrol prices going through the roof? […] We know you cringe at the thought of filling up the car, paying for the groceries, or trying to pay off your credit card. “

 

 

Simon Bridges said;

“I feel a deep sense of urgency as I watch this country that I love falter, as I see middle New Zealanders struggling to pay increasing rents and to put petrol in their car.”

 

 

 

In 2008, John Key said;

“Why can’t our hardworking kids afford to buy their own house?”

 

 

 

Simon Bridges said;

“A housing market that builds houses.”

 

 

 

 

In 2008, John Key said;

Why hasn’t the health system improved when billions of extra dollars have been poured into it?”

 

 

Simon Bridges said;

“The New Zealand that I want to lead will not have a two class health system that provides care for those who can pay and leaves others suffering because they can’t.”

 

 

 

 

In 2008, John Key said;

“We will be unrelenting in our quest to lift our economic growth rate and raise wage rates”

 

 

Simon Bridges said;

“A strong economy means confident thriving businesses that create more jobs and increase incomes.”

 

 

 

In 2008, John Key said;

“It matters because at number 22 your income is lower, you have to work harder…”

 

 

Simon Bridges said;

“We know it’s the men and women of New Zealand that work hard…”

 

 

 

In 2008, John Key said;

“The National Party has an economic plan that will build the foundations for a better future.”

 

 

Simon Bridges said;

“National has a plan and a track record of getting things done. We are the ones that can manage the economy to ensure it is delivering for you.”

 

 

In 2008, John Key said;

“We will focus on lifting medium-term economic performance and managing taxpayers’ money effectively.”

 

 

 

Simon Bridges said;

“We are the ones that can manage the economy to ensure it is delivering for you.”

 

 

 

In 2008, John Key said;

“This year, signs are emerging that the winds of global growth have not only stopped but are turning into a head wind.”

 

 

Simon Bridges said;

“All that platitudes and hope have given us is a weakening economy that’s not delivering for anyone.”

 

 

 

 

In 2008, John Key said;

“We will invest in the infrastructure this country needs for productivity growth.”

 

 

Simon Bridges said;

“We are the party of infrastructure.”

 

And there’s more. Read both speeches and the repetition is startling and humourous. As if someone had dusted off past speeches; re-ordered a few words, and then handed it over to Mr Bridges.

Different decade, same bovine excrement. Political manure at it’s best.

This is recycling, done National-style.

Expect more of the same last nine years of National should that party find a coalition partner to propel it over the 50% party vote line.

Which, all humour aside, is a dangerous prospect. With New Zealand – and the entire planet – is facing unprecedented challenges (ie; crises) such as worsening climate change, and resurgent nationalism,  growing from social stresses and dislocation. There are war drums on the horizon.

National has not demonstrated it is a forward-looking political party. It’s “more-of-the-same, business-as-usual” philosophy, as demonstrated by Mr Bridges’ recycled speech,  is simply not tenable.

National’s contempt and constant undermining of policies to mitigate greenhouse gas emissions is a cynical ploy to win votes. It is short-term self-interest, done at the expense of our climate and future generations.

If National can re-cycle a speech from eleven years ago, it clearly demonstrates it has no new ideas.

Check out Simon Bridges’ speech. He does not mention climate change at all. The word “environment” is barely mentioned once, in passing. Even then it is in the context of growing the economy.

National is a relic of a by-gone age. For the 21st Century, it is simply not fit for purpose.

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References

Radio NZ: Simon Bridges: ‘NZ can’t afford another three years of this government’

National Party: Speech to National Party Conference. Our bottom line – You (alt.link)

NZ Herald: John Key – State of the Nation speech

Other blogposts

The Standard:  The weasel accurately dissects National

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This blogpost was first published on The Daily Blog on 29 July  2019.

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Simon Bridges: “No ifs, no buts, no caveats, I will repeal this CGT”

13 March 2019 1 comment

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A recent bold statement from current National Party leader, Simon Bridges, declared his intentions should a capital gains tax (CGT) be enacted;

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…No ifs, no buts, no caveats, I will repeal this CGT as Prime Minister of New Zealand ” – a statement so categorical that it made John Key’s 2008 commitment never to raise GST, look timid;

“National is not going to be raising GST.

National wants to cut taxes not raise taxes.”

Except, he did.  In October 2010, Key’s National government increased GST from 12.5% to 15%.

Nine years later, Simon Bridges has made a similar, solemn, hand-on-heart, promise: “No ifs, no buts, no caveats, I will repeal this CGT as Prime Minister of New Zealand“.

Except, he can’t.

On at least several levels, his commitment to repeal a capital gains tax will fail.

Labour’s  Grant Robertson, made it crystal clear that any proposed CGT will not be implemented until after the 2020 general election;

“We know it is important to get this right, so we will balance the need for certainty and urgency by ensuring that any potential changes will not come into effect until the 2021 tax year. This gives multiple opportunities for public input, and a general election before any new tax would come into effect.”

The process would be straight-forward: whatever the Coalition government decides would be put into legislation that would not ‘activate’ until after the next election. It would take a repeal of that legislation to stop CGT from ‘kicking in’.

The difficulty with this is two-fold.

Firstly, Simon Bridges and the National Party would have to achieve a simple little thing: win the next election.

The chances of that happening – with current polling – is marginal, to say the least.

For starters, National has been trailing Labour in the last two political polls.

Secondly, National has no ‘mates’. ACT is consistently in the zero-to-1% band and the faux-Bluegreen Party is nowhere to be seen.

That leaves two parties: the Greens and NZ First.

The Green Party membership would rather machine gun the last remaining Hector’s Dolphins than entertain a “teal” coalition with the Nats. Bridges’ promise to reinstate offshore exploratory drilling for oil and gas would make any potential National-Green coalition toxic and as likely as a flying saucer landing on the White House lawn.

Which leaves NZ First. It is unclear as to what benefit – if any – a coalition deal with the Nats would offer to NZ First. As well as having been the “kiss of death” to other small parties, National has tried to destroy Winston Peters in the past. Peters is unlikely to have forgotten the leaking of his superannuation over-payment and the strong probability that it was engineered by a senior National government minister who shall remain nameless.

Moreover, if this current Coalition Government passes legislation for a capital gains tax to take effect in 2021, that would mean all three parties – Labour, Greens, and NZ First – voting to pass said necessary legislation.

For a National-NZ First Coalition to repeal that legislation would mean NZ First voting against a law that they themselves helped enact.

The fallout with the public would be massive, echoing NZ First’s disastrous decision to form a coalition with National back in 1996. Public support for NZ First would rapidly evaporate.

There would be simply no possible political gain for NZ First to travel down that road.

So unless Simon Bridges can find a new political party to ally with; or, unless National can win 50% outright of the Party Vote in 2020 – both unlikely scenarios – his promise to “repeal this CGT as Prime Minister of New Zealand” cannot be taken seriously.

Indeed, the comments following Bridges’ ‘tweet’ on 6 March reflected the disbelief of such an unlikely event happening.

And more than one social media commentor asked some pertinent questions;

“Does that include the Brightline Test your government introduced?”

And;

“Will you get rid of tax on wages and if not, why not?”

Considering that National introduced a limited capital gains tax – the  two year ‘brightline’ test – in 2015, Bridges would have to make some hard decisions and explanations to the public.

Would the ‘Brightline’ test remain in place if he had an opportunity the scrap the Coalition’s more comprehensive CGT?

Would he return the ‘Brightline’ test to two years or keep it  at five?

How would he justify retaining a ‘Brightline’ test – whether at two or five years – when scrapping a more comprehensive, and justifiably fairer, capital gains tax? Why is one form of CGT acceptable to National, but not the other?

And as more than one person demanded to know, why is National promising to get rid of one tax (Capital gains) which would benefit property speculators – but not income tax, which would benefit every wage and salary earner in the country  (and put a permanent smile on David Seymour’s face that would never be erased)?

Bridges would be facing these questions and more in 2020 if he decided to make capital gains taxation an election issue next year.

All of which is unsurprising: at around 5% in the polls, Bridges faced the ignominy of approaching the margin of error – depressing symbolism to be viewed as an ‘error’ – and over-taken by one of his National MPs, Judith Collins. This has made him that most desperate of beasts; a politician at risk of becoming irrelevant.

No party can hope to win the governing benches with a Leader who is seen as uninspiring and lacking support from even National Party voters.

If Bridges cannot succeed in campaigning to defeat capital gains, his tenure as National’s leader will come to an abrupt end. To be followed in rapid succession by his political career.

A further point has probably not escaped the attention of the National Party: if the Coalition government wins the next election and remains intact, that would signify not just the implementation of the capital gains tax – but it’s bedding-in for three years. That would make it much harder to repeal.

Especially if all the fear-mongering, gloomy predictions failed to materialise and the world (or at least the bit at the bottom where New Zealand sat) failed to end in Mayan Calendar 2012-style. Like GST, National would have to ‘bite the bullet’ and accept the new tax. They simply could not find any justification to repeal it without perpetuating their ‘other’ reputation as being a party of, and for, “rich pricks”.

If Labour, the Greens, and NZ First hold their nerve and don’t blink in the face of right-wing hysteria and bluster, the political gain from implementing CGT could be greater than they anticipate.

In fact, everything to gain, and National to lose.

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Postscript

Response to National MP, Scott Simpson, engaging in fear-mongering over CGT:

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References

Twitter: Simon Bridges – no ifs no buts no caveats – 6 March 2019

Otago Daily Times: Key ruled out GST increase in 2008

NZ Herald: GST rise – The hole in your pocket

Interest.co.nz: Labour releases document setting out tax plan, says no Working Group taxes would come into effect until after 2020 election

Mediaworks/Newshub: National plunges to worst result in over a decade – Newshub poll

NZ Herald: National will reverse Govt’s offshore oil exploration ban if in power in 2020 – Bridges

Radio NZ: Peters’ legal action against National party continuing – lawyer

Beehive: Bright-line test targets gains on property sales

Interest.co.nz: The Bill that will see the bright line test extended from two-years to five has passed its third reading and now awaits the Royal Assent to become law

Mediaworks/Newshub: NZ prefers Judith Collins to Simon Bridges as Prime Minister – Newshub poll

Twitter: Frank Macskasy – Scott Simpson – capital gains tax

Other Blogs

The Standard: Why New Zealand needs a capital gains tax

Previous related blogposts

A Capital Gains Tax?  (14 July 2011)

ACT intending a “serious assault”?  (17 July 2011)

National spins BS to undermine Labour’s Capital Gains Tax (31 May 2014)

A Claytons Capital Gains Tax? (13 September 2014)

Simon Bridges – out of touch with Kiwi Battlers (2 March 2019)

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This blogpost was first published on The Daily Blog on 8 March 2019.

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Simon Bridges – out of touch with Kiwi Battlers

2 March 2019 2 comments

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As property investors/speculators; assorted financiers; and their  political-wing, the National Party,  ramp up their opposition to a capital gains tax to a stridency approaching hysteria, current party leader, Simon Bridges, has used the mainstream media to push his highly propagandised (and highly emotive and misleading) messages;

“What the Kiwi way of life is is a recognition that New Zealanders aspire, they understand that people who work hard, who save, who invest, who take risks deserve the fruits of their labour and there is nothing fair about a capital gains tax that fundamentally gets in the way of that.”

He makes it sound as if property investment in New Zealand is akin to carving out and building a railway through the Himalayas.

On social media, Mr Bridges has used blitzed Twitter and Facebook with isolated examples of supposedly “contradictory cases” where CGT might or might not apply and has even taken to mis-representing aspects of how such a tax might apply (though he was quickly called out by other social media users).

Anyone would think that the Four Harleyriders Of The Apocalypse are bearing down upon us.

But Bridges miscalculated badly when one particular message posted on Twitter caught the eye of several users;

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New Zealanders aspire & want to get ahead for themselves & their families. How is it right that an $8m home in Auckland won’t face a CGT but a couple scrimping and saving for a bach or crib for their family will get slammed with the top tax rate? That’s not the Kiwi way.

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The kiwi way“?!

Homeless people living in garages and vans; families crammed into over-crowded houses; and even the home-seeking kids of the middle-class who cannot afford their own first homes would hardly be “The Kiwi Way“.

They would hardly be sympathetic to property owners lamenting having to “scrimp and save for a bach or crib“. Not many tears would be shed over “a bach or crib“.

Especially when many, if not most, if these “baches” and “cribs” are now substantial constructions and no longer the rustic cottages we once knew as kids.

As several Twitter-users pointed out;

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“Because a primary home is a necessity; a beach house is a luxuary.”

Babes if you don’t understand how CGT works maybe don’t get into it. And your mate’s kids might be “scrimping and saving” for a Bach but most of nz are just struggling to get a house deposit together thanks to the mess which is the property market xox

If you are scrimping perhaps a holiday home should not be a priority?

I don’t know anyone scrimping and saving for a batch. Just to get by each week yes. You are so out of touch bro.”

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There were other criticisms made, with many pointing out to Mr Bridges that a capital gains tax would apply only to any profit made at the end of selling a bach/crib – not saving for it;

“It’s not profit unless you realise it by selling the asset, you mean”

But it speaks loudly that Mr Bridges is openly appealing to the propertied middle class – those who already hold assets.

He does not appear to be even remotely concerned at the homeless nor frustrated young home-seekers who have been forced out of the property market, and destined to forever rent. National could not even admit that a home ownership problem existed.

To do so would have been a tacit admission of failure.

The term “Generation Renters” exists for good reason, as economist Shamubeel Eaqub explained in 2015 (when National was strenuously  rejecting any suggestion of a housing crisis);

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Economist Shamubeel Eaqub calls the Auckland housing story “madness” – and his upcoming book Generation Rent captures the rising sense of hopelessness among young New Zealanders locked out of the home ownership dream.

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The number of households who own or part own their home has decreased by 75,000 since 2007, despite the total number of households increasing by 155,000 in the same period. The number of households renting has increased by 117,000 during that time.

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The facts, however, speak more clearly and truthfully than any rhetoric from the current leader of the National Party, desperate to shore up his waning support and struggling to remain relevent.  If Mr Bridges loses the CGT debate it will be another nail in his political coffin.

The data, however, is hard to dismiss:

In 1991 Home ownership had reached a peak of 73.8%.

By 2013, home ownership had fallen to 64.8%.

Last year’s census results are not yet available according to Statistics NZ, but they are hardly likely to show any improvement.

The numbers show the dire state of our plummetting home ownership rates. If Mr Bridges was truly concerned for the “ordinary Kiwi battler”, he would be focused on those locked out of owning their own home instead of those already owning property and ‘aspiring’ to buy holiday homes on top of their bricks-and-mortar assets.

Instead, Mr Bridges’ comments about “a couple scrimping and saving for a bach or crib” indicates how utterly divorced he and his National Party fellow MPs are from mainstream, non-propertied New Zealand. The fact that most of them own investment properties should not be lost on us. They epitomise privilege.

National was certainly not reluctant to raise GST, prescription charges, family court fees, and a whole raft of other charges in 2010. Where was Mr Bridges then, championing those who “scrimp and save”, only to be hit by increased GST, medicine costs, and government charges?!

Mr Bridges and his privileged colleagues appear clearly wedded to protecting the interests of those for whom property investments has created mostly tax-free wealth. If ever there was a party for entrenched privilege, it is National.

It is also clear that those wanting to “get onto the first rung of the property ladder” need look elsewhere than the National Party. “Aspirational” for  the homeless and first home-owners means something completely different to National.

When a party leader unashamedly declares that he backs existing owners of property; wanting more property; without paying their fair share of tax on unearned gain on property – then those without property should look elsewhere.

The real question is not whether Mr Bridges and National are on the side of the property-owners or home-seekers. That question has well and truly been answered by Mr Bridges’ revealing ‘tweet’ above.

No, the real question now is, which side does NZ First want to be on?

What will be Winston Peters’ legacy? Aspirational home seekers or paper-wealthy property owners looking to increase their assets?

I know which one I’d want to be remembered for.

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Note: This blog author is currently away from his main computer, so reference-links may not be as comprehensive as they normally are.

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References

Radio NZ: Capital gains proposal – ‘What we’ve got here is a tax on a tax’ – Simon Bridges

Twitter: Simon Bridges – oriental bay, ohariu, gorse – 25.2.2019

Twitter: Simon Bridges – auckland home, auckland home office, exempt – 25.2.2019

Twitter: Simon Bridges – couples, scrimping, saving, baches, CGT – 22.2.2019

Radio NZ: Housing ‘challenge’ still not a ‘crisis’

Fairfax/Stuff media: House price rises creating a generation of renters

Statistics NZ: Owner-Occupied Households

Statistics NZ: 2013 Census QuickStats about national highlight

Other Blogs

The Daily Blog: ’The laughable myth of the ‘Kiwi way of life’

The Standard: Spare a thought for our poor impoverished landlords

Previous related blogposts

A Capital Gains Tax?  (14 July 2011)

ACT intending a “serious assault”?  (17 July 2011)

National spins BS to undermine Labour’s Capital Gains Tax (31 May 2014)

A Claytons Capital Gains Tax? (13 September 2014)

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Capital gains tax labour NZ Politics Daily - Bryce Edwards Otago University liberation blog - www.liberation.org.nz

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This blogpost was first published on The Daily Blog on 25 February 2019.

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Standard & Poor’s just sabotaged Simon Bridges’ tax bribe announcement

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Poor Simon Bridges.

Since becoming Leader of the National Party, he has been dogged by embarrassing leaks (which appear to be ongoing even after Jami-Lee Ross’s departure from caucus); a once-trusted MP turned feral; another MP accused of bullying her staff; allegations of a culture of sexual harrassment in the Party; travel expenses that make him look profligate with taxpayers’ money; assorted bed-hopping; and a potential contender for his job breathing down his neck as his poll ratings continue to languish in single figures.

Never mind “it’s not easy being green” – being Blue right now is positively diabolical for Simon Bridges. The only thing missing is a National MP who is revealed to be an agent for a foreign power. Oh…

With indications that the Tax Working Group will shortly be making it’s final report back to the Coalition, and with expectations that it will recommend a Capital Gains Tax on property (excluding the family home), National has launched a multi-media campaign on taxation. Twitter, Facebook, as well as the msm have all carried National’s announcement to cut taxes (dressed up as “tax adjustments” to deflect criticism that National is once again planning to cut taxes for the rich).

It was revealing that Bridges decided to give his speech out-lining plans for  tax-cuts-dressed-up-as-tax-adjustments at the Canterbury Chamber of Commerce, in Christchurch. He would not dare make such a speech at the Child Poverty Action Group, foodbank, or community hall in a predominantly state housing area.

He made his pitch at the Canterbury Chamber of Commerce because those are the people who would – yet again – benefit from tax-cuts-dressed-up-as-tax-adjustments.

As well as offering the bog-standard tax-cut bribe, Simon Bridges also alluded to National’s so-called reputation for being a “prudent fiscal manager“;

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To which one couldn’t help but reply;

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But worse was to come for Simon Bridges.

A day later, international credit ratings agency, Standard & Poor’s, up-graded New Zealand’s sovereign outlook from “stable” to “positive”. The  S&P report noted;

“Accommodative monetary policy, population growth, higher wage outcomes and higher government spending” and a decline in the New Zealand dollar, was continuing to support growth, it said.

“We don’t believe trade tensions between New Zealand’s major trading partners will currently have a substantial impact on the country’s economy and external performance, particularly given that key exports are imported for domestic consumption in China, rather than for re-exporting.”

It was capitalism’s vote-of-confidence in a left-wing government with overtly left-wing policies.

Which stands in stark contrast with the credit-rating down-grade New Zealand experienced in 2010 and 2011 – under the right-wing, Key-led National government;

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New Zealand went from “stable outlook” in 2009 to “negative” by November 2010.  By September 2011, we had dropped from AA Positive to just AA.

In fairness, a sound explanation could lie with the fallout from the 2008 Global Financial crisis and Great Recession that followed.

But no. National compounded the fall in tax revenue resulting from the Recession by cutting taxes in 2009 and 2010, which reduced the tax-take even further. That meant only one recourse for then Finance Minister, Bill English: borrowing. Massive amounts of borrowing..

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National will fast track a second round of tax cuts and is likely to increase borrowing to pay for some of its spending promises, the party’s leader John Key says.

But Mr Key said the borrowing would be for new infrastructure projects rather than National’s quicker and larger tax cuts which would be “hermetically sealed” from the debt programme.

In opening remarks to the party’s annual conference in Wellington today Mr Key said National would incorporate Labour’s October 1 tax cuts, bring forward a second round to April 2009 – a year earlier than Labour – and a third round to April 2010.

Labour’s planned third round would not take effect until April 2011.

National is yet to explain how it will pay for the promised larger cuts.

But deputy leader and finance spokesman Bill English told delegates National was prepared to borrow more to fund infrastructure.

He said New Zealand had one of the lowest levels of debt of any developed country and “additional borrowing” for infrastructure would boost economic growth.

Even after Treasury released a report predicting a $30 billion deficit, then National leader (and subsequent PM), John Key, was not prepared to abandon his party’s planned taxcut bribe;

John Key has defended his party’s planned program of tax cuts, after Treasury numbers released today showed the economic outlook has deteriorated badly since the May budget.

The numbers have seen Treasury reducing its revenue forecasts and increasing its predictions of costs such as benefits.

Cash deficits – the bottom line after all infrastructure funding and payments to the New Zealand Superannuation Fund are made – is predicted to blow out from around $3 billion a year to around $6 billion a year.

Mr Key said National anticipated that the figures would be bad but thought “even Michael Cullen could do better than this”.

But he said his party would proceed as planned with the announcement of their tax strategy on Wednesday and he said there would be tax cuts.

By mid-2009, National realised that spending cuts to social services would have to be made. The public were being “softened up” to the inevitable.

Despite drastic spending cuts to social services; ceasing payment to the NZ Superannuation Fund, and redundancies in the state sector – it was all futile and  insufficient to meet the duel cost of reduced revenue due to recessionary pressures and the – now obviously unaffordable – taxcuts.

By May 2011, the National government was borrowing $380 million per week. Debt stood at $71.6 billion.

National’s crazy borrowing had been exacerbated by tax cuts that we could ill-afford. This is why Standard and Poor’s took alarm at National’s tax-cuts and borrowings, and downgraded our credit outlook to “negative”. It could be said that New Zealand was ‘Going Greek’ in the South Pacific.

So when current National Party leader, Simon Bridges boasted that New Zealanders “trusted National with managing the economy. You know we’ll be careful with your money” – people with long memories reacted with justified derision.

Make no mistake – and let me spell it out with crystal clarity:  there is no such thing as a ‘free school lunch’ or tax-cuts without consequences. School lunches (which are a social necessity) are usually paid for by taxpayers.  Tax-cuts will be paid by all of us, if sufficient numbers of voters buy into Bridges’ tax-cut bribe.

Expect National to cut spending on vital social areas; sell remaining state assets (by stealth, if they can get away with it); stop contributions (again) to the NZ Super Fund; and increase user-pays government charges. Bridges may even go so far as to raise gst again.

As well as promising de facto tax cuts, Bridges has also made other, expensive promises;

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It is difficult to understand how National will pay for it’s promises with all those taxes abolished. And what does Bridges mean “in our first term“? What, exactly, are they planning for a second term?

We have heard this terrible “tax cuts” song before. It will not sound better the second time around.

I hope New Zealanders have better sense than to fall for this fiscal sleight-of-hand again.

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References

Radio NZ: Bridges – National caucus didn’t leak travel expenses

Otago Daily Times: More National Party leaks

Fairfax/Stuff: Another alleged recording of phone call between Simon Bridges and Jami-Lee Ross is leaked

Radio NZ: Maggie Barry bullying claims – Ex-staffer speaks out

Mediaworks/Newshub: National to conduct independent review into party culture

Radio NZ: Simon Bridges defends $113k expenses bill

Noted: Parliament’s star-crossed lovers who crossed each other

Otago Daily Times: Could Collins become National’s new leader?

NBR: Bridges clocks lowest Newshub-Reid poll rating of any National leader for a decade

Newsroom: Newsroom Investigation – National MP trained by Chinese spies

Mediaworks/Newshub: Capital gains tax set to be biggest political scrap of the year

Twitter: Simon Bridges

Facebook: Simon Bridges

Fairfax/Stuff: National promises three-yearly income tax cuts in first major speech of 2019

Fairfax/Stuff: Improved S&P outlook ‘underlines’ position of NZ economy, says Grant Robertson

The Treasury: Credit Ratings

NZ Herald: Nats to borrow for other spending – but not tax cuts

NZ Herald: Key – $30b deficit won’t stop Nats tax cuts

Fairfax/Stuff: Labour Budget pledges face axe

NZ Herald: Govt borrowing $380m a week

Fairfax/Stuff: Government debt rises to $71.6 billion

Twitter: Simon Bridges – 30 January 2018 2.44pm – abolish taxes

Additional

The Atlantic: Tax Cuts Don’t Lead to Economic Growth, a New 65-Year Study Finds

Other Blogs

Greater Auckland: What happens if you get rid of the Regional Fuel Tax?

The Daily Blog: Yawn – Simon Bridges promises less than a weekly Big Mac Combo in tax cuts

The Standard: Show us the money Simon

Previous related blogposts

“It’s one of those things we’d love to do if we had the cash”

Tax cuts & school children

The Mendacities of Mr Key #3: tax cuts

The consequences of tax-cuts – worker exploitation?

Plunket and the slow strangulation of community organisations

The cupboard is bare, says Dear Leader

An earthquake separates John Key and ‘The Iron Lady’, Margaret Thatcher

The Mendacities of Mr Key # 19: Tax Cuts Galore! Money Scramble!

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This blogpost was first published on The Daily Blog on 1 February 2019.

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A possible solution to Party campaign funding rorts

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1. Party donations

As the law currently stands with regards to party donations, there are set limits to election spending. According to the Electoral Commission;

Expenditure limit

A registered party’s election expenses during the regulated period for the 2017 general election (23 June to 22 September) must not exceed $1,115,000 (including GST) plus $26,200 (including GST) per electorate contested by the party.

If a registered party does not contest the party vote, its total election expenses cannot exceed $26,200 (including GST) for each electorate candidate nominated by the party.

The candidate election expenses regime does not apply to people who are list candidates only. Any spending by those candidates promoting the party is an election expense of the party and must be authorised by the party secretary.

Party limits are separate from the expense limits applying to electorate candidates.

The issue of donations is more complicated;

Party donations and contributions to donations of more than $15,000 (including GST) are required to be declared in the party’s annual return of donations. A series of donations, or contributions of more than $1,500 to donations, made by one person that adds up to more than $15,000 must also be declared.

Fundraising activities are also covered;

Raffles, stalls and other fundraisers

A supporter providing a party with free cakes or other goods or services to use for fundraising is not making a donation for the purposes of the Electoral Act if the value of the items given is worth $1,500 or less. Purchasers of raffle tickets and cakes from a cake stall are not ‘donors’ as they are not making a donation to anyone. The total proceeds of a raffle or a cake stall for a party’s campaign are treated as a donation. The person who runs the raffle or cake stall will normally be the donor.

If the total funds from the raffle or cake stall are over $15,000, then the party’s donation return must include the name and address of the person who ran the fundraiser and subsequently donated the proceeds, along with the total amount given and the date that the donation was received by the party secretary.

It would be a fairly profitable “chook raffle” or “cake stall” to raise $15,000. That’s a very expensive chook. And a truck-load lot of cupcakes.

2. Dodgy dealings

Fundraisers such as National’s $5,000/plate dinner event at ‘Antoine’s’ restaurant in Parnell, Auckland in 2014 raised eyebrows, forcing then-PM John Key to defend  his Party’s activities;

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Fundraising events using fronts such as ‘Antoine’s‘ restaurant are nominally legitimate – if dubious – methods to avoid identifying donors to political parties. Donation returns for National in 2010 and 2011 showed tens of thousands of dollars being funnelled through the restaurant;

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There is currently little protection from circumventing disclosure requirements by using ‘fronts’ such as Trusts and private companies.

Only direct donations are monitored.

Only where non-disclosure or false information is provided is the law is unequivocal regarding a donation;

If the party secretary knows, or has reasonable grounds to believe, that the donor has failed to supply information about contributions, the whole donation must be returned to the donor.

And,

Parties are not allowed to retain anonymous donations exceeding $1,500. An anonymous donation is a donation made in such a way that the party secretary who receives the donation does not know the identity of the donor and could not, in the circumstances, reasonably be expected to know the identity of the donor. [See section 207 of the Electoral Act]

If you receive an anonymous donation greater than $1,500 you may retain $1,500 of that donation. The balance of the donation must, within 20 working days of receipt, be paid to the Electoral Commission for payment into a Crown bank account.

NZ First was forced to return a portion of one such donation in 2008 when it received a donation of $3,690.02 from an unknown donor who was obviously providing bogus details;

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The possibility of a deliberate set-up by a political opponent should make all Party Secretaries highly cautious when dealing with donations where the donor’s details are dubious. The Donghua Liu Affair showed vividly what can happen when a Party is accused (falsely in this case) of rorting the Electoral Act.

But where a donor providing larger donation is known to Party leaders it becomes easier to circumvent legal requirements for disclosure. Recent allegations from Jami Lee Ross that businessman Zhang Yikun donated $100,000 to National, via the Botany Electorate of that Party, and was broken up at some point into smaller portions below the $15,000 threshold for mandatory declaration, are being investigated by the Police.

The apparent ease by which the Electoral Act’s requirements for disclosure can be flouted is disturbing. It opens up dangerous vulnerabilities for corruption; undue influence by big business and the wealthy, and candidates-for-money.

The US shows us where Big Money buying influence leads us – and it is not a good place.

Problems surrounding rorting the party donation system need to be urgently addressed. It is harder to cut out rot once it has set in; corruption is hard to dislodge once it has taken hold.

3. Solutions

Suggestions for tightening up legislation has ranged from lowering the limit for mandatory disclosure to $1,000 to full public funding of political parties by taxpayers.

As Green Party co-leader, Marama Davidson warned;

“The fact of the matter is, as long as political parties are accepting donations from powerful vested interests, there is a constant risk of corruption.

It is clear that those vested interests have a tangible influence on the decision making of political parties. This is a threat to democracy and should change.

Political parties are an important component of our democracy and if increasing state money for electioneering removes the influence of powerful vested interests, then it should be considered.”

Writing for Interest.co.nz, David Hargreaves has gone further, calling for a total end of private donations to political parties;

But there’s no question also that these ‘donations’ can be used by those making the donation to seek influence. If a donation ‘buys’ the people giving the money access to the political party concerned (such as dinner at someone’s house) then the opportunity is there to carry influence.

So, you get the situation in which the person making the donation wants to be able to influence proceedings – without the public at large knowing that – while the party receiving the donations doesn’t want the public at large to know that they are getting money from places that might suggest they are being subjected to particular influence.

There has to be obvious concern if particular vested interests are pumping money into political parties in order to seek influence. Now that could be say religious groups. It could be people from other countries – and what if other countries are seeking to assert their so-called ‘soft power’?

This all has to be taken very seriously.

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It’s the lack of transparency about the current system that’s the real problem.

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I increasingly think ‘donations’ should be banned. I think it should be illegal for anybody to contribute money to a political party.

Activist group, Action Stations has called for three significant reforms for Party donations:

  • All donations over $1500 should be declared and the donors named.
  • Loopholes that allow fundraising through trusts, dinners, and charity auctions to remain anonymous should be closed.
  • Donations should be publicly disclosed in real time, to allow greater and immediate scrutiny.

4. There is a further option to tighten up controls on donation.

This blogger proposes that all donations above a certain amount (whether $1,000 or $1,500) be made directly to the Electoral Commission, using internet banking. For those not au fait with internet banking, donations could be available by other means – NZPost, etc – but still made directly to the Electoral Commission.

Each donation would be made to a  nominated Party or Electorate Candidate using drop-down menus on the Commission’s website.

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Donor’s details can be matched with their bank account details. Once verified, the donated amount is lodged in a holding-account and the donor’s name  made public in real-time.

Donations through dinners, auctions, etc, can be lodged directly during the event, into the Commission’s account, disclosing the details of the donor at the dinner or auction. (Again, if the donor’s details do not match their bank account details, the donation is automatically rejected.)

As per Action Station’s demand, donations through Trusts would be banned. Any method that does not provide transparency would not be permitted through the Commission.

Parties would be banned from handling funds greater than $1,000 or $1,500.

This still allows for low-level fund-raising such as sausage sizzles, cake stalls, and chook raffles. (Cake stalls raising $15,000 would be scrutinised to see what the hell those ‘cakes’ were made from.)

Once verified, funds would be disbursed to relevent Parties to meet campaign expenses.

Any funds over the Party and Electorate cap (see above) would be held in escrow for the following election.

Interest gained from holding these funds in the Electoral Commission’s account would self-fund the system.

The obvious primary benefit would be that it makes it harder – though not impossible* – for political Parties to rort the system.

(* A wealthy donor could still, theoretically give smaller amounts to friends and family, who then make said donations to a Party or Electorate Candidate via the Commission’s account. A bank would have to implement protocols to detect suspicious payments. Any police investigation; subsequent prosecution and conviction, would have to have financial penalties so severe that anyone contemplating such a scheme would think very carefully before proceeding.)

The above proposal does not cover every aspect of donations (such as goods and services) to political parties – but it’s a start.

If Jami Lee Ross has achieved anything, it is casting the full glare of public scrutiny over Party donations. His methods may have been unorthodox – but he’s got our attention. We can no longer feign lack of awareness of this dark shadow over our democracy.

The rest is up to us, as a nation, what we do now.

Otherwise, we end up with more-of-the-same;

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For sale: one parliament.

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References

Electoral Commission: Part 3 – Election expenses, donations and loans

Mediaworks: Key not talking about fundraising dinner

Electoral Commission: National_Party_donations_2010.pdf

Electoral Commission:  New Zealand National Party donations 2011.pdf

Electoral Commission: NZ First Party Donations Returns 2008

Fairfax media: Show us the money: Donors bankrolling Greens lead way in fronting up to public

Interest.co.nz: We should urgently consider changes to the way our political parties are funded

Action Stations: Fix Political Donations

Scoop media: Stop powerful vested interests and preserve democracy

NZ Herald: Bryce Edwards – Should taxpayers fund political parties?

Fairfax media: Secret donors – Buck stops here

Additional

The Good Society: Max Rashbrooke – Donations to political parties 2011-16

Electoral Commission: Party Donations by Year

Fairfax media: Over half of major political cash comes from donations of over $15,000

NBR:  Key under fire for Antoine’s donations

Other blogs

The Standard: Ross saga quiescent, but donations scandal needs addressing

Previous related blogposts

National’s fund-raising at Antoine’s – was GST paid?

Some troubling questions about the Ross Affair

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With acknowledgement to Sharon Murdoch

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This blogpost was first published on The Daily Blog on 31 October 2018.

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