MMP requires tougher political donation laws

The notion that money can be used to buy policies via donations to a political party, is repugnant to anyone who supports a quality democracy.   I believe there is too much anecdotal information around to dismiss the concerns held by several commentators.

What has not been discussed is the role the MMP system plays in the way monied interests view political parties.   Under MMP smaller political parties don’t expect to get 35% plus of voters and thus target their campaigns around a few issues.  These few issues attract not just voters but money which supports them.

As major parties Labour and National have to appeal to broader constituencies and thus cannot indulge too many narrow special interests.  When negotiating with smaller parties, Labour and National have to make policy concessions, much as that might grate with their supporters.   Thus we have a situation where MMP provides the opportunity for those with money to influence specific policies.

We have laws relating to political donations and the fact some behaviour has resulted in prosecutions and also SFO investigations, show the system does work.   Could it be better?  I think so but don’t support the notion we have a Royal Commission as proposed by Bryce Edwards.  Royal Commissions are expensive long winded exercises which sometimes produce reports that don’t get acted on.

The USA has heaps of laws in this area, but their system allows people to effectively buy policies.  The challenge with any new law is to prevent policy buying, without creating undue compliance costs or simply change the way the policy buying works.

My proposition is two fold.   First, require political parties to disclose the names of all donations above $1000 or $15,000pa.   Second, require all donors to be on the electoral roll.  This would mean no corporate, union, foundation or any other organisations, donating to political parties.

By reducing the donation disclosure level to $1000, donors will be part of a much larger group and thus hopefully less shy about being disclosed.   Also the $1000 limit, combined with the requirement they be on the Electoral Roll, will make it extremely difficult for donors to get around the $15,000 current disclosure level.

The two proposals will require some consequential review of legislation applying to  others, to ensure they were not used to get around the requirements for political parties.

New Zealand has a great reputation for transparency and non corrupt politics.   My proposals would reduce reputational risks and enhance our democratic institutions.




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