Review may end use of donor trusts

John Banks. Photo / Chris Loufte

The review of local electoral finance laws prompted by the furore over anonymous donations to John Banks when contesting the Super City mayoralty may end the use of trusts to shield the identity of big donors, as employed by Auckland Mayor Len Brown.

Local Government Minister David Carter confirmed this week that the Local Electoral Act is set to be amended before next year's local body elections.

As it stands, the law - passed by Labour in 2002 - allowed Mr Banks to solicit and receive big donations from internet tycoon Kim Dotcom and casino company SkyCity to his 2010 mayoral campaign and then declare them as anonymous.

Last week, police said they would not charge Mr Banks - now Act Party leader and a Government minister - over his declaration. They said there was insufficient evidence he knowingly signed off a false return.

Yesterday, Mr Carter said the Government was "on target" to have legislation addressing the problem of anonymous donations in place before next year's local body elections.

He said the Electoral Act would provide the template for how donations were treated.

Asked whether that would include looking at the use of trusts, Mr Carter told the Herald officials were focusing on the issue of anonymous donations, "and I expect other issues will be raised as part of this work".

Mr Banks' victorious rival in the 2010 Super City mayoral election, Len Brown, used a trust - $499,000 was folded into a single trust - to protect the identity of those who gave money to help elect him but wished to remain nameless.

Through a spokesman, Mr Brown yesterday said he would welcome any review of the legislation with regard to the funding of local government elections.

Meanwhile, Opposition MPs used parliamentary privilege yesterday to attack Mr Banks over the police finding that he did solicit the donations.

They accused him of lying and questioned his ethics and the Prime Minister's continued expressions of confidence in him.

Green MP Denise Roche said he was now known as "Mr John 'Fill My' Banks" in some circles.

Labour MP Trevor Mallard goaded him over the donations to the point where Mr Banks sought the Speaker's intervention, saying extradition proceedings against Kim Dotcom meant he should not be discussed in Parliament.

Labour's deputy leader, Grant Robertson, said that if Mr Banks didn't resign, the PM should stand him down as minister.

Mr Banks later said he was not under any pressure to resign.

"I'm determined to stay on and there's been a police inquiry. I told you from day one I did nothing wrong, worked within the law. The police have had an extensive investigation and I have been totally cleared."

Asked whether he intended to stand in the 2014 parliamentary elections, Mr Banks said his career was "in its infancy".

"I've only been around public life for three decades."

THE DIFFERENCE

Local Electoral Act (for councils etc)
* Candidates must disclose all donations of more than $1000, including anonymous ones. No limits on number or size of anonymous donations. No restrictions on using trusts to channel donations through.

Electoral Act (for MPs)
* Candidates must disclose all donations of more than $1500. Maximum anonymous donation is $1500. Individual donations of more than $1500 through trusts must also be disclosed.