Labour leader David Shearer has backed MP Clayton Cosgrove who has faced criticism for drafting a law that would have benefited a friend.

Cosgrove has publicly declared $17,500 in donations from Independent Fisheries, whose chief executive, Mike Dormer, is a longstanding friend.

The company was one of several that stood to gain from the law drafted in 2009. It was never drawn from Parliament's members' bill ballot and Cosgrove let it lapse in 2010 after the Canterbury earthquake.

Shearer said Cosgrove was "as honest as the day is long".

"He has actually been overly transparent ... he even declared the wood that holds up his hoardings."

Meanwhile, Labour MPs will today consider a proposal that would give members – and possibly unions and supporters – a say in who leads the party; something now determined only by MPs.

Shearer yesterday confirmed that, if approved, it would be "a mix of caucus and the membership in terms of electing the leadership".

The percentage votes allocated to each group were "up in the air", and he would not yet disclose what part unions and affiliates would have.

But the party's discussion paper, released earlier this year, points to Britain where in leadership ballots MPs' votes count for one third, the membership vote for one third and affiliated unions and supporters for one third.

Shearer said the party's ruling council would also consider the issue over the next week or so.

Speaking from a two-day retreat for MPs at Waitangi, he said he told caucus that over the past six months its message had resonated with the public. Its economic policy – which included a capital gains tax and a plan to lift the retirement age – suited the growing consensus for growth-boosting policies.

- © Fairfax NZ News