Herald has own 'spin' says Cullen

Deputy Prime Minister Michael Cullen last night lashed out at the Herald's coverage of Labour's pledge card spending row and tried to draw a comparison with a tax arrangement involving the newspaper's publishers.

Dr Cullen appeared to be incensed by an article in yesterday's paper headed "Labour's Pledge Card Spin" setting out, alternately, "The spin" and "What really happened", about taxpayer funding of political party advertising, much of which the Auditor-General has provisionally found to be unlawful.

In an editorial yesterday the Herald argued that Labour should pay back the money rather than pass retrospective legislation to validate it.

Dr Cullen issued a press statement last night headed "Be careful whose spin you believe".

He took issue with the article's claim that what happened before the Speaker's 2003 rules on the matter was irrelevant.

While the 2003 determination restated the principle that Parliamentary Service funding was intended for parliamentary purposes, Dr Cullen said, "What is complicated is exactly what is included as parliamentary purposes".

"The Herald would be wise to consider the consistency of its position," he added.

"The owners of the Herald recently found themselves liable to a very large tax bill even though they could reasonably argue that the transaction which triggered it would not at the time have done so according to the general understanding of the law.

"As a result the Government has agreed to support legislation which effectively retrospectively validates that understanding and relieves the Herald's owners of the bill."

He said the bill would pay for a large number of elective operations.

He challenged the Herald to explain the difference between its own tax case "and the current storm in a teacup over Parliamentary Service funding - other than that the former is very much larger."

PricewaterhouseCoopers tax firm chairman John Shewan, an adviser to APN, said the changes in the legislation were a correction of a technical issue.

"It's a clarification of the law that has a retrospective effect."

National leader Don Brash said of Dr Cullen's comparison: "Anything more directly intimidatory or bullying it would be hard to imagine.

"He seems to be threatening APN with a major tax obligation unless you guys toe the Labour Party line."

HOUSE RULES

"Parliamentary business" means all business relating to the work of a Member of Parliament or parliamentary political party and may include:

* promoting or providing details of the services a member is offering to the public

* material of an informational nature to inform the recipient of the member's or parliamentary political party's views on public issues of the day

* information about a member's or parliamentary political party's activities.

"Parliamentary business" does not include:

* soliciting subscriptions or other financial support for a political party or a candidate at an election

* party political, promotional or electioneering material for the purpose of supporting the election of any person or party

* any work undertaken as a Minister of the Crown and Member of the Executive Council.

In the event of Vote funded advertising material which is determined as being in breach of these rules, the Speaker will usually require the member to reimburse the Vote for the costs incurred, or for a party to reimburse the amount from party funds.