Fran O'Sullivan on business

Business analysis and comment from Herald columnist Fran O'Sullivan

Fran O'Sullivan: Donor slip exposes Cunliffe hypocrisy

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He may be a darling of the left but the Labour leader is playing both sides

David Cunliffe's ascension to the role of Labour leader came despite the majority of his caucus not liking him. Photo / APN
David Cunliffe's ascension to the role of Labour leader came despite the majority of his caucus not liking him. Photo / APN

David Cunliffe must be kicking himself he didn't just fund his own way into the party's top job.

The Cunliffe household - lawyer Karen Price and Opposition leader David - would pull in a combined income of at least $500,000 a year. Writing a campaign cheque for $20,000 to cover last year's leadership campaign would not have stretched the family's finances one iota.

Instead he had his campaign manager rattle the tin for him resulting in about $20,000 of anonymous donations being laundered through a secret trust.

Cunliffe has been battling the stench of hypocrisy since the use of a secret campaign trust to launder leadership campaign donations from five donors was disclosed.

It's not surprising that wealthy businessmen such as Tony Gibbs and Selwyn Pellett tossed some of their chump change into Cunliffe's leadership campaign trust.

He's a known quantity. He's personable. Many business people like him even if some are deeply wary about just what changes will occur under a Labour-led government because Cunliffe sometimes says one thing in public and something very different to them in private.

It's all rather priceless.

You see in public, Cunliffe has carefully crafted a rather overblown image that has made him the darling of the left: the union and Labour party activists who bang on about wanting an end to neo-liberalism and want to roll the State back in to play a much bigger role in our lives. The majority of his caucus don't like him. But the broader party voted him into the leadership over their wishes.

But in private, Cunliffe has been very cosy indeed with some smart businessmen. Those people - Gibbs, Pellett and Perry Keenan, who is a former colleague from his Boston Consulting Group days - were quite happy to be outed as donors once the kerfuffle over the secret trust emerged. Pellett and Gibbs were upfront about their support.

Both have given to Labour before. Gibbs even says Cunliffe will be a "fine Labour leader".

The episode underlines Cunliffe's essential political duality. He relies on secret donations from wealthy supporters to fund a campaign which positions himself as a man of the people. People from Auckland suburbs like Otara, Manurewa and Mt Roskill. Not people from swankier areas like Herne Bay, where he resides.

Cunliffe is now paying back two other donors who don't want to be exposed as having contributed to his campaign. But he is yet to explain why this pair of donors didn't want to proudly proclaim their support for Cunliffe. Have these two other donors got something to hide? By insisting their identities remain secret they have inevitably fuelled speculation that they have something to gain from Cunliffe's ascension to the Labour leadership and may have been trying to buy influence. This is either true or it is not. The pair may have believed they were entitled to make anonymous donations to the trust. It is likely they did not understand that MPs have to disclose donations that exceed $500 and, when it comes to election candidates, anonymity goes out the window if a donation is more than $1500.

In his defence, Cunliffe initially pleaded the rules were ambiguous when it comes to leadership primaries.

But that doesn't wash for a politician of Cunliffe's intellect and experience.

The fundamental problem is that campaign trusts have always contained a sham element.

Party leaders get trotted out to make the policy pitches. Party presidents and campaign bagmen then put the squeeze on donors. Donors then contribute anonymously to trusts to maintain the convenient political fig leaf that there is no connection between the funders and the ultimate recipients - the politicians whose campaigns they are backing.

Does anyone seriously believe this convoluted charade stops the politicians from making educated guesses over who is backing them? Or that Auckland Mayor Len Brown hasn't a clue over which business people contributed to his campaign fund trust? I don't think so.

In Cunliffe's case this issue is of critical importance as he has admitted one of the five donors did first make a direct approach to him.

The donor was sent off to an "agent" (in this case his longtime campaign manager Greg Presland). Thus Cunliffe could say hand on heart he did not know whether the donor did ultimately contribute. He wasn't in charge of the trust, Presland was.

But here's the thing. Cunliffe should not be ashamed of attracting business backing. Fellow leadership contestant Shane Jones also attracts a coterie of supporters from the business community. People such as EY Oceania chief executive Rob McLeod, who once spruiked Jones as potentially New Zealand's first Maori prime minister.

Jones is strongly focused on economic development. He says he has declared all donations over $500 for the leadership campaign as Parliament's rules require.

Speculation has again been fuelled that Jones might take a tilt at the Labour leadership ahead of the election. It would be a big move to take Cunliffe out at this stage. But John Key will ultimately do that at the election if the Labour leader doesn't up his game.

- NZ Herald

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