Labour faces dilemma on ads payback

Helen Clark

National has put Labour in the awkward position of having to decide whether to support its call for a law change enabling it to repay broadcasters for the $112,500 "illegal" airtime it ordered for election advertising.

National had a spending limit of $900,000 for broadcasting advertising. But after the election the party said there had been a misunderstanding with its media agent, Rainmakers.

The firm thought the figure was GST exclusive when it was not.

The party cannot legally repay broadcasters the additional $112,500 owed once GST was added, without breaching the Broadcasting Act.

Leader Don Brash said yesterday that he would introduce a private member's bill enabling National to refund the Electoral Commission the money, in turn allowing it to pass the money to broadcasters.

Out of pocket are: TVNZ $57,369; Radio Bureau $24,895; TV3 $20,013; Sky $6887 and Prime $3327.

TV3 has said it is pursuing the debt. TVNZ said it was in discussions.

Police investigated and decided against prosecuting National, taking a similar stance on different over-spending claims levelled against Labour.

The Parliamentary Service Commission is now considering whether there should be changes on election spending.

But emails included in the police files into the GST investigation raise questions about why then National campaign manager Steven Joyce did not pick up the problem before the September 17 election.

Dr Brash needs all political parties' votes to get the bill dealt with now, otherwise it will sit in the ballot and may never get drawn.

Labour has attacked the GST overspending, so would find it very difficult to oppose the bill.

But if the party paved the way for National to wipe its election-spending slate clean, National would then inevitably turn the heat back up on what it claims was Labour's bigger campaign overspending.

Labour spent $446,000 of Parliamentary Service funding on its pledge card. National claims it was election advertising which, if properly accounted for, would put Labour $400,000 over its spending limit.

Helen Clark declined to take a position on the GST bill yesterday.

"I've no idea what stance we'll take on the bill because I haven't seen it."

The papers show Mr Joyce said to police that he told Rainmakers media agent Marianne McKenzie the $900,000 allocation was GST inclusive. She maintains he did not.

There was no written contract and National said it picked up the error only after Rainmakers sent an account on September 20.

The police summary on the decision not to prosecute - worth a maximum fine of $100,000 - said only that it was not able to attribute responsibility for the error.

On August 3, Ms McKenzie emailed Mr Joyce, saying the party would overspend its $900,000 allocation by $30,453 if it continued with all booked advertising, so would have to drop some.

Although the television accounts do not mention GST, the pages of radio broadcasting accounts sent to Mr Joyce were clearly marked "GST exclusive".