Throughout the Helen Clark Labour Government’s third term in office, issues of political finance were particularly controversial, culminating with the Electoral Finance Act 2007 (EFA) being widely debated as either a cure or poison for fair elections. But just how much impact did the now-defunct EFA have on the actual 2008 general election campaign? This blog post below is a highly abridged version of the chapter that I wrote entitled ‘The impact of the Electoral Finance Act’ in the new post-election book Key to Victory: The New Zealand General Election of 2008 (edited by Stephen Levine and Nigel S. Roberts). [Read more below]
Opponents of the EFA complained that the new rules were stymieing freedom of expression and political debate. In fact, only nine weeks out from election day, the head of the Electoral Commission declared that the uncertainty resulting from the legislation was having a ‘chilling effect on the extent and type of participation in political and campaign activity’ (Electoral Commission 2008a: pp.7-8). The commission also made a number of controversial decisions during the campaign that suggested the EFA was indeed affecting the campaign. There were minor controversies about the legality of everything from Tui beer billboard advertising to Act Party leader Rodney Hide’s yellow jacket, with a host of other legal rulings and court cases highlighting the legal uncertainty and complexity of the EFA. Yet political parties appeared to campaign in much the same way as they had in previous MMP elections, suggesting that the EFA’s effects might have actually been relatively mild, and that democracy did not appear to be ‘under threat’ at all. This chapter weighs up the evidence, pinpoints where the EFA had the most impact, and details some of the Electoral Commission’s more controversial and salient decisions.
The alleged chilling effect of the EFA
The view that the difficulties related to the EFA were having a ‘chilling effect’ appeared to be backed up by a number of controversial alleged breaches of the Act, which indicated the ‘dangers’ for political parties, individuals and organisations participating in political discourse during election year. For example, the commission had to consider whether EFA-breaches were caused by such items as red Labour Party balloons, Rodney Hide’s embroidered yellow jacket, Maori Party stick-on tattoos, old party T-shirts, Government media releases, Green Party candidate garden hedges displaying the party name, and so forth. In some of these cases, experienced MPs were referred to the Police for their breaches – for example, Hide for his jacket, and Jim Anderton for his emailed media releases.
At the same time, it is possible to argue that the ‘chilling effect’ was overstated. Proponents of the EFA put forward the argument that petty breaches would not be prosecuted due to what Justice Minister Annette King called the ‘law of common sense’ that would mean that ‘inconsequential’ breaches did not have to be referred to the Police by the commission. In fact the EFA specifically gave authorities the autonomy to ignore breaches that were deemed to be either inconsequential and therefore not in the public interest to prosecute, or not wilfully committed.
There is no doubt that the EFA created a much more comprehensively state-regulated campaigning environment, which consequently reduced the freedom of some individuals and organisations to participate in political discourse. Proponents of this increased regulation argued that the provision of such civil freedoms and rights needs to be balanced against other goals for the political system. The desirability of promoting political equality for voters and for preventing political corruption, for example, meant that the restrictions inherent in the EFA, such as the reduction of political freedom, were warranted.
Legal activity involving the EFA
The shift to a highly-regulated political process under the EFA meant that electoral battles of 2008 were supplemented by a substantial increase in legal battles. Certainly the 2008 campaign had a far greater legal aspect than any previous. Lawyers were employed in greater numbers than ever before – the Electoral Commission took on extra staff, Crown Law was kept busy advising government departments, and many political parties and third parties hired lawyers to help them understand their compliance requirements.
The Electoral Commission was often at the centre of this legal activity, and during 2008 it issued 54 decisions regarding alleged breaches of electoral law. Of these, 3 concerned the Broadcasting Act, 9 concerned the Electoral Act, 45 concerned the Electoral Finance Act, and 13 resulted in referrals to the Police for investigation and prosecution. Those referred to the Police for EFA-breaches included the Labour Party (2 breaches), National Party (2), Jim Anderton’s Progressives (2), Act Party (2), the Maori Party, New Zealand First, the Employers and Manufacturers Association, The Radio Network, and Shane Jones.
A legalistic approach became central to the 2008 election partly because the EFA was primarily concerned with regulating activity relating to election advertisements and there was considerable ambiguity over issues of definition. The adopted definition of what constituted an election advertisement was extremely broad: any form of words or graphic that could reasonably be regarded to be encouraging or persuading a person to vote for or against a party or candidate. This very wide definition was the subject of much legal activity as well as parliamentary and media debate. The issue of the definition was of considerable significance, as it meant that third parties did not know whether they needed to register, political parties had trouble calculating their expenditure, and many people did not know when a promoter statement was necessary.
On one particular complaint – regarding the display of red Labour Party balloons with the party’s logo and website on them – the commission took eight months (from April to December) to make a decision. Commission members were apparently divided over whether party logos could be regarded as an election advertisement and therefore sought a decision from Crown Law, which took seven months to arrive. Eventually the commission decided that a logo was not an election advertisement unless it was disproportionately displayed. This was a key ruling, and Claire Robinson put forward the view that the commission’s decision was based on a ‘flawed definition’, and was actually pragmatically-driven by the implications of the decision: ‘What is inconvenient is the ramification. Once it is acknowledged that party logos are election advertisements, the Electoral Finance Act will be rendered absolutely, unequivocally dead in the water’ (Robinson 2008: p.9). Clearly if such a tight and literal interpretation was used, this would have seen virtually all political parties and MPs being prosecuted for breaching the EFA
Throughout 2008, the commission mostly ‘interpreted the Act rather more loosely than might have been expected’ (Otago Daily Times 2008). This was understandable, because as with the decision on whether party logos constituted electioneering, the ramifications of interpreting the EFA any other way ‘would have been so ridiculously restrictive as to make a farce of the campaigning’ (Otago Daily Times 2008). It would have made it blatantly obvious that the EFA was undermining the political process.
Much of the legal activity related to the uncertainty brought about by some of the more opaque features of the EFA. Quite simply, many political parties and third parties were uncertain about what they could or could not legally do in election year. For example, the Finsec union said that, ‘The most pernicious thing about the Act was the uncertainty around what it required of third parties and an absolute inability to get clear and concise advice about this – even from the bodies charged with its enforcement’ (Casidy 2009).
In the end, there was therefore relatively little activity in terms of election advertisements or issue advocacy from registered and non-registered third parties. Lawyer Peter Kiely says that the general legal uncertainty created a reluctance by third parties in participate:
On a risk benefit analysis I think they decided it just was not worth the legal expense and/or risk of being referred to the police with such punitive fines and possible imprisonment. More realistically, most voters or organisations could afford the legal fees to find out (Kiely 2009).
A large part of the problem was that the authorities charged with interpreting the legislation were unable or unwilling to provide adequate clarifications to electoral participants.
The impact on political parties
Was it true that the EFA made it difficult for parties and their candidates to communicate with voters at a time that the public wanted election information? Certainly there were numerous anecdotal accounts that the parties were publishing and distributing less election material throughout the year – leaflets and billboards, in particular, were less visible than usual. Parties clearly found calculating their allowable expenditure complicated, as there was a number of publicity outputs that parties and candidates were unclear as to whether they needed counting or not.
A number of complaints to the commission about alleged breaches of the EFA possibly reinforced a more cautious campaigning approach of parties and candidates. This led to a significant operational reconfiguration within the party organisations. In particular, the lack of clarity over how widely authorities would interpret election advertising forced a new approach. A cautious approach also meant that throughout the country MPs altered their electorate offices, taking down party logos from their signage, and removing party publications from window displays.
Did all of these internal legalistic issues actually matter to the campaign? Defenders of the EFA downplayed the impact of the EFA on political parties and candidates and reminded us that many of these trivial issues only amounted to a sideshow to the actual election campaign.
It is beyond the scope of this chapter to ascertain the EFA’s effectiveness in achieving its stated objectives, but instead it can be stated that in the end, the EFA was just one minor issue amongst many in a noisy election year. While behind the scenes, this election had a greater legal aspect to it than any previous ones, and the complex and highly-interventionist rules of the EFA proved to be very difficult for the political parties, third parties, and the Electoral Commission, to deal with, perhaps in the greater scheme of things, for voters it was just another election campaign.