Claire Trevett

Claire Trevett is the New Zealand Herald’s deputy political editor.

Cunliffe comes clean over donations

Labour leader David Cunliffe. Photo / Warren Buckland
Labour leader David Cunliffe. Photo / Warren Buckland

Labour leader David Cunliffe has come clean about the trust set up to handle his donations during the leadership contest last year, naming three donors but saying two others were not willing to be named so their donations would be returned.

Mr Cunliffe has also said that using the trust for the campaign was a lapse in judgement.

"I don't think in hindsight that a trust structure fully represented the values I would like to bring to this leadership."
David Cunliffe

He said the three donors willing to be named were Selwyn Pellett, Perry Keenan and Tony Gibbs, who gave a combined total of $9,500. Mr Pellett, a businessman, is a longstanding Labour supporter who has donated to the party and Mr Cunliffe in the past.

Mr Gibbs is a businessman and former right hand man to Sir Ron Brierley. Perry Keenan is a New Zealander who is now senior partner at the Boston Consulting Group in Chicago.

Mr Cunliffe worked for the Boston Consulting Group prior to entering Parliament.

He said other donors had given a total of $8,300 but were not willing to be named. "That is their legal right. I respect their decision and can't control it. In their case, the trust will be returning their donations to them." He said he did not know who those donors were, or whether they were individuals or corporates.

Mr Cunliffe said it was an error of judgement to use the trust. It had meant he did not have to disclose donations in the Register of Pecuniary Interests.

"I don't think in hindsight that a trust structure fully represented the values I would like to bring to this leadership. Decisions that were made to set up the trust could have been better. I have learned form that and am now making sure I do whatever I can to ensure transparency."

He said if returning those donations left any shortfall in his campaign funding, he would cover the amount out of his own pocket. He estimated his campaign cost about $20,000.

The spending cap set by Labour was $30,000.

He said his former electorate chair, Greg Presland, was the main trustee of the trust. His wife, Karen, had also assisted in the campaign and was involved in discussions to set up the trust, but was not a trustee. He said he was not personally either a trustee or a beneficary of the trust, but it was used to pay his campaign debts.

Mr Cunliffe said he was confident the trust arrangement did meet with the requirements of the Labour Party's rules, and the Register of Pecuniary Interests. The Labour Party rules had specified donations would be confidential, and the donors had given on that understanding.

"This was the first time the Labour Party has run a leadership campaign and in the course of it we learned a thing or two about the rules that we need to iron out." He said he believed the rules around donations should be tightened and would support that in an upcoming review."

Labour leader David Cunliffe confirmed at least one of the donors - Perry Keenan - had approached him directly to offer a donation but said he had referred Mr Keenan on to the trustee of his campaign trust and did not know if the donation was made.

"I referred him on, but I was not aware of how that ended up. When people offered to help, they were referred to the trustee."

He said Mr Keenan was an old friend and former work colleague at the Boston Consulting Group. Mr Cunliffe said Mr Gibbs had supported the party in the past. He had approached somebody else on the team and was also referred to the trustee.

Mr Gibbs said he believed he had donated $1500. "I think he'll be a fine Labour Leader."

He said over the years he had made donations to parties across the political spectrum.

"I'm a firm believer in New Zealand's electoral system and from time to time I've donated to National, Labour and Act."

Mr Cunliffe's admission comes after a week of questioning by the Herald which revealed the Register for Pecuniary Interest required Labour's leadership donations to be declared.

Mr Cunliffe initially refused to confirm a trust was used for his campaign - a mechanism which effectively allowed him to avoid the disclosure of individual donations in the register. After admitting to using a trust a day later, he said it was "common practise" in politics and was not illegal.

Asked if he would have taken the step of voluntary disclosure today had it not been for media pressure, he said he had been reflecting on it over the last week."

"It's always been my approach that where you reflect on a matter and you think you could have done it better, the best approach is to be upfront with people, say you could have done it better and do your best to put it right. That's what I'm doing."

Mr Cunliffe said he would apologise to his caucus today. He denied setting up the trust specifically to avoid disclosing donations to the Register of Pecuniary Interests, saying decisions were made at "rapid pace" during the campaign.

"The reasons were two-fold. It was to give donors a higher level of confidentiality and also to keep me removed from the detail."

He said he did not know exactly when the trust was set up, and said it had a broader remit than his leadership campaign. He has been told he was not a beneficiary of it, but had known it was being set up. The beneficiaries included some people on the campaign team, including Mr Presland, but he did not know who the others were.

That register requires MPs to disclose all gifts and donations of more than $500 unless the donation was for an election campaign. In an election, candidates must declare all donations of more than $1500 to the Electoral Commission.

Mr Cunliffe did not know if his wife had asked for donations. "Lots of people approached lots of members of the campaign team with offers to help. They are referred to the trustee." He said his wife was a lawyer, so was aware that if a trust was set up to distance Mr Cunliffe from the donations, she would not tell him who the donors were.

He said as well as the donations of more than $500, there were a number of smaller donations. He did not know how much the trust took in total, but said it had a wider purpose than solely the leadership campaign.

Prime Minister John Key said the affair was "a complete mess" and Mr Cunliffe's undertaking to pay some of the money back to donors meant little.

Mr Key said Mr Cunliffe should have disclosed his donors last year, "so nothing he can do in 2014 including repaying the money alters (that) fact."

"You have to ask the question why is he going to such extraordinary lengths to protect two people, claiming he doesn't know who they are but also claiming he's going to repay money to people he says he doesn't know who they are. The whole thing is just a botch up from go to whoa.

"Clearly there's something going on there about people who gave money but know that if their identity is in the public domain, that would be very untidy for the Labour Party, maybe the policies that they've developed who knows, but three of his donors have come out and said it's ok.

"David Cunliffe has a responsibility to make sure he tells the public who the other two are or he's going to guilty of being labelled as having a secret agenda which none of us can verify either way."

Mr Key said it was "amazing" that Mr Cunliffe hadn't disclosed the donors at the time, "because it was the Labour Party that changed the rules around trusts, it's the Labour Party that's claimed that people should be transparent and upfront".

"Well on this very first test before he even became he leader he went about a process to ensure that his donors could be kept secret... now he's trying to fix things up in a half botched way it's very untidy."

Act MP John Banks said Mr Cunliffe and former Leader David Shearer, who initially failed to disclose a US bank account, had "railed against me day after day week after week month after month" over donations he received from Sky City and Kim Dotcom during his 2010 Auckland Mayoral campaign but which he listed as anonymous.

"They should look at themselves. These people are hypocrites."

- Additional reporting Adam Bennett

- NZ Herald

© Copyright 2014, APN New Zealand Limited

Assembled by: (static) on red akl_n2 at 18 Sep 2014 15:52:39 Processing Time: 951ms