Insurance firms deny fund links

Labour's claims that the insurance sector and National engaged in "cash for policy" dealings have been rejected by some of the industry's major players - who say they don't donate to any party.

Labour has gone on the attack about National's funding sources over the past two weeks as it battles heavy criticism of its own use of taxpayer money to fund its pledge card.

Central to Labour's attacks has been a suggestion that the insurance industry poured money into National's coffers anonymously before last year's election.

Senior Labour figures have linked this to National's policy to open up the Accident Compensation Corporation to competition from private insurers, which could provide a windfall to those companies.

But IAG New Zealand - which owns the State and NZI brands and claims 37 per cent of the general insurance market - yesterday said it "definitely does not" donate to any party.

A spokeswoman said such a move would be against the company's philosophy.

Tower group managing director Jim Minto also said his company had a policy of not making political donations, and didn't make any in 2005.

"In years gone by we used to make a token donation equally to the main parties," Mr Minto said.

"But no, we have not made any political donations in Australia or New Zealand in the last few years."

Tower is the only insurance company to appear on Labour's list of declared donors above $10,000 in the 1999 and 2002 election years.

The declarations show that Tower gave both Labour and National $11,000 in 1999 and $15,000 in 2002.

In 2005 the company's name doesn't appear on the declarations of any political party.

This week Prime Minister Helen Clark noted that insurance companies which had given to Labour previously had failed to do so before last year's election, and she linked this to ACC policy.

Mr Minto said the only reason Tower didn't give anything to Labour in 2005, when previously it had, was because the company decided against donating to anyone.

Mr Minto also questioned the attractiveness to insurance companies of National's policy to open up ACC to competition.

He said companies lost tens of millions of dollars in the late 1990s when National went down that road and then Labour reversed it.

"I think companies would be very, very cautious before going back in again," Mr Minto said.

Labour Party president Mike Williams yesterday said insurance companies other than Tower had donated to Labour in previous years, but the amounts were under the $10,001 level that required disclosure.

National has denied it engaged in any secret deals or agreements on its ACC policy.

Yesterday National's ACC spokesman Paul Hutchison said his party's intention to open up ACC to competition had been its policy for many years.

It was therefore "rubbish" to suggest the policy was influenced by political donations in 2005.