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www.mccully.co.nz 17 February 2006

www.mccully.co.nz 17 February 2006

A Weekly Report from the Keyboard of Murray McCully
MP for East Coast Bays

Kim Il Clark

As MPs rocked up to Parliament this week to hear the Prime Minister’s opening statement, there was an air of anticipation. The Ninth Floor of the Beehive has been the venue for a slew of meetings in recent weeks. Worried that the economy is turning south in a hurry, the Sisterhood has been meeting business leaders to seek their advice.

What was said behind closed doors is not known. But the recent surveys of business sentiment must give a pretty good guide: NZIER says 71% of businesses expect the economy to deteriorate – their worst numbers in 35 years. The National Bank says 62% of respondents expect conditions to worsen. The BNZ says 65% of its respondents predict a similar downturn, and Rabobank had 60% of farmers predicting gloomy times ahead.

Faced with the dire forecasts of those at the coalface, Tuesday’s Prime Ministerial speech was the chance to take some positive steps, to show her many business visitors that she had listened to the initiatives that would motivate our job and wealth creators. But Tuesday’s speech was a Kim Il Clark special – the sort of reaction to an impending downturn you would expect in North Korea.

New Zealanders were told we’re going to have economic transformation. Not once. Several times. And how, we hear you ask, will this economic transformation occur? Will it be because the Sisterhood has decided to incentivise businesses with lower taxes, or speed up investment with faster compliance processes, or fast-track investment in key infra-structure? Well, no. The Sisterhood announced none of these things. New Zealanders are to have economic transformation because Kim Il Clark has commanded them to. And here’s betting that Kim Il Clark’s economic transformation is every bit as successful as it has been for her mentor in North Korea.


On 10 June 2005, the worldwide headquarters of mccully.co ran a lead item outlining the saga of the Prime Minister, Helen Clark’s refusal to meet the Auditor-General (AG). Acting on a complaint from the humble Member for East Coast Bays, the AG had already shaved over $5 million off the Sisterhood’s planned $21 million Working for Families pre-election publicity extravaganza. Sensing that further Sisterhood rorts were in the offing, the AG sought meetings with the Prime Minister and the Leader of the Opposition to seek agreement on tighter and clearer rules for the spending of taxpayers’ cash.

Dr Brash, who insists on conservative rules for the spending of his Leader’s budget, readily agreed to co-operate. But Helen Clark refused to meet the Auditor-General. She had already been briefed on his recommendations. And had concluded that they were in conflict with her re-election plans. The mccully.co edition of 10 June outlined this extraordinary saga of events. And speculated as to the financial atrocities which the Sisterhood must have had planned for the unsuspecting populace, leading Clark to refuse to meet the AG.

Repeats of the "You’re Better Off with Labour"billboards were predicted, along with the customary taxpayer-funded direct mail letters and TV ads. But how naïve could we be? On a really grim day, we could probably have imagined that the Sisterhood would use taxpayers’ cash to fund the $446,000 credit card promotion – the centrepiece of their entire campaign – but that would be a stretch, even for the Sisterhood. But never in our wildest dreams did we imagine that they would use taxpayers’cash to fund the centre-piece of their campaign, and then have the sheer gall to claim that it wasn’t actually an election expense (and therefore required to be listed in their return).

Readers who have relied upon this journal for its thorough and dispassionate analysis will be rightly disappointed that we were so trusting as to imagine that the Labour Party would merely content itself with ripping off taxpayers by conscripting their cash to fund their election campaign. The fact that we did not predict or even imagine the possibility that Clark and Labour might attempt a full-frontal rort of the Electoral Act – a cornerstone of our constitutional democracy – was an oversight of significant proportions. To those readers who feel let down by our inability to imagine the scale of the Labour Party’s deceit, dishonesty and contempt for the rule of law, we tender our sincere apology.

Who Knew?

The referral of the Labour Party to the Police for over-spending their campaign budget came at the end of lengthy series of events. And most commentators have been so confused by the numerous moving parts that they have had difficulty understanding just where the mischief lies, and who the perpetrators were.

Well, it goes like this. To the uninitiated observer, it might appear to be a simple case of the Labour Party making a few administrative blunders, then finding out after the election that they had overspent the Electoral Act limit. Banish anything so simple from your minds, dear readers. Some time in the weeks building up to the election, Labour was told that the $446,000 credit card, which (unbeknown to everyone else) they had no intention of declaring as an election expense, was indeed such an expense and must be returned accordingly. Labour knew, from that time, that the credit card would blow their Electoral Act budget. Unless of course, they cut other planned expenditure for the final weeks of the campaign. But the polls showed the result would be tight. So they decided to proceed with their planned expenditure, knowing that it would put them in full frontal breach of the Electoral Act cap.

But how do we know they knew. Well, alarmed that Labour’s credit card did not contain the authorisation (by a party official) required by law, the National Party referred the matter to the Speaker, who forwarded it to the Auditor-General. They also complained about the lack of authorisation to the Chief Electoral Officer, and because his only recourse is to refer a matter to the Police, that is what he did. Their presence on the scene must have set off warning bells. So some time, two or three weeks before the election, it appears the Labour Party was told by the Chief Electoral Officer that the credit card costs were an election expense, which must be declared inside their $2,380,000 limit.

From that moment, the Labour Party faced a choice: cut expenditure for the final weeks of the campaign, or knowingly commit a full frontal breach of the Electoral Act spending limit. They went with option 2.

It is worthy of note that confronted with exactly the same choice, the National candidate for Tauranga, Bob Clarkson, (advised by officials that certain costs would need to be included in his return), slashed his spending plans for the final weeks in order to comply. The Labour Party made the opposite choice.

So, the question that now remains is this: just how many senior figures in our government, having been warned by the Chief Electoral Officer (and knowing the Police were already on the case), knowingly and deliberately committed a breach of the Electoral Act spending limits. In Parliament this week, Helen Clark refused to answer that question. Other senior Labour figures are equally in the gun. The questions will go on being asked until we get an answer. Then the public will be able to conclude whether those with such a blatant contempt for the law of the land are really fit to govern.


Last Monday was Iran’s national day. The Iranian ambassador duly invited the usual political and diplomatic suspects to the embassy for the traditional celebration. Ordinarily that would mean the Head of Protocol from MFAT would attend, and perhaps the odd junior MP.

But this year’s national day function took place at anything but an ordinary time. The controversy around the publication of the infamous cartoons, and potential trade consequences was receding. International concern over the inflammatory statements of the President of Iran continued to run high. And both the UN Security Council and the International Atomic Energy Agency were expressing widely publicised concerns over Iran’s decision to move ahead with its nuclear programme.

So attendance at the Iran national day celebrations this year required careful thought. The Leader of the Opposition was not there. Nor was his humble spokesman on Foreign Affairs. John Hayes MP, a former Ambassador to Iran, was the National Party representative. Strangely, the Speaker of the House decided to attend. And New Zealand’s Foreign Ministry had a sizable contingent, headed, not by the Head of Protocol, but by none other than the Minister of Foreign Affairs, Mr Peters, himself. How very, very interesting.


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