Report on election spending almost complete

The Auditor-General's final report into the use of taxpayer money for political advertising is almost complete and appears unlikely to differ greatly from the preliminary view which has triggered a political storm.

Sniping between political parties has been intense since the leaking of the Auditor-General's preliminary view that much of the taxpayer-financed party advertising before last year's election was unlawful.

Deputy Controller and Auditor-General Phillippa Smith said yesterday a final report had been put together and would go to the Parliamentary Service this week for comment.

The department is to see the report so it can comment on any findings that may be adverse - a normal practice.

"It [the report] is not going to say anything hugely different, but it is a different document," Ms Smith said.

The report was a "more complete" document and would likely become public after Parliament's upcoming recess, which ends on October 10.

Polls have shown that the public overwhelmingly believes parties should pay back money found to have been spent illegally on the election.

National and the Maori Party have done just that, but Labour - which is thought to have as much as $800,000 of spending under question - has refused and has instead talked about passing legislation to validate the spending.

Labour is not alone. United Future, New Zealand First, the Greens and Act are also under the spotlight.

Prime Minister Helen Clark is waiting for the Auditor-General's final report before commenting further, but Act leader Rodney Hide yesterday revealed he had managed to trim as much as $46,000 from his party's liability.

Mr Hide said Auditor-General Kevin Brady's preliminary view was that $63,234.85 of Act's leadership budget had been misspent.

But after meeting Mr Brady - who is away until next week - Mr Hide said he had convinced him that some of that spending was actually within the rules.

"He has accepted it was legitimate parliamentary business."

At issue was a nationwide petition which cost as much as $46,376.42 to produce and which was circulating in May and June last year.

Mr Hide said with that item removed, the amount under question was now $16,858.43.

It is the first time Mr Hide has revealed the extent of Act's potential liability.

"I am pleased the amount has come down. The report was always draft and the findings provisional - so I wasn't going to rush to judgment."

Mr Hide said he had worked "scrupulously" to follow the rules, and thought he had complied, but he and other parliamentarians must accept the Auditor-General's final view when it is presented. "It would bring total disrepute on our Parliament and Government if we ignore him."

Asked if Act would pay back the $16,000, Mr Hide said he was waiting to see what the report said.

Asked if he would support passing legislation to validate the spending, he said: "It would be a huge mistake for MPs to use their position of privilege and power to change the rules for their own spending just because they can".

National deputy leader Gerry Brownlee said last night that there was "not a chance" the Auditor-General would okay Labour's $446,000 pledge card.

Meanwhile, Helen Clark today questioned who was funding the Libertarianz Party's legal action against Labour over its spending.

Libertarianz has lodged a claim in the High Court arguing Labour unlawfully spent taxpayer money to fund its 2005 election campaign.

Speaking on Newstalk ZB, the prime minister said it was "old news" that the "small right wing outfit" was taking the case.

But she asked how the Libertarianz had the money to pay for high profile Auckland QC Tony Molloy.

"I think the more interesting question is who funds all these attacks," she said

"The pledge card was funded for the previous two elections without the auditor-general raising a single query.

"The National Party funded commitment leaflets as recently as the previous election without the auditor-general turning a hair. Now my question back is what has changed relevant to those publications."

(Additional reporting by NZPA)