Rules around anonymous donations to local election campaigns are one step closer to being toughened up.
The changes were announced in the wake of the John Banks campaign donation scandal.
The Local Electoral Amendment Bill No 2 passed its first reading last night at Parliament.
The bill would bring local electoral rules closer to those governing parliamentary elections.
Changes include limiting the size of anonymous donations to $1500, revising the definition of "anonymous", increasing disclosure, reporting and recording obligations and introducing penalties for non-compliance.
Currently, politicians must declare the source of donations over $1000 if they know who the donor is.
Local Government Minister David Carter said the bill would increase accountability in local elections.
It would also provide greater efficiency and transparency, Carter said.
"In short, this bill will allow for more effective democratic representation."
The bill also increased flexibility for councils to set ward boundaries in a better way, he said.
Labour MP Annette King said her party would support the bill.
"This bill should be called the John Banks bill because this bill is about straightening up the behaviour of one of the National Party's ministers."
Labour had put its own bill forward to make these changes, she said.
Banks was investigated by police this year over anonymous donations to his failed bid to be mayor of Auckland super-city.
Should the speed limit be raised to 110kmh on some roads?Related story: 110kmh limit moves closer