Scrutiny surrounding foreign political donations have flared again after revelations that the New Zealand National party received $150,000 as a gift from Chinese Billionaire Lang Lin. Lin is a prominent figure in the Chinese horse racing industry and made the donation through the Inner Mongolian Ride Horse Industry Group. This large sum has led to fears of foreign influence in New Zealand’s political system. While the cap for overseas donations is supposedly set at $1500, Lin managed to skirt these laws by donating through a New Zealand based company. William Boyd spoke with Lara Greaves about the rules around political donations.
Lara Greaves is a Lecturer in Politics and International Relations at the University of Auckland. She is an expert in New Zealand politics and policy.
This interview has been edited for clarity and length
William Boyd: Could you clarify what the current laws are around foreign donations?
Lara Greaves: The rules on this are a little bit complex and a bit confusing and I think a lot of people just ignore it because it is electoral law and people are not very much into electoral law. So when you actually look at the rules, someone who is classified as a foreign donor can only actually donate up to fifteen hundred dollars in a given year, so this is more a case of people going ‘Okay, let’s find some way to get around the rules to get this money through’. It is all within the law what they are doing, although I recently read that over one hundred countries have completely banned foreign donations, so this is more a case of people looking at the law and then trying to work around it.
WB: So this donation is not technically illegal. Why is it being labelled as troubling?
LG: People have labelled this as being outside of the spirit of the law. A lot of it does come back to xenophobia and we see this when we have Chinese businesspeople donating money. We have seen this before with the National party and the whole Jamie Lee-Ross drama…There is an element of xenophobia in that, firstly. Secondly, I would say that people just do not like the idea of this and this goes back to the idea of fairness that people have: does this feel fair? People kind of feel as though it doesn’t. So I think there is an element of that in there as well.
WB: Private influence over politics occurs overseas but what is the historical link between money and power in New Zealand. How often does this happen here?
LG: We have seen over the last few decades National receive a lot more donations than Labour. So if you look at the last election in 2017, National got 4.6 million dollars in donations overall and Labour got 1.6 million dollars in donations. Now a lot of that has not been from overseas, it is not a lot of money that is in this foreign category but generally there has been this huge imbalance over the years between the amount of money that has gone to right leaning parties and right wing parties and that have gone to left leaning parties. So if you look at ACT who have one MP, they got $780,000 last election and the Greens got $850,000 yet they are a much bigger party. Historically the right has gotten a lot more money from donations and so that means from time to time it comes up as large political issue and especially around the issue of moving to state funding rather than having foreign donors or any donors, any businesses, any individual person able to donate money.
WB: Do you know what the laws are surrounding transparency for these donations?
LG: If you donate more than fifteen thousand dollars in a year you have to be public but if it is less than that then you do not have to be public. There is a long list of bullet points online that are incredibly confusing.
WB: How tight do you think laws are in preventing foreign interference? Do you think they are good enough or do they need to be looked at?
LG: Well, the Justice Select Committee are looking at them at the moment and really trying to figure out what exactly you can do to tighten them. The problem is the people that we are talking about are really creative and they generally are successful businessman or businesses. We know those people are particularly good at finding their way around laws. I think that they need to be tightened but that is just a very difficult thing to do because people will find a way around it, it is just what these people do.
WB: What do you think the intentions were behind the Lang Lin donation to the National party?
LG: People have speculated that that is in response to the laws around banning the export of livestock, live livestock and those laws. I think that generally, though it goes back to why someone would donate that much money. And we have seen in the past it has been to get dinner with ministers or have people’s ear and I think that is quite suspicious to people.
WB: Simon Chappell from Victoria University is suggesting a cap on domestic donations as well as a complete ban on foreign donations. Do you agree with this?
LG: If you cap the donation automatically what is going to happen is you are going to have political parties on the right claiming that is disadvantaging them and they are going to then cry [about the] nanny state and argue ‘Well, are you now going to go to publicly funded donations?’. Then the general public will go ‘Well, I don’t want my money going to political parties, I don’t want my tax dollars going to funding political parties’. So I don’t really know what the answer is and I think no matter what you do you will get people disagreeing. For me it goes back to political participation, and donating money is political participation and it is political participation that we cannot all do. So for a lot of people they do not have enough money to live day to day let alone give money to political parties and I think that is fundamentally unfair. As a democratic person I would love to go to a system that is all publically funded and fair because again businesses are always going to give disproportionately large amounts of money to the right wing parties and they will have that advantage, but I do not think the public will necessarily want to give their tax money to politicians.
This interview originally aired on 95bFM’s weekly news and current affairs show The Wire. For more stories like this, click here.
Disclaimer: The views expressed in this discussion reflect the opinions of the guest and not necessarily the views of The Big Q.