0 Boom!

The Donghua Liu donations saga seemed to have disappeared from our consciousness. But just as Labour MP's head to Wellington for the party's congress, the Herald has lobbed a bomb in Labour's direction; check this out:

A former Labour Minister intervened three times in the immigration bid of Donghua Liu including waiving the English language requirement for the millionaire businessman.
Damien O'Connor, in his role as the associate Immigration Minister, wrote three letters to Liu's advisor Warren Kyd - the former National Party MP - before deciding to grant residency against the advice of officials the day before the 2005 election.

The Herald goes on to detail Damien O'Connor's interventions, based on letters obtained under the Official Information Act:

The West Coast MP has said he cannot remember why he granted residency to the businessman whose links to both National and Labour have created political waves this year.
But letters released to the Herald under the Official Information Act show Mr O'Connor was being lobbied by Mr Kyd on behalf of Liu in the lead up to the tightly fought election.
The first, dated June 1 2005, stated Mr O'Connor would not intervene on Liu's behalf in regards to an "amended photograph" submitted as part of the immigration application.

"As my previous intervention on Mr Liu's behalf shows, I think Mr Liu has to date had a positive impact in New Zealand, and to this end, I would encourage him to lodge another application for residence.
"Mr Liu should be advised that I have instructed the Immigration Service to receive any such application without prejudice which may have been caused by his previous application."
There is no explanation of the "previous intervention" of Mr O'Connor, who accepted Mr Kyd's explanation that a third party was responsible for the "amended photograph" on the file.
A second letter to Mr Kyd, dated August 9 2005, reveals Mr O'Connor said "it is not my normal practice to intervene in the established immigration application process, however, I have decided to make an exception in this case.
"I have directed the Department of Labour Immigration Service to waive the English language requirements for Donghua Liu for any forthcoming residence application."
Mr O'Connor suggested Liu should enclose a copy of the letter with application, to be lodged within two years.

Somewhere along the line though, Mr O'Connor's position changed; the very day before the 2005 General Election, which was at that point anybody's race; read on:

A third letter to Mr Kyd, dated September 16, 2005 - the day before the election - stated Mr O'Connor had considered the case carefully and "decided to intervene".
"I am therefore instructing the Department of Labour Immigration Service to gran residence to Mr Liu as an exception to policy. The grant of residence will be subject to Mr Liu completing an application form, paying an application fee and meeting health and character requirements".
The residency was granted under the terms of the Investor Category at the time.

You can view the letters from Damien O'Connor here.

This bombshell from Jared Savage at the Herald raises some huge questions. What changed between 1 June 2005 and 16 September 2005 to cause Mr O'Connor to have a significant change in his approach to the Liu case? Was pressure brought on the MP, and if so, from whom. Did pressure come from people within the Labour Party? Why can Damien O'Connor not remember a case in which he had several interventions? And if it was "not my normal practice to intervene" in immigration applications, why did he intervene, not once but thrice in the Liu case?

And why the urgency to decide Donghua Liu's residence application as an exception to policy on the eve of a General Election in which Labour had a very real chance of being voted out? There are possible answers to that question that cut to the heart of the integrity of politics in New Zealand.

David Cunliffe will be seething. Not only has the Herald taken the focus off Labour's election-year congress, but he is now going to be bombarded with questions as to Damian O'Connor's conduct. Those questions will have added validity after the way that Labour attacked National and Maurice Williamson over the latter's phone call to the the police after Liu's arrest on domestic violence charges.

And Damien O'Connor needs to recover his memory, and quickly. He has some very significant questions to answer about Donghua Liu, and the circumstances in which Mr Liu was given New Zealand residence.

0 Hide on Labour's risky strategy

Rodney Hide reckons that Labour is walking a tightrope with the Donghua Liu donations saga. In his Herald on Sunday piece, and under the headline Risky response to donor row Hide opines:

Deny, deny, deny. Attack, attack, attack. That's been Labour's response to businessman Donghua Liu claiming he donated tens of thousands of dollars to the Party.
Labour's strategy is risky. It is challenging Liu's honesty and integrity. He's no doubt feeling aggrieved. The danger for Labour is that Liu produces documents, witnesses and photographs confirming his substantial donations.
That's what did it for Winston Peters in 2008. Sir Owen Glenn was able to prove the donations that Peters denied.
Labour also risks drying up its donations. Attacking a donor is hardly encouraging to others. I doubt there will too many Chinese charity auctions for Labour this election.
It's a risky response but Labour's entire attack strategy has been risky. Attacking John Banks for declaring Dotcom's donations as anonymous ran the risk that its own house wasn't in order. Likewise in attacking Maurice Williamson for ringing the police on Liu's behalf.

Cunliffe's letter 11 years ago for Liu wouldn't have mattered except for the hellfire and brimstone he visited on National for similar advocacy. It's true Cunliffe wasn't ringing the police. It's true Liu wasn't facing charges. But such difference matters constitutionally. It doesn't matter politically.
As far as headlines and soundbites go, Cunliffe has been caught doing exactly what he railed against.

Hide is dead right; perception is everything in politics,and the perception is that David Cunliffe has been a hypocrite. He and his MP's attacked National with relish, and made all sorts of accusations towards National MP's.

Had they restricted themselves to simply attacking National MP's, this may have passed without comment. But the likes of Trevor Mallard, aided and abetted by Winston Peters who relishes any opportunity to attack Chinese, made a series of allegation against National's apparent mate. One of those accusations was that he was downright corrupt, offering cash for changes to immigration policy. Like most of the accusations Mr Mallard makes, always under the cover of parliamentary privilege, he has yet to substantiate it.

But Labour took things one step too far, impugning Donghua Liu's reputation. That's when he started talking about his links to the Labour Party, at a time when David Cunliffe was a senior Minister. The rest, as they say, is (or will be) history.

Hide continues:

So where are we now? Confused. Liu said he gave substantial money to the Labour Party. The Labour Party says it has no record of it, and hasn't reported any donations from Liu.
But it's quite possible that everyone is telling the truth. The money could have been stolen. That would mean Liu gave the money but Labour never received it. Charity auctions and the like are often chaotic and it is too easy to have no one properly in charge of recording and receipting all payments and donations. This is especially so in political events. Volunteers are enthusiastic but not necessarily experienced and politicians are anxious to stay well away from money changing hands.
Indeed, a big part of Cunliffe's problem - and Banks' and Williamson's - is that politicians shy away from fundraising details precisely to avoid the perception that cash influences decision-making.

It is indeed possible that no one in Labour actually saw any of the money donated by Liu; possible, but highly improbable, we would say. We base that on information that we have heard in the last week; information which may or may not have got as far as Jared Savage from the NZ Herald. If even some of it is correct, Labour had better hope that no one has broken ranks. 

And Donghua Liu lawyering up, and giving documents to Paul Davidson QC whilst seeking financial records from his homeland ought to be worrying to Labour. What is in the financial records that Mr Liu is so anxious to share with his lawyer?

Hide closes, with a message that might send shivers up David Cunliffe's spine:

The safer course of action for the Labour Party would be to say it was treating the matter seriously. That would mean thanking Liu for coming forward with his information and inviting the police to investigate. The police could try to trace the money, letting Cunliffe off the hook. He would have done everything by the book. He would be open and upfront. It would also kill the story. He couldn't comment while police were investigating.
But Labour didn't do that. It denied and attacked.
There's a reason politicians do the things they do. Cunliffe couldn't be sure what the police would find. Calling in the police runs the risk of finding out more than Cunliffe wants to know.

David Cunliffe ought to remember that a "deny, deny, deny; attack, attack, attack" strategy is akin to poking a stick into a wasp's nest. As leader of the party, David Cunliffe is the one most likely to be stung if the wasps decide to fight back, and he is forced to defend, defend, defend.

There's an old saying in politics; never ask a question you don't already know the answer to. That would appear to be a strategic mistake on the part of Mr Cunliffe, and those who advise him, or who blog on Labour's behalf. It is going to be fascinating to see where this story goes, but a tweet yesterday from Herald editor Tim Murphy provides a clue:

We'd say the Donghua Liu saga still has some surprise twists and turns, and the exhortations to "move on" from the likes of Greg Presland towards the end of the week just gone may have been more in hope than anything else.  

0 Liu lawyers up

Donghua Liu is taking threats of legal action from the Labour Party seriously. Far from backing down and issuing an apology, the Chinese businessman has lawyered up with a high-profile QC. Jared Savage continues to tell the tale in the Herald, which is also showing no signs of backing down to Labour's threats:

Millionaire businessman Donghua Liu has hired a high-profile Queen's Counsel to deal with any legal action from the Labour Party.
Aucklander Paul Davison, QC, is heading a team of advisers for Liu reviewing the property developer's records following the comments of David Cunliffe this week.
The Weekend Herald understands this includes more than 30 photographs taken over 18 months linking Liu to Labour, including a fundraiser at an Auckland restaurant and a trip to China, where he hosted a Cabinet minister in 2007.
Liu is also seeking to retrieve financial records held in China.

The Labour Party seems to have forgotten that reputation is very important in Chinese culture. And by implying that Donghua Liu is corrupt and has told lies, Labour has given the businessman added motivation to prove what he has alleged in his statements. The fact that he has given documentary evidence and photographs to his lawyer, and is seeking to retrieve financial records from his home country is an ominous development.

Despite Labour's cheerleaders at The Standard and the Daily Blog (who include among their number one of David Cunliffe's closest confidantes and other Labour Party staffers) declaring that there is nothing to see here, we reckon there's plenty to see. And if Jared Savage is worth his salt as an investigative journalist, he will continue sniffing around as well.

And all the while, Labour stays in the news for all the wrong reasons...