KEY POINTS:
The casual observer of politics could be excused for thinking that Labour has succumbed to public pressure and agreed, albeit grudgingly, to remedy the more draconian aspects of its troubled Election Finance Bill.
Labour's defence of the indefensible was always doomed to miserable failure. With substantial amendment pending at the bill's select committee stage, the prospect of an embarrassing backdown would seem to hover over the legislation.
In fact, there will be nothing of the sort.
True, Labour has made reassuring noises about problems being fixed at the bill's select committee stage, now underway with the first hearing of public submissions last Thursday.
But Labour is only likely to concede ground where it has little to lose - such as increasing the meagre amounts that so-called "third party" lobby groups will be able to spend during election campaigns.
Labour is not going to budge on parts of the bill with a crucial bearing on its election campaign next year. To put it mildly, Labour is not flush with cash. National will be rolling in the stuff. While the bill's declared intention is to create a level playing-field by restricting how much parties can spend on election-related advertising, its short-term aim is to spike National's considerable advantage.
However, the levelling or tilting of playing fields - depending on your viewpoint - is not confined to machinations over the Electoral Finance Bill.
While the spotlight was on the bill on Thursday, another unpublicised meeting was taking place elsewhere in the parliamentary complex, called by Heather Simpson, the Prime Minister's chief of staff.
This meeting of representatives from all parties in Parliament was part of a series to sort out the rules on how money in parliamentary support funds is spent. These stashes of taxpayer-provided cash are allotted on a pro rata basis to help parties run their parliamentary operations. In Labour's and National's cases, they run to upwards of $5 million.
Those rules were thrown into confusion last year after Labour was caught pillaging its fund to pay for its credit card-sized pledge card at the 2005 election.
While digging deep into its empty pockets to obey the Auditor-General's instructions and reimburse the taxpayer, Labour also passed a law validating the illegal spending.
The law established temporary rules enabling parties to keep spending part of their funds on self-promotion and publicity while permanent guidelines were drafted and then written into law. Those rules expire at the end of this year. There is now some urgency to get permanent rules passed by Parliament before then.
That process had been kept out of the public eye until Wednesday when National suddenly cried foul. Gerry Brownlee accused Simpson of colluding with other parties to secure majority support for a proposal which would allow parties to spend any amount they liked out of support budgets on election-related activities.
Joining the dots to draw the bigger picture, National is saying Labour is curbing how much National can spend on election advertising out of its pocket, while feathering its nest by ensuring it can spend up large on the taxpayer.
National fears Labour is now so desperate it is shamelessly manipulating the system by intertwining three seemingly separate things to work to its advantage - the Electoral Finance Bill, the parliamentary funding plus Government-related advertising.
Government advertising is fair enough when it involves road safety or a tax reminder. It is more questionable when it comes to providing information about Government policies subject to political argument, such as KiwiSaver, Labour's 20 free hours for early childhood education or Working for Families entitlements.
The political impact of such campaigns is a moot point given they are politically-sanitised to satisfy the Auditor-General.
National's beef is that Government advertising will remain free of restriction, but new limits are going to be placed on advertising that parties finance themselves.
A key feature of the Electoral Finance Bill is the extension of the so-called "regulated period". The net result is National will be limited in how much it can spend on advertising next year. Previously, it was obliged to keep within its entitlement of around $2.3 million during the three months before polling day. It could spend what it liked in prior months.
The period during which spending limits apply has now been extended from the start of the year until polling day. Spending limits have not been increased to compensate. National will have to make its $2.3 million limit stretch across the nearly 11 months to polling day.
The extension of the regulated period is supposedly designed to reduce the impact of the "permanent campaign" where electioneering starts earlier and earlier and the advantage lies with the party which has the most money.
The immediate effect is to dramatically curtail National's ability to repeat its devastatingly effective nationwide billboard campaign of 2005 or some equivalent.
While Labour will be flexible about other aspects of the bill, it will not budge on the regulated period. It probably will not have to as a longer regulated period suits the cash-strapped minor parties.
But there is another reason why it wants the longer period. The money in the taxpayer-funded support budgets is not subject to the spending cap. The Electoral Finance Bill states activities carried out by MPs are exempt from its provisions.
At the last election, Labour spent close to $1.2 million on advertising funded by its parliamentary support budget in the three months before polling day.
It is understood that Labour is pushing a proposal which would enable parties to do pretty much anything publicity-wise as long as advertisements do not expressly solicit votes, encourage people to join a party or seek money to fill party coffers.
This would be a reaffirmation of what parties had thought they could do prior to Labour's run-in with the Auditor-General.
National will argue Labour is frustrating other parties' right to spend their own money as they see fit, while blithely spending taxpayers' money as it sees fit.
Labour will argue it is being fair as the spending limits will apply to all parties, the parliamentary rules will also be the same for everyone and National anyway gets a similarly-sized chunk of parliamentary funding to Labour.
But Labour will want all-parties to sign-up to the rules covering support budgets so everyone cops any public backlash when enabling legislation eventually goes before Parliament.
That gives National some leverage. It may withhold endorsement and use that as a bargaining chip to get changes to the Electoral Finance Bill.
But Labour is unlikely to shift where it matters to National. The bill has seen Labour copping flak from just about every quarter. It may cop even more once the rules on parliamentary funding are released. But Labour calculates voters' memories are short. It is worth wearing criticism now if it can nobble National's campaign next year.
