Opinion: Are National and Act getting themselves into trouble with their deal in Epsom?

By John Pagani*

I've been watching the Act-National dirty deal in Epsom and I'm beginning to wonder about the legal situation, where National's Paul Goldsmith is not going to seriously campaign to win the seat from the individual whose hagiography he penned. Meanwhile Act's John Banks seems content for Mr Goldsmith to collect a party vote in the seat as a reward for gifting the seat to a 'competing' party.

Since National and Act are colluding over Epsom they begin to get into some tricky territory - especially if the deal takes the form of 'endorse Act in Epsom and Act endorse National on the party vote.'

Collusion is not illegal, but it comes at a price.

Parties are limited to spending just over $1m plus $25,000 per constituency candidate Candidates in an electorate are limited to (another) $25,000.

If Act and National collude, they are at risk of breaching the spending cap because huckstering on behalf of someone else still counts towards the limit. 

This issue came up in 2008 when the CTU prepared a pamphlet advocating a vote for iirc Labour, Green, Progressive or the Maori party (yes! the CTU actually encouraged their members to vote for a party in coalition with National! How clever.) Anyway, those parties had to agree to reduce their total spending by an attributed portion of the cost of the CTU pamphlet.

So in Epsom this might matter because - Act huckstering for a party vote for National has to be counted towards National's spending limit. 

What matters is that there is collusion over the intention to promote a party vote for National or an electorate vote for Act. If, say, I were to advocate a party vote for Act (as if), it wouldn't count, because I haven't colluded. But since National and Act are making formal arrangements, the spending cap appears to come into play.

If Act spend, say, a million dollars on their campaign - and half of that is compromised by collusion with National - then National has to reduce their total spending by half a million dollars.

Ooo, good.

It's even more stark in Epsom itself. If National's Mr Goldsmth is campaigning for the party vote under any sort of arrangement with Act, then some of his spending in the electorate might have to be set off against Act spending. That is, Banks might be able to spend less than $25,000. In a full-throated campaign, $25,000 isn;t much. A full set of hoardings alone runs to around $12,000.

It will be awkward to work out the proportion attributed - but awkwardness doesn't get round the fact that it needs to be done. Parties for example have to make a judgement call on each leaflet about how much is for the local candidate and how much is for the party.

And, depending on the nature of the collusion, it might be that 100% of National's spending in Epsom is attributable to Act. Because if National are explicitly - and maybe even implicitly - throwing the seat to Act, what else could National's spending in the seat be for?

Unless he gets a declaratory judgment in advance, Banks will have to make conservative allowances about what might happen. Of course, he could always ask Goldsmith to keep his spending down but any contact of that sort would absolutely be collusion and certainly bring the spending caps into play.

So, whether or not a judge finally decides on a lower spending cap, Banks will be hampered by the nature of the collusion and signalling that has already taken place.