A new report has warned of “serious storm clouds” on New Zealand’s democratic horizon, calling on the Government to limit voting rights to citizens, crack down on lobbyists and make political parties declare the source of all donations.

The release of the policy brief comes after allegations from former National MP Jami-Lee Ross relating to an alleged $100,000 donation from Chinese businessman Zhang Yikun.

Ross’s claims, currently being investigated by police, have raised concerns about New Zealand’s electoral finance rules and China’s political influence in the country.

Prime Minister Jacinda Ardern has defended New Zealand’s donations transparency, also suggesting the Government had a range of measures to tackle the issue of foreign interference.

However, Dr Simon Chapple, the report’s author and director of the Institute for Governance and Public Policy at Victoria University of Wellington, said while New Zealand had a robust democracy by world standards, there were “serious storm clouds on our democratic horizons”  coming from both within the country and the outside world.

Poor representation, rise of identity politics

Chapple said Parliament and the public service did not represent New Zealand society when it came to wealth and socio-economic backgrounds, while voter participation in local and national elections had been declining since World War II.

“Poorer people, welfare beneficiaries, Maori and newer migrant groups are much less likely to enrol to vote and, conditional on enrolling, also less likely to vote.

“Enrolment rates and voting rates are lowest in the poorer areas of the country, and here ethnic gaps are largest, suggesting a socio-economically disadvantaged sub-set of Maori are being left behind other New Zealanders, including middle-class Maori.”

He said the MMP electoral system had led to lower levels of public scrutiny for list MPs, “and a developing notion that at least some of these MPs informally represent an ethnic community rather than New Zealanders as a whole”.

“The move to MMP has coincided with the growth of identity politics, which has a tendency to formalise and reify the fracture lines of identity groups as the basis for political action, rather than to break down group barriers, emphasise a common humanity and seek shared ground.”

New Zealand’s aggressive pursuit of ties with China came despite that country’s willingness to “weaponise” its economic relations, Simon Chapple said.

High and rising levels of both emigration and immigration had also had an impact, with high levels of “population churn” likely to undermine participation and social connections while possibly changing New Zealand’s political balance.

Chapple was critical of New Zealand’s economic performance, saying 50 years of low productivity growth had not yet been solved despite multiple attempts, with the current “solution du jour” based on “attaching ourselves to the coat-tails of the fast growing Asian economies”.

He said the aggressive pursuit of ties with China, despite its status as an unequal and authoritarian country which had shown a willingness to “weaponise” its economic engagements, carried significant risks.

“A thoughtless, economically driven prioritisation of engagements in this region risks undermining the low corruption nature of our democracy and offering opportunities for rent-seeking by rich vested interests to the detriment of New Zealand democracy.”

Democratic reforms needed

Chapple said one solution was to “consciously limit” democratic rights to citizens, setting up civic education programmes that would run in parallel with the pathway from residency to citizenship.

“New migrants should be strongly encouraged to become citizens, rather than remaining indefinitely as simply sojourning residents.”

He called for an outright ban on any foreign contributions to political parties – currently there is a $1500 limit – as well as a requirement that all domestic donations be declared regardless of their size, source or nature.

To avoid placing an excessive financial burden on political parties, they could be paid on a per head of contribution basis to cover the costs of “data transparency”.

“It is not good enough to argue there is no problem: there may be one coming down the road very rapidly.”

Chapple said there also needed to be greater transparency around political lobbying, such as conflict of interest provisions, stand-down periods for both politicians and public servants to avoid “revolving-door appointments”, and a ban on MPs holding membership of foreign political parties.

“It is not good enough to argue there is no problem: there may be one coming down the road very rapidly.”

He suggested the introduction of a strong civics programme at schools, coupled with lowering the voting age to 16 – although he acknowledged there would be “significant political challenges to overcome”, including a perception that most teachers held centre-left beliefs.

Addressing concerns about the decline of traditional media and “fracturing” of media sources into groups identifiable by ideology, Chapple said there was a need for “well-funded, independent state-funded” outlet covering multiple platforms and languages which was “clearly and consistently politically neutral”.

Asked about the report on Tuesday morning, Ardern said she kept an eye on the country’s democratic “indicators” to ensure it was in a healthy condition.

“We have robust electoral laws and we’ve been named by Transparency International as one of the least corrupt countries in the world – I take heart from that, but we can’t be complacent, we do need to protect our reputation, our institutions, and we’re constantly vigilant about that.”

Justice Minister Andrew Little had already written to Parliament’s justice and electoral committee, asking it to look at broader issues related to New Zealand’s electoral regulations and laws as part of its review of the 2017 election.

Chapple’s report was produced as part of a “pop-up think tank” run by the University of Canterbury’s Small States and the New Security Environment Project, set up to produce policy analysis on defence and foreign affairs issues for New Zealand politicians.

11.18am: This article has been updated to include comment from Prime Minister Jacinda Ardern.

Sam Sachdeva is Newsroom's national affairs editor, covering foreign affairs and trade, housing, and other issues of national significance.

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