A bill set up to fail

``Follow the money," the Washington Post's Watergate-busting investigative journalist Bob Woodward was once told.

It's lucky he doesn't live in New Zealand.

In the midst of all the Benson-Poping over the past week, another, potentially more far-reaching, political story was all but buried.

It's the story of a government that huffed and puffed about finally ending this country's truly Third-World laws around campaign finance and implementing a fair, honest, and transparent regime. And then doing precisely nothing of the sort.

Here's a quote from Prime Minister Helen Clark in December: "I think the public wants to know who is funding political parties. They want to know who is pulling strings."

And here's one from her deputy Michael Cullen last September: "I'm sure that we will want to look, as a result of this, at a much more transparent regime – a regime which makes it clear where money has come from, taking out things like anonymous donations, etcetera."

Contrast that with what Clark said in Parliament last week: "Until there can be a more mature debate on that issue ... that matter cannot be addressed."

No wonder the Prime Minister scarpered out of her weekly press conference and left Justice Minister Mark Burton to front media questions on Labour's new campaign finance bill.

To call this legislation a wet bus ticket does a grave disservice to moisture-laden receipts for public transport.

Gone are Labour's promises to halve the $10,000 limit at which the identity of donors must be disclosed. In fact, donations above that amount don't have to be disclosed either, if the party genuinely does not know where the money came from (nudge, nudge, wink, wink).

Gone are plans to prohibit blind trust accounts that allow both Labour and National to fund their election campaigns without disclosing where their money has come from.

In fact, the only pledges that remain intact are clauses that will severely restrict the ability of third-party lobby groups to play an active role in the next election campaign.

How has this happened? Where did Labour's bold statements about cleaning up "corruption" in the funding of elections disappear to?

Clark provided the answer to Parliament last week: banning anonymous donations without providing additional state funding would have left parties "across the spectrum" struggling for funding.

In other words, despite all the hyperbole from Labour about National's "secret trusts", Labour is concerned that forcing campaign funding out into the light of day would scare off donors from the Left as much as the Right.

It's true that National received more anonymous donations than Labour in 2005. But Labour still took around eight of them, worth some $300,000.

Given how skint the party is at present, anything that would threaten Labour's chances of building up a war chest for next year had to go by the wayside.

Originally, Labour had hoped to get around the problem by introducing state funding of political parties – common enough overseas, but not a popular idea in New Zealand.

Every other party in Parliament bar the Greens realised this idea was political suicide in the wake of the Auditor-General's scathing report on what they currently did with taxpayers' money and the Government was forced to drop the idea.

The wonder is that Labour bothered to proceed with the bill at all.

By ripping the guts out of it while retaining the crackdown on third-party campaigns and extending the definition of the election period right out to one year, the proposed legislation is actually worse than the status quo.

Whether or not Labour realised it, the result of this bill, should it become law, would likely severely curtail freedom of expression during the campaign season, with no-one except the parties themselves able to spend more than $60,000 making their voices heard.

Meanwhile, the two big parties are free to continue to spend up to $2 million each on their campaigns, plus the sizeable sums they take from the taxpayer from their "leaders' budgets", which are still being spent on promotional material under interim rules brought into force after last year's pledge card fiasco.

On top of this, National fears that Labour, as the incumbent, will have access to millions of dollars worth of free advertising of government policies.

Last election, the Government earmarked $15 million to promote Working for Families over three years, and you can bet it will do the same next year with Kiwi Saver.

And yet the new bill gives the Electoral Commission no new powers to investigate such rorts, instead leaving it as toothless as an old chihuahua.

It's hard to escape the conclusion that the legislation is little more than utu by Labour on the Exclusive Brethren, who will find it extremely difficult to "help" National in the 2008 election.

It's by no means certain that the bill will survive the select committee process.

The justice and electoral committee is likely to be swamped by submissions criticising the legislation, and so it should be.

The submissions won't be just from the Exclusive Brethren either. Even extremely moderate lobby groups and academics are appalled by this bill and its attack on freedom of speech.

If it is substantially amended, or, more likely, thrown out altogether, Labour will say that it did its best but couldn't force the bill through against the will of Parliament.

But this won't be strictly true.

Labour has set this legislation up to fail at the first hurdle because it, too, has a vested interest in protecting a system that keeps the financial backers of our political parties hidden from the light of day.

- © Fairfax NZ News