It was labelled "corrupt" and "cash-for-access" when the last government did it. But now that Labour Government ministers are fundraising by holding exclusive dinners for the wealthy, it's suddenly okay. This is the story of how the Minister of Finance is leveraging his executive powers to try and get money out of the rich and powerful, and it's hard to see how it's any different to the type of events run by National that Labour politicians used to rail strongly against.
In general, there seems to be three problems with this fundraising revelation: 1) It's ethically questionable, and could be seen as corrupt, 2) It's entirely hypocritical since Labour opposed National doing the same thing, and 3) It's the type of cosying up to business that should be embarrassing for a Labour Party.
In an expose last week that never got the attention it deserved, business journalist Hamish Rutherford raised questions about the integrity of the new government – see: Labour hosts business and lobbyists at $600-a-head dinners in exclusive private clubs.
The gist of the story is that the Minister of Finance, Grant Robertson, has been fundraising for the Labour Party by inviting businesspeople, corporate lobbyists and other wealthy individuals to meet with him in exclusive venues. On Wednesday, it was at the Wellington Club, and on Thursday it was at the Northern Club in Auckland.
At the Wellington meeting, the Minister of Finance apparently "spoke about May's Budget and future Budgets. He also signalled policy announcements set to be announced in the coming weeks", and "After his speech, Robertson went table to table for more private conversations with small groups."
According to Rutherford, the standard price of entry is $600, and the "concern is that wealthy figures are able to gain access and insight that is not available to the general public."
Why there was such a low-key response
The response to this potential scandal has been muted. The parliamentary opposition has decided not to make a noise about it, beyond quite rightly pointed out the hypocrisy of Labour now using the benefits of being in government to raise money for their own party. Simon Bridges is quoted by Rutherford saying: "Labour sought to kick the crap out of us for somewhat similar sorts of events. Now they're deep in it."
Of course, Bridges also knows that National would be hypocritical if they complained about Labour's elite fundraising, and has stated that National doesn't have a problem with what the Minister of Finance is doing. Without any politician making complaints, most of the media haven't covered the issue.
Even the Greens have been relatively muted in their expressed unease with Robertson's behaviour. Newshub's Anna Bracewell-Worrall and Jenna Lynch report that "Green co-leader Marama Davidson says she's had a word to Labour", with the co-leader quoted saying "I've simply registered a concern that high-end fundraisers are not the best look and it's not something that the Greens would do" – see: Green Party cross with Labour after swanky dinner with minister.
It seems that the Greens' problem with "cash for access" schemes is more about the ticket prices are too high, than the fact that the events are happening at all. Davidson says: "Every political party absolutely does fundraising and we completely understand that. The Green Party holds fundraisers that our ministers of course attend, but we wouldn't hold something that was high-end… We tend to cater our fundraisers towards being affordable and inclusive, and suitable to our members, communities and constituencies who are our supporters".
Political commentators, so far, have also been relatively silent or relaxed about the fundraising. Right wing commentator Matthew Hooton attended the Auckland Northern Club meeting with Robertson, and he reported on this in his RNZ Nine to Noon Politics slot on Monday. Hooton defended the practice of the exclusive meetings – you can listen to this discussion (at about the 22-minute point of this 25-minute interview: Political commentators Mike Williams & Matthew Hooton.
Hooton says: "If that Cabinet manual rule was to be taken literally, it would be that Jacinda Ardern, Winston Peters, and James Shaw can't even go to a sausage sizzle and make sausages for their party in their capacity as prime minister or deputy prime minister. And parties do fundraise. Unless we are going to move to state funding of political parties then I think this is a completely legitimate way of parties to fundraise. It is not corrupt. It is more like backstage passes for Adele. People go along and they hear a speech, and there's an illusion that they are on the inside, in the bubble, and you get their photo taken with the minister."
Mike Williams, a former Labour Party president and fundraiser, had the same point of view, saying "I'm totally relaxed about this. Everybody does it, everyone has done it. It's done quite overtly and openly."
With a lack of strong condemnation from the media and other political parties, it's mostly been left to outsiders to comment. The No Right Turn blogger has labelled it "corruption", and poured scorn on Labour's defence of it: "So, they're selling access, exploiting office for private gain, just like National. No doubt they'll trot out the Politician's Excuse: 'it was within the rules'. But that doesn't change the fundamental truth here: this is corrupt, and the only reason it is not criminal is because politicians write the laws to suit themselves" – see: Same as the old boss.
Is this kind of fundraising really allowed?
There has been some debate about whether there are any rules against Cabinet ministers fundraising in this way. Labour's fundraising party president, Nigel Haworth, has defended the practice, arguing that Grant Robertson was at the meeting wearing his MP hat rather than his Ministerial hat. This is despite the invitation to the dinner clearly stating: "You are cordially invited to join me at a private post-Budget dinner with the Finance Minister, Hon Grant Robertson MP".
This concept of ministers wearing different hats was one that was often used by the previous National government, especially in justifying their ministers' involvement in their "Cabinet Club" fundraisers.
Given this innovative distinction, party president Haworth has pronounced that the Minister of Finance has not breached the Cabinet manual, which is the book of rules about how the government operates. Journalist Hamish Rutherford sought Prime Minister Jacinda Ardern's official ruling on this. Her office replied to him that the Cabinet Office had provided a response to this issue, saying "The conclusion of the advice is that while it is preferable if Ministers are described in invitations to these events in their party political terms, it is not required or a breach of the rules" – see: Prime Minister says fundraiser where 'Finance Minister' was guest did not breach Cabinet rules.
Surprisingly, the rules say "that Ministers can and will attend political fundraisers, and there is no explicit guidance in the Manual as to how they should be described on those occasions". Certainly such a lack of rules benefits the politicians.
However, the Cabinet manual also clearly states that "A Minister must not accept additional payment for doing anything that could be regarded as a ministerial function", and in this case that is exactly what appears to have happened. The manual also states that such money raised must be "declared to the Registrar of Pecuniary and Other Specified Interests of Members of Parliament", and so it will be interesting to see if Robertson complies with this.
Rutherford also reports in his article that Haworth "insisted Robertson was there as a party member" rather than a minister. Haworth is quoted: "No, no, he wasn't there [as Finance Minister]. He was there, invited by me, as a senior member of the party… This is an absolutely important issue that you must understand, now, obviously, for it to be reported absolutely clearly". Furthermore, Haworth says, "This event was no different from what all political parties have done on many occasions for decades".
Finally, we should expect to see more of this type of scandal with Labour, because being in government again means that there's plenty of people who want to give the party money. This is because, in modern politics, "money flows towards power", something I wrote about recently in a Newsroom column – see: The money follows Labour again.