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Submission on the Electoral Finance Reform Issues Paper

26 June 2009

Jesse Wilson
Jonathan Orpin
Stephen Whittington
Yogesh Patel

―[Representative democracy] means ultimately government by the free public opinion of an open society,
the effectiveness of which, as events have not infrequently demonstrated, is undoubted.

But public opinion, in order to meet such a responsibility, demands the condition of a virtually
unobstructed access to and diffusion of ideas. Parliamentary government postulates a capacity in men,
acting freely and under self-restraints, to govern themselves; and that advance is best served in the degree
achieved of individual liberation from subjective as well as objective shackles [...]

This constitutional fact is the political expression of the primary condition of social life, thought and its
communication by language. Liberty in this is little less vital to man's mind and spirit than breathing is to
his physical existence. As such an inherence in the individual it is embodied in his status of citizenship.‖

Switzman v Elbing [1957] SCR 285 at 306 per Rand J

1
jesse.wilson@bellgully.com
26 June 2007 jonathan.orpin@stoutstreet.co.nz
whittington.stephen@gmail.com
By email: electoralfinancereform@justice.govt.nz yhpatel@gmail.com

Ministry of Justice

WELLINGTON

Electoral Finance Reform

We welcome the opportunity to make a submission in relation to the Ministry of Justice‘s Issues
Paper, Electoral Finance Reform, dated 22 May 2009.

While we believe that many aspects of the Ministry of Justice‘s Issues Paper provide a helpful
starting point for the development of new electoral laws, we also respectfully consider that
certain aspects of the discussion in the Issues Paper are ill-considered and contemplate measures
that would be likely to undermine important rights and freedoms.

For the reasons set out in this submission, we hope that the government will conclude that many
of the restrictions on political speech discussed by the Issues Paper are unjustified and that it will
not include such measures in its Proposal Document. We also hope that the government will
take this opportunity to reconsider the arbitrary restrictions on private political advocacy on radio
and television.

Notwithstanding our criticism of a number of parts of the Ministry of Justice‘s Issues Paper, we
believe that the consultative process with respect to the review of New Zealand‘s electoral
finance laws is commendable.

This submission is made in our personal capacities only.

Please contact us if you have any queries in relation to the above.

Yours sincerely,

Jesse Wilson / Jonathan Orpin / Stephen Whittington / Yogesh Patel

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TABLE OF CONTENTS

1. Introduction 6

2. Guiding principles 7

Principle 1: Everyone has the right to freedom of expression, including the freedom to
seek, receive, and impart information and opinions of any kind in any form 7

Principle 2: Elections should be free and fair 15

Principle 3: Legal barriers to public participation in public debate and parliamentary


democracy should be minimal 18

Principle 4: The election laws should protect the reasonable privacy interests of
citizens 18

Principle 5: The use of public monies in connection with the electoral process should be
transparent 19

Principle 6: There is a public interest in the disclosure of donations to political parties


and candidates if those donations raise the possibility of quid pro quo by virtue of their
size and nature 20

Principle 7: Electoral laws should be applied impartially and expeditiously so as to


ensure that participants in the electoral process are held accountable according to law 21

Principle 8: In accordance with the rule of law, it should be possible to ascertain with
fair certainty the meaning, scope, and effect of the electoral laws 21

Summary 23

3. Comments on the Ministry of Justice’s proposed guiding principles 24

The “equity” and “level playing field” expressions are ill-considered 24

The concern that some political ideas will be “drowned out” in the absence of regulation
is unfounded 35

The concern that regulation is required to control the “manipulative” effects of expensive
political advertising is misguided 37

Transparency 40

4. Disclosure of donations 41

Anonymous donations should be permitted via the protected disclosure regime 41


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Summary 44

5. Limits on donations 45

6. Public funding of political parties and candidates 46

7. The exclusion of express private political advocacy from radio and television is
unjustified 46

8. Spending limits on political parties and candidates 48

There is no convincing evidence that the absence of spending limits on political parties or
candidates would undermine the integrity of the electoral process 48

There is no convincing evidence that campaign expenditure is highly determinative of


election outcomes 49

Spending limits may have pro-incumbent consequences 54

Summary 55

9. Spending limits on private political advocacy 58

10. The meaning of election advertising 60

The rationale of preventing “exploitation” of gaps in the definition of “election


advertisements” is a recipe for comprehensive regulation 61

The distinction between election advocacy and issue advocacy is blurry at best 63

Media-specific exemptions are arbitrary 70

Summary 73

11. Public disclosure of names and addresses 74

Requiring disclosure of a speaker’s identity is a form of content regulation that limits


freedom of speech 75

There is no compelling state interest that justifies requiring speakers to reveal their name
and address 76

There are many legitimate reasons why one may wish to speak anonymously 79

There is a long and honourable tradition of anonymous political speech 80

Summary 81

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12. Reflections on the Electoral Finance Act 2007 82

The failures of the Electoral Finance Act reflected flawed premises as well as poor
drafting 82

The harms that were asserted to justify the Electoral Finance Act were never adequately
explained or demonstrated by convincing evidence 83

Appendix One: Authors 85

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1. Introduction

1.1. One of the most important rights guaranteed by a free society is the right to freedom of
expression, including the freedom to criticise politicians and advocate change. The
publication of such expression takes myriad forms in an advanced society: from books
and pamphlets to websites and documentary films. Governmental restrictions on how
many books or pamphlets can be published and distributed or how much production
expense can be devoted to websites and documentary films limit freedom of expression.
Special restrictions on how much money citizens are allowed to spend developing,
publishing, and disseminating political advocacy strike at the core principle that citizens
should be able to speak freely about public affairs and publish their views about the
government and candidates seeking political office.

1.2. Given the fundamental character of the right in question, the rationales put forward to
justify restrictions on political speech prior to an election warrant careful scrutiny,
especially in view of the historical tendency for such laws to serve the interests of
incumbent politicians. It would be especially concerning if the new electoral regime
combined restrictions on private political advocacy with the introduction of public
funding for political parties, higher spending limits for politicians than citizens, and the
maintenance of a system that excludes private political advocacy from the airwaves
while mandating special broadcasting privileges to political parties. That such measures
might be introduced under the banner of ―the level playing field‖ provides an insight
into the apparent elasticity of that concept and its inadequacy as a basis to justify limits
on fundamental rights.

1.3. It is also appropriate to carefully consider the potential machinery provisions necessary
to enable a system of restrictions on the publication of advocacy (if such there must be)
to operate. New Zealand‘s experience under the Electoral Finance Act 2007
demonstrated the operational problems associated with a relatively comprehensive
regulatory system. It would be possible to improve on the workability of the system by
creating a number of exceptions from the reach of the campaign finance laws. Such
exceptions are likely to be arbitrary and would also raise questions about why a set of
rules that are said not to unduly restrict political advocacy by ordinary citizens are
nonetheless thought sufficiently burdensome to necessitate exceptions for specific
institutions or media formats. However, it is difficult to design logical rules for an ill-
considered game.

1.4. A more principled approach, and one which we hope the government will consider,
would be to return to first principles and allow citizens to publish their political views
without restriction. This would allow the electoral laws to focus on more important
matters such as ensuring the integrity of the electoral process, preventing corruption,

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and ensuring appropriate disclosure of large donations to candidates and political
parties.

2. Guiding principles

2.1. We agree with many of the Ministry of Justice‘s proposed ―guiding principles‖ for
reforms to New Zealand‘s electoral finance laws. However, we disagree with the
Ministry of Justice‘s approach in two respects:

First, the Ministry of Justice‘s proposed guiding principles do not take account of
several important principles that ought to be taken into account (e.g., the principle
of the rule of law which requires that it should be possible to for citizens to
ascertain with fair certainty the meaning, scope, and effect of the electoral laws).

Second, several of the Ministry of Justice‘s proposed guiding principles are


unnecessary or could be stated more succinctly (e.g., the principle of ―Equity‖,
which is said to mean that ―The electoral contest should be fair‖, can, in our view,
be restated in terms of the principle: ―Elections should be free and fair‖).

2.2. Accordingly, we set out below the eight principles which we submit should guide the
process of reforming New Zealand‘s electoral finance laws, together with some
discussion of the implications of those principles for electoral finance regulation.

Principle 1: Everyone has the right to freedom of expression, including the freedom to seek,
receive, and impart information and opinions of any kind in any form

2.3. Section 14 of the New Zealand Bill of Rights Act 1990 (Bill of Rights) affirms that
―everyone has the right to freedom of expression, including the freedom to seek,
receive, and impart information and opinions of any kind in any form.‖ It has been
accurately observed that ―it is difficult to imagine a guaranteed right more important to
a democratic society than freedom of expression‖ 1 and that freedom of expression is the
―the first and last trench in the protection of liberty.‖2 The right to freedom of
expression is as important for the audience as the speaker, as Justice Marshall, joined by
Justice Brennan, eloquently explained in his dissenting judgment in Kleindienst v
Mandel:3

The freedom to speak and the freedom to hear are inseparable; they are two sides of the same coin.
But the coin itself is the process of thought and discussion. The activity of speakers becoming

1
Edmonton Journal v Alberta (Attorney General) [1989] 2 S.C.R. 1326 at 78 per Cory J.
2
Hosking v Runting [2005] 1 NZLR 1 at 64 per Anderson J (dissenting).
3
408 US 753 (1972) (concerning the decision of consular officials to bar a Marxist academic from entering the
United States to appear at conferences and lectures). Marshall and Brennan JJ concluded that they were ―convinced
that Americans cannot be denied the opportunity to hear Dr Mandel‘s views in person because their Government
disapproves of his ideas.‖
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listeners and listeners becoming speakers in the vital interchange of thought is the means
indispensable to the discovery and spread of political truth. Its protection is a fundamental
principle of the American government. The First Amendment means that the Government has no
power to thwart the process of free discussion, to ―abridge‖ the freedoms necessary to make that
process work.

2.4. In the context of proposals to limit freedom of expression in the context of campaign
finance regulation, we submit that four aspects of the right to freedom of speech bear
emphasis:

First, regulations that limit the amount of money that can be spent on political
speech implicate the right to freedom of expression affirmed by section 14 of the
Bill of Rights.

Second, it is important to distinguish the principle of freedom of speech (i.e.,


everyone has the right to freedom of expression, including the freedom to seek,
receive, and impart information and opinions of any kind) from the beneficial
effects for societies that respects freedom of speech. While not all protected
speech is admirable (indeed, sometimes it is loathsome), it is necessary to respect
the principle of freedom of speech if one hopes to preserve the desirable effects of
that principle.

Third, freedom of expression may be subject, under section 5 of the Bill of Rights,
to such reasonable limits as can be demonstrably justified in a free and democratic
society. Demonstrable justification requires that freedom of expression only be
limited in the pursuit of pressing and substantial public interests and that the
harms invoked as justifications for limiting freedom of speech ought to be
properly explained and evidenced.

Fourth, the right to freedom of expression is closely connected to the right to


associate with others of a like mind to advocate for change and to encourage
others to associate with you for that purpose.

2.5. We consider each of these matters in turn.

REGULATIONS THAT LIMIT THE AMOUNT OF MONEY THAT CAN BE SPENT ON POLITICAL SPEECH
IMPLICATE THE RIGHT TO FREEDOM OF EXPRESSION AFFIRMED BY SECTION 14 OF THE BILL OF
RIGHTS.

2.6. Regulations that burden or limit the exercise of the right to freedom of expression
implicate the right affirmed by section 14 of the Bill of Rights. For example, restricting
the amount of money that a person may spend on publishing a pamphlet limits freedom
of expression for both the author of the publication and its recipients. The Crown Law
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Office acknowledged as much in its opinion concerning the consistency of the Electoral
Finance Bill 2007 with the Bill of Rights. 4 This legal proposition has been confirmed
by the highest appellate courts in Australia, 5 Canada,6 and the United States.7

2.7. Nevertheless, some proponents of campaign finance regulation continue to assert that a
limitation on the amount of money that a person may spend when expressing an idea is
not a limitation on the expression of ideas. 8 With respect, such a claim is unsustainable
as a matter of practical reality as well as being incorrect as a matter of law under the Bill
of Rights. The direct connection between a limitation on the amount of money
expended on the expression of ideas and the limitation of that expressive act was
explained in the following unanimous passage of the US Supreme Court:9

A restriction on the amount of money a person or group can spend on political communication
during a campaign necessarily reduces the quantity of expression by restricting the number of
issues discussed, the depth of their exploration, and the size of the audience reached. This is
because virtually every means of communicating ideas in today's mass society requires the
expenditure of money. The distribution of the humblest handbill or leaflet entails printing, paper,
and circulation costs. Speeches and rallies generally necessitate hiring a hall and publicizing the
event. The electorate's increasing dependence on television, radio, and other mass media for news
and information has made these expensive modes of communication indispensable instruments of
effective political speech.

2.8. The Supreme Court went on to observe in a footnote to its per curiam opinion: 10

Being free to engage in unlimited political expression subject to a ceiling on expenditures is like
being free to drive an automobile as far and as often as one desires on a single tank of gasoline.

2.9. The limitation on freedom of expression associated with restrictions on spending for the
purposes of political advocacy is also readily apparent when evaluated in the context of
other hypothetical limits on the ability of citizens to express themselves.

Consider, a person who wants to publish a pamphlet. One way to print


sufficient copies would be to pay for printing services. However, if the
person owned a printer or press, another option would be to print them

4
―Electoral Finance Bill: Consistency with the New Zealand Bill of Rights Act 1990‖, 26 June 2007, at paragraph 8
(―By limiting electoral advertising and/or imposing conditions on electoral activity, all of these provisions constrain
freedom of expression in terms of s 14 of the Bill of Rights Act‖) available at http://www.justice.govt.nz/bill-of-
rights/bill-list-2007/e-bill/electoral-finance-bill.html.
5
Australian Capital Television Pty Ltd v Commonwealth (1992) 175 CLR 1.
6
Libman v Quebec (Attorney General) [1997] 3 S.C.R. 569 at paragraph 35: ―The Act accordingly places
restrictions on such persons who, unlike the national committees, cannot incur regulated expenses during the
referendum period in order to express their opinions and points of view. This clearly infringes their freedom of
political expression. There is no doubt that freedom of expression includes the right to employ any methods, other
than violence, necessary for communication.‖
7
Buckley v Valeo 424 US 1 (1976).
8
Ibid at 19.
9
Ibid at 19.
10
Ibid at footnote 18.
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herself. Presumably no one would dispute that a government restriction on
the ability to use one‘s own printer would constitute a direct limitation on
the right to freedom of expression.

In the same way that a law restricting the free use of private presses would
limit the right to freedom of expression, so too would a law restricting the
ability of a person to pay the owner of a private press to publish his book.

Suppose, furthermore, that the government passed a law requiring its


approval for the publication of more than 100 copies of a book containing
political advocacy or a political book consisting of more than 100 pages.
Such a law would constitute an infringement on free speech because it limits
the number of copies or pages in order to control political speech.

A law prohibiting a film maker from spending more than a certain amount
of money producing a documentary film that criticised the qualifications and
positions of a politician running for office would limit the rights of the film
maker and the audience to freedom of expression.

2.10. Accordingly, we submit that the international jurisprudence to the effect that limitations
on spending money on political speech implicate the right to political speech is logical.
As Scalia J explained in McConnell: ―Where the government singles out money used to
fund speech as its legislative object, it is acting against speech as such, no less than if it
had targeted the paper on which a book was printed or the trucks that deliver it to the
bookstore.‖11

IT IS IMPORTANT TO DISTINGUISH THE PRINCIPLE OF FREEDOM OF SPEECH FROM THE BENEFICIAL


EFFECTS FOR SOCIETIES THAT RESPECTS FREEDOM OF SPEECH

2.11. A common argument by proponents of limitations on political speech is that the


limitations are necessary to further the ultimate objective of freedom of speech. It is
argued that democratic value will be strengthened and the quality of public debate
enhanced if the right to political speech is subject to certain limitations. Professor
Owen Fiss, a leading proponent of speech regulation, exemplifies this approach:12

A commitment to rich public debate will allow, and sometimes even require the state to act in
these ways, however elemental and repressive they might at first seem. Autonomy will be
sacrificed, and content regulation sometimes allowed, but only on the assumption that public
debate might be enriched and our capacity for collective self-determination enhanced. The risks
of this approach cannot be ignored, and at moments they seem alarming, but we can only begin to
evaluate them when we weigh in the balance the hidden costs of an unrestricted regime of
autonomy.

11
McConnell v Federal Election Commission 540 US 93 at 252 (2003).
12
Owen Fiss, ―Free Speech and Social Structure‖ (1986) 71 Iowa L. Rev. 1405 at 1415.
10
2.12. We believe that the conceptual flaw in this approach has been cogently expressed by
Professor Charles Fried in this way: 13

The error Fiss commits right at the outset is to mistake an effect of the principle for the principle
itself. The First Amendment protects a liberty -- liberty of expression -- and it is an effect of this
liberty that there is wide and uninhibited discussion of political matters. Similarly, property rights
enable markets and the efficiencies they entail. But property is not respected just because of the
effect, economic efficiency; rather the effect follows because property rights are respected in
principle.

2.13. A similar point has been helpfully expressed by Bernard Robertson, the editor of the
New Zealand Law Journal, who observes: 14

Once one assumes the ability to identify some purpose to an institution such as freedom of
expression one opens the door to the Fatal Conceit, a line of thinking which goes like this: The
purpose of X is Y; we can identify occasions when X does not fully pursue Y; therefore we should
intervene to make X better pursue Y. […]

In the case of freedom of speech we have, first, the marketplace of ideas. This is a parallel with
the marketplace for goods and services and is said to encourage innovation and so on. But the free
market is simply an aspect of a free society. Likewise the marketplace of ideas is a consequence
of, not the purpose of freedom of speech. It is a spin-off.

2.14. We submit that Professor Fried and Mr Robertson are essentially right: the positive
consequences associated with freedom of speech are the consequences of respecting
everyone‘s right to speak their mind.

FREEDOM OF EXPRESSION MAY BE SUBJECT, UNDER SECTION 5 OF THE BILL OF RIGHTS, TO SUCH
REASONABLE LIMITS AS CAN BE DEMONSTRABLY JUSTIFIED IN A FREE AND DEMOCRATIC SOCIETY

2.15. Under section 5 of the Bill of Rights, the rights affirmed by the Act may be subject only
to such reasonable limits as can be demonstrably justified in a free and democratic
society. In our view, the justifications for limit restrictions on spending, burdens on the
exercise of political speech, and the exclusion of private political speech from certain
media ought to be clearly explained and the asserted harms should be properly
explained and demonstrated. Given that the right to freedom of speech is clearly
implicated by many of the proposals contemplated by the Issues Paper, we believe that
the persuasive burden rests on proponents of such restrictions. We believe that this
approach is consistent with the principles underpinning the Bill of Rights, which the
White Paper made clear:15

The third important feature of the provision is that is puts the burden of persuading a court that the
provision justifies a law or other government action which is presumptively in breach of a right in
the Bill on the Government or the other party relying on the law or action.

13
Charles Fried, ―The New First Amendment Jurisprudence: A Threat to Liberty‖ (1992) 59 U. Chi. L. Rev. 225 at
226–227.
14
Bernard Robertson, ―Freedom of Speech‖ [2007] NZLJ 197 at 197–198.
15
Palmer, A Bill of Rights for New Zealand (1985) at 10.29.
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2.16. The New Zealand jurisprudence under section 5 of the Bill of Rights has largely
followed the approach of the Canadian Supreme Court under section 1 of the Canadian
Charter of Rights and Freedoms. 16 The first question is whether the restrictions are
directed towards a pressing and substantial governmental objective. This principle was
expressed as follows by the Supreme Court of Canada in R v Chaulk:17

The objective of the impugned provision must be of sufficient importance to warrant overriding a
constitutionally protected right or freedom; it must relate to concerns which are pressing and
substantial in a free and democratic society before it can be characterized as sufficiently important.

2.17. If the restrictions are designed to pursue a pressing and substantial objective of
sufficient importance to override the right to freedom of expression, the next issue is
whether the restrictions are reasonable, which requires that the restrictions must:18

―be ‗rationally connected‘ to the objective and not be arbitrary, unfair or


based on irrational considerations‖;

―impair the right or freedom in question as ‗little as possible‘‖; and

―be such that their effects on the limitation of rights and freedoms are
proportional to the objective‖.

2.18. In the first place, we submit that these principles require that the justifications for
restrictions on spending, burdens on the exercise of political speech, and the exclusion
of private political speech from certain media ought to be clearly explained and the
asserted harms should be properly explained and demonstrated.

2.19. For the reasons elaborated in this submission, we also consider that some of the
justifications offered in support of restricting freedom of expression do not constitute
pressing and substantial governmental objectives. In particular, we submit that there is
no pressing and substantial state governmental objective in restricting the ability of
some citizens to criticise politicians or engage in robust advocacy with respect to public
policy in order to somehow ―equalise" the relative voices of other citizens. Moreover,
we submit that some justifications offered in support of restricting freedom of
expression during the election period (not least, the argument for ―equalising‖ influence
or expression) do not satisfy the tests for reasonable justification due to their
incoherence, arbitrariness, and reliance on irrational considerations. Furthermore, we
submit that certain of the objectives of restricting political expression during campaign
periods could not be achieved without a restrictive and comprehensive system of speech
regulation of a kind that is not justifiable in a free and democratic society.

16
See, e.g., R v Oakes [1986] 1 SCR 103. R v Hansen [2007] 3 NZLR 1 (SC).
17
[1990] 3 SCR 1303 at 1335.
18
Ibid at 1335–1336.
12
2.20. It is also helpful to make some preliminary observations on the overseas case law. We
acknowledge that there are a number of cases from Canada and the United Kingdom
which assist the argument of proponents of campaign spending restrictions. There are
also cases from the United States and Australia that are of assistance to the opponents of
such restrictions. Nevertheless, we would make the following comments:

The Canadian and United Kingdom cases that are helpful to the arguments
made by supporters of campaign spending restrictions explicitly defer to
legislative judgments about the policy rationales for such restrictions19
(though we acknowledge that there is also judicial commentary that suggests
substantive agreement with those legislative policy judgments as well as
mere deference);

We consider the Canadian decisions upholding campaign spending


restrictions should not be followed because the scrutiny that they apply to
limitations on freedom of expression is not sufficiently exacting, their
rationales are conceptually flawed, the empirical basis for those rationales is
weak and in some cases mere assertion, there are well argued dissenting
judgments, and there are a number of earlier decisions from lower courts20
which make well reasoned arguments to overturn such restrictions;

The position in the United Kingdom has not been conclusively settled with
respect to the Political Parties, Elections and Referendums Act 2000.
However, we acknowledge that the tenor of Animal Defenders
International21 suggests that it is more likely than not that those provisions
would be held to satisfy the principles laid down in Bowman;22

We consider the United States23 and Australian24 decisions make powerful


and principled arguments, and correctly note some of the conceptual and

19
See, e.g., Harper: ―The difficulties of striking this balance are evident and, given the right of Parliament to choose
Canada‘s electoral model and the nuances inherent in implementing this model, a court must approach the
justification analysis with deference‖; and Animal Defenders: ―Government and Parliament have recently examined
with some care whether a more limited ban could be made to work and have concluded that it could not. The
solution chosen has all-party support. Parliamentarians of all political persuasions take the view that the ban is
necessary in this democratic society. Any court would be slow indeed to take a different view on a question such as
this.‖
20
See, e.g., National Citizens’ Coalition Inc v Canada (Attorney General) (1984) 11 DLR (4th) 481 (Alta. Q.B) and
also the judgments of the Alberta Court of Queen‘s Bench and the Alberta Court of Appeal in Harper v Canada:
(2001) 93 Alta LR (3d) 281(2002) 14 Alta LR (4th) 4 and
21
R (Animal Defenders International) v Secretary of State for Culture, Media and Sport [2008] 2 WLR 781.
22
Bowman v United Kingdom (1998) 26 EHRR 1 (ECHR).
23
See, e.g., Buckley v Valeo 424 US 1 (1976).
24
Australian Capital Television Pty Ltd v Commonwealth (1992) 175 CLR 1.
13
empirical weaknesses of the rationales for certain restrictions on paid
political advocacy;

As with other subjects, judicial approaches to campaign finance restrictions


are not static. Accordingly, we think it is possible that in time the Canadian
and United Kingdom courts will conclude that some of their earlier
decisions gave insufficient weight to freedom of expression and that the
rationales for those decisions were weak; and

The real question is not how far the government can limit speech before a
court would conclude that the limits were not demonstrably justified in a
free and democratic society. The flip-side of judicial deference to
legislative judgments is that the legislature should exercise its judgment in a
considered way. To the extent that the Ministry of Justice and the
government contemplate limitations on political speech during election
periods, careful consideration should be given, among other things, to the
rationales of such restrictions, whether there is any evidence to support
those rationales, and what the consequences of such limitations are likely to
be.

THE RIGHT TO FREEDOM OF EXPRESSION IS CLOSELY CONNECTED TO THE RIGHT TO FREEDOM OF


ASSOCIATION

2.21. Fourth, the right to freedom of expression is closely connected to the right to associate
with others of a like mind to advocate for change and to encourage others to associate
with you for that purpose.

2.22. It is not uncommon for those who wish to express ideas to seek out other like-minded
people. Some of those groups work together to jointly develop and articulate ideas on
certain political issues of the day (e.g., lobby groups). By working together in the
pursuit of a common objective, those individuals hope that their advocacy may be more
effective because they have pooled their resources. As those organisations become
larger (often by virtue of the success of their previous advocacy efforts in encouraging
new members to join, i.e., the process of ―speakers becoming listeners and listeners
becoming speakers‖), 25 it may also be helpful for them to incorporate to obtain the
benefits of legal personality.

25
408 US 753 (1972).
14
2.23. The relationship between freedom of expression and freedom of association was
explained by the United States Supreme Court in National Association for the
Advancement of Coloured People v Alabama:26

Effective advocacy of both public and private points of view, particularly controversial ones, is
undeniably enhanced by group association, as this Court has more than once recognized by
remarking upon the close nexus between the freedoms of speech and assembly. It is beyond
debate that freedom to engage in association for the advancement of beliefs and ideas is an
inseparable aspect of the "liberty" assured by the Due Process Clause of the Fourteenth
Amendment, which embraces freedom of speech. Of course, it is immaterial whether the beliefs
sought to be advanced by association pertain to political, economic, religious or cultural matters,
and state action which may have the effect of curtailing the freedom to associate is subject to the
closest scrutiny. (citations omitted)

2.24. One of the consequences of individuals pooling their efforts and resources in an
advocacy organisation is that the capacity of that organisation to publish ideas widely
and create publications that examine an issue in depth is greater than the individuals
could have managed alone. Indeed, that is, in part, their purpose. Nevertheless, this
beneficial consequence of people in concert causes some to fear that such organisations
will spend too much money publishing ideas. Their concern is that such organisations
constitute ―big money‖27 and therefore ought to have their advocacy curtailed. 28 We
consider later in this submission whether such a concern makes sense and whether it
provides a demonstrably justifiable basis for limiting free speech. In any event, we note
that freedom of speech and freedom of association are closely connected and mutually
reinforcing principles of a free society. 29

Principle 2: Elections should be free and fair

2.25. As noted above, we believe that the Ministry of Justice‘s second principle, ―equity‖,
should be better restated in terms of the principle: ―Elections should be free and fair‖.
Formulated in this way, the principle captures the essence of the Ministry‘s explanation
of that principle (i.e., ―the electoral contest should be fair‖).

2.26. In our view, fairness in the electoral context should be understood as procedural rather
than substantive fairness (if that term is interpreted to mean that the candidates have
equal resources as opposed to equality before the law). Elections, after all, are a contest

26
357 US 449 at 460–461 (1958).
27
For example, the Rt Hon Helen Clark has talked of ―just how much big money was sloshing around for the
National Party in the last election campaign‖ (Hansard, Questions for Oral Answer, 4 December 2007).
28
For example, Doug Woolerton has stated that ―the important thing to ensure in electoral law is that the voice of
the New Zealand public is heard at election time, not just the voices of well-funded lobby groups‖ (Hansard,
Questions for Oral Answer, 20 November 2007).
29
Reference Re Public Service Employee Relations Act (Alta), [1987] 1 SCR 313 per McIntyre J at 407: ―It is, I
believe, equally clear that . . . freedom of association should guarantee the collective exercise of constitutional
rights. Individual rights protected by the Constitution do not lose that protection when exercised in common with
others.‖
15
in which people and ideas compete. Some candidates and parties will attract more
support than others. That is inherent in the nature of the democratic system. In this
sense elections by design are not about substantive fairness (if that term is interpreted to
require material equality among candidates). We discuss the difficulties associated with
the Ministry of Justice‘s use of ―equity‖ and ―level playing field‖ in more detail under
section 3 of this submission.

2.27. Rather, the principal concern when it comes to determining whether an election is ―free
and fair‖ is to ensure that there is procedural fairness. Procedural fairness is what
distinguishes sham elections from genuine ballots which reflect the free expression of
the will of the people. A procedurally fair election has a number of characteristics,
including but not limited to, the following:

It comports with the principle of one person one vote;

It is free from intimidation and fraud;

The election process is independently run and managed;

The process is transparent and may be monitored by parties and other non-
government agencies; and

The organs and resources of the state are not used to favour particular candidates
and parties over others.

2.28. A focus on procedural fairness is consistent with section 12 of the Bill of Rights which
deals with ―electoral rights‖. That section guarantees the right to vote in ―genuine
periodic elections‖:

Every New Zealand citizen who is of or over the age of 18 years—

(a) Has the right to vote in genuine periodic elections of members of the House of
Representatives, which elections shall be by equal suffrage and by secret ballot; and

(b) Is qualified for membership of the House of Representatives.

2.29. This also reflects Article 25 of the International Covenant on Civil and Political Rights
which also guarantees ―genuine periodic elections‖:

Every citizen shall have the right and the opportunity, without any of the distinctions mentioned in
article 2 and without unreasonable restrictions:

(a) To take part in the conduct of public affairs, directly or through freely chosen representatives;

(b) To vote and to be elected at genuine periodic elections which shall be by universal and equal
suffrage and shall be held by secret ballot, guaranteeing the free expression of the will of the
electors;

16
(c) To have access, on general terms of equality, to public service in his country.
2.30. Article 21 of the Universal Declaration of Human Rights is in similar terms:

(1) Everyone has the right to take part in the government of his country, directly or through
freely chosen representatives.

(2) Everyone has the right of equal access to public service in his country.

(3) The will of the people shall be the basis of the authority of government; this will shall be
expressed in periodic and genuine elections which shall be by universal suffrage and shall
be held by secret vote or by equivalent free voting procedures.

2.31. The focus in both the Bill of Rights and the international instruments on genuine
elections is consistent with our concern of ensuring that the rules under which elections
are run are procedurally fair, do not favour or disadvantage some candidates and parties
over others, and reflect the free will of the people. While it is true that many countries
also impose limits on political speech in the pursuit of other objectives (such as
―equality‖) we think it is helpful to separate the issues and include a principle that
focuses on the integrity of the electoral process.

2.32. The requirements for a ―free and fair election‖ were discussed (though not exhaustively)
by the Constitutional Court of South Africa in New National Party of South Africa v
Government of the Republic of South Africa.30 Commenting on s 19(2) of the South
African Constitution which provides that ―[e]very citizen has the right to free, fair and
regular elections‖, Yacoob J said: 31

The right to vote is of course indispensible to, and empty without, the right to free and fair
elections; the latter gives content and meaning to the former. The right to free and fair elections
underlines the importance of the exercise of the right to vote and the requirement that every
election should be fair has implications for the way in which the right to vote can be given more
substantive content and legitimately exercised. Two of these implications are material for this
case: each citizen entitled to do so must not vote more than once in any election; any person not
entitled to vote must not be permitted to do so. The extent to which these deviations occur will
have an impact on the fairness of the election. This means that the regulation of the exercise of the
right to vote is necessary so that these deviations can be eliminated or restricted in order to ensure
the proper implementation of the right to vote.

2.33. Accordingly, we submit that the second principle should be rephrased to focus on
procedural fairness: ―Elections should be free and fair‖. Those who argue that the
guiding principles should include a principle that addresses material inequalities
between candidates and parties ought to explain their rationale for such a principle on its
own terms, as opposed to conflating it with the fairness of the election. For the reasons
we set out under section 3 of this submission, we consider that the rationale for adopting
a principle based on leveling down inequalities of resources between candidates would

30
[1999] ZACC 5.
31
Ibid at [12].
17
be weak. However, regardless of the view that the government ultimately takes with
respect to that issue, we submit that the principle that an election should be free and fair
is so important that it ought to be expressed in those terms (as opposed to the abstract
expression ―equity‖, which, with respect, is devoid of obvious meaning).

Principle 3: Legal barriers to public participation in public debate and parliamentary


democracy should be minimal

2.34. We broadly agree with the comments made by the Ministry of Justice at paragraphs
1.8–1.9 of its Issues Paper. Legal barriers to public participation (whether by way of
they spending limits or burdensome procedural requirements), increase the costs of
political participation and therefore decrease the quantity and, perhaps, quality of
political participation. For example, if private citizens are required to register before
they are able to campaign, then some may not bother to do so. Others may not express
their political views for fear of falling foul of the law. Therefore, legal barriers to public
participation affect groups at the margin who are considering whether to campaign.

2.35. In our view, the focus of this principle should be the reduction of legal barriers to
participation. Of course, social and economic circumstances may limit a person‘s
ability to participate in public debate. For example, a party may have very few
supporters or a speaker may find that no one wants to listen to his or her arguments. We
do not regard these types of social circumstances (where a person is nevertheless free to
speak) as ―barriers‖ of the kind that this principle addresses.

Principle 4: The election laws should protect the reasonable privacy interests of citizens

2.36. We submit that election laws should protect the reasonable privacy interests of citizens.
While the affairs of government should be transparent, the affairs of citizens fall into a
different category. Citizens are entitled to transparency in government given its
coercive powers, the fact that they ultimately bear the costs of government, and because
government legitimacy in a democratic society rests on the support the citizenry. Such
rationales do not apply in reverse. Rather democratic government should, absent some
compelling state interest, respect the privacy interests of its citizens.

2.37. We submit that respect for the reasonable privacy interests of citizens in the political
context is a well established value in New Zealand society. It is evident from the
following:

The secret ballot which allows individuals to vote their conscience without having to
explain their decision to others and without fear of reprisal. 32

32
The secret ballot is provided for in s 168 of the Electoral Act 1993.
18
The fact that citizens are not asked to declare a party affiliation when registering to
vote.33

The fact that political parties are not required to publicly list the names of their
members.

The fact that citizens may make anonymous donations to charities and advocacy
groups.

The absence of a requirement on charities and other incorporated societies to


publicly list their members.

Section 21(1)(j) of the Human Rights Act 1993 which provides that ―political
opinion‖ is a prohibited ground of discrimination.

The right to freedom of ―thought, conscience, religion, and belief‖ in s 13 of the Bill
of Rights.

2.38. We recognise that in drafting election laws the reasonable privacy interests of citizens
will necessarily have to be weighed against competing considerations. We submit,
however, that this balancing process will be better carried out if respect for the
reasonable privacy interests of citizens is explicitly acknowledged as an important
guiding principle at the outset. At present it is not mentioned as a guiding principle in
the Ministry of Justice‘s issues paper. We submit that it should be included.

Principle 5: The use of public monies in connection with the electoral process should be
transparent

2.39. To the extent that public monies are used in connection with the electoral process such
use should be transparent. This is simply a specific application of the wider principle
that democratic governments should be accountable to the citizens they serve. While
the application of this principle in certain contexts may raise complex policy issues, we
believe it is appropriate to make two general points.

2.40. First, to the extent that public money is used, either to run elections or to support
individual candidates and parties, such use should be acknowledged and disclosed. In
other words, the use of public money in the electoral context should be subject to the
same accountability principles that other uses of public funds are. In particular, citizens

33
Unlike in some States in the United States where it is necessary to declare a party affiliation in order to vote in
primary elections when registering to vote. See question 7 of the National Mail Voter Registration Form on the
United States Election Assistance Commission‘s website which asks for the voter‘s ―choice of party‖:
http://www.eac.gov/files/voter/nvra_update.pdf. The accompany notes to the National Mail Voter Registration
Form provide a State by State explanation as to whether this requirement is compulsory.
19
should be able to see what money is being spent on and by whom. Access to such
information allows the public to assess the legitimacy of such spending and demand
accountability, be it political or otherwise. In this respect, we agree with the Issues
Paper when it says:

1.10 The public must have confidence in their democratic system. Rules to promote
transparency around electoral finance help to maintain that confidence.

1.11 Transparency is the best way of ensuring that participants in the electoral process comply
with the law and behave ethically because, ultimately, the voters will hold them to
account.

2.41. Second, our inclusion of this principle should not be taken as an indication of our
support for allowing political parties and candidates to spend public money for
campaign related purposes. It is merely an acknowledgment that to the extent that such
spending either takes place now or is proposed in the future, such spending should be
subject to public scrutiny. We are, however, opposed to the concept of creating a
general system of public funding for political parties.

Principle 6: There is a public interest in the disclosure of donations to political parties and
candidates if those donations raise the possibility of quid pro quo by virtue of their size and
nature

2.42. As a particular aspect of transparency, we submit that there is a public interest in the
disclosure of donations to political parties and candidates if those donations raise the
possibility of quid pro quo by virtue of their size and nature.

2.43. As indicated above, we generally believe that electoral laws should seek to uphold the
reasonably privacy interests of citizens. Small and anonymous donations made to
political parties do not give rise to concerns that financial support is being given in
return for favours, influence or policy support. We reiterate the observation (made in a
different context) that it is necessary ―to distinguish between matters of general interest
or curiosity to the public, and matters which are of legitimate public concern‖.34
Although it may be interesting that one‘s neighbour donates small sums of money to a
political party, it is not a matter of legitimate public concern. Accordingly, we are of
the view that the privacy interests of small and anonymous donors are entitled to
respect.

2.44. We recognise, however, that certain donations by their size and nature are of legitimate
public concern. Although large donations are not improper, they may raise an inference

34
Hosking v Runting [2005] 1 NZLR 1 (CA) at [133] per Gault and Blanchard JJ.
20
of a quid pro quo.35 In such cases we submit that the privacy interests of the donor are
outweighed by the public interest in disclosing the existence of the donation. Disclosure
will allow voters to evaluation any inference of a quid pro quo and, as the Issues Paper
notes, ―hold [parties and candidates] to account‖, if they believe that is warranted.36

Principle 7: Electoral laws should be applied impartially and expeditiously so as to ensure that
participants in the electoral process are held accountable according to law

2.45. We agree with the fifth principle proposed by the Ministry of Justice (―accountability‖),
as well as its comment that ―it must be clear to everyone that those who break the rules
are held to account.‖37 Clearly expressed and coherent electoral laws assist electoral
regulators to enforce those laws expeditiously and are likely to improve public
confidence in the electoral system. We believe that it would be helpful to express the
principle in the terms we suggest above.

Principle 8: In accordance with the rule of law, it should be possible to ascertain with fair
certainty the meaning, scope, and effect of the electoral laws

2.46. Reasonable certainty as to the meaning and application of the law is an important aspect
of the rule of law. The Hon Murray Gleeson, then Chief Justice of the High Court of
Australia, explained the importance of the ability of citizens to foresee how the law will
affect them as follows:38

In a liberal democracy, the idea of the rule of law is bound up with individual autonomy – the
freedom to make choices. It is only if people know, in advance, the rules by which conduct is
permitted or forbidden, and the rights and obligations that flow from their conduct, that they are
free to set their personal goals and decide how to pursue them. That is the purpose of having law
in the form of general rules, of reasonable clarity and certainty, capable of being known by people
in advance of choosing to act in a certain way.

2.47. The Nobel laureate economist and political philosopher, F.A. Hayek similarly expressed
the importance of fair certainty to the rule of law in this way:39

Nothing distinguishes more clearly conditions in a free country from those in a country under
arbitrary government than the observance in the former of the great principles known as the Rule
of Law. Stripped of all technicalities, this means that government in all its actions is bound by
rules fixed and announced beforehand – rules which make it possible to foresee with fair certainty
how the authority will use its coercive powers in given circumstances and to plan one‘s individual
affairs on the basis of this knowledge.

35
For example, in 2008 questions were raised about the connection between donations received by the New Zealand
First Party and its racing policy. See http://www.odt.co.nz/news/politics/14508/peters-rejects-donations-influenced-
racing-policy.
36
At paragraph 1.11.
37
Issues Paper, paragraph 1.13.
38
The Hon Murray Gleeson, "A Core Value", Judicial Conference of Australia, Annual Colloquium, 6 October
2006. Available at http://www.jca.asn.au/attachments/2006-cj_6oct06.pdf.
39
F.A. Hayek, The Road to Serfdom (1944).
21
2.48. Fair certainty is particularly important where criminal sanctions apply to the breach of a
rule (i.e. a concomitant principle to the rule that ignorance of the law is no excuse for
breaching it is that those subject to the law should be able to ascertain what the law
forbids). It is especially important where, as in the context of campaign regulations
affecting political speech, significant human rights are at stake. As the Privy Council
indicated in de Freitas v Permanent Secretary of Ministry of Agriculture, Fisheries,
Lands and Housing – a case concerning freedom of expression – "legal provisions
which interfere with individual rights must be . . . formulated with sufficient precision
to enable the citizen to regulate his conduct."40 As Lord Simonds, put the point: ―a man
should not be put in peril on an ambiguity.‖ 41

2.49. We therefore submit that one of the guiding principles for the development of new
electoral laws should be that the rules are sufficiently understandable to afford citizens
fair certainty as to what is permitted and what is prohibited. As the experience of the
Electoral Finance Act demonstrated, laws which are based on vague standards are
difficult to understand and apply. 42 We submit that it is inconsistent with the rule of law
to regulate public debate according to prohibitions so uncertain that citizens and
regulators alike are unable to determine their meaning with fair certainty. We also
believe that it would be helpful for the Ministry of Justice and the government to
consider the comments of the New Zealand Law Society‘s Rule of Law committee with
respect to the Electoral Finance Act, including its comment that:43

The rule of law requires, as a minimum, certain, stable and predictable rules of laws that commend
themselves to the sense of fairness of the people. However, the uncertainties that beleaguer the Act
are seriously confounding the political process. No one is able to say with confidence whether
some forms of political spending constitute election advertising and are subject to the Act‘s
prescriptive requirements. Given the uncertainties, the rule of law has descended into what an
electoral official says is the law (does this or does this not constitute election advertising?). So
much, then, for certain, stable and predicable rules of law. The Act is fundamentally flawed and
misconceived, and ought to be repealed.

2.50. To some extent, the need for certainty and predictability is touched upon by the sixth
principle of ―legitimacy‖ proposed by the Ministry of Justice. The Ministry notes that,

40
[1998] 3 WLR 675 at 682.
41
[1951] 2 All ER 278 at 281 (HL). The significance of the principle is not diminished by the fact that the penal
statute does not concern serious crimes: ―I regard it as of particular importance that this rule should be observed,
whether the statutory prescription refers to the invasion of copyright, or to the system of working in a factory, or, as
here, to the repair of ships in a shipyard‖ (at 281 per Lord Simonds).
42
See, for example, R. Harrison QC, ―Political Free Speech in New Zealand: Dangerous Beast or Endangered
Species‖, University of Waikato Seminar, Freedom of Speech and the Safety of the State, 10 July 2008; A. Nicholls
and L. Clark, ―Law and Disorder‖, Listener, 28 June 2008, 24; M. Chen, ―Advising clients on the Electoral Finance
Act 2007‖ 86 NZLawyer, 18 April 2008, 10; R. Partridge and J. Wilson, ―Free Speech in Election Years‖ [2008]
NZLJ 96)
43
http://www.lawsociety.org.nz/__data/assets/pdf_file/0015/4416/Electoral_Finance_Act.pdf.
22
―having legitimate electoral finance legislation that is clear and easily understood means
that the law has credibility, and constituency candidates, political parties and electoral
agencies know what is expected of them.‖ 44 While this correct, the ability of citizens to
understand the electoral laws implicates more fundamental concerns relating to the rule
of law. For this reason, we submit that a separate principle be introduced affirming the
principle that it should be possible to ascertain with fair certainty the meaning, scope,
and effect of the electoral laws.

Summary

2.51. In summary, we submit in relation to the questions raised by the Ministry of Justice:

Q1.1 Do you agree with the six principles for guiding the development of the new
legislation? Are there any other principles you think are also important?

A1.1 As discussed above, we disagree with the way in which the principles are
expressed. We also discuss some of the problems with the Ministry of Justice‘s
commentary to the principles below under section 3 of this submission. We also
submit that several important principles relating to the requirement have been
omitted (not least, the principle that, in accordance with the rule of law, it should
be possible to ascertain with fair certainty the meaning, scope, and effect of the
electoral laws).

Q1.2 Are any principles more important than others? Do any of the principles
conflict? If so, how do you think a balance can be achieved?

A1.2 Certain of the principles discussed above are more important than others,
which is reflected by Parliament‘s decision to enact the Bill of Rights to affirm
and protect New Zealanders‘ fundamental rights and freedoms, including freedom
of expression. The New Zealand Bill of Rights also sets out the grounds on which
the rights it guarantees can be limited. Accordingly, to the extent that some of the
principles proposed by the Ministry of Justice (such as ―equity‖) conflict with
rights affirmed and protected by the New Zealand Bill of Rights, those rights
ought to prevail except where a limitation on them can be demonstrably justified
as necessary to the achievement of a pressing and substantial governmental
purpose.

Q1.3 Should a statement of these principles be included in the new legislation?

A1.3 In order for such a statement of principles to be useful, it is necessary that


the principles be expressed clearly and that the principles themselves should be

44
Issues Paper, paragraph 1.14.
23
sound. In our discussion above, we have suggested ways in which the principles
can be expressed more directly (e.g., replace ―Equity: The electoral contest should
be fair‖ with ―Elections should be free and fair‖ and replace ―Freedom of
expression: Freedom of expression should not be unduly restricted‖ with
―Everyone has the right to freedom of expression, including the freedom to seek,
receive, and impart information and opinions of any kind in any form‖). In the
next section we submit that certain concepts raised by the Ministry of Justice are
incoherent and have potentially far reaching and ill-considered implications.

3. Comments on certain aspects the Ministry of Justice’s proposed guiding principles

3.1. We believe that several aspects of the Ministry of Justice‘s discussion of its proposed
guiding principles warrant specific comment for two reasons:

First, the Ministry of Justice uses a number of very ambiguous expressions (e.g.,
the ―level playing field‖) without explaining those expressions or defining the
principles for which the expression is a short-cut reference.

Second, several of the Ministry of Justice‘s comments with respect to its proposed
guiding principles have potentially far-reaching implications for the reform of
New Zealand‘s electoral finance laws. We submit that these comments require
detailed consideration before being used to formulate substantive legislative
proposals.

3.2. Accordingly, we discuss below the comments of the Ministry of Justice.

The “equity” and “level playing field” expressions are ill-considered

3.3. The Ministry of Justice proposes as its first guiding principle a principle of ―equity.‖
The Ministry of Justice begins with the statement that ―the electoral contest should be
fair.‖ For the reasons discussed above, we agree with this principle and submit that the
principle should be reformulated to reflect the standard language used to describe a fair
electoral contest: ―elections should be free and fair.‖

3.4. However, while the Ministry of Justice‘s proposed standard of fairness is


unobjectionable, its discussion of the meaning of ―equity‖ introduces a number of
separate and highly uncertain concepts. The Ministry of Justice asserts:45

Equity means that no person has an unfair advantage when seeking election to Parliament.
Constituency candidates and political parties should campaign on a level playing field, and have
the opportunity to explain their policies to the general public and influence the choice that voters
make.

45
Issues Paper, paragraph 1.15.
24
3.5. The Ministry of Justice makes no detailed attempt to define what it means by ―unfair
advantage‖ or a ―level playing field.‖ In our submission, an expression such as ―level
playing field‖ is an unhelpful short-cut of which it might be said that ―it owes its
attraction … to the fact that one may utter it without having the trouble of really
thinking out with precision what one means oneself or what others understand by it.‖ 46

3.6. If ―equity‖, the absence of ―unfair advantage,‖ and a ―level playing field‖ in fact refer to
the establishment of clear and impartially applied rules to ensure the propriety of the
electoral process, then such a standard could be directly covered by the principle that
―elections should be free and fair.‖ If, however, the Ministry of Justice intends that the
expressions ―equity‖ and ―level playing field‖ include concepts that go beyond the
traditional expectation that elections should be free and fair, it is proper and necessary
to explain what it means by a ―level playing field.‖ The metaphor of a ―level playing
field‖ ambiguously suggests a number of quite different requirements for the conduct of
an election. If the Ministry of Justice intends to introduce concepts that fall outside the
traditional understanding of a free and fair election, it should explain those concepts
clearly. Absent a clear definition of those concepts, it is difficult to determine precisely
what the Ministry of Justice means when it states, for example, ―a very high limit [on
spending for political speech] may ‗tilt‘ the playing field unreasonably with a negative
effect on equity and participation.‖ 47 We therefore believe that the Ministry of Justice‘s
decision to include the undefined expression of a ―level playing field‖ is unhelpful to
the process of formulating high quality electoral laws.

3.7. In a free and fair election, of course, some parties will have far more members than
others and therefore receive more volunteer support and donations. Some parties‘
candidates will already hold elected office and, therefore, generate more publicity when
they speak or make campaign appearances. Certain candidates will be more charismatic
than others and some candidates will be highly experienced in political campaigns and,
therefore, more effective and resourceful on average than some of their rivals.
Influential lobby groups, business associations, or trade unions may endorse and support
some candidates to the disadvantage of others. Accordingly, free and fair elections
involve robust rivalry as candidates for office and political parties attempt to persuade
voters to cast ballots in their favour. This is consistent with an understanding of a ―level
playing field‖ that means everyone is free to participate and subject to the same rules,
which will be fairly and impartially applied. This is the essence of the traditional
conception of political equality: ―the traditional notion of political equality is that each
person has a right to vote and to have that vote weighted equally with those of others.
But citizens are free to use their differing abilities, financial wherewithal, and personal
46
This comment was made in a different context by Lord Pearce in The Heron II Koufos v C Czarnikow Ltd [1969]
1 AC 350 at 415.
47
Issues Paper, paragraph 3.13.
25
disposition to become more or less active in political life and to attempt to persuade
their fellow citizens to vote in a particular manner.‖48

3.8. It is possible that the Ministry of Justice has used the expression of a ―level playing
field‖ to refer to a standard of equality of resources between participants in public
debate and Parliamentary democracy. We note, for example, that the majority report of
the Select Committee in relation to the Electoral Finance Bill 2007, invoked a (similarly
undefined) concept of a ―level playing field‖ to justify the restrictions on political
speech in that legislation. If the Ministry of Justice intends the concept of ―equity‖ or a
―level playing field‖ to carry a similar meaning, then we submit that the proposed
principle is misguided for the following reasons.

First, the legitimacy of an election does not require that each candidate for office
enjoys an equal or nearly equal level of resources.

Second, electoral finance laws that purport to create a ―level playing field‖ of
resources target only one resource relevant to the electoral process.

Third, the application of an ―equal playing field‖ (in the sense of an equality of
resources to ensure equality of influence) rationale to private citizens makes even
less sense than applying it to political parties and candidates.

Fourth, we submit that regulation of speech in order to control the ―fairness‖,


―balance‖, or ―equality‖ of public debate disserves the public interest.

Fifth, we would disagree with any suggestion that it is undesirable that not every
possible viewpoint is equally represented in public debate or that the ideal state of
affairs would be that the government ensured that every possible viewpoint was
equally represented in public debate. One of the consequences of an uninhibited
marketplace of ideas is that certain ideas become more or less popular and some
ideas are discredited. That is the point of presenting a reasoned argument and this
is the process by which civilised societies decide issues.

3.9. We consider each of these matters in turn.

THE LEGITIMACY OF AN ELECTION DOES NOT REQUIRE THAT EACH CANDIDATE FOR OFFICE ENJOYED
AN EQUAL OR NEARLY EQUAL LEVEL OF RESOURCES

3.10. First, the legitimacy of an election does not require that each candidate for office
enjoyed an equal or nearly equal level of resources.

48
Bradley Smith, ―Money Talks: Speech, Corruption, Equality, and Campaign Finance‖ (1997) 80 Geo. L.J. 45 at
96.
26
3.11. In our submission, the proposition that an election result does not legitimately reflect the
will of the electorate if some candidates greatly outspent others is implausible. To take
a trite example, in the 2005 New Zealand general election the party with the highest
level of party and candidate spending outspent the party with the least by more than
5241:1.49 The fact that the Labour Party outspent the Republic of New Zealand Party
by so many orders of magnitude could not seriously be regarded as impugning the
fairness of the election. Indeed such a suggestion would be regarded as absurd on its
face. Nonetheless, the example demonstrates the equal absurdity of the claim that an
election is ―unfair‖ unless every candidate for office can apply roughly equal resources
to the campaign. For example, no one seriously suggests that the 2005 election was not
free and fair by virtue of the Labour Party outspending New Zealand First by 6:1 or
ACT New Zealand by 3:1. A suggestion that the differences in spending implicated a
―level playing field‖ concern would raise puzzling questions. Should the National and
Labour parties have been restricted to a level of spending that New Zealand First could
match in order to preserve a ―level playing field‖? Does a ―level playing field‖ standard
require a parity of spending with the ACT party (and, if so, why not the Aotearoa
Legalise Cannabis Party)? Accordingly, a claim that an election outcome is somehow
unfair if some parties spent much more than other parties is unconvincing.

3.12. Alternatively, a ―level playing field‖ might be thought to require only an upper cap on
the amount of spending so as to ensure that the largest parties do not greatly outspend
one another (leaving the question of the differences in resources between the largest
parties and the smaller parties unaddressed). So modified, the claim would be that the
legitimacy or fairness of an election is undermined when one large party or leading
candidate spends materially more than the nearest rival candidate or party. Such a claim
also seems implausible. In the recent US presidential elections, the successful candidate
is estimated to have outspent his nearest rival by $397 million.50 There are no obvious
indications that the spending difference was regarded by the citizens of that country as
calling into question the integrity of the outcome.

ELECTORAL FINANCE LAWS THAT PURPORT TO CREATE A ―LEVEL PLAYING FIELD‖ OF RESOURCES
TARGET ONLY ONE RESOURCE RELEVANT TO THE ELECTORAL PROCESS

3.13. Second, electoral finance laws that purport to create a ―level playing field‖ of resources
target only one resource relevant to the electoral process.

49
http://www.elections.org.nz/record/expenses-returns/party-expenses-2005.html
50
Senator McCain spent $333 million, while Senator Obama (as he then was) spent $730 million (see
http://www.opensecrets.org/pres08/index.php?cycle=2008). It is not necessary, for present purposes, to consider
whether the calculation of money spent ―for‖ each candidate should include spending by the Republican National
Committee, Democratic National Committee, trade unions, and business groups, etc. (Though we note that this
illustrates one of the problems with trying to ―balance‖ elections).
27
3.14. Spending money on political speech in the form of pamphlets, posters, or billboards is
one way to disseminate ideas. Legislation aimed at a ―level playing field‖ with respect
to campaign spending would control expenditure in order to ensure equality of resources
among election participants. However, money is only one type of resource deployed
during an election campaign. To the extent that other resources are not targeted by
campaign regulations, it is relevant to inquire into the implications of their exclusion for
the integrity of the ―level playing field‖ concept.

3.15. One of the most obvious non-monetary advantages that a candidate can enjoy is name
recognition. A relatively well known candidate can benefit from their reputation and
the simple fact that voters know who she is. By contrast, a little known candidate must
establish that reputation with voters by campaigning, many forms of which cost money.
It is reported that when Howard Metzenbaum, the United States Senator from Ohio, was
criticised for spending too much in a campaign against his ex-astronaut rival, John
Glenn, he retorted that he did not have the benefit of his opponent‘s name recognition,
based on billions of dollars of expenditure by the federal government. 51 While usually
less dramatic, such disparities in name recognition are commonplace. Although it
would not be sensible to attempt to level down such disparities, it seems a fair question
to ask why supporters of a ―level playing field‖ rationale would not be in one way
concerned about such disparities even if they thought that they were too difficult to
address.

3.16. Another such resource is time. As Bradley Smith observes, ―even the availability of
time can be very unevenly distributed in favour of certain points of view. For example,
a sole proprietor may have less time to devote to political activities than his hourly
employees. However, he may also have more money to contribute.‖52 A single person
may have more time to devote to a campaign than a person with substantial family
commitments. Those who work long hours or seven day weeks may find it
impracticable to participate in political activity. Moreover, the effect of each person‘s
time on a campaign is unequal: ―a Hollywood celebrity‘s time spent campaigning is far
more valuable than any time a typical butcher can donate to a campaign.‖ 53 In Professor
Sanford Levinson‘s words, it would presumably ―be bizarre to tell the [Paul] Newmans
of the world that they could not actively participate in the political world because the
resource they contribute – their celebrity – is so much greater than that of the average
citizen.‖54 Again, it seems reasonable to ask why disparities between candidates based
51
See Sanford Levinson, ―Regulating Campaign Activity: The New Road to Contradiction‖ (1985) 83 Mich. L. Rev.
939 at footnote 41.
52
Bradley Smith, ―Money Talks: Speech, Corruption, Equality, and Campaign Finance‖ (1997) 80 Geo. L.J. 45 at
94–95.
53
Ibid at 95.
54
Sanford Levinson, ―Regulating Campaign Activity: The New Road to Contradiction‖ (1985) 83 Mich. L. Rev.
939 at 949.
28
on the availability or value of their supporters‘ time would not be thought to be unfair in
some sense by supporters of a ―level playing field‖ concept. After all, these
considerations are relevant to a candidate‘s electoral prospects.

3.17. Another resource consists of the benefits of being an incumbent office holder. An
incumbent is generally able to generate more coverage from the press than her lesser-
known rivals. For example, a Prime Minister campaigning for re-election can expect to
enjoy significant publicity and attention at campaign appearances. Similarly, his or her
rivals who have already been elected to Parliament will ordinarily receive more
significant publicity than candidates who are not Members of Parliament. Such
coverage is clearly helpful to the candidates and the interest of the public and media in
following the progress of the leading candidates is obvious. It would not be serious to
claim that an election was unfair or illegitimate (by virtue of violating the principle of a
―level playing field‖) because some candidates received vastly more coverage than
others through the ordinary process of news reporting. Yet few would question that the
coverage of the campaign on the nightly news, the radio, or the morning newspapers
plays at least as significant a role in the outcome of the campaign (in fact, probably
more significant) than the billboards that the parties erect and the pamphlets they
distribute. While the Broadcasting Act mandates balanced reporting,55 it would not be
serious to suggest that the law should regulate news reporting so as to require equal time
be devoted to each candidate in order to provide a ―level playing field.‖

3.18. The same point could be made about a host of other inequalities56 that might be
imagined to tilt the notional ―level playing field‖ (e.g., experienced campaigners will
tend to be more effective than novices). Such inequalities in the availability and value
of the time of political activists are facts of life and their impact on political campaigns
can be substantial. However, no one proposes something as quixotic as regulation to
impose a ―level playing field‖ in respect of the time and energy of political supporters.
That such proposals would be thought preposterous in respect of those resources ought
to at least make supporters of a ―level playing field‖ rationale for limiting speech think
twice about whether that rationale has been properly thought through.

3.19. As the discussion above indicates, one of the unusual aspects of regulation intended to
impose a ―level playing field‖ of resources during elections is that the regulatory efforts
target one type of resource – money spent on political advocacy – while leaving other
resources that are significant to campaign efforts unaddressed. The fact that these

55
Broadcasting Act 1989 section 4 (1)(d).
56
As Scalia J quipped during the oral argument in Davis v. FEC 128 S. Ct. 2759 (2008) (holding that the provisions
in 2 USCS § 44a-1 and § 44a-1(b) of the Bipartisan Campaign Reform Act – the so-called ―millionaire‘s
amendment‖ – violated the First Amendment): ―You think that‘s really a proper function of government, to look out
over there and say. ―We‘re going to even the playing field in this election‖? What if … one candidate is more
eloquent than the other one? You make him talk with pebbles in his mouth or what?‖.
29
resources are largely ignored is likely to reflect both the practical impossibility of
ensuring that competing candidates for office are somehow equal in all conceivable
resources and attributes as well as the conceptual incoherence of the ―level playing
field‖ metaphor.

THE APPLICATION OF AN ―EQUAL PLAYING FIELD‖ RATIONALE TO PRIVATE CITIZENS MAKES EVEN
LESS SENSE

3.20. Third, the application of an ―equal playing field‖ (in the sense of an equality of
resources to ensure equality of influence) rationale to private citizens makes even less
sense than applying it to political parties and candidates.

3.21. For the reasons discussed above, we believe that the concept of regulating speech in the
pursuit of an equality of resources among parties and candidates is misguided.
However, we believe the notion is quite bizarre when applied to all political advocacy
by private citizens during an election period.

3.22. Even on an abstract theoretical level, there is no obvious basis for a claim that a ―level
playing field‖ requires the government to regulate speech in an attempt to somehow
―equalise‖ the influence of all private citizens. As a starting point, it is not clear what it
would mean for everyone to somehow be equally influential in public debate. As
Professor Lillian Bevier observes: 57

If being a "political equal" means that one cannot legitimately attempt to acquire political
influence, what point is there in engaging in political deliberation? If everyone truly had "the
same" amount of political influence, would not the very concept of "political influence" be
oxymoronic?

3.23. Differences in political influence among private citizens reflect the diversity and
complexity of life. Religious leaders have influence among their followers. Celebrities
may attract greater attention to the social or political causes they support than non-
celebrities. Journalists and editorial commentators have a greater opportunity to express
their ideas to a wider audience than others. 58 Editorial commentators engaged by
successful publications have a wider audience than those employed by less successful or
more narrowly focused publications. Full-time and part-time bloggers can attract a
following among internet users. Professors and teachers can play an influential role in

57
Lillian BeVier, ―Campaign Finance Reform: Specious Arguments, Intractable Dilemmas‖ (1994) 94 Colum. L.
Rev. 1258 at 1267.
58
See, e.g., Mills v. Alabama 284 US 214 at 218 – 219: ―Suppression of the right of the press to praise or criticize
governmental agents and to clamor and contend for or against change, which is all that this editorial did, muzzles
one of the agencies the Framers of our Constitution thoughtfully and deliberately selected to improve our society
and keep it free. The Alabama Corrupt Practices Act by providing criminal penalties for publishing editorials such
as the one here silences the press at a time when it can be most effective. It is difficult to conceive of a more
obvious and flagrant abridgment of the constitutionally guaranteed freedom of the press.‖
30
shaping the ideas of their students. Simply put, influence is a feature of peaceful human
interaction.

3.24. Contrary to the implicit logic of the idea that the government should regulate speech in
order to ―equalise‖ political influence among private citizens, a person who has been
―influenced‖ is not worse off by virtue of that persuasion. We are, in fact, better off
when we hear a convincing speech that persuades us to re-evaluate our view on a
subject or read a well-reasoned article that persuades us that we had wrongly judged an
issue. We are better off for the speaker or writer having marshaled the evidence and
arguments in support of an issue or raising a matter which we had not previously
considered. We are better off for the fact that some people have established television
and radio stations to broadcast news and entertainment that we could not arrange by our
own efforts. Influence through persuasion is the basis for positive human interaction,
not a threat to our ―political equality.‖ Indeed, a person who sought to avoid being
influenced or persuaded by others would be a hermit or misanthrope. A person who
distrusted persuasion unless he could somehow ―persuade them back‖ would be
misguided.

REGULATION OF SPEECH IN ORDER TO CONTROL THE ―FAIRNESS‖, ―BALANCE‖, OR ―EQUALITY‖ OF


PUBLIC DEBATE DISSERVES THE PUBLIC INTEREST

3.25. Fourth, we submit that regulation of speech in order to control the ―fairness‖, ―balance‖,
or ―equality‖ of public debate disserves the public interest.

3.26. It is not possible to attempt to level down inequalities in public political debate or
private political advocacy without a regulatory regime to monitor and control the
amount of spending and supervise the content of speech. While it is debatable that such
a regulatory regime could achieve the ideals of a ―level playing field‖, it is in our view
certain that a number of regulatory measures would be required to pursue that ideal.
Accordingly, when considering the merits of measures to limit political debate, it is
necessary to have regard to the likely (even if unintended) consequences of regulating
speech in this way (we discuss some of these consequences below).

3.27. For the purposes of evaluating the consequences of attempts to level down inequalities
and redress imbalances in public debate, it is helpful to consider the regulation of the
US broadcast media, as an example of where this has been tried and ultimately rejected
by the regulators themselves. It is also helpful to refer to this for the purposes of
providing some balance to the New Zealand policy debate concerning electoral finance
reform. Many of the various assessments of the necessity of campaign regulation in
New Zealand (particularly in connection with the Electoral Finance Act) have largely
focused on the judgments of the House of Lords and the Supreme Court of Canada as
well as certain legislative inquiries. For completeness, it is appropriate to refer to the
31
contrary findings, based on no less extensive work, of the Federal Communications
Commission (FCC) in relation to now defunct ―fairness doctrine‖.

3.28. The ―fairness doctrine‖ required broadcasters to broadcast devote equal time to each
side of a political issue in order to ensure that one viewpoint was not ignored. The
constitutionality of the doctrine was upheld in an early decision based on the ―the
scarcity of broadcast frequencies‖, which entitled the federal government to impose
content-based licensing restrictions on broadcasters. 59 However, following considerable
dissatisfaction with the doctrine, the FCC initiated a wide-ranging review, the findings
of which were reported in its Report Concerning General Fairness Doctrine
Obligations of Broadcast Licensees.60

3.29. In that report, the FCC stated:61

On the basis of the voluminous factual record compiled in this proceeding, our experience in
administering the doctrine and our general expertise in broadcast regulation, we no longer believe
that the fairness doctrine, as a matter of policy, serves the public interest. In making this
determination, we do not question the interest of the listening and viewing public in obtaining
access to diverse and antagonistic sources of information. Rather, we conclude that the fairness
doctrine is no longer a necessary or appropriate means by which to effectuate this interest. We
believe that the interest of the public in viewpoint diversity is fully served by the multiplicity of
voices in the marketplace today and that the intrusion by government into the content of
programming occasioned by the enforcement of the doctrine unnecessarily restricts the journalistic
freedom of broadcasters. Furthermore, we find that the fairness doctrine, in operation, actually
inhibits the presentation of controversial issues of public importance to the detriment of the public
and in degradation of the editorial prerogatives of broadcast journalists.

3.30. The FCC went on to state:62

In sum, we find that the evidence, derived from the record as a whole, leads us to conclude that the
fairness doctrine chills speech. As a result of this finding alone we no longer believe that the
fairness doctrine, as a matter of policy, furthers the public interest and we have substantial doubts
that the fairness doctrine comports with the strictures of the First Amendment. Because the
fairness doctrine inhibits the presentation of controversial and important issues, in operation, it
actually disserves the purpose it was designed to achieve. In our view, an elimination of the
doctrine would result in greater discussion of controversial and important public issues on
broadcast facilities.

3.31. While the FCC concluded that it remained for Congress to abolish the doctrine, the
United States Court of Appeals for the District of Columbia subsequently held that the
doctrine was an ―administrative construction, not a binding statutory directive.‖
Accordingly, the FCC formally abolished the ―fairness doctrine‖ in Syracuse Peace
Council.63 That decision was challenged on administrative law grounds but sustained

59
Red Lion Broadcasting Co., Inc. v. FCC, 395 U.S. 367 (1969).
60
102 F.C.C.2d 143 (1985).
61
Ibid at paragraph 5.
62
Ibid at paragraph 68.
63
2 F.C.C. Rcd. 5043 (1987).
32
by the District Court and the Court of Appeals for the District of Columbia;64 and a
Congressional resolution requiring the FCC to enforce the ―fairness doctrine‖ was
subsequently vetoed by President Reagan.

3.32. We submit that the findings and careful analysis of the FCC with respect to the ―fairness
doctrine‖ are relevant to some of the issues involved in New Zealand‘s review of
campaign finance regulation. It might be thought that the core focus of the FCC‘s
report would be less relevant if the New Zealand review proposes a widely drafted
exemption for media reporting. However, such an exemption may raise almost as many
questions as it answered.

THE IDEAL STATE OF AFFAIRS IS NOT ONE IN WHICH EVERY POSSIBLE VIEWPOINT IS EQUALLY
REPRESENTED IN PUBLIC DEBATE

3.33. Fifth, we would disagree with any suggestion that it is undesirable that not every
possible viewpoint is equally represented in public debate or that the ideal state of
affairs would be that the government ensured that every possible viewpoint was equally
represented in public debate.

3.34. In a free society, people have the liberty to speak their minds and evaluate the
arguments of others. Not all arguments are equally persuasive, certain ideas lose
salience or credibility when viewed in the light of experience, and some arguments are
patently false. Not all ideas that rise to prominence turn out to have desirable
consequences and, in turn, those ideas tend – on average and over time – to be
discredited by reasoned argument. Accordingly, the ideal state of affairs is not one in
which every possible viewpoint is equally represented in public discussion and there is
much wisdom (provided one notes the careful adjectival qualifier, ―best‖) in the
observation of Justice Oliver Wendell Holmes that ―the best test of truth is the power of
the thought to get itself accepted in the competition of the market.‖65

3.35. That is not to say that the marketplace of ideas is perfect at distilling good ideas from
bad ideas. While part of the realisation that some ideas are not worthy of consideration
occurs through discussion, sometimes it is necessary to put ideas into practice before the
discovery process reveals them to be poor ideas. Some ideas may still be popular
despite the poor results they deliver when actually practiced, and despite the success of
alternatives. (An example that is sometimes given in the literature on this topic is that
free trade is often unpopular.66)

64
867 F.2d 654 (1989).
65
Abrams v United States 250 US 616 at 630 (1919).
66
See, Bryan Caplan, The Myth of the Rational Voter, Princeton University Press, 2007.
33
3.36. We therefore consider it simplistic for supporters of restrictions on political advocacy to
rely on situations in which more resources have been devoted to presenting arguments
in favour of one policy as opposed to another. We respectfully consider that the
Supreme Court of Canada fell into this error in Libman v. Quebec (Attorney General).67
It is helpful to quote the relevant passage from the Supreme Court‘s decision in full: 68

The 1988 federal election showed clearly how independent spending could influence the outcome
of voting. During the 1988 election, there were no controls on independent spending. Elections
Canada was not enforcing the provisions of the Canada Elections Act, R.S.C. 1970, c. 14 (1st
Supp.), on spending limits for individuals and groups as a result of the decision in National
Citizens’ Coalition Inc. v. Canada (Attorney General) (1984), 11 D.L.R. (4th) 481 (Alta. Q.B.). In
that case, the National Citizens‘ Coalition had challenged, inter alia, the limits on independent
spending provided for in s. 70.1 of the Canada Elections Act (now s. 259). That section prohibited
all independent spending to directly promote or oppose candidates or political parties during an
election. Medhurst J. held that this provision was an unjustified restriction on the freedom of
expression of individuals and groups during an election. The government decided not to appeal
the decision (Lortie Commission, supra, at p. 328). As a result, this provision was not enforced
during the 1984 and 1988 general elections. During the 1988 election, independent spending on
advertising exceeded $4.7 million (Lortie Commission, supra, at p. 337). Most of these
advertisements were directed at the issue of free trade. The statistics showed that four times as
much money was spent to promote free trade as was spent to oppose it. Thus, even if this
spending was not necessarily partisan, it clearly favoured the Progressive Conservative Party
indirectly. That party was the only one to advocate free trade; it therefore benefited considerably
from this ―indirect‖ independent spending. The Lortie Commission drew the following conclusion
from that experience, at pp. 337-38:

The 1988 election experience clearly demonstrated that advertisements promoting an


issue but not explicitly exhorting voters to vote for a particular candidate or party could
themselves be grossly unfair because they can constitute an endorsement of a particular
party, if one party can be clearly distinguished from others on the basis of its stand on a
central election issue.

3.37. With respect, the Supreme Court‘s analysis that the predominance of advocacy in
favour of free trade demonstrates the possibility that advertisements might be ―grossly
unfair‖ is a non sequitur. It is not obvious why anyone would expect the arguments for
and against free trade to be evenly balanced or why ―fairness‖ requires an equal amount
of resources to be devoted advocating for protectionism as advocating free trade. It is
perfectly plausible to surmise that free trade policies prevailed in the marketplace of
ideas by virtue of their superior economic logic and the lessons of experience. Few
would be troubled today that free trade enjoys much more widespread support than in
1988. We therefore find it puzzling to suggest that it was ―grossly unfair‖ that much
more money was spent to promote arguments in favour of free trade than to oppose it.
(We note also that we consider it objectionable in principle that the advocacy of policies
– which supporters of electoral finance legislation sometimes assert is protected
provided that speakers ―stick to the issues – could nevertheless be restricted to avoid

67
[1997] 3 S.C.R. 569.
68
At [51].
34
―gross unfairness‖ to the politicians who take a different stand on those issues. In our
view, the electoral laws ought not to be designed to protect the tenure of politicians).

3.38. It is not clear how far those who regard it as ―grossly unfair‖ that different viewpoints
have unequal resources devoted to them would extend restrictions in order to obviate
that unfairness. To begin with some trite examples, philosophies such as communism
and fascism have been so discredited that it is unsurprising and unobjectionable that
their proponents no longer enjoy minimal (let alone equal) representation in public
debate in New Zealand society. To take less extreme examples, we do not consider it
troublesome that certain other views that appear to have aged poorly and have very little
representation in the marketplace of ideas in modern New Zealand society:

The government should control the wages of all New Zealand employees and the
prices of all New Zealand businesses;69

Compulsory unionism should apply to New Zealand workers; and

New Zealand should return to a system of accident compensation based on tort


law and disestablish the no-fault regime.

3.39. In our view, the absence of support for such views is a consequence of the ―the process
of thought and discussion [and] the activity of speakers becoming listeners and listeners
becoming speakers in the vital interchange of thought‖ that Marshall J spoke of in
Kleindienst v Mandel.70 We see no obvious reason to mourn the demise of ideas that
have been discredited or bemoan their unequal representation in the public discourse
(after all, no one need be restricted from repeating such arguments if they want to).
However, as discussed elsewhere throughout this submission, we consider there are
clear risks associated with proposals to restrict – in the pursuit of so nebulous a concept
as a ―level playing field‖ – the ability of people to publish their political beliefs using
their own money.

The concern that some political ideas will be “drowned out” in the absence of regulation is
unfounded

3.40. A concern commonly expressed by supporters of measures designed to regulate political


advocacy and speech is the possibility that ―big money‖ 71 will somehow ―dominate‖72

69
Wages were frozen in 1982 under the Remuneration Freeze Regulations and the Wage Freeze Regulations, while
prices were frozen under the Economic Stabilisation Act 1948.
70
408 US 753 (1972).
71
Hansard, Volume 644, page 13418, Clark.
72
Paragraph 5.13: ―Some say that this can lead to wealthy members of the public dominating the election campaign,
by targeting a particular candidate or party and damaging their election prospects.‖
35
(or ―overwhelm‖73) political discourse and ―drown out‖74 other viewpoints. For
example, Judge J. Skelly Wright complained that ―unchecked political expenditures …
may drown opposing beliefs, vitiate the principles of political equality, and place some
citizens under the damaging and arbitrary control of others.‖ 75 As with the concept of a
―level playing field‖ of influence, the specific concern is often difficult to identify and it
is likely that the use of figurative language reflects the difficulty in explaining the actual
basis for the concern. In our view, it is likely that the argument is simply a variation on
the ―level playing field‖ argument. Nevertheless, it is potentially helpful to consider
what the expression ―drowning out‖ could mean and what specific claims could
underpin such a rationale for the regulation of political speech during election years.

3.41. As a starting point, proponents of regulations to prevent certain ideas ―drowning out‖
other ideas presumably cannot mean that, absent regulation, some wealthy individuals
could somehow procure so much advertising as to foreclose the opportunities for rivals
to disseminate their ideas. The inconsistency of such a concern with the practical reality
of the modern media environment has been expressed colourfully by Professor Fried: 76

Considering the facts of the American world, the whole drownout thesis is patently absurd. It
simply is not the case that no one will publish unpopular views. Information technology is so far
advanced that it takes relatively small capital -- capital that almost anyone can assemble -- to put
out one's message in print form. One need only listen to the news and information programming of
public broadcasting to hear the broadest array of opinions -- with opinions on the left generously
represented. If raw, uninterrupted, uninterpreted public affairs reporting is your thing, it is possible
in most large cities to overdose on twenty-four hours a day of one or even two C-SPAN channels.
Mini-dish satellite broadcasting will reach the humblest home in the most rural setting -- as it does
already in Europe and parts of the Third World. So what in the world are these people talking
about? They cannot literally mean that their messages are drowned out in the sense that those who
wish to hear them cannot. It is not as if the networks or The Wall Street Journal were actually
jamming the broadcasting of anyone's views. What these people really mean is that not many
people are interested; or are not interested for long; or, like myself, if interested are not at all
persuaded.

3.42. Since the publication of Professor Fried‘s comments in 1992, communications


technology has continued to develop apace. It is now possible for private citizens to
publish their ideas on the worldwide web or upload videos with minimal cost. Personal

73
Explanatory Note to the Electoral Finance Bill at pages 4-5 (―The additional regulation of third parties will – …
ensure that election advertising by third parties cannot overwhelm the speech of speech of political parties and
candidates‖).
74
Elena Kagan, ―Private Speech, Public Purpose: The Role of Governmental Motive in First Amendment Doctrine‖
(1996) 63 U. Chi. L. Rev. 413 at 466 (―The realm of public expression may have too much of some kinds of speech,
too little of others; some speakers may drown out or dominate their opposite numbers. Self-conscious redistribution
of expressive opportunities seems the most direct of correcting these defects and achieving the appropriate range and
balance of viewpoint‖).
75
J. Skelly Wright, ―Money and the Pollution of Politics: Is the First Amendment an Obstacle to Political Equality?‖
(1982) 82 Colum. L. Rev. 609 at 637.
76
Charles Fried, ―The New First Amendment Jurisprudence: A Threat to Liberty‖ (1992) 59 U. Chi. L. Rev. 225 at
252.
36
computers and printing services are more affordable than ever before. Countless
websites offer news and commentary from almost any political perspective and it is
possible to create one‘s own website at minimal cost. The notion that some ideas will
go unexpressed in the absence of government regulation is therefore absurd.

3.43. It is, however, possible that proponents of the ―drown out‖ rationale for the regulation
of political speech mean that expensive advertisements will be more effective than less
expensive advertisements and that those who print more pamphlets will reach a wider
audience than those who print less. Since the more expensive and extensive advertising
efforts will tend to be more effective, it might be thought that the cheaper advertising
initiatives have been ―drowned out.‖ Used in this limited sense, we submit that the
claim that less expensive advertising is ―drowned out‖ is simply a restatement of the
inequality rationale for the regulation of political speech. Moreover, we consider the
use of the expression ―drown out‖ in this context is highly inaccurate. Suppose that a
trade union spends $300,000 on advertising advocating one set of policies and a
business association spends $100,000 on advertising advocating a contrary set of
policies. Is it sensible to say that the trade union ―drowned out‖ the voice of the
business association? Would it make sense to say that the business association in turn
had ―drowned out‖ the voices of people who disagreed with their position but did not
spend any money on advertising?

3.44. We submit that differences in the amount of spending on advertising cannot be


conceptualised through the metaphor of ―drowning out.‖ Each group that spends money
on advertising their ideas will have the opportunity to express their viewpoint amidst a
vast range of other advertisements in the marketplace of ideas. A group‘s advertising
budget will affect the type of advertising and the extent of advertising but even a limited
budget does not preclude a group from disseminating their ideas. Some proponents of
the regulation of political speech might nonetheless claim that all groups should have
equal (or roughly equal) advertising resources and, therefore, the groups with greater
resources should be restricted from using those resources for the purposes of political
speech. However, this would be an equality-based rationale for regulating speech and
not a rationale based on ensuring that those with fewer resources are able to disseminate
their ideas.

The concern that regulation is required to control the “manipulative” effects of expensive
political advertising is misguided

3.45. A legislative assertion made by the British and Canadian governments, to which the
House of Lords77 and the Supreme Court of Canada78 have deferred, is that wealthy

77
R (Animal Defenders International) v Secretary of State for Culture, Media and Sport [2008] 2 WLR 781.
78
Harper v Canada (Attorney General) [2004] 1 S.C.R. 827.
37
interest groups will purchase political advertising in such large amounts as to
―manipulate‖ public opinion. For example, Lord Bingham in R (Animal Defenders
International) v Secretary of State for Culture, Media and Sport, accepted the legislative
judgment that the public interest in having a balanced public debate would be
undermined if ―well-endowed interests which are not political parties are able to use the
power of the purse to give enhanced prominence to views which may be true or false,
attractive to progressive minds or unattractive, beneficial or injurious.‖ 79 His Lordship
identified the specific concern as being that ―objects which are essentially political may
come to be accepted by the public not because they are shown in public debate to be
right but because, by dint of constant repetition, the public has been conditioned to
accept them.‖80 Lord Bingham illustrated the potential risks as follows:81

Hypothetical examples spring readily to mind: adverts by well-endowed multi-national companies


seeking to thwart or delay action on climate change; adverts by wealthy groups seeking to ban
abortion; or, if not among member states of the Council of Europe, adverts by so-called patriotic
groups supporting the right of the citizen to bear arms. Parliament was entitled to regard the risk of
such adverts as a real danger, none the less so because legislation has up to now prevented its
occurrence.

3.46. Baroness Hale‘s speech considered the potential emotional effects of the television
advertisement in question. It is worth quoting Baroness Hale‘s discussion of this
advertisement in full in order to assess the conclusion that allowing television
advertisements such as this ―greatly risks distorting the public debate in favour of the
rich‖:82

The proposed advertisement shows an animal‘s cage, in which a chained girl gradually emerges
from the shadows into view; the screen goes black and the following messages appear: ―A chimp
has the mental age of a 4 year old‖; ―Although we share 98% of our genetic makeup they are still
caged and abused to entertain us‖; ―Please help us to stop their suffering by making a donation
today‖; the final shot is of a monkey in a cage in exactly the same position as the girl was in. It
takes little imagination to understand how powerful this would be, much more powerful than a
static image on a bill-board or printed page, and beamed into every households in the land where
anyone was watching commercial television at the time.

3.47. The majority of the Supreme Court of Canada in Harper deferred to legislative
judgment with respect to a related concern. While the Canadian voter ―must be
presumed to have a certain degree of maturity and intelligence‖, nevertheless political
advertising ―seeks to systematically manipulate the voter.‖ Therefore, ―the Canadian
electorate may be seen as more vulnerable‖ and measures to protect the electorate by
restricting the amount of political speech were held to be justifiable. 83

79
R (Animal Defenders International) v Secretary of State for Culture, Media and Sport at paragraph 28.
80
Ibid at paragraph 28.
81
Ibid at paragraph 29.
82
Ibid at paragraphs 50 and 51.
83
Harper v Canada (Attorney General) at paragraph 80.
38
3.48. The ―manipulation‖ rationale expressed in the majority judgments of these courts is not
easy to understand. They do not explain:

The distinction between persuasion and ―manipulation‖ in the context of political


advertising (e.g. is all political persuasion thought to be ―manipulative‖ by
definition, or are there substantive criteria, or does an argument somehow become
―manipulative‖ if it is expressed too often or too expensively?);
What it means to be ―vulnerable‖ to an idea;
What Lord Bingham means when he suggests that voters can ―conditioned to
accept‖ an argument by virtue of its repetition; and
Why the series of examples raised by Lord Bingham are assumed to pose a ―real
danger.‖ Would advertisements advocating the opposite positions (i.e., urging
action on climate change, supporting the availability of abortion services, and
advocating gun control) also constitute a ―real danger‖?

3.49. We submit that the language used by proponents of this ―manipulation‖ rationale is
unhelpfully imprecise. We therefore believe it is helpful to begin with the starting point
that ―arguments address the mind and the emotions; they threaten only persuasion.‖84 It
is neither possible to buy votes nor elections; rather advertising offers an opportunity
(whether by appeal to the voter‘s mind or emotions) to persuade a citizen to accept the
merits of a point of view. Since it is not possible for the government to determine ex
ante which ideas have merit or lack merit, the liberal society allows citizens to make up
their own minds. An assertion that it is possible for the government to regulate to
protect citizens from the ―manipulative‖ effects of speaking to one other on the subject
of politics would therefore require a substantive conception of what types of political
speech are unduly ―manipulative‖ by virtue of the amount of money expended or the
character of the speaker. Of course people of diverse political inclinations sometimes
think that their fellow citizens adhere to seemingly irrational beliefs by virtue of
populist demagoguery or superficial arguments. The thought that others are deeply
misguided may reflect the depth of one‘s convictions on an issue. (The comments
above with respect to free trade are arguably an illustration of this). However, it is, with
respect, a misuse of language to speak of protecting other citizens from ―manipulation‖
if that term refers to nothing more than the extensive dissemination and repetition of
ideas with which one disagrees.

3.50. The language deployed by proponents of the ―manipulation‖ rationale for the regulation
of political speech is not only troublingly incoherent but also designed to rationalize
some form of legislative intervention to protect the ―vulnerable‖ citizens from ―big

84
Charles Fried, ―The New First Amendment Jurisprudence: A Threat to Liberty‖ (1992) 59 U. Chi. L. Rev. 225 at
250.
39
money,‖ which threats to ―distort‖ their judgment. As Professor Kathleen Sullivan
explains, ―this epistemology dictates a government response. If we are socially
malconstructed, in their view, government should come to the rescue.‖85 We take a less
pessimistic view of the capabilities and robustness of citizens (and, in any case, agree
with John Stuart Mill that the development of such capabilities is strengthened only
through their use).86 We respectfully agree with Rand J‘s comments in Switzman v
Elbing: ―Parliamentary government postulates a capacity in men, acting freely and
under self-restraints, to govern themselves‖. 87 In our submission, there can be no place
for paternalism with respect to the presentation of arguments to voters: citizens have the
dignity and the right to listen to the arguments and make up their own minds.

Transparency

3.51. We are generally supportive of the Ministry of Justice‘s fourth principle,


―transparency‖. However, there are two matters of concern that we wish to note.

3.52. First, we submit that the principle requires some clarification. In particular it is
important to establish both what and who must be transparent. In this respect we submit
that it is important to draw a distinction between state action and the activities of
citizens. We believe that while most people would accept that the affairs of government
should be transparent, private individuals are entitled to respect for the privacy of their
own activities. In our view this distinction should be reflected in the guiding principles.

3.53. Second, we submit that there are two distinct elements to transparency which should
each be recognised by a separate principle. Those elements are:

The use of public monies in connection with the electoral process should be
transparent.

There is a public interest in the disclosure of donations to political parties and


candidates if those donations raise the possibility of a quid pro quo by virtue of
their size and nature.

3.54. The first principle concerning the use of public money is a specific application of the
wider principle that democratic governments should be accountable to the citizens they
serve. The second principle is specific to the electoral context and recognises that
although donations are a sign of civic engagement and not intrinsically harmful, they

85
Kathleen Sullivan, ―Free Speech Wars‖ (1994) 48 SMU L. Rev. 203, 210.
86
John Stuart Mill, On Liberty: ―The human faculties of perception, judgment, discriminative feeling, mental
activity, and even moral preference, are exercised only in making a choice … The mental and moral faculties, like
the muscular powers, are improved only by being used‖.
87
[1957] SCR 285 at 306.
40
can sometimes raises inferences of quid pro quo. In agreement with the Issues Paper,
we believe that the best way to deal with such inferences is through transparency.

3.55. We submit that the above concerns are met by dividing the Ministry of Justice‘s fourth
principle (―transparency‖) into two separate principles (the second and third principles
below) and by adding an additional principle to recognise that the activities of citizens
are in a different category to those of the state. The transparency principle is thus
replaced with the following three principles:

First, election laws should protect the reasonable privacy interests of citizens;

Second, the use of public monies in connection with the electoral process should be
transparent; and

Third, there is a public interest in the disclosure of donations to political parties and
candidates if those donations raise the possibility of a quid pro quo by virtue of their
size and nature.

3.56. We already discussed each of these principles above.

4. Disclosure of donations

4.1. Four principal issues concerning the disclosure of donations are raised in the Ministry of
Justice‘s Issues Paper:

Whether anonymous donations should be permitted;

Whether the current disclosure thresholds are appropriate;

Whether there should be a limit on donations from a single source; and

Whether there should be a prohibition on donations from certain sources.

4.2. We only wish to comment in any detail on the first issue. For the remaining issues we
provide brief answers to the questions raised where we have a concluded view.

Anonymous donations should be permitted via the protected disclosure regime

4.3. We begin by noting the definition of anonymity adopted by the Ministry of Justice in
the Issues Paper:88

―A donation is not anonymous if the constituency candidate or political party does not know the
donor‘s identity, and could not reasonably be expected to know it. A donation is not anonymous

88
At paragraph 2.11.
41
if the candidate or political party knows its true source (or they have a good idea what the source
was, or if they could have found out without difficulty).‖

4.4. Adopting this definition of anonymity, we submit that anonymous donations should be
permitted. This follows as a result of our approach to the guiding principles and the
balance to be struck between transparency (where the possibility of a quid pro quo is
raised) but otherwise giving effect to the reasonable privacy interests of citizens.

4.5. At this point we simply make three brief points in connection with the issue of
anonymous donations.

First, donations are a type of political speech which is protected by s 14 of the Bill
of Rights.

Second, anonymous donations do not raise quid pro quo concerns and so the
rationale of limiting the influence of wealthy individuals or groups does not justify
limiting freedom of speech.

Third, in the context of anonymous donations it is not clear what the transparency
concern is, so this rationale also fails to justify limiting freedom of speech.

DONATIONS ARE A TYPE OF POLITICAL SPEECH WHICH IS PROTECTED BY SECTION 14 OF THE BILL OF
RIGHTS

4.6. In our submission a donation to a political party or candidate is a form of speech


protected by the freedom of expression. In Buckley v Valeo89 the Supreme Court of the
United States recognised that although limits on donations were not as restrictive as
expenditure limitations, a political donation is still a form of speech. The Court noted
that ―[a] contribution serves as a general expression of support for the candidate and his
views‖.90 In this respect we note that some individuals may prefer to contribute to
public discussion by financing the message of other participants in the debate, rather
than speaking personally. Others may choose to donate because the lack the time or
resources to individually take part but wish to associate with and encourage a particular
individual or party. Whatever the reasons for donation, we submit that it is plain that
making a financial contribution to another‘s speech is itself a form of expression.

4.7. Given that donations are a form of political speech, it falls to those who wish to limit
them to justify such limitations. Two justifications for prohibiting anonymous
donations are suggested by the Ministry of Justice in the Issues Paper. A transparency
justification is advanced in paragraph 2.17 and an influence justification in paragraph
2.18. We consider both justifications below.

89
424 US 1 (1976).
90
At 21.
42
GENUINELY ANONYMOUS DONATIONS DO NOT RAISE QUID PRO QUO CONCERNS

4.8. We address the influence justification first. This is explained in the Issues Paper in this
way:91

Supporters of the restrictions on anonymous donations argue that voters have the right to know
who is funding the constituency candidate or political party they are thinking of supporting. The
argument here is that disclosure of all significant donations helps to limit the influence that
wealthy individuals or groups can exert through their donations. If a person or group wants to
influence a public process such as an election, arguably there is a trade-off with their right to
privacy.

4.9. We submit that this rationale is unconvincing. It is open to the objection that if the
donation is genuinely anonymous then there can be no suggestion of a quid pro quo and
no suggestion of wealthy individuals influencing political parties. A donor whose
identity is unknown to her benefactor can hardly expect to receive anything in return.

4.10. In this regard we note that following the establishment of the protected disclosure
scheme administered by the Electoral Commission, there is an apparently reliable and
independent process by which donations can be anonymously made, thus reducing any
concerns that the identities of large anonymous donors are not unknown to the
recipients.92 So far as we are aware, no concerns about the reliability of the protected
disclosure regime were aired during or after the 2008 general election.

4.11. Given that the possibility of a quid pro quo does not arise, the influence justification is
reduced to the claim that the public have a right to know who is participating in the
political process by financially supporting candidates or parties. The rationale for this
view is presumably that some voters may consider it relevant that individual X is
supporting party Y (unbeknown to Y). Although some voters may find this information
interesting, in our view it is not a compelling state interest as it does not raise any
concerns about the legitimacy of the election process. We repeat our earlier observation
that what is interesting to the public and what is a matter of legitimate public concern
are not the same thing. Absent an analysis of what the compelling state interest is, we
submit that as Principle 693 is not engaged, Principle 494 should prevail.

IN THE CONTEXT OF ANONYMOUS DONATIONS IT IS NOT CLEAR WHAT THE TRANSPARENCY


CONCERN IS

91
At paragraph 2.18.
92
The protected disclosure scheme is explained in the Issues Paper at paragraphs 2.13 to 2.14.
93
There is a public interest in the disclosure of donations to political parties and candidates if those donations raise
the possibility of quid pro quo by virtue of their size and nature.
94
The election laws should protect the reasonable privacy interests of citizens.
43
4.12. The transparency justification is alluded to in the Issues Paper in these terms: 95

―The rules on anonymous donations complement the rules requiring disclosure of donor details
when donations exceed a certain amount. Permitting anonymous donations would lead to a less
transparent donation regime.‖

4.13. In our view, given the absence of any possible suggestion of a quid pro quo this concern
is without merit. It stems from the overly broad way in which the ―transparency‖
principle is framed in the Ministry of Justice‘s Issues Paper.

Summary

4.14. We submit in answer to the questions raised by the Ministry of Justice:

Q2.1 Should direct anonymous donations be permitted to constituency candidates


and/or to political parties? If so, is the current threshold appropriate?

A2.1 In our submission anonymous donations should be permitted to both candidates


and political parties. So long as donations are genuinely anonymous we submit
that disclosure is not justified as quid pro quo concerns do not arise. We further
submit that the best way to ensure genuine anonymity is through the protected
closure regime. This regime ensures that there are no quid pro quo concerns
while at the same time recognising the privacy interests of donors. We accept that
large direct anonymous donations may give rise to a suspicion that there is not
genuine anonymity. For this reason we accept that some threshold is appropriate,
although we do not have a concluded view on what the appropriate level is.

Q2.2 Should there continue to be a disclosure requirement for indirect anonymous


donations (for example, through intermediaries such as trusts) to constituency
candidates and/or to political parties? If so, is the current ($1000) appropriate?

A2.2 Our response to this question mirrors our response to Q2.1 above.

Q2.3 Should the protected disclosure regime for donations to political parties be
retained?

A2.3 Yes. We support the retention of the protected disclosure regime. In our
submission there should be no limit on the amount of money that a party may
receive through this mechanism or that an individual donor may give. As the
regime provides an assurance of anonymity and thus addresses the quid pro quo
concern, there is no justification or need for limiting donations. In this case the
reasonable privacy interests of citizens should be respected.

95
At paragraph 2.17.
44
Q2.4 Should the name and address of donors who donate above a certain threshold be
disclosed (that is, made publicly available)?

A2.4 Yes. We accept that certain donations by virtue of their size and nature may give
rise to quid pro quo concerns. In such cases it is appropriate to require disclosure.

Q2.5 Should the disclosure thresholds be left as they are? Raised or lowered? If so, to
what level?

A2.5 We submit that the current thresholds are too low. In our view, a $10,000
donation is unlikely to give rise to a quid pro quo concern giving its relatively
small size in comparison with total election expenditure. However, we do not
have a concluded view as to what the exact threshold level should be.

Q2.6 Should the same disclosure threshold apply to donations made to constituency
candidates, and to donations to political parties (including donations made
through intermediaries, such as trusts)?

A2.6 We do not have a concluded view on this issue.

Q2.7 Should the disclosure threshold for political parties (currently set at $10,000) be
the same as the limit on anonymous donations (currently set at $1,000) to reflect
the equivalent regime that exists for candidates?

A2.7 We do not have a concluded view on this issue.

Q2.8 Should there be a limit on donations from a single source? If so, what should it
be? Should it be inflation adjusted?

A 2.8 No. We support the retention of the current position.

4.15. We do not have concluded views in relation to questions 2.9 to 2.12.

5. Limits on donations

5.1. In the same way that spending limits on candidates limit freedom of expression, so too
do limits on the size of donations that may be made by individuals to political parties or
candidates. Freedom of expression includes not only financing of your own speech, but
also the financing of speech undertaken by others. People have the capacity to donate
time, celebrity, charisma, and mana, amongst others, to a campaign in quantities limited
only by the natural scarcity of those resources. Donation of those resources is part of
individuals' freedom of expression. The right to freedom of expression should not
change by virtue of the particular resource being donated.

45
5.2. Moreover, limits on donations are necessarily arbitrary. The idea that spending up to a
limit should be protected by law as a right, but that the marginal dollar does not qualify
for protection as a right, is absurd.

6. Public funding of political parties and candidates

6.1. We do not support the creation of a system for publicly funding political parties or
constituency candidates.

7. The exclusion of express private political advocacy from radio and television is
unjustified

7.1. The Broadcasting Act 1989 prohibits private persons from expressly advocating the
success or defeat of a political party or candidate. This restriction, which is contained in
section 70(1) of the Broadcasting Act, does not exclude issue advocacy (although for
the reasons discussed below, we believe that this distinction can be a blurry one). The
scope of this restriction has been helpfully discussed by Professor Geddis in his text,
Electoral Law in New Zealand,96 and by Professors Burrows QC and Cheer. 97

7.2. We submit that this limitation should be removed for the following reasons.

7.3. First, the restriction on express political advocacy by private persons limits freedom of
speech.

7.4. Second, such a restriction would need to be ―demonstrably justified‖. In its Issues
Paper, the Ministry of Justice discusses, as possible justifications: 98

The ―level playing field‖; and

The presence of restrictions on political parties with respect to radio and


television.

7.5. We consider these potential justifications weak. The first justification is generally
flawed for the reasons we discuss throughout this submission. In any event, it offers no
justification for treating radio and television differently than newspapers and books.

7.6. We think that the second justification again reflects the tendency for election campaign
restrictions to expand in a self-justificatory way. We address that argument in section 9
of this submission in the context of considering whether general spending limits should
apply to ―parallel campaigners‖ on the logic that they apply to political parties and
candidates. This justification is no stronger in the context of radio and television than in
96
(Lexis Nexis, 2007) at pages 164-165.
97
(2005, 5th ed) at pages 484-485.
98
Issues Paper at paragraph 2.82 and 2.83.
46
the context of general spending restrictions and it is therefore unnecessary to repeat the
arguments against it.

7.7. We note that overseas case law has upheld similar limitations on the basis that radio and
television are somehow special and, therefore, require greater restrictions on political
advocacy. For example, in Animal Defenders International, the House of Lords held
that restrictions on political advocacy on television were justified because television is
―more pervasive and potent than any other form of media". 99 Accordingly, the ban in
the United Kingdom was upheld because television, ―with its dissemination and
immediacy would have a stronger effect on the public than other means of
communication‖. 100

7.8. The approach of the House of Lords is flawed in two respects. First, the distinction
between television and radio and other forms of communication are arbitrary (e.g.,
citizens increasingly seek and receive audiovisual news, entertainments, and political
discussion online).101 Removing arbitrary media-specific rules would be consistent with
the Ministry of Justice‘s comments (with which we broadly agree) concerning the
importance of media neutrality in the formulation of campaign finance laws.

7.9. Second, the potency of television and radio is as much a reason to allow express private
political advocacy as to ban it. The claim that television and radio should be carefully
guarded because they are potent tools of communication is a non sequitur unless one
also agrees with the general rationales for limiting private political advocacy (such as
the ―drown out‖ or ―manipulation‖ rationales discussed in section 3 of this submission).
In our view, those general rationales are weak when applied to books and pamphlets and
no stronger when they come to television advertisements.

7.10. We would, therefore, answer the Ministry of Justice‘s questions as follows:

Q.2.27 Should parallel campaigners be able to campaign on radio and


television?

A.2.27 Yes.

99
R (Animal Defenders International) v Secretary of State for Culture, Media and Sport [2008] 2 W.L.R. 781 at
paragraph 30.
100
Ibid at 2.
101
For example, (1) internet users in New Zealand spent five hours less a week watching television than non users
and (2) in 2008, 77% of New Zealanders used the internet on a regular basis, of which the majority ranked the
technology as a more important source of information than the traditional media sources (television, newspapers and
radio): see World Internet Project New Zealand, International Comparisons, Highlights from a New Zealand
Perspective 2008, AUT University, which can be accessed at: http://www.aut.ac.nz/research/research-
institutes/icdc/projects/world-internet-project.
47
Q2.28 Should restrictions on radio and television advertising by parallel
campaigners be removed if there is a limit on spending?

A.2.28 Yes (although we submit that there should not be a limit on spending).

8. Spending limits on political parties and candidates

8.1. For the reasons expressed elsewhere in this submission, we disagree in principle with
spending limits on political advocacy. However, we make four submissions that relate
specifically to spending limits on political parties and candidates:

First, there is no convincing evidence that the absence of spending limits on


political parties or candidates would undermine the integrity of the electoral
process or public confidence in free and fair elections;

Second, there is no convincing evidence that campaign expenditure is highly


determinative of election outcomes;

Third, spending limits may have pro-incumbent consequences; and

Fourth, spending limits tend to reduce voter turnout.

There is no convincing evidence that the absence of spending limits on political parties or
candidates would undermine the integrity of the electoral process

8.2. Sometimes supporters of restrictions on spending on political advocacy present the


absence of such limits as a threat to the integrity of the electoral process and the
functioning of the democratic process. As a starting point, it is pertinent to observe that
the United States and Australia do not impose limits on spending for political advocacy
during an election period. That two of the world‘s leading democracies deliberate
during election periods without restrictions on how much can be spent on political
advocacy makes clear, in our view, that the absence of such restrictions does not
fundamentally implicate the integrity of the electoral process. (Indeed, we submit that
they are very much stronger because of their strong commitment to freedom of speech).

8.3. We also note a related, and regrettable, tendency for some supporters of campaign
finance reform to sometimes express their arguments in favour of spending limits on
political advocacy using the rhetoric of combating corruption (or, as it is sometimes
qualified, ―the perception of corruption‖). We believe it is helpful that the Ministry of
Justice has not adopted that rhetoric in its Issues Paper. While there may be legitimate
anti-corruption objectives associated with, say, the rules relating to the disclosure of
donations, it is unhelpful and, with respect, inaccurate to suggest that spending limits on
political parties are closely connected to the prevention of political corruption. (In the

48
specific context of the United States, there is also a strategic dimension to framing the
purpose of such measures in terms of combating corruption because the Supreme Court
indicated in Buckley v Valeo that equalising relative influence is an impermissible basis
for restricting political speech).

8.4. If supporters of spending limits on political parties are principally motivated by their
concern that the absence of spending limits would exacerbate inequality, it is
appropriate for their concerns to be addressed on that basis rather than unhelpfully
raising the red herring that spending limits are necessary to ensure that elections are
somehow ―cleaner‖ or non-corrupt. We address that concern below.

There is no convincing evidence that campaign expenditure is highly determinative of election


outcomes

8.5. One of the concerns held by those advocating spending limits on campaign expenditure
is that spending will have a large influence on voting patterns. 102 Sometimes explicit is
the fear that campaign expenditure will favour political parties that receive large or
numerous donations.103 However, the relationship between spending and electoral
performance is a complex one. In our submission, there is no convincing evidence that
campaign expenditure is highly determinative of election outcomes. However, we
believe it is important to emphasise two points at the outset. First, while we do not have
concluded answers on many aspects of the relationship between spending and election
outcomes, we believe that it is the proponents of restrictions on political speech that
bear the burden of establishing the empirical basis of their rationale for limiting speech.
Second, uncertainty cuts both ways: it is possible, as we discuss below, that spending
limits have unintended consequences.

8.6. We discuss below the studies considering whether this is a statistical causation (as
opposed to mere correlation) between spending and electoral outcomes. However, there
is a preliminary point that even the correlation between spending and outcome is not
clear-cut. Table 1 below illustrates this. Despite spending less in 2001 than the
Conservative Party, the Labour Party won far more seats. However, despite increasing
its spending by nearly 64% in the 2005 UK parliamentary elections – and despite
spending virtually the same amount of money as the Conservative Party in 2005 – the
Labour Party had a significant net loss of seats. It is possible to surmise a number of
reasons for this based on, for example, national partisan swings or the likelihood that
many Labour Party gains in 2001 were in electorates which would be difficult for that
party to hold in the long-term due to its policies. However, there seems to be no basis
for explaining the changes in electoral performance based on spending.

102
Hansard, Volume 640, page 10785, Fitzsimons.
103
Hansard, Volume 640, page 10775, Burton.
49
Table One: Comparison of 2001 and 2005 United Kingdom General Election

Number of Number of Percentage Percentage


Expenditure Expenditure Seats Increase in
Seats Won Seats Won increase in increase in
2001 2005 Gained spending
2001 2005 seats spending
Conservative Party 166 £12,751,813.21 198 £17,852,240.75 32 £5,100,427.54 19.28% 40.00%
Labour Party 412 £10,945,119.00 355 £17,939,617.00 -57 £6,994,498.00 -13.83% 63.91%
Liberal Democrats 52 £1,361,377.00 62 £4,324,574.00 10 £2,963,197.00 19.23% 217.66%

8.7. For completeness, we also set out the New Zealand figures for the previous two
elections in Table Two below:

Table Two: Comparison of 2005 and 2008 New Zealand General Election

Number of Ependiture Number of Ependiture Percentage Percentage


Seats Increase in
Seats Won (party and Seats Won (party and increase in increase in
Gained spending
2005 candidate) 2005 2008 candidate) 2008 seats spending
ACT 2 $1,375,743.69 5 $1,375,558.52 3 -$185.17 150.00% -0.01%
Green 6 $834,616.31 9 $1,748,887.27 3 $914,270.96 50.00% 109.54%
Labour 50 $4,633,162.98 43 $3,989,761.60 -7 -$643,401.38 -14.00% -13.89%
Maori 4 $372,032.02 5 $518,325.46 1 $146,293.44 25.00% 39.32%
National 48 $3,797,428.77 58 $3,797,534.77 10 $106.00 20.83% 0.00%
New Zealand First 7 $771,193.06 0 $1,165,939.32 -7 $394,746.26 -100.00% 51.19%
United Future 3 $409,154.41 1 $294,301.71 -2 -$114,852.70 -66.67% -28.07%

8.8. Accordingly, even the correlation between spending and electoral outcomes is not
always clear-cut. However, we acknowledge that the idea that there is a strong causal
connection between spending and electoral performance seems persuasive to some
people because there is often a correlation between campaign expenditure and electoral
victory. Since the parties that spent the most often seem to win more seats than parties
that spend less, the thinking goes that the spending ―bought‖ the election result.

8.9. However, the correlation between campaign expenditure and electoral victory need not
imply that campaign expenditure is a sufficient or even necessary condition for electoral
victory. If correlation implied causation, one could state with equal authority that a
politician's capacity to solicit votes also suggested they were particularly effective at
soliciting donations. Variations in campaign spending that are caused by factors which
also directly affect the election outcome serve to confuse the literature on the efficacy of
campaign expenditure.104

8.10. An example is illustrative. Let us assume that charismatic candidates are more effective
at soliciting campaign contributions. Let us also assume that most charismatic
candidates win electorate seats. The data would show a correlation between campaign

104
Jeffrey Milyo, The Electoral Effects of Campaign Spending in House Elections: A Natural Experiment
Approach, Citizens‘ Research Foundation, Los Angeles, 1998, page 2.
50
expenditure and electoral victory. However, it is equally true to say that there is a
relationship between charisma and raising money, and charisma and electoral victory. It
would be unclear whether charisma or campaign expenditure had affected the electoral
result. For example, the success of Senator Obama (as he then was) at both fundraising
and securing votes during the 2008 presidential campaign will have undoubtedly been
driven in part by personal characteristics, such as charisma. More generally, the
preferences of many voters and donors tend to be static, so a politician whose policies
appeal to them is likely to get both more donations and also more votes than a politician
with unpopular policies.

8.11. Another factor that can complicate the analysis of the effect of election expenditure is a
national level partisan swing. If one party becomes relatively more popular nationwide
this will tend to manifest itself in more enthusiasm from its existing supporters (who
may donate more money and time to the campaign) and increases in membership. As a
result the party‘s donations and spending levels may increase as a reflection of
improvements in its standing. The partisan swing is, also, reflected in independent
voters choosing to vote for that party because its arguments seem more salient and its
campaign has more momentum. It is hard to isolate the effects of spending because the
changes in its political fortunes affect both its capacity to spend money (through
donations) and also the level of its support among voters generally.

8.12. Studies which seek to isolate the effects of increases in campaign spending that are
unrelated to a candidate‘s direct appeal to voters are one way to determine the nature of
the relationship between campaign expenditure and election outcomes. While these
studies are difficult to undertake, some recent studies have used sample selection to
reduce the bias shown above. One study sought to isolate campaign spending by
limiting the sample to those elections in which the same candidates faced one another
on multiple occasions – a sample which consisted of 633 elections in the United States
between 1972 and 1990.105 Assuming that candidate quality therefore remained the
same, and controlling for other factors such as incumbency and national-level partisan
swings, the author found that ―campaign spending has an extremely small impact on
election outcomes.‖106 The figures produced by the study have stood up to scrutiny,
with an extension of the basic model to more recent repeat challenger elections finding
similar results.107

105
Steven Levitt, ―Using Repeat Challengers to Estimate the Effects of Campaign Spending on Electoral Outcomes
in the U.S. House,‖ Journal of Political Economy 102 (1994): 777–798, 783.
106
Ibid at 780.
107
Jeffrey Milyo, The Electoral Effects of Campaign Spending in House Elections: A Natural Experiment
Approach, Citizens‘ Research Foundation, Los Angeles, 1998, at 11.
51
8.13. Another concern is that, while marginal campaign expenditure has only a small impact
on election outcomes, the capacity for others to spend large amounts of money may act
as a disincentive for some candidates or political parties from contesting an electorate
seat or seeking party votes in the first place. This is similar to the fear that spending by
some candidates will ―drown out‖ messages by others. Studies have also sought to
determine whether this is a consequence of high levels of campaign expenditure.

8.14. One study sought to isolate the effects of increases in campaign spending by examining
the effects of incumbent wealth. Although the United States has limits on private
donations, candidates themselves are able to donate as much as they wish to their own
campaigns. By examining whether wealthy incumbents fare better than non-wealthy
incumbents, the study sought to examine whether well-funded candidates prevent high
quality challengers. Having first concluded that ―the net effects of wealth on Challenger
Expenditure and the incumbent's Vote Share are small and insignificant,‖ the authors
found that ―[i]ncumbent wealth does not deter challengers or high-quality
challengers.‖108 Some studies on the effect of incumbent wealth have gone further,
suggesting that those who receive large donations harm their prospects in elections. 109
Nine of the top ten self-financed candidates in House of Representative and Senate
races in the United States between 2002 and 2006 resulted in the wealthiest candidates
losing. 110

8.15. We acknowledge that there are other studies, which find contrary conclusions to those
summarised above.111 Given the complexities of trying to disentangle characteristics
that are both instrumental in helping candidates raise money and win elections, all the
evidence needs to be approached carefully. We would make two related submissions:

First, in the face of detailed studies which suggest that (a) marginal campaign
expenditure has only a small effect in increasing the likelihood of electoral
victory, and (b) there is no relationship between campaign spending and the
quality of opponents, we submit that there is a weak empirical basis for the
rationale that spending should be limited because spending is strongly
determinative of electoral outcomes. At a minimum, more work would be
required on the part of proponents of spending limits because their
empirical112 claims are not ―demonstrably justified‖; and

108
Jeffrey Milyo and Timothy Groseclose, ―The Electoral Effects of Incumbent Wealth,‖ Journal of Law and
Economics 42 (1999): 699–722, page 708.
109
Ibid at 711.
110
http://www.forbes.com/2009/06/11/terry-mcauliffe-virginia-primaries-opinions-columnists-fundraising.html.
111
See, e.g., Stephen Ansolabehere and James Synder, ―The Inter-Election Dynamics of Campaign Finance: US
House Elections, 1980 to 1994‖ (1996).
112
For the reasons set out above in section 3, we do agree that the rationale is correct in principle either.
52
Second, if further analysis by the Ministry of Justice on the empirical basis for
restrictions found that the results were ambiguous, we would submit that the
tie should be broken in favour of freedom of speech.

8.16. We also acknowledge that the results of these studies raise an obvious question: why do
political candidates seek to raise money if the effect of campaign expenditure on
electoral victory is not strong (let alone decisive)? We do not have an answer on this.
There are several plausible hypotheses (though we acknowledge they are speculative at
best):

The first hypothesis is that political candidates are themselves confusing


correlation with causation. Since it is true that the ability for a candidate to
express herself in her own words through paid advertising is useful to a
campaign, there are reasons to think that politicians might assume that the
marginal return of each dollar of advertising will always be positive.

A second hypothesis is that there may be institutional incentives for a


politician to focus on fundraising (e.g., successful fundraiser may be valued
by his or her colleagues within a party).

A third hypothesis is that since politicians cannot predict how certain aspects
of the campaign will turn out, they prefer to deploy the maximum amount of
money available in case it does make a difference. For each individual
politician, being elected or not is a win/lose payoff, which might encourage
them to spend more money than is efficient. Moreover, the decision to spend
a marginal dollar that has already been raised may have a low opportunity cost
for the candidate or party.

8.17. While these hypotheses are speculative, we think there may be something in them. At a
minimum, however, they indicate that there is no logically necessary basis to assume
that the marginal dollar spent on election advertising must be very important to the
outcome simply because politicians think so. With respect, we believe the Neill
Committee in the United Kingdom fell into this error. It acknowledged that, ―it cannot
be proved that high spending buys elections‖ 113 but thought that ―common sense‖
suggests that high spending may make the difference. 114 We submit that such a
rationale for restricting free speech cannot be ―demonstrably justified‖ on such weak
empirical foundations.

113
Fifth Report of the Committee on Standards in Public Life: The Funding of Political Parties in the United
Kingdom (1998) at 1029.
114
Fifth Report of the Committee on Standards in Public Life: The Funding of Political Parties in the United
Kingdom (1998) at 10.28.
53
Spending limits tend to have pro-incumbent consequences

8.18. Although the effect of campaign expenditure on electoral outcomes is minimal, most
studies find that campaign expenditure by challengers is more effective than campaign
expenditure by incumbents.115 The primary reason for this is that challengers have to
create a profile that incumbents usually already have by virtue of their status as
incumbents.

8.19. The extent of the benefit to challengers relative to incumbents of campaign expenditure
is much disputed. Early studies suggested that the size of the benefit to challengers
relative to incumbents was large.116 More recent studies, including those which seek to
adjust for bias by selecting samples that avoid differences in challenger and incumbent
quality, suggest that the additional benefits of campaign expenditure to challengers are
relatively small. 117 Regardless of the size of the benefit spending limits will have pro-
incumbent consequences to the extent that campaign expenditure is less effective when
undertaken by incumbents as opposed to challengers. By reducing the capacity for
challengers to create a profile that incumbents already have, political competition is
inhibited.

8.20. This is of particular concern as regards independent candidates. Independents typically


lack the support of a party and party volunteers. In addition, independents lack the
brand that a party will often give a candidate, suggesting that even more of an effort
needs to be made to create a profile. These circumstances may weigh in favour of
independent candidates spending more money in order to make up for the resources that
others have – e.g., to spend more money on advertising than on door-knocking.
Spending limits reduce the trade-offs that candidates can make, and because they impact
different types of candidates in different ways have the potential to affect the ultimate
victor.

8.21. Of course, this discussion should not be confused with advocating for electoral rules
which advantage challengers over incumbents. As stated above, confusing the purpose
of the right to freedom of expression with creating specific outcomes or patterns of
outcomes is misconceived. The point is that legal restrictions on freedom of speech not
only inhibit the rights and freedoms of citizens and speakers but also create certain
unintended consequences. In the context of this discussion, there is at least some
evidence that suggests that spending limits designed may make elections ―fairer‖ and
more ―competitive‖ may actually have the opposite effect.
115
Jeffrey Milyo and Timothy Groseclose, ―The Electoral Effects of Incumbent Wealth,‖ Journal of Law and
Economics 42 (1999): 699–722
116
Ibid.
117
Steven Levitt, ―Using Repeat Challengers to Estimate the Effects of Campaign Spending on Electoral Outcomes
in the U.S. House,‖ Journal of Political Economy 102 (1994): 777–798, 786
54
Summary

8.22. In summary, we submit in relation to the questions raised by the Ministry of Justice:

Q3.1 Should there be limits on campaign spending for constituency candidates


and political parties?

A3.1 No, because (1) limits on campaign spending limit freedom of


expression, (2) none of the rationales contemplated by the Ministry of Justice
in its Issues Paper constitute ―demonstrably justified‖ bases, in principle, to
limit freedom of expression, and (3) the empirical basis for the rationales
contemplated by the Ministry of Justice in its Issues Paper are weak. Absent a
clearly expressed and principled rationale for limiting speech that is based on
credible empirical evidence, we submit there is no proper basis for imposing
limitations on political speech.

8.23. Since we do not believe that there should be spending limits on political parties or
candidates, it follows that we do not have any proposals with respect to several of the
Ministry of Justice‘s questions that deal with the machinery provisions of a regulatory
system designed to control spending by political parties. However, we believe that it
may be helpful to make some general comments on the policy considerations raised by
those questions.

Q3.2 If there are campaign spending limits, should the current limit for
constituency candidates ($20,000) and political parties (a maximum of $2.4
million, if all electorates are contested) be retained or justified?

A3.2 It is not possible to express a view on what the spending limit should be
without knowing what the purpose of the limit is.

Q3.3 Should campaign spending limits be adjusted regularly in line with


inflation? If not should spending limits be regularly reviewed? Who should have
responsibility for the review (for example, a parliamentary committee or an
independent body)?

A3.3 Yes, spending limits should be adjusted for inflation. Asking whether such
limits should be reviewed regularly and who should have the responsibility for the
review does not address the more important question: what would be the criteria
for determining whether the limit should increase or decrease?

Q3.4 When should the regulated campaign spending period start?

55
A3.4 There should be no regulated campaign spending period. However, if one is
introduced, the likely consequence is that, other things being equal, political
parties and candidates will shift some of their spending to the period immediately
prior to the commencement of the regulated period (when they can speak more
easily because the associated regulatory compliance burdens do not apply and
their speech is not counted towards the overall limit).

This consequence of creating a regulated period will concern some of those who
support the imposition of spending controls. This will lead may people into a
chain of logic, which we discussed elsewhere, that creates a self-justifying loop of
expanding the regulated period. For example, if the regulated period is 3 months
prior to the election, it is arguably necessary for the effectiveness of those controls
to expand it to 6 months, which may make it necessary to expand it to the entire
year leading up to the election (which was the position under the Electoral
Finance Act). The logical end-point – which the British government has now
reached – is to apply restrictions continuously (see, e.g., Ministry of Justice Party
finance and expenditure in the United Kingdom, June 2008). The fact that
successive reviews in the United Kingdom (1998, 2006, and 2007) have each
found the need to propose extensions to campaign finance restrictions is a
reflection on this problem. As Sir Hayden Phillips‘s 2007 report indicated, the
law was ―at the same time inadequate and excessively complicated‖. 118 His
solution included more comprehensive controls.

It may also be helpful to address a related point: the claim that was sometimes
been made by some opponents of the Electoral Finance Act that its key problem
was its regulated period was too long. We agree that some of the practical
problems relating to the Electoral Finance Act‘s operation would become less
important under a new regime if the regulated period was short. Since, other
things being equal, a great deal of spending would be likely to shift to the period
before the regulated period, the significance of the problem of deciding what
should be covered would be somewhat reduced (especially if the spending limits
were also raised).119 However, it would be better for speakers and voters if
political communications were made during the period when many undecided
voters actually make up their minds on how to vote. Absent restrictions, speakers
would be likely to focus their energies on the period close to the election. With
restrictions in place, it might be desirable to publish their messages earlier to
avoid the additional burdens and limits associated with those rules. Even aside

118
Strengthening Democracy: Fair and Sustainable Funding of Political Parties (15 March 2007) at 13.
119
However, as we discuss below under section 9 of this submission, it would not go away because the dubious
distinctions involved in deciding what constitutes a regulated publication and what constitutes unregulated issue
advocacy lead to the creation of rules that are either clear but arbitrary or fact-specific but ambiguous.
56
from our concerns based on freedom of speech, is not clear to us how this
regulatory consequence (i.e., less speech that might influence our vote during the
period when we decide how to vote) improves political discourse.120

Q3.5 How long should the regulated campaign spending period be?

A3.5 In our view, this question raises the same issues as Q3.4.

Q3.6 If the length of the regulated campaign spending period is decreased or


increased, should there be a corresponding decrease or increase in overall
spending limits.

A3.6 If the government wishes to introduce spending limits then the effect of
those limits would be depend on both the amount of the limit and the length of the
period to which the limit applied. (It would also depend on other aspects of the
regulatory regime, such as the definition of election advertising) For example, if
the spending limits are high and the regulated period is short, then many of the
disadvantages of spending limits are reduced (though not removed because (1)
there would be regulatory compliance burdens associated with spending money
under a system with limits and (2) in our view, the limits would remain
objectionable in principle). If the spending limits are lowered and the regulated
period is increased then the amount of political speech would be reduced to some
extent (again, the reduction in speech would depend on the ability of speakers to
incur expenses prior to the regulated period or publish speech that qualifies under
an exception to the legislation). Which situation is better depends on what the
legislation is trying to achieve. If policy makers think it is better to have less
speech because that means wealthy speakers are able to publish less political
advocacy then (putting aside Bill of Rights considerations) then they should
favour low limits and long regulated periods. (As we discuss below in section 9
of this submission, whether that outcome is achieved depends, in part, on the
lengths to which lawmakers are prepared to go to restrict speech, e.g., since the
wealthy person could buy a newspaper company and, if he or she wished, exercise
editorial control it would be necessary to impose restrictions on newspapers in
order to prevent that person from having more influence than a person who
doesn‘t own a newspaper but operates, say, a blog) We do not consider that
situation to be an improvement and believe, in any case, that the restraints
required to achieve it are inconsistent with the Bill of Rights.

120
Of course, it might be thought that the ―less speech when it matters‖ situation leaves voters better off because the
additional speech would be published at the behest of ―big money‖, which, the argument goes, ―manipulates‖ voters
and ―drowns out‖ competing ideas. We have set our view on the merits of that arguments above under section 3A of
this submission.
57
9. Spending limits on private political advocacy

9.1. We submit that, even if the government were minded to maintain or extend restrictions
on expenditure applicable to political parties and candidates during the election period,
any proposal to apply limits to private citizens should be independently justifiable. In
particular, we submit that it is improper to rationalise restrictions on private citizens as
desirable to ensure that restrictions on political parties and candidates are workable.
Such an argument based on expediency is wrong for three reasons:

First, it is inconsistent with the requirement under section 5 of the Bill of Rights
that any limitation on fundamental rights should be demonstrably justified.

Second, it falls into the error, also discussed earlier in this submission, of applying
limits according to the internal operating logic of the regulatory system. This
leads to a self-justifying process of extending the reach of the laws. By starting
with the premise that one restriction is necessary, it is possible to rationalise other
restrictions as being necessary to support the previous restriction (e.g., in order to
prevent parties spending money outside the election period the election period
should be increased from 3 months to the entire year; in order to prevent
politicians being disadvantaged by the electoral restrictions that apply to them, the
same limits should be applied to everyone).

Third, extending limits to all citizens greatly increases the scope and complexity
of the regulatory system because it is necessary to create rules and institutions to
monitor the spending on political speech by private citizens. This will also lead to
higher legal barriers to private citizens who wish to participate in public debate
and Parliamentary democracy.

9.2. Accordingly, we submit that, even if the government decides to create spending limits
for political parties, those limits ought not to be carried over to the publication of
political advocacy in New Zealand‘s civil society.

9.3. Since we do not consider that any limits on private political advocacy ought to be
created, it follows that we have no recommendations as to the amount of such a limit.
However, there is a point of principle worth noting. If spending limits are to be
imposed on private citizens, the amount of the limits should reflect their rationale. One
way to test the coherence of ―level playing field‖ rationale is to consider what types of
limits it might call for:

First, the spending limits for ―parallel campaigners‖ might be the same as the
spending limits applicable to political parties and candidates. This would put
―parallel campaigners‖, in one sense, on a ―level playing field‖ with political

58
parties and candidates. However, this approach is unlikely to be popular with
many supporters of campaign finance reform because it would suggest much
higher spending limits than under the Electoral Finance Act. It would also mean
that some ―parallel campaigners‖ could spend more than other ―parallel
campaigners‖ could afford.

Second, the spending limits could be based on what a poorly resourced person or
group could spend. This view would, at least, reflect the egalitarian rhetoric of the
―level playing field‖. It would also call for a preposterously low spending limit
(e.g., many people can afford to spend almost no money on publishing political
advocacy).

Third, the spending limit could be based on some calculation of the cost of
running a certain number of advertisements of a particular type during the
regulated period (e.g., the cost of a full page advertisements in the major
newspapers on five separate occasions during the regulated period). This
approach pays only lip service to the ―level playing field‖ rationale (after all, how
many people could afford one full page advertisement, let alone numerous full
page advertisements?) It is also arbitrary in the sense that it postulates the
advertising requirements of a standard ―parallel‖ campaign. Its practical
advantage for policy makers is that it allows almost any spending limit to be
rationalised (e.g., three full page advertisements instead of five, or calculate the
limit based on the costs of direct mail to 20,000 households or the costs of direct
mail on two separate occasions, or three). However, because this method is
blatantly arbitrary, it illustrates the incoherence of the ―level playing field‖
rationale.

Fourth, it would be possible to simply choose a figure that is higher than the
national spending limits under the Electoral Finance Act. Again, this is an
arbitrary method and it effectively substitutes a rationale of ―reasonableness‖
(without explaining what it is reasonable in relation to) for the ―level playing
field‖ rationale (because the spending limit would be more than most people want
to spend or could spend). If a spending limit for ―parallel campaigners‖ derived
by this method were lower than the limits for political parties and candidates, this
ought to be accompanied by some explanation. We do not doubt that it would be
possible to rationalise lower limits (e.g., there are more third parties than political
parties or political parties have costs not shared by private citizens, which makes
it ―reasonable‖ that their spending limits are higher). A rhetorical variation on
this approach would be to say that a certain amount of money constitutes ―big
money‖.

59
9.4. These potential methods of calculation (and there may be more) serve to illustrate, in
our view, the incoherence of the ―level playing field‖ rationale. For that reason, if
spending limits were to be introduced, we would not have a view on what amount
would be ―reasonable‖ because we do not think there is any meaningful governmental
purpose against which the reasonableness of limits could be evaluated.

9.5. In summary, we submit in relation to the questions raised by the Ministry of Justice:

Q5.9 Should spending by parallel campaigners be limited?

A5.9 No.

Q5.10 If a spending limit is imposed, what do you think the limit should be?

A5.10 It is not possible to express a view on how the amount of spending limit
should be determined without knowing what purpose the limit is intended to
serve. Since we do not consider that the ―level playing field‖ rationale is
coherent, we do not consider it possible to express a view on what spending limits
are appropriate under that rationale.

10. The meaning of election advertising

10.1. The Ministry of Justice correctly observes that the meaning of ―election advertising‖ is
extremely important for a system of campaign finance regulation whose coverage is
largely defined by that concept. We also agree that the existence and scope of certain
specific exceptions from the regime will have important implications for the functioning
of the system.

10.2. We make three submissions in relation to the Ministry of Justice‘s discussion of the
meaning of ―election advertising‖ and the appropriateness of creating specific
exceptions from the reach of that definition.

First, there is a trade-off between preventing the ―exploitation‖ of the campaign


finance system (i.e., speakers adapting their speech to ensure that they are outside
the technical ambit of restrictions on political advocacy) and the ability of citizens
to criticise politicians and advocate policies freely. Effective prevention of such
―exploitation‖ requires a relatively broad definition of ―election advertising‖ and
imposes a heavier burden on the exercise of freedom of expression.

Second, some campaign finance regimes distinguish between ―election


advertising‖ and ―issue advocacy‖ in order to reduce the level of restrictions on
political speech. Such distinctions tend to be very ambiguous (not least because
elections are partly about issues).

60
Third, some campaign finance regimes create specific safe-harbours based on
either the technological format used to express political ideas or the nature of the
speaker. For example, some campaign finance regimes create specific protections
for news media reporting. While media-specific safe harbours can provide clear-
cut protection for freedom of expression within those defined contexts, the safe
harbours tend to be quite arbitrary, especially in view of the developments in
modern communications technology.

The rationale of preventing “exploitation” of gaps in the definition of “election advertisements”


is a recipe for comprehensive regulation

10.3. Since most proponents of campaign finance regulation do not propose a system of
comprehensive regulation of political speech, it is necessary for the regulatory regime to
distinguish between regulated and unregulated political speech during an election
period.

10.4. The definition of such safe harbours or categories of election advocacy determines the
boundaries of the campaign regulations and, accordingly, the definitional approach is
very important to the operation of the campaign regulation system. The Ministry of
Justice notes that there are competing considerations concerning the definition of
―election advertising‖ for the purposes of regulating political speech:121

On the hand, the argument is that if the definition is too broad, then regulation will be too heavy
and it will restrict freedom of speech and limit participation.

10.5. The Ministry of Justice‘s statement that regulation will restrict freedom of speech ―if the
definition is too broad‖ is incorrect. Even limitations based on a narrow conception of
―election advertising‖ (e.g., direct, candidate-specific advertising such as ―John Smith is
too inexperienced to be Prime Minister and you ought not to vote for him‖) restrict
freedom of speech. However, the Ministry of Justice‘s implicit point is a fair one: broad
definitions of ―election advertising‖ will impose restrictions on a greater range of
political speech than narrow definitions and, therefore, entail more serious limitations
on freedom of expression. Balanced against this consideration, the Ministry of Justice
notes the potential for definitional loop-holes to be exploited:122

On the other hand, there is an argument that if the definition is too narrow, then it will not cover
important types of advertising. This would leave obvious gaps that individuals could exploit to
get around the law. Ultimately, this could make people cynical about how effective the rules
really are.

10.6. The Ministry of Justice‘s comments reflect a basic conundrum for proponents of
campaign regulation. Absent outright regulation of all political advocacy, the definition

121
Issues Paper at paragraph 4.5.
122
Issues Paper at paragraph 4.6.
61
of ―election advertising‖ will exclude some types of communications that are capable of
persuading voters. Other things being equal, many people will tend to frame their
communications so as to fall within protected categories of speech or to comply with the
requirements for a regulatory safe harbor. For example:

If advocacy in support of a candidate is regulated but criticism of a candidate is


not regulated, one would expect relatively more ―negative advertising‖ (i.e.,
criticism of the qualifications and policies of a candidate for public office).

If direct calls to vote for or against someone are regulated but general discussion
of their merits is not regulated, one would expect relatively more advertising that
avoids using the ―magic words‖ to which regulatory consequences attach (e.g.,
―John Smith understands our communities and is committed to putting them first‖
instead of ―Vote for John Smith‖).

If advocacy for or against a named candidate is prohibited, one would expect


relatively more advertising that is expressed in general terms (e.g., ―This
November, vote for change‖ as opposed to ―Vote for the ABC party to get rid of
the DEF party‖).

If the definition of ―election advertising‖ draws a distinction between advocating


for candidates and advocating for policies, one would expect to see relatively
more advocacy in favour of policies proposals (e.g., ―This November, vote for tax
cuts‖).

If the definition of ―election advertising‖ excludes communications that encourage


citizens to discuss public policy matters with their elected representatives, one
would expect to see more communications of this kind (e.g., ―Phone your local
MP and tell them to protect our families by voting no on the ABC bill‖).

If the definition of election advertising excludes comparisons of the policy


positions of the candidates or parties, one would expect to see relatively more
communications framed as comparisons (e.g. an environmental group might
produce a ―rating‖ for the parties‘ environmental policies).

10.7. The Ministry of Justice uses the expression ―exploit‖ to describe the conduct of those
who choose forms of expression that the law designates as unregulated and the tendency
to avoid forms of expression that put the person at risk of penal consequences. We
think that such language – if it is intended to denote disapproval, which is unclear – is
not helpful for the purpose of dealing with these definitional problems. Ultimately,
many people feel very strongly about certain matters of public policy and wish to try to
persuade their fellow citizens. (Indeed, we consider that a law framed with sufficient
62
breadth as to prevent the types of communications listed above would be exceedingly
draconian). When the law burdens certain modes of expression, it is to be expected that
speakers will use methods which allow them to speak more easily. Nevertheless, we
submit that it is clear that preventing speakers from ―exploiting‖ gaps in the definition
of ―election advertising‖ would require the legislature to broaden that definition in
response to such exploitation. As a consequence, the scope of campaign regulation has
a tendency to broaden over time for the reasons explained by Thomas J (dissenting) in
McConnell:123

It is not difficult to see where this leads. Every law has limits, and there will always be behavior
not covered by the law but at its edges; behavior easily characterized as "circumventing" the law's
prohibition. Hence, speech regulation will again expand to cover new forms of "circumvention,"
only to spur supposed circumvention of the new regulations, and so forth. Rather than permit this
never-ending and self-justifying process, I would require that the Government explain why
proposed speech restrictions are needed in light of actual Government interests, and, in particular,
why the bribery laws are not sufficient.

The distinction between election advocacy and issue advocacy is blurry at best

10.8. Some proponents of campaign finance regulation argue that the limitations on political
speech associated with such reforms can be confined to ―election advertising‖, which
preserves the ability for citizens to engage in unregulated ―issue advocacy.‖ It is
therefore said that a carefully drafted campaign finance law can target communications
that concern voting behavior while allowing wide open and uninhibited discussion of
the merits of public policy ideas. We submit that this distinction is conceptually
problematic and, therefore, the definitional distinction between election advocacy and
issue advocacy is likely to be very ambiguous (a ―line drawn in the sand on a windy
day‖). 124 In summary, we believe that the problem with the distinction is that elections
are partly about issues and persuasive speech about issues is likely to have the potential
to influence the voting choices of voters. The abstract distinction between advocating
policies and advocating electoral outcomes tends to break down when applied to
politically contentious policies during an election period. We submit that the problems
with the election advocacy / issue advocacy dichotomy were illustrated by New
Zealand‘s experience under the Electoral Finance Act. While we do not believe that
overseas legal regimes have been able to draw a workable distinction either, we believe
it is helpful to begin by discussing the Electoral Finance Act.

10.9. The Electoral Finance Act governed the publication – broadly defined – of an ―election
advertisement‖, which meant any form of words or graphics which can reasonably be
regarded as, among other things, ―encouraging or persuading voters to vote, or not to
vote, for a type of party or for a type of candidate that is described or indicated by

123
540 US 93 at 268 – 269 (2003).
124
Ibid at 128.
63
reference to views, positions, or policies that are or are not held, taken, or pursued
(whether or not the name of a party or the name of a candidate is stated)‖.

10.10. The enacted definition of ―election advertisement‖ was narrower than the original bill,
which included ―taking a position on a proposition with which 1 or more parties or 1 or
more candidates is associated‖. The removal of that limb of the definition was intended
to make it possible to advocate a position on an issue without those publications being
classified as ―election advertisements‖ provided that the words or graphics cannot
reasonably be regarded as encouraging or persuading voters to vote or not vote for ―a
type of party‖ that is described ―by reference to views, positions, or policies‖ (and
therefore not subject to the obligations to disclose the promoter‘s residential address, or
the other reporting obligations, spending restrictions, and criminal sanctions imposed
under the Act). This possibility led the then Minister of Justice to observe that it is
possible for advocacy groups to avoid the restrictions of the Act if they ―stick with the
issues.‖125

10.11. However, the distinction between protected ―issue advocacy‖ and speech which
amounts to an ―election advertisement‖ under section 5(1)(a)(ii) was far from clear-cut.
A central purpose of public debate on an issue is to persuade an audience of the merits
of a perspective on public policy. Since candidates for office and political parties also
hold views and positions with respect to those ideas, the difference between attempting
to persuade the public in an election year of the correctness of a view on public policy
and persuading the public to vote for a type of party by reference to that view is
relatively indeterminate. Take, for example, a publication discussing the economic and
social merits of adopting a particular policy (say, increasing annual leave) on which
various candidates and parties take differing views. The publishers of the report believe
their analysis is compelling and, therefore, wish to persuade readers of the merits of
their perspective on the issue. Accordingly, the position of issue advocates under the
Act was fraught with regulatory risk. As Rodney Harrison QC observed, ―this
extremely vague and uncertain formulation potentially impacts on all manner of special
interest advocacy during an election campaign.‖126

10.12. The ambiguity of the definition is illustrated by the determination of the Electoral
Commission in respect of the following advertisement published by the Employers &
Manufacturers Association (Northern), Inc. (EMA).

125
644 NZPD 14013, 18 December 2007.
126
R. Harrison QC, ―Political Free Speech in New Zealand: Dangerous Beast or Endangered Species‖, University of
Waikato Seminar, Freedom of Speech and the Safety of the State, 10 July 2008 at 9.
64
10.13. Following a complaint, the Electoral Commission was required to determine whether
the EMA‘s advertisement was an ―election advertisement‖ under section 5 of the
Electoral Finance Act by virtue of encouraging voters not to vote for a candidate or
party. The EMA submitted that its advertisement constituted protected issue advocacy.
The thrust of their submission was summarised by the Commission as follows: 127

The EMA contends that the item is nothing to do with the election, and that it focuses on proposed
changes to the Kiwisaver legislation which were likely to be the subject of parliamentary debate a
few days after the item was published. Rather than encouraging or persuading voters to vote or not
to vote in a particular manner, the item encourages readers to make their views known to the
policymakers and legislators if they agree that the proposed changes advocated by Trevor Mallard
are wrong.

127
Electoral Commission decision 2008-25, ―Employers and Manufacturers Association (Northern) Inc, election
advertisement‖, 19 August 2008, at page 2 available at http://www.elections.govt.nz/files/2008-
25_EMA_Stop_Mallard.pdf
65
The EMA submits that changes to the definition of election advertisement in the Electoral Finance
Bill during its passage were made expressly to address concerns that the original definition would
catch issues-based advocacy by NGOs. The EMA also refers to the New Zealand Bill of Rights
Act and submits that interpretation of the Electoral Finance Act must be consistent with the
freedoms protected in that Act.

10.14. The Commission concluded: 128

In the view of the Electoral Commission the impact of the newspaper item is a primary
consideration in determining whether it is an election advertisement. The headlines, associated
with the graphics which include ‗stop‘ signs, give an overall perception of wanting to stop Trevor
Mallard and/or his party. The Commission concluded that the item is therefore an election
advertisement within the meaning of section 63 of the Act (as defined in section 5), as it can
reasonably be regarded as encouraging voters not to vote for the Labour Party and it was published
in the regulated period.

10.15. We do not have a concluded view on whether the Commission‘s assessment of the
EMA‘s advertisement is correct in terms of the Electoral Finance Act. Indeed, we
consider the definition of ―election advertisement‖ in the Electoral Finance Act so
vague as to create a hazard that any statement criticising a political policy connected to
a party or politician would fall within its reach. More fundamentally, however, we
believe that the EMA‘s advertisement illustrates the point that the distinction between
an ―issue advertisement‖ and an ―election advertisement‖ is conceptually and practically
unworkable. The advertisement makes clear that the target of the EMA‘s concern is the
proposed legislation affecting the ability of employees and employers to bargain over
whether to take some of their remuneration in the form of Kiwisaver contributions or as
an increase in their cash salary. Since the Hon Trevor Mallard was a sponsor of the
legislation, the advertisement is also critical of Mallard role in relation to the legislation.
The question is whether the advertisement criticising ―Mallard‘s Law‖ constitutes mere
―issue advocacy‖ or is intended to encourage voters not to vote for Mallard (or, as
Scalia J might have asked:―Does attacking the King‘s policy attack the King?‖).129

10.16. The Electoral Commission‘s reasoning suggests that the EMA‘s advertisement may
have fallen outside the definition of an ―election advertisement‖ if it did not ―give an
overall perception of wanting to stop Trevor Mallard and/or his party.‖ It is not clear
whether this would have required the EMA to have omitted any mention of Mallard‘s
role in relation to the legislation. For example, would an advertisement omitting the
silhouette graphic of Mallard and the references to Mallard in the text have constituted
an election advertisement where the advertisement nonetheless indicated that the
government had introduced legislation that reflected the ―usual busybody attitude we‘ve
come to expect from Wellington,‖ constituted an ―attack on workers,‖ was ―unfair,‖
―discriminatory,‖ and ―wrong‖ and ―must be stopped‖? In our view, there would still be

128
Electoral Commission decision 2008-25, at page 2.
129
Federal Election Commission v Wisconsin Right to Life, Inc., 551 US 449 (2007).
66
a risk that such an advertisement would be regarded as an ―election advertisement‖ to
the extent that it might be regarded as encouraging readers not to vote for government
politicians by reference to the undesirability of a government policy.

10.17. In order to constitute unregulated speech, it might therefore be necessary to remove any
references to the government or the criticism of the sponsors of the legislation. Such an
advertisement might state, in relevant part, that legislation ―had been introduced‖ (by
whom?) that was ―unfair, discriminatory, and wrong‖ and which ―must be stopped.‖
Such an advertisement would be peculiar in at least two respects.

10.18. First, voters would be aware which parties formed the government so it is not clear how
such an advertisement would avoid the likelihood that readers who were persuaded that
the legislation was ―unfair, discriminatory, and wrong‖ would be encouraged not to
support government parties which they knew would have formulated the legislation.

10.19. Second, such an advertisement would be unhelpfully uninformative by not being able to
disclose the sponsors of the impugned legislation, where the parties stood in relation to
the legislation (lest the advertisement by be regarded as encouraging readers to vote for
or against those parties), or indicating what further steps a dissatisfied voter might take
(such as whom the voter might call to express their opposition). It is not clear whether
such an advertisement would become an ―election advertisement‖ (as that term was
defined in the Electoral Finance Act) if it rebutted a publicly stated justification by
Mallard in support of the legislation. If so, the scope for unregulated issue advocacy
was narrow indeed because advocacy that does not deal with other publicly stated views
or engage with contrary perspectives has greatly diminished value. An advertisement of
the kind described above – careful to reduce the risk that readers might draw a
connection between a policy and those who designed it – might avoid classification as
an ―election advertisement.‖

10.20. Nevertheless, in the case of policies whose proponents are widely known, it is open to
question whether omitting the names of the sponsors would remove the risk of being
classified as an election advertisement. Suppose for example that a lobby group wanted
to publish an advertisement in opposition to the proposal for universal student
allowances during the period following the announcement of that policy by the Labour
Party during the 2008 election campaign. It is not clear that it would be possible to
avoid the likelihood that readers who were persuaded by the arguments against
universal student allowances would be encouraged not to vote for the Labour Party.
Alternatively, advertisements which called for universal student allowances would be
likely to encourage students who were persuaded by the arguments in their favour to
vote for the Labour Party (being a party supporting that policy).

67
10.21. It might be thought that the uncertainty arising from the definition of ―election
advertisement‖ in the Electoral Finance Act reflects the circumstances in which that
enactment was drafted rather than a fundamental problem with the dichotomy between
election advocacy and issue advocacy. We disagree on the basis that other regulatory
regimes have similarly struggled to create a definition of election advocacy that
preserves a clear and meaningful ability to engage in robust issue advocacy. This
difficulty is illustrated by the approach of the United Kingdom Electoral Commission
under the Political Parties, Elections and Referendums Act 2000 (PPERA). Certain
features of the PPERA are similar to the Electoral Finance Act, including the definition
of ―election material‖ under section 85(3), which relevantly includes, ―material which
can reasonably be regarded as intended to— promote or procure electoral success at any
relevant election for— […] candidates who hold (or do not hold) particular opinions or
who advocate (or do not advocate) particular policies or who otherwise fall within a
particular category of candidates, or otherwise enhance the standing— of any such
candidates.‖ The United Kingdom Electoral Commission has published guidance on
this provision, which provides as an example of ―election materials,‖ a ―pamphlet in
support of banning blood sports and listing all parties and candidates that also support
the ban.‖130 Therefore, as with the EMA‘s advertisement, speech identifying the
position of political parties on an issue and expressing a policy preference in relation to
that issue can constitute regulated election advocacy.

10.22. Consider also the following example given by the Neill Committee in the United
Kingdom in support of its view that ―third party‖ political speech should be limited: 131

Throughout the 1950s, but principally during election campaigns, the privately owned steel
industry – both individual firms within the industry and the industry as a whole – campaigned
against steel nationalisation, which also formed part of Labour‘s programme at that time. […]

Not all political propaganda during election campaigns overtly promotes or opposes the election of
particular parties. At the 1959 general election, a privately owned steel firm, Stewarts and Lloyds,
ran a series of advertisements in daily and Sunday newspapers, most of which were thought to
have large Labour readerships. The advertisements were clearly intended to discourage voters
from voting Labour. That is not, however, what they said. On the contrary, the Stewarts and
Lloyds slogan insisted: ―It‘s not your vote we ask for, it‘s your voice. Speak up against state-
owned steel.‖

10.23. On which side of the hazy line between issue advocacy and election advocacy should a
―third party‖ speech regulation (if such there must be) classify an advertisement of this
kind? If the Stewards and Lloyds‘ advertisements persuaded some voters that the
nationalization of the steel industry was unwise then the persuasive effects of the speech

130
Electoral Commission, ―Guidance for recognised third parties: Controlled expenditure and donations‖. Available
at http://www.electoralcommission.org.uk/
131
Fifth Report of the Committee on Standards in Public Life: The Funding of Political Parties in the United
Kingdom (1998), paragraphs 10.73 – 10.78.
68
would clearly have been disadvantageous to the electoral prospects of Labour
candidates. For this reason, it might be thought that the speech should be treated as
election advocacy rather than issue advocacy. However, it is not clear there is much
scope for unregulated issue advocacy if any speech that persuades an audience that a
policy associated with a political party will be detrimental is treated as regulated
election advocacy.

10.24. Indeed, the breadth of the United Kingdom‘s definition of election advertising reflects
in part the legislature‘s dissatisfaction with an early case in which the Court took a
narrow view of election advocacy. 132 In R v Tronoh Mines Ltd, the Court considered
whether a jury could reasonably conclude that the publication of certain statements in a
newspaper could be considered to have constituted the incurring of an expense ―with a
view to promoting or procuring the election of a candidate at an election … or of
otherwise presenting to the electors the candidate or his views or the extent or nature of
his backing or disparaging another candidate‖ under section 63 of the Representation of
the People Act 1949.133 The advertisement in question criticized the United Kingdom
Labour Party‘s policy concerning corporate dividends and went on to include the
following impugned statement:

The coming general election will give us all the opportunity of saving the country from being
reduced, through the policies of the Socialist government, to a bankrupt 'Welfare State'. We need
a new and strong government with Ministers who may be relied upon to encourage business
enterprise and initiative, under the leadership of one who has, through the whole of his life,
devoted himself to national and not sectional interests.

10.25. McNair J held that section 63 applied only to speech which concerned a particular
candidate and did not apply to ―general political propaganda, even though that general
political propaganda does incidentally assist a particular candidate among others.‖134
Accordingly, McNair J concluded that a reasonable jury could not making one of the
findings necessary to convict the company on the charge of unlawfully incurring
expenses under the legislation.

10.26. The Tronoh Mines case illustrates the tendency discussed by the Ministry of Justice that,
however election advertising is defined, people will usually try to express themselves in
a way which complies with the applicable rules. While it is possible to prevent people
―exploiting‖ specific loop-holes by progressively broadening the definition of election
advertisement, it is not possible to close the loop-holes without progressively increasing
the restrictions on freedom of expression.

132
Fifth Report of the Committee on Standards in Public Life: The Funding of Political Parties in the United
Kingdom (1998), paragraph 10.18.
133
[1952] 1 All ER 697.
134
[1952] 1 All ER 697 at 700.
69
Media-specific exemptions are arbitrary

10.27. While media-specific carve-outs from the coverage of campaign finance laws sit
awkwardly with the rationales underpinning restrictions on political speech during
election periods, they have some obvious attractions. Few proponents of campaign
regulation believe it would be wise to subject the news media, for example, to the same
rules that apply to political speech generally. It would be highly undesirable, for
example, for editors of newspapers to bear the risk that they could be liable for writing
editorials which were thought too one-sided. The concern is that the potential for such
liability would encroach on matters of editorial judgment. Editors and journalists
should not be made to run the risk that they might be liable for either criticising some
politicians too sternly or praising others too lavishly. Absent clear protections for the
news media, it would be difficult to generate much support for restrictions on political
speech. It is clear that a regime of speech regulation during election periods (if such
there must be) would be less harmful if the news media were exempt. However, such
an exemption would itself raise concerns about how the government decided who
counted as the news media and what the basis is for creating different rules for some
citizens than others.

10.28. Other carve-outs from the reach of campaign regulations might be supported in order to
avoid apparently absurd outcomes. For example, few supporters of campaign finance
regulation would support restrictions on the publication of books and films
notwithstanding that they can influence voting behaviour (and in some cases may be
designed to create political influence, e.g. some documentary films).

10.29. Nevertheless, the logic of ―leveling the playing field‖ or preventing the ―undue
influence‖ of ―big money‖ would be theoretically consistent with comprehensive
regulation of speech, notwithstanding the embarrassing consequences for supporters of
restrictions on political speech during election periods. The following exchange during
the oral argument in Citizens United v Federal Election Commission (a case which
concerns the issue of whether a documentary film that criticized Hillary Clinton
constituted election advertising) is interesting: 135

JUSTICE ALITO: That's pretty incredible. You think that if -- if a book was published, a
campaign biography that was the functional equivalent of express advocacy, that could be banned?

MR. STEWART (on behalf of the FEC): I'm not saying it could be banned. I'm saying that
Congress could prohibit the use of corporate treasury funds and could require a corporation to
publish it using its PAC.

JUSTICE ALITO: Well, most publishers are corporations. And a -- a publisher that is a
corporation could be prohibited from selling a book?

135
Available at http://www.supremecourtus.gov/oral_arguments/argument_transcripts/08-205.pdf. The Supreme
Court has not yet issued its judgment.
70
MR. STEWART: Well, of course, the statute contains its own media exemption or media --

JUSTICE ALITO: I'm not asking what the statute says. The government's position is that the First
Amendment allows the banning of a book if it's published by a corporation?

MR. STEWART: Because the First Amendment refers both to freedom of speech and of the press,
there would be a potential argument that media corporations, the institutional press, would have a
greater First Amendment right. That question is obviously not presented here. The -- the other two
things --

JUSTICE KENNEDY: Well, suppose it were an advocacy organization that had a book. Your
position is that under the Constitution, the advertising for this book or the sale for the book itself
could be prohibited within the 60/90-day period -- the 60/30-day period?

MR. STEWART: If the book contained the functional equivalent of express advocacy.

10.30. Once one accepts the premise that the government may restrict speech during election
periods in the pursuit of objectives such as a ―level playing field‖, the creation of media-
specific exemptions is inconsistent with the pursuit of that objective. If a filmmaker
produces an expensive and heavily one-sided documentary film in an election year that
fiercely criticises, say, a prominent politician, it is not clear why the supporters of
campaign finance regulation would support an exemption to protect that film from the
application of rules restricting the amount of money that can be spent on political
advocacy. The same would be true of a best-selling book. It is not clear why the
supposed public interest in restricting pamphlets and infomercials does not apply to
feature films and books. It would also not be clear how the regulatory regime should
determine which technological formats qualify for an exemption:

Is a book protected in hard cover but potentially a campaign advertisement when


viewed on a Kindle?136

In a technological age where the boundaries between newspapers, television


channels, radio stations, and blogs are increasingly blurry, should a blog on a
newspaper website be treated differently than a dedicated blog run independently
of a newspaper?137

Should a politically partisan film shown on the cinema screen be exempt but a
shorter advertisement be covered?

10.31. The creation of exemptions based on the identity of the publisher, such as a ―news
media‖ exemption, would also be problematic. In a free society, people do not need to
register with the government in order to report and comment on events. For that reason,

136
http://en.wikipedia.org/wiki/Amazon_Kindle
137
For example, should David Farrar be exempt when he writes a blog entry for the National Business Review‘s
website (www.nbr.co.nz) but nonetheless subject to regulatory scrutiny when he writes a blog entry on
www.kiwiblog.co.nz?
71
the boundaries of who should qualify for a ―news media‖ exemption are by no means
clear. For example:

Could a blog qualify for a news media exemption? If so, should a political blog
that reports the news from a particular point of view qualify? If not, why treat
such a blog differently than a magazine which reports the news from a particular
political perspective?

If ―objectivity‖ is a precondition for being exempt from restrictions on freedom of


expression, how could this be determined? (After all, which major publications
have not been accused at one time or another of having a political tilt by
politicians of various political stripes?)

Is it possible to make any determinations of the character, political complexion,


and genuineness of a media outlet (if the regulatory regime requires such) without
the risk of outright regulatory supervision of the editorial content of the media?

10.32. We submit that once the government attempts to regulate the terms of public debate in
the name of ―fairness‖ and ―equality,‖ it faces a dilemma between comprehensive
regulation of the media or the potential arbitrariness of determining which media
institutions should be exempt.

10.33. The potential for ―sham‖ publications of this kind is likely to be disconcerting to some
supporters of campaign finance regulation. The disquiet of proponents of campaign
finance regulation over the possibility that people may circumvent the restrictions or
publish ―sham‖ books or documents may be some form of test for the genuineness of
the publication. For example, the protection for the media could be conditioned on an
assessment that their publications are ―solely‖ for the purposes of entertaining or
informing the public, as was the case under the Electoral Finance Act. We submit that it
is unacceptable to expose reporters and editors to the risk that their publication would be
subsequently determined to fall short of some standard of genuineness for two reasons.
First, ex post determinations of a publication‘s genuineness would be likely to affect
editorial and reporting decisions. This ―chilling effect‖ on the exercise of editorial
judgment would diminish the ability of editors and journalists to report and comment on
the news as they think fit. Second, it is contrary to the values of a liberal democratic
society to permit government officials, backed by the coercive power of the campaign
finance laws, to second-guess the genuineness of editorial and reporting decisions.

72
Summary

10.34. In summary, we submit in relation to the questions raised by the Ministry of Justice:

Q4.1 Should New Zealand retain its current approach to the regulation of election
advertising, or should a revised definition of ‗advertising‘ be adopted?

A4.1 As discussed above, the present approach to the regulation of election advertising
is inconsistent and in some respects arbitrary. If, as we submit would be preferable, the
election laws did not place limits on the ability of citizens, candidates, and political
parties to spend money expressing their arguments, the significance of the definition of
―advertising‖ would be greatly reduced. However, if spending limits are to be imposed,
then the definition of ―advertising‖ also defines the reach of those spending limits. As
such, there will be considerable pressure (much of it sensible and necessary, if one
assumes that there must be spending limits) to create certain exemptions from the
definition of ―advertising‖.

Q4.2 How should ‗election advertisement‘ be defined? Should it be broad or narrow?


Should there be exceptions and if so what should they be?

A4.2 In our submission, this question is misconceived. When the Ministry of Justice
asks whether the definition of ―election advertisement‖ should be ―broad or narrow‖, its
real question is whether the spending limits should comprehensively apply to most
forms of published political advocacy or whether the spending limits should have a
narrow application to only some forms of published political advocacy. We do not have
a concluded view on which exceptions should be created because we consider them
likely to be arbitrary. If an exception is to be made to protect, for example, reporting by
the news media from restrictions on political speech during the election period, the
government should justify the criteria by which the legislation will define which
institutions count as the news media and explain why rules that are said not to unduly
restrict the speech of private citizens are nonetheless sufficiently onerous to require a
special exception for the news media. In our view the following question posed by
Professor Levinson is a pertinent one: ―To the extent that it strikes us as dubious – or
indeed ‗unthinkable‘ – to limit the ability of a newspaper to campaign actively for its
favorite candidates, then we should at least question why it would be any more
legitimate to limit the amount of spending by an individual eager to support the same
candidate.‖138 We agree also with his conclusion that, ―it is hard to cabin the pro-

138
Sanford Levinson, ―Regulating Campaign Activity: The New Road to Contradiction‖ (1985) 83 Mich. L. Rev.
939 at 947.
73
regulation argument in any way that leaves the press magnate singularly free of the
restrictions placed on others.‖139

Q4.3 Should rules on publication be media-neutral, so that new communication


technologies that are designed fall within them?

A4.3 In principle, we submit that the electoral laws ought to be media-neutral because
media-specific rules are arbitrary. However, the Ministry of Justice‘s question is
ultimately focused on how comprehensive the coverage of restrictions on published
political advocacy ought to be. If a ―media-neutral‖ rule means a rule under which
more forms of political discussion will be subject to regulation than under a non-media-
neutral rule, then in our submission, the real question remains what justification exists
for limiting how much can be spent publishing political arguments (whether they are
published in the form of books or blogs). If media-neutrality is said to guide the
development of the new campaign finance laws, it would also be appropriate for the
government to explain why the principle of media-neutrality would not also require the
removal of the special restrictions that apply to private political advocacy on the
broadcast media (as we discuss above at section 7 of this submission).

11. Public disclosure of names and addresses

11.1. The Ministry of Justice notes that election law currently requires the promoter of an
election advertisement to include their name and contact address in the advertisement.
We submit that this requirement should be abolished and that those engaged in political
debate should be free to remain anonymous, if they choose to do so. In our view this
approach is supported by four considerations:

First, requiring disclosure of a speaker‘s identity is a form of content regulation


that limits freedom of speech;

Second, there is no compelling state interest that justifies requiring speakers to


reveal their name and address;

Third, there are many legitimate reasons why one may wish to speak
anonymously; and

Fourth, there is a long and honourable tradition of anonymous political and


literary speech.

11.2. We take each point in turn.

139
Ibid at 948.
74
Requiring disclosure of a speaker’s identity is a form of content regulation that limits freedom of
speech

11.3. As the Butlers note in their text The New Zealand Bill of Rights Act: A Commentary:
―The right to freedom of expression encompasses the right not to express an opinion or
information.‖140 As such we submit that a government requirement to include certain
material in an election advertisement is a limit on the right to freedom of speech.

11.4. By way of illustration, we submit that it could not seriously be denied that any of the
following illustrations of forced speech amount to a limit on the right to freedom of
speech (leaving aside the reasonableness of such a restriction for the moment):

Requiring citizens to compulsorily salute the flag or recite a loyalty oath or


pledge.

A requirement that bloggers include their name and address on any posts
discussing political matters.

A requirement that journalists identify by name the source of all information


referred to in articles.141

11.5. The requirement that the speaker include his or her name and address is in the same
category. It limits the speaker‘s ability to formulate his or her message in the manner
that he or she believes will be most effective.

11.6. This point has been recognised by the Supreme Court of the United States in a number
of decisions which held that the First Amendment to the Constitution included a right to
speak anonymously. In Talley v California142 the Court held unconstitutional a
Californian ordinance which prohibited distributing hand-bills which did not have
printed on the cover the name and address of the printer and the person who caused the
document to be produced. Giving the opinion of the Court, Justice Black said: 143

There can be no doubt that such an identification requirement would tend to restrict freedom to
distribute information and thereby freedom of expression. ‗Liberty of circulating is as essential to
that freedom as liberty of publishing; indeed, without the circulation, the publication would be of
little value.‘ Lovell v. City of Griffin, 303 U.S. at page 452, 58 S.Ct. at page 669.

140
Butler and Butler The New Zealand Bill of Rights Act: A Commentary (2005) at [13.27.1].
141
By of analogy, see the cases concerning the common law ―newspaper rule‖ including Broadcasting Corporation
of New Zealand v Alex Harvey Industries Ltd [1980] 1 NZLR 163 (CA) and European Pacific Banking Corporation
v Television New Zealand Ltd [1994] 3 NZLR 43 (CA). This rule is now contained in s 68 of the Evidence Act
2006.
142
362 US 60 (1960). The majority comprised Warren CJ, Black, Douglas, Harlan, Brennan and Stewart JJ.
Frankfurter, Clark and Whittaker JJ dissented.
143
Ibid at 64.
75
11.7. Similarly, in McIntyre v Ohio Election Commission144 the Court held unconstitutional
an Ohio statute which prohibited the distribution of anonymous campaign literature.
Giving the opinion of the Court, Justice Stevens wrote:145

Under our Constitution, anonymous pamphleteering is not a pernicious, fraudulent practice, but an
honorable tradition of advocacy and of dissent. Anonymity is a shield from the tyranny of the
majority. … It thus exemplifies the purpose behind the Bill of Rights, and of the First
Amendment in particular: to protect unpopular individuals from retaliation – and their ideas from
suppression – at the hand of an intolerant society.

11.8. We submit that these authorities are compelling and establish that requiring a speaker to
disclose his or her name and address is a clear limit on the right to freedom of
expression. Accordingly, it is for proponents of disclosure to make the case that the
limit is demonstrably justified in a free and democratic society. As an aside, we note
that the Ministry of Justice‘s discussion of the issue of disclosure in the Issues Paper
includes no reference to the right to freedom of speech and no analysis as to whether
mandating disclosure is consistent with the Bill of Rights.

There is no compelling state interest that justifies requiring speakers to reveal their name and
address

11.9. Turning to the question of justification, we submit that there is no compelling state
interest in requiring speakers to reveal their name and address.

11.10. Three possible justifications are suggested by the Ministry of Justice in the Issues Paper
at paragraph 4.24. They are:

Requiring disclosure allows the public to identify the person publishing an


advertisement, so that they can make their own judgments about whether the
message in the advertisement is something that they want to consider when they
vote (we will refer to this as the ―information justification‖).

Allowing electoral agencies and advertising standards authorities responsible for


enforcement to follow up if the rules are not being complied with (we will refer to
this as the ―compliance justification‖).

Allowing candidates and political parties to identify material they have not
authorised (we will refer to this as the ―authorisation justification‖).

11.11. We consider each justification in turn.

THE INFORMATION JUSTIFICATION

144
514 US 334 (1995). The majority comprised Stevens, O‘Connor, Kennedy, Souter, Thomas, Ginsburg and
Breyer JJ. Rehnquist CJ and Scalia J dissented.
145
At 357.
76
11.12. We submit that the information justification is not a reasonable limit on the right to
freedom of expression because it is not a pressing and substantial government objective.
Although some individuals may consider the identity of the speaker relevant, this is not
a reason to mandate that speakers provide it. If the mere fact that some people thought
information was useful made provision of such information a pressing and substantial
government objective, the government could regulate the content of any speech, by the
media or private citizens, in the interests of satisfying the content preferences of those
individuals. This would gut the freedom of speech and the press of any meaningful
content.

11.13. As Justice Stevens explained in McIntyre:146

Insofar as the interest in informing the electorate means nothing more than the provision of
additional information that may either buttress or undermine the argument in a document, we think
the identity of the speaker is no different from other components of the document‘s content and
the author is free to include or exclude it. … The simple interest in providing voters with
additional relevant information does not justify a state requirement that a writer make statements
or disclosures she would otherwise omit.

11.14. To the extent that individuals consider the identity of the speaker relevant, they can
weigh its omission in assessing the material. This is a familiar part of assessing
information and advertising in modern society. When one reads an editorial in a
newspaper or considers an advertisement on television, an assessment of what is not
said regularly forms just as important element in the message‘s consideration as an
assessment of what is said.

11.15. The ability of the public to assess anonymous material was rightly recognised by the
Court in McIntyre when it quoted the following passage with approval: 147

Of course, the identity of the source is helpful in evaluating ideas. But ‗the best tests of truth is
the power of the thought to get itself accepted in the competition of the market‘. Don‘t
underestimate the common man. People are intelligent enough to evaluate the source of
anonymous writing. They can see it is anonymous. They know it is anonymous. They can
evaluate its anonymity along with its message. And then, once they have done so, it is for them to
decide what is ‗responsible‘, what is valuable, and what is truth. (citations omitted)

11.16. It is also worth recalling the related point made by the United States Supreme Court in
First National Bank of Boston v Bellotti that:148

[T]he inherent worth of speech in terms of its capacity for informing the public does not depend
upon the identity of its source, whether corporation, association, union, or individual.

11.17. Accordingly, we submit that although some individuals may regard the identity of a
speaker as relevant, this does not make provision of such information a pressing and
146
At 348.
147
At 348.
148
435 US 765 at 777 (US).
77
substantial government objective. In the absence of such information individuals will
weigh speech accordingly.

THE COMPLIANCE JUSTIFICATION

11.18. With respect to the compliance justification, we note that the Ministry of Justice does
not specify which rules can only be enforced by requiring public disclosure of the name
and address of the speaker. Without such information it is difficult to properly assess
the cogency of this rationale or indeed to understand how such disclosure promotes
compliance. Two points, however, may be noted which persuade us (in the absence of a
clearly articulated case setting out the compliance justification) that this justification
does not amount to a reasonable limitation on the right to freedom of expression.

11.19. First, given our submission that there should be no limit on the amount that parties,
candidates and individuals can spend in an election campaign, requiring disclosure of
names and addresses is not necessary to ensure compliance with these rules. In any
event, given that parties and candidates are required to make disclosure of their election
spending, we fail to see how requiring advertisers to include their name and address is
necessary to ensure compliance with spending limits (if that is the suggestion being
made by the Ministry of Justice).

11.20. Second, even if it is necessary for electoral agencies to know the identity of the
promoter of election advertisements, it is not necessary to disclose names and addresses
to the public at large. In this sense, the limitation does not impair the right as little as
possible. A less restrictive regime could be put in place, for example by requiring
newspapers and advertising agencies to hold promoter details to pass on to electoral
agencies if needed, but otherwise ensuring the anonymity of those promoters who desire
it.

THE AUTHORISATION JUSTIFICATION

11.21. We submit that this is the weakest of all three justifications suggested by the Ministry of
Justice. It is susceptible to three principal objections.

11.22. First, the rationale as explained is not a governmental objective; it is designed to


advantage political parties and candidates. The Ministry of Justice says that it enables
―constituency candidates and political parties to identify material they have not
authorised‖ (at paragraph 4.24). No explanation is provided as to why this is a
governmental objective or how it would be in the interests of society at large.

11.23. Second, this rationale is based on what we submit is the false assumption that parties
and candidates are assumed to have authorised all election advertisements in their
favour unless the contrary can be shown. It is unclear to us why such an assumption
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would be adopted. Even if there was a good reason to adopt the presumption that
messages generally consistent with a political party or candidate‘s interests have been
authorised by it, disclosure of the promoter‘s name and address does not rebut this
presumption. Revealing the name of a promoter, even one associated with a political
party, does not indicate whether the particular advertisement was authorised by the
party or candidate in question.

11.24. Third, this rationale appears to be based on the further assumption that political parties
and candidates have some type of right to control or manage the content of all election
advertisements that are favourable to them during an election. This notion is
fundamentally misconceived. Like all other individuals, parties and candidates have a
right to participate in the election and to freedom of speech. However, the right of non-
candidates to participate and to exercise their freedom of speech is no less important.

11.25. Accordingly, we submit that no pressing and substantial government interest has been
identified which justifies requiring speakers to disclose their name and identity.

There are many legitimate reasons why one may wish to speak anonymously

11.26. We have already submitted that it is inconsistent with the right to freedom of speech to
require speakers to reveal their name and address. We further submit that there are
many legitimate reasons why one may wish to speak anonymous.

11.27. This point was cogently explained in both United States Supreme Court decisions
referred to above. It suffices to refer to the relevant passages. In Talley, Justice Black
explained that:149

Anonymous pamphlets, leaflets, brochures and even books have played an important role in the
progress of mankind. Persecuted groups and sects from time to time throughout history have been
able to criticize oppressive practices and laws either anonymously or not at all. The obnoxious
press licensing law of England, which was also enforced on the Colonies was due in part to the
knowledge that exposure of the names of printers, writers and distributors would lessen the
circulation of literature critical of the government.

11.28. Justice Stevens made the same point in McIntyre:150

The decision in favour of anonymity may be motivated by fear of economic or official retaliation,
by concern about social ostracism, or merely by a desire to preserve as much of one‘s privacy as
possible. Whatever the motivation may be, at least in the field of literary endeavor, the interest in
having anonymous works enter the marketplace of ideas unquestionably outweighs any public
interest in requiring disclosure as a condition of entry.

11.29. A littler later Justice Stevens explained:151

149
At 64.
150
At 341–342.
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On occasion, quite apart from any threat of persecution, an advocate may believe her ideas will be
more persuasive if her readers are unaware of her identity. Anonymity thereby provides a way for
a writer who may be personally unpopular to ensure that readers will not prejudge her message
simply because they do not like its proponent.

11.30. Finally, it is worth recalling the point cogently made by John Stuart Mill in On Liberty
that the effect of a government silencing a speaker, even if he alone holds a particular
view, is to impose a cost on society as a whole. This point is particularly apposite when
made in connection with an unpopular or persecuted speaker who feels that she has to
speak anonymously or not at all: 152

If all mankind minus one were of an opinion, mankind would be no more justified in silencing that
one person than he, if he had the power, would be justified in silencing mankind. Were an opinion
a personal possession of no value except to the owner, if to be obstructed in the enjoyment of it
were simply a private injury, it would make some difference whether the injury was inflicted only
on a few persons or on many. But the peculiar evil of silencing the expression of an opinion is
that it is robbing the human race, posterity as well as the existing generation – those who dissent
from the opinion, still more than those that hold it. If the opinion is right, they are deprived of the
opportunity of exchanging error for truth; if wrong, they lose, what is almost as great a benefit, the
clearer perception and livelier impression of truth produced by its collision with error.

There is a long and honourable tradition of anonymous political speech

11.31. Finally, as we have alluded to above, there is a long and honourable tradition of
anonymous political advocacy. This history was extensively reviewed by the Supreme
Court in McIntyre. For a detailed account, readers should refer to the judgments of
Justices Stevens and Thomas. For present purposes we simply highlight some of the
more well known literary and political writers who published either anonymously or
using pseudonyms.

11.32. With respect to the literary world, the following examples are identified by Justice
Stevens in the judgment of the court:153

Samuel Langhorne Clemens (Mark Twain);

William Sydney Porter (O Henry);

Francois Marie Arouet (Voltaire);

Amandine Aurore Lucie Dupin (George Sand);

Mary Ann Evans (George Eliot);

Charles Lamb (Elia);

151
At 342.
152
John Stuart Mill On Liberty (Penguin Books, Penguin Classics, England, 1974) at 76.
153
In footnote 4.
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Charles Dickens (Boz); and

Benjamin Franklin employed numerous pseudonyms.

11.33. The prevalence of anonymous writing is not confined to the literary world. Many
important political works have also been published anonymously or under a pseudonym.
For example:

The pre-Revolutionary War English pamphleteer ―Junius‖ whose identity remains


unknown. 154

The Federalist Papers, advancing arguments in favour of ratifying the United


States Constitution, were published under the fictitious name ―Publius‖. In actual
fact the Papers were written by James Madison (who went on to become the
fourth President of the United States), Alexander Hamilton (later the first
Secretary of the Treasury) and John Jay (later the first Chief Justice of the United
States).155

The Anti-Federalists also published anonymously. Notable pseudonyms include:


―Cato‖ (believed to be New York Governor and later Vice-President George
Clinton); ―Centinel‖ (probably Samuel Bryan or his father); ―The Federal Farmer‖
(possibly Richard Henry Lee, one of the signers of the Declaration of
Independence); and ―Brutus‖ (possibly Robert Yates a New York Supreme Court
justice). 156

11.34. For an extended discussion of earlier American examples of anonymous political


speech, see Justice Thomas‘ concurring judgment in McIntyre at 361–363.

Summary

11.35. In summary, we submit in relation to the questions raised by the Ministry of Justice:

Q4.4 Should there be a requirement for persons who publish an election advertisement
to include their name and contact address?

A4.4 No. In our submission such a requirement would restrict freedom of speech.
None of the rationales identified in the Issues Paper justifies such a restriction.
Further, there are many legitimate reasons why individuals may choose to speak
anonymously. Indeed, there is a long tradition of anonymous political and
literary writing.

154
McIntyre at 343.
155
McIntyre at 342 and footnote 6.
156
McIntyre at 343.
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Q4.5 If so, are the existing rules adequate, or should they be changed in some way?
Do you have any suggestions for change?

A4.5 Given our answer to Q4.4, we have no submission to make in relation to this
question other than to repeat that we believe that the current rules are
inconsistent with the right to freedom of expression and should be repealed.

12. Reflections on the Electoral Finance Act

12.1. The Electoral Finance Act is regarded by many as a low point in New Zealand‘s recent
legislative history. The legislation was ill-considered and poorly drafted, which led to
considerable uncertainty over its application. However, it would be incorrect to
conclude that the problems with the Electoral Finance Act were confined to its drafting
or the absence of cross-party consultation prior to its introduction. In our submission,
there are two wider lessons from the experience with the Electoral Finance Act.

First, the failures of the Electoral Finance Act reflected flawed premises as well as
poor drafting. The Electoral Finance Act started from the premise that the ―undue
influence‖ of wealthy ―third parties‖ (i.e., citizens) using their money to present
arguments was a threat to the integrity of the electoral process. The next premise
was that the electoral regime should be so wide as to focus on published
statements that could influence voting behaviour. As a result of these two
premises was the creation of an absurdly broad system of speech regulation.

Second, the harms that were asserted to justify the Electoral Finance Act were
never adequately explained or demonstrated by convincing evidence. It would be
regrettable if the government were to introduce new legislation limiting political
speech during election years without explaining the specific rationales for the
restrictions and demonstrating the asserted harms with clear and convincing
evidence.

12.2. We consider these two points in more detail below.

The failures of the Electoral Finance Act reflected flawed premises as well as poor drafting

12.3. Notwithstanding the fierce criticism that has been leveled at the drafting behind the
Electoral Finance Act, the drafting problems reflected the flawed premises of the
legislation as much or more so than they reflected haste. The basic problem for the
drafters was that no specific publication that they sought to regulate was intrinsically
harmful. No one sensibly thinks that it should be unlawful to give someone a pamphlet
stating, for example: ―the government is not governing well and I urge you to vote them
out at the coming election.‖ However, the logic of campaign finance regulation is that
speech becomes harmful if it is published too often to too many people. That which is
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individually harmless, or is in fact a positive expression of civic engagement, becomes
dangerous in the aggregate. For example, a pamphlet, which is recognised as
unobjectionable when given to one person (or perhaps 1,000 people), is thought to
become a threat to the ―level playing field‖ if given to 10,000 people (or perhaps if an
expensive, glossier version is given to 1,000 people). Nevertheless, the coverage of the
legislation must include each publication, however innocuous on its own, because
proponents of campaign finance reform are concerned that if the publication were
spread widely enough then it could undermine ―equality.‖

12.4. Accordingly, the definitional machinery that is fundamental to the operation of the
spending limits on political advocacy contained in the Electoral Finance Act became a
source of embarrassment. It was embarrassing to some supporters of campaign finance
reform that the law should create a situation in which anonymous informers tipped off
the authorities that a person had a billboard on their property or when a person
successfully complained that a politician‘s jacket constitutes an ―election
advertisement‖ in order to lampoon the legislation. 157 However, while we agree that
that these applications of the law are absurd, it is hard to create good rules for an ill-
considered game. At some level, those who are seriously concerned that speech must be
―equal‖ in some sense would presumably be concerned that unregulated billboards were
being erected on a person‘s property (otherwise, how could the law expect to guard
against the risk that one candidate would erect many more billboards than another).
While it is easy (and justifiable) to mock the definitional problems of the Electoral
Finance Act, the problem remains that it is genuinely hard for proponents of the ―level
playing field‖ to avoid absurdities but nonetheless still try to limit the myriad
―inequalities‖ of speech in a free and open society.

The harms that were asserted to justify the Electoral Finance Act were never adequately
explained or demonstrated by convincing evidence

12.5. The absence of a clear and specific explanation of what risk was posed by ―third party‖
spending on political speech contributed to the incoherence of the regime enacted under
the Electoral Finance Act. The proponents of the law did not explain what exactly
―undue influence‖ meant in the context of political speech or what a ―level playing
field‖ meant in the context of restrictions on political speech. It is possible, in our
submission, that the use of these expressions may have made it easier to rationalise the
serious (and, in some instances, absurd) restrictions on political speech contained in the
Electoral Finance Act. For that reason, we consider it a matter of concern that the
Ministry of Justice‘s Issues Paper also uses undefined expressions like ―level playing
field‖.

157
See http://www.nzherald.co.nz/nz-election-2008/news/article.cfm?c_id=1501799&objectid=10540994.
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12.6. Moreover, even if the government concluded that limiting the ability of paid political
speech to influence the electoral process is a legitimate basis to limit the right to
freedom of speech, it would be proper to first undertake a detailed study of the actual
relationship between spending on political advertising and electoral outcomes
(controlling for other factors). If such a study found similar results to the US studies
which we refer to in section 8, the basis for limiting paid political speech under this
rationale would be weak. Absent such a study to confirm the empirical basis for such a
rationale, we respectfully submit that it would not be demonstrably justifiable to limit
speech on the grounds of that rationale.

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Appendix One: Authors of this submission

This appendix briefly summarises the backgrounds of the authors of this submission.

Jesse Wilson BA/LLB(Hons) Auckland, LLM Stanford


Jesse works in the litigation department at Bell Gully, Auckland

Jonathan Orpin BA/LLB(Hons) Auckland


Jonathan works as a barrister at Stout Street Chambers, Wellington

Stephen Whittington BA Victoria University of Wellington, studying towards


LLB(Hons)
Stephen works as a research assistant to the Hon Sir Roger Douglas

Yogesh Patel studying towards LLB/BCA(Hons) Victoria University of


Wellington
Yogesh works as a tutor at Victoria University of Wellington

This submission is made in our personal capacities only and nothing in this submission should be
taken to represent the view of any of our employers or clients.

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