Bulk-fund parties, MPs told after letting themselves off hook

Political parties could ironically acquire greater control of their parliamentary spending through bulk-funding, a confidential report suggests.

MPs are at present resisting the proposal that their breaches of the rules will mean a tighter rein on their spending.

But one option for future change includes looser controls.

The Herald understands that on Wednesday, bureaucrats in the Parliamentary Service outlined three ideas for future directions, in a confidential report to MPs on the cross-party Parliamentary Service Commission.

Auditor-General Kevin Brady criticised the service and political parties over $1.17 million in unlawful election advertising.

The first option in the report was for more extensive controls of MPs' spending, including approval before costs were incurred, and a ban on taxpayer-funded advertising in the three months before an election.

The second would need a change in the definitions of "parliamentary purpose" and electioneering, implying that the rules would be changed to allow the sort of expenditure found to be unlawful.

The third option would involve bulk-funding parliamentary parties.

Parties which incurred little liability in the Auditor-General's report have said the rules were clear. But parties with the most believe that the findings on advertising cast doubt on all expenditure.

The Parliamentary Service has taken a similar line, that the Auditor-General's rulings will have a "profound and widespread impact" on the approval and administration of such spending.

The confidential report said that regardless of the extent of law and rule changes, the service would implement pre-approval and accountability and control measures before spending was incurred.

Meanwhile, New Zealand First leader Winston Peters was yesterday seeking legal advice over the finding the party unlawfully spent $158,000.

Despite being off work for a knee operation this week, he was still seeking advice, a spokeswoman said.

Speaker Margaret Wilson formally reported to Parliament yesterday that New Zealand First was the only party that had not decided to reimburse the Parliamentary Service in the light of the Auditor-General's findings.

But she said the party had indicated it would let her know its intentions as soon as possible.

"Once I receive that notification, I will report to the House."

The New Zealand First deputy, Peter Brown, and president, Dail Jones, have indicated the party wanted to appeal to the Auditor-General's office to review the total rather than challenge the amount through the courts.

The Parliamentary Service has a week to come up with interim rules on election advertising.


Note to graphic (Click on 'more pictures' above to see it)

* The Labour-led Government, with the support of New Zealand First, United Future and Jim Anderton's Progressive - which did not misspend money - had the numbers 61-50 to pass the Appropriation (Parliamentary Expenditure Validation) Bill.

National and ACT voted against it.

The Maori Party did not vote at the third reading, but had opposed the legislation. The Green Party's six MPs abstained on the bill, which wipes the slate clean on unlawful election spending.

Deputy Prime Minister Michael Cullen said Treasury advice was that the bill was needed to validate $1.17 million in election spending Auditor-General Kevin Brady found unlawful.

The Government also said the bill was needed to clarify what the Parliamentary Service, which administers the money, can spend it on.

Mr Brady concluded the $1.17m was wrongly spent because it was taxpayer money used for "electioneering", when the money can only be used for "parliamentary purposes".

National leader Don Brash said there would now "effectively be no limit at all on what taxpayers' funds can be used for electioneering".

National tried, but failed, to move an amendment to make the bill conditional on political parties paying back what they owed.

Dr Brash said the bill's passing meant there would be "no legal obligation on anybody to pay back anything".