Cullen backs law change on party spending

Deputy Prime Minister Michael Cullen is planning to take to Cabinet a proposal for legislation to validate election expenditure the auditor-general has found unlawful.

The National Party has grabbed the moral high ground in the election spending row by paying back more than $10,000 of taxpayer money, but the Government says it is just a publicity stunt.

Auditor General Kevin Brady, with advice from former Solicitor General Terence Arnold, has ruled in a draft report -- to which parties have been asked to respond -- that significant taxpayer funds were used unlawfully by parties contesting last year's election.

National has paid back $10,588 Mr Brady considered was wrongly spent by seven of its MPs, and has accepted his interpretation of the rules.

Labour, New Zealand First and the Greens have not.

They say the same processes have been followed for the last five elections, and Mr Brady is trying to retrospectively change the rules.

Dr Cullen said on National Radio today that Parliament may have to validate the expenditure. "I think it most likely that we will have to consider validation not just for the last few months of 2005 but going back, as I said, into the 1980s."

Dr Cullen said decision to pay back the $10,000 was a "cheap move" by National leader Don Brash to grab the high ground.

If National was going to do it properly, it would have to confess to spending over many years and going back at least to 1989, Dr Cullen said.

He believed Dr Brash was "pleading guilty to a very minor offence and hoping to get off on a murder charge".

The spending in this case, for both Labour and National since 1989/90, would run to "many millions of dollars", Dr Cullen said.

Parliament could validate the expenditure "which it has done on many occasions in the past".

National deputy leader Gerry Brownlee has ruled out his party supporting retrospective legislation concerning Parliamentary Services funding of election campaign material.

He said there would have been a figure for money Labour spent in the draft report provided to Prime Minister Helen Clark, but he did not know what it was.

Labour would not pay it back, he said.

Dr Brash called on Labour to repay the $446,000 it spent on its pledge cards during last year's election campaign.

"If Labour's pledge cards and brochure -- both released just weeks from the election -- are not electioneering then I don't know what is," he said.

Dr Brash said yesterday the rules were clear and taxpayer money could not be used for electioneering.

- NZPA