House debates

Tuesday, 16 November 2010

Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2010

Second Reading

Debate resumed.

8:20 pm

Photo of Laura SmythLaura Smyth (La Trobe, Australian Labor Party) Share this | | Hansard source

At my last opportunity to make remarks on the Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2010, I was referring to the various reforms which are being considered in the bill. I had remarked on the new lower threshold for disclosure of donations, which I had observed was a fairly innocuous reform but a significant reform from the point of view of the electoral system and the transparency of the system in the public’s eyes. I found it remarkable that those opposite were taking issue with such a relatively innocuous reform.

Simultaneously, a key reform to the capacity to make anonymous donations will be made under the bill. The current Commonwealth Electoral Act provides that registered political parties and their branches, candidates, Senate groups and those who act on behalf of persons within each of these categories may receive anonymous donations below a specified indexed threshold. The indexed threshold is currently set at $11,500, and anonymous donations which exceed that threshold are not permitted. But at present a donor who wishes to make anonymous donations could do so by making multiple donations slightly below the threshold to various divisions of the same political party. The bill before us would remove that donation-splitting loophole by using an existing definition of ‘related political parties’ found elsewhere in the Commonwealth Electoral Act to ensure that donations to different divisions of a political party are treated as aggregated, as they should be. This again is what one might regard as a fairly innocuous reform, and yet again we are seeing considerable resistance to it from those opposite.

The reforms proposed under this bill will have the effect of banning all anonymous donations except those which are less than or equal to $50 and which are received at a general public activity or at a private event. These activities and events are defined in the bill and specified records must be kept in order for the anonymous donations to be retained.

All of these reforms will apply equally to all political parties and all candidates. Once again, it is most surprising that those opposite seek to resist these changes so strenuously. Unfortunately, while I have articulated the merits and factual circumstances of this bill, those opposite have maligned union officials and union generally. I have not, as the member for Mackellar flagged in her remarks, sought to malign any individual donor or categories of donor and I do not propose to do so in the remaining time available to me.

Anonymous donations by third parties for political expenditure will now also be prohibited. This will apply to third parties that are required to lodge annual returns of their political expenditure above the current threshold, which will hopefully—assuming that this bill is passed—be lowered to a threshold of $1,000. The bill also provides for the recovery by the Commonwealth of any unlawful anonymous donations. Both of these reforms will improve substantially the transparency of political donations and the confidence that the public can have in our political processes. It is pleasing to note in particular that these reforms are supported by the Greens and the Independents.

Both of these reforms, along with the balance of reforms in the proposed bill, will have a very significant role to play in terms of the public scrutiny of political donations and expenditure by making information more swiftly available to the public. The bill before us will require more regular disclosure of political donations and expenditure. It will also reduce the current time periods for the lodgement of returns from the existing periods of between 15 and 20 weeks down to eight weeks. The requirement to lodge returns will now apply once every six months rather than once every 12 months as is currently the case.

My time has been somewhat interrupted this evening, unfortunately. I will leave it to my colleagues remaining to speak in this debate to remark on the other merits of the bill. In closing, the changes that I have discussed and a substantial number of additional measures proposed in the bill that I have not had an opportunity to discuss this evening will have a very significant and positive impact on public perceptions of campaign finances and electoral transparency.

One of the remarks of the member for Mackellar this evening was, ‘What motivation other than rank self interest makes any sense?’ I put it back to the opposition, because I simply cannot understand what motivation other than rank self interest makes any sense. (Time expired)

8:26 pm

Photo of Malcolm TurnbullMalcolm Turnbull (Wentworth, Liberal Party, Shadow Minister for Communications and Broadband) Share this | | Hansard source

The issue of political donations is a vexed one in politics and it is fundamental to the integrity of our political system. An important aspect of political speech and political freedom is the ability for people to make a financial contribution to a political party, candidate or cause. But we all know that very real concerns arise about the independence and the integrity of political parties and candidates where the sums involved are so large that something must be given in return—or something must be assumed to be given in return.

The Labor Party has a very different history to the Liberal Party. The Labor Party is the political wing of the labour movement. The trade unions are the industrial wing of the labour movement. The Labor Party was established as a means of getting the representatives of the trade unions into parliament. The operations, the preselections and the policies of the Labor Party are to a very large extent controlled by the trade union movement.

We have reached a point in Australia in the campaign finance area where the Labor Party enjoys an enormous advantage in terms of fundraising and campaign finance. They receive 100 per cent of the tens of millions of dollars that the trade unions give to political campaigns—the unions do not give any to the Liberal Party. Those in the business sector—particularly the large public companies—increasingly do not make political donations at all or, where they do, they split them between both parties. But increasingly they do not make political donations at all. If you go back 20 years, you could say that the big end of town gave to the conservatives and the unions gave to Labor, and there was a rough equivalence. That is not the case any longer.

Increasingly, you have Labor dominated financially by the trade union movement. They have an organisational leverage over the Labor Party because of the history and structure of the Labor Party. But they also have a financial stranglehold over the Labor Party—it cannot function without the massive support from the trade union movement. At the same time as the large public companies that used to make political donations have increasingly not made them, more and more we have seen political donations from business that used to come to either party go overwhelmingly to the Labor Party because of their domination at the state level for some time. Further, political donations that come from business tend to come from businesses that have a particular interest in government policy—for example, the liquor industry, the gaming industry and property developers.

There have been many efforts—false starts—at trying to do something about this. The issue of disclosure is being sought to be addressed in this bill, but this bill is not calculated to restore integrity to campaign finance. It is designed to tilt a campaign finance playing field that is already tilted in favour of Labor even more in favour of Labor. Because of the large sums that the trade union movement gives to the Labor Party, it is immaterial whether the disclosure level is $11½ thousand or $1,000. The donations are going to exceed the higher disclosure level. There are many small and medium sized businesses that know that if they make a donation to our side of politics and that is disclosed they will come under pressure to make an equivalent donation to the Labor Party. There is no point being naive about this. Those honourable members who have been involved in campaign finance—in particular, those on the Labor side—know that that is exactly how it works. The pressure, the standover, is brought to bear and a business is pressured to make an equivalent donation to Labor or, alternatively, decides that it is all too hard and stops making donations at all.

This bill is designed not to effect campaign finance reform. We have sought over the years to engage the Labor Party in constructive discussions about real campaign finance reform. What that would look like is campaign finance reform that puts a cap on donations and eliminates donations. This is my own view. It is based on submissions I have made over the years and my own experience as honorary Federal Treasurer of the Liberal Party in a previous life. I was the principal fundraiser for the Liberal Party in that capacity. My view is that we should have a system whereby there is a cap on donations and donations can be made only by natural persons—that is to say, human beings—who are on the electoral roll. Donations could not be made by trade unions or by companies or associations. That would restore a degree of equivalence, an equity, and would address many of the issues of perceived influence that we see at the moment.

I make the point that these issues of influence are very, very substantial. All of us on our side have complained over the years about the influence the trade union movement has over the Labor Party. The Labor Party would say in response to that, ‘Well, the trade union movement created our party; it is only reasonable that they should have influence.’ However, consider this: the Labor government in New South Wales—which I hope is entering into its last months in office—in its time under Premier Bob Carr, permitted an extraordinary expansion of gaming facilities in hotels throughout New South Wales. Every hotel in New South Wales, with very few exceptions, was turned into a small casino. That was done to protect the economics of the hotel industry. You would have to be one of the most naive people—and I hope I do not fall into that category—to imagine that that extraordinary change in policy, which I believe has done great social harm in New South Wales, was not connected with the massive donations from the hotel industry and from the gaming industry to the Australian Labor Party’s New South Wales branch.

These issues of influence, perceived or real—people have different views about them—have to be dealt with. This bill does not deal with them. This bill is designed to do one thing and one thing only. It is designed to make it harder for small businesses to support the coalition, because they are the ones that will be sensitive to disclosure due to the pressure that they come under. The unions do not mind, because their donations are very big—they are well over the $11½ thousand threshold. Large companies are not fussed, because their donations are also going to be well over $11,500. If you think about the sorts of people and the sorts of people and businesses that are making $5,000, $6,000 and $7,000 donations to political parties, they are small and medium business and their owners. They are overwhelmingly supporters of the coalition, and they will be vulnerable, once their donations are disclosed, to being hit up by the Labor Party.

That is what this so-called reform is all about. If Labor were fair dinkum about campaign finance reform, it would look at caps being placed right across the board and donations being limited to natural persons. So take unions out of it, take companies out of it, limit it to people on the electoral roll and then focus on what measures can be taken to ensure that those rules are not subverted by third-party activity. We have come close in discussions with different people in the Labor Party over the years to achieving we thought some kind of consensus in this area. But Labor, with this legislation, is quite clearly not interested in real reform; it is interested in changes that benefit it as opposed to the coalition.

So I cannot support this legislation. I have a longstanding commitment, publicly documented over nearly a decade, to campaign finance reform, but it has to be fair dinkum. That means it has to be root-and-branch reform, not just fiddling at the edges—not just twirling the knobs to make the system that much more favourable to the Labor Party. The playing field is already tilted in favour of the ALP. This legislation is designed to tilt it even further in that direction. It does not address the real problems of perceived influence, real influence, integrity and equity that we face in campaign finance. We need to face those issues, and we can do so. There is a common will to do it. At least I thought there was a common will when Senator Faulkner was in a leading role in the government ranks, but that seems to have dissipated, and Labor is again trying to game the system to make it work better for it at the expense both of its political opponents and of democracy.

8:37 pm

Photo of Shayne NeumannShayne Neumann (Blair, Australian Labor Party) Share this | | Hansard source

I speak in support of the Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2010. This bill has nothing whatsoever to do with trade unions or the trade union movement. There is no mention of the same in this legislation. I heard the member for Wentworth—and, indeed, the member for Mackellar, when she was in the chamber before—prattling on about the trade union movement. They just cannot get over it. This legislation is about transparency, accountability and integrity in the political process. On 20 October 2010, the Special Minister of State, the honourable member for Brand, said in his speech on the second reading:

The bill aims to improve our system of political donations disclosure and election funding to help ensure that campaigning is fair and transparent.

The forces of conservatism, the bastions of privilege in this country, were against the franchise. They have been against the universal suffrage that Labor campaigned for. They were in favour of malapportionment of boundaries. I saw that in my home state of Queensland under the dark, long years of the Bjelke-Petersen regime. They made difficult provisional voting for those people who were itinerant. They have restricted enrolment; they have cut back the time in which people can enrol to vote when the roll closes. They have done everything they possibly can to cut back the franchise and to ensure that, as the population increases, the franchise goes backwards. Their true colours have been clearly shown—clearly against transparency, integrity and accountability in the political process—by the speech we heard from the member for Wentworth. This legislation is about those three factors.

By world standards we are a very young country. On a national scale, however, we are a very old democracy. Our national anthem talks about being young and free. We are right to be proud of our democratic history. Not many countries in the world have had a longstanding history of democracy and changes of government like we have. We are right to be proud of how healthy our political system is: the integrity, the efficiency and the effectiveness of the Australian Electoral Commission. Its impartiality is to be cherished and honoured. We ought to really laud the Electoral Commission for the way in which it has carried out its duties. The personnel there do a fine job—not for us the terrible events of Florida, in the US, in the presidential election some years ago! We do face challenges in our system, including changing technology, how people can participate in the political process and how influence can be brought to bear through new media and new technologies. With respect to political campaigning we do face the so-called arms race. The major parties spend millions of dollars at each election, at state and federal level, campaigning, trying to win the marginal seats, ensuring that their message is out across the country and ensuring that they get adequate and proper representation also in the Senate. There is a perception by many people that money does buy influence. Every person in this House would have raised funds to run their campaign. The political parties they represent and indeed the Independents, if they were a member of a political party before becoming an Independent, would have also been engaged in party campaign fundraising.

We have many elections in this country: local, state and federal. Many countries in the world, such as the UK, have local elections, but they have a unitary system of government: a House of Commons and a House of Lords. We are a federation, so Australians face the ballot box many times more than those in other countries. Indeed, in my home state the state election is held every three years. Elsewhere it is four but, at a federal level, it is usually significantly less than three years for the House of Representatives and the half-Senate.

As I say, there is a perception that large sums of money not disclosed can have an influence, unnecessarily and unduly, on the political process. Labor is trying to restore some integrity, transparency and some accountability in a system that was, in my view, abused by the 2006 changes by the Howard government where the disclosure threshold for political donations was lifted from $1,500 to more than $10,000, CPI indexed. The Howard government raised the limit for anonymous donations from $1,000 to donations exceeding $10,000, also indexed.

As a delegate to the national conference I, of course, supported Labor’s position of ensuring greater transparency and accountability. As a candidate in the 2007 federal election I was pleased to support Labor’s position. It is a position I hold firmly to my breast and I really believe that what we are doing here today is in the best interests of the political process and builds on the democratic values we hold dear in this country.

In March 2008, the Special Minister of State, Senator John Faulkner, announced the introduction of legislation that would comprehensively reform Australia’s electoral laws. The agenda included three elements: the first was the lowering of the donation threshold from $10,000 to a lower figure and preventing donation splitting to avoid the donation disclosure threshold by treating donations to different branches of a political party—for example, the New South Wales branch of the Labor Party to the Queensland branch of the Labor Party—as donations to the same political party, namely, the Australian Labor Party.

The second element is banning overseas donations and banning anonymous donations unless they are donations of $50 or less received through fundraisers—that is, taking a bucket around at a branch barbecue and raising some funds that way. The third is increasing the reporting obligations on political parties, candidates and other participants in the political process and making sure that we tie public funding to verified electoral expenditure to make sure that political parties and candidates, even if they are Independents, cannot make a profit from public funding. Mr Deputy Speaker Slipper, in our home state—yours and mine—we have seen a former member for Oxley engage herself in significant profit making by virtue of being a serial campaigner at various stages. This is to the discredit of the political system, in my view, and I think we should make sure that there is greater integrity in the political process. Candidates, if they are going to be reimbursed, should be reimbursed for verified political expenditure.

The coalition showed their true colours, just as the member for Wentworth showed them today, by opposing these reforms at every available opportunity, initially by referring the bill to the Parliamentary Joint Committee on Electoral Matters for more than a whole year. When the joint standing committee reported on that bill in October 2008, there was dissent by the opposition. The coalition members dissented from the majority and simply argued for further delay, greater procrastination, greater inertia, greater inaction. That was their motto and their mantra. By their voting against the measures in the Senate in March 2009, together with Senator Fielding’s vote, the reform legislation which Senator Faulkner introduced into the Senate was defeated. By voting against a reintroduced bill in the House of Representatives, they again showed their true colours in their opposition to this integrity measure. By voting against allowing the Senate to consider the bill, yet again, during the March 2009 sittings, again they delayed the legislation and showed that procrastination was what they were all about.

Despite this persistent opposition, the federal Labor government remains committed to making sure that this legislation gets put into our electoral laws. We believe it is important. We believe it is also important for further reforms, and it is not true to think that this is being done in isolation. The member for Wentworth would have you think that all we are on about is an isolated change with respect to this legislation, but our agenda is far wider. Indeed, that was shown by Senator Faulkner bringing forward as part of the government’s comprehensive reform measures an electoral reform green paper on donations, funding and expenditure, released in December 2008. That was open for public discussion and submission. The government considers that electoral reform in its widest measure is important to make sure that the system works to the benefit of all Australians and is open and transparent to all.

This bill puts into action the commitment that we made to the Independent members and to the Greens to reform political donations—the funding laws for political parties and for election campaigns. It aims to make sure that the system is fair. I do not agree with the analysis of the member for Wentworth. The bill does improve our system of political donation disclosure. This bill introduces six new measures in the key three areas: increasing transparency of political donations disclosure; more frequent and timely reporting of political donations and expenditure; and—the third phase which I think is important as part of those measures—reforming the public funding of elections.

The bill today is largely in the same form as one introduced—as I referred to—in March 2009. That bill encompassed the government’s amendments to the earlier bill introduced in May 2008, which was rejected by the Senate. The March 2009 bill lapsed with the cessation of the 42nd Parliament. The introduction of this bill and the debate today demonstrate our commitment to restoring the integrity of our political processes and systems.

The six measures in the bill can be easily summarised. First, the donation disclosure threshold level is set at a flat rate of $1,000, lowering it from the current threshold of $11,500. Second, the bill expands on the previous rules on anonymous donations which, under the Commonwealth Electoral Act, could only be given to registered political parties, branches of parties, candidates, Senate groups and people acting on behalf of these categories below an indexation threshold of $11,500. Anonymous donations above this amount are prohibited.

The bill today extends this ban to anonymous donations except where the donation is $50 or less and has been received at a public event such as I described: a barbecue or fete where a bucket is provided for donations—a private event really, like a dance or trivia night, where people might donate smaller amounts. We in this chamber have all been involved in those. Today’s bill defines these activities and events, and specified records must be kept. Currently, if a third party wants to anonymously donate funds for political expenditure, there is no restriction under the Commonwealth Electoral Act. This bill prohibits this by requiring the third party to lodge annual returns of their political expenditure and also altering the threshold of donations in this instance from $11,500 to $1,000.

Currently, section 314AEB of the Commonwealth Electoral Act defines political expenditure on the public expression of views of a political party, a candidate or a member of the House of Representatives or the Senate, including an issue during an election, and the publication of material that requires authorisation. With this bill, only those anonymous donations of $50 or less received by third parties at a general public event or private event will be able to be used for political expenditure by entities required to lodge returns under that section of the Commonwealth Electoral Act. Unlawful anonymous donations, under this bill, can be recovered by the Commonwealth government.

The third measure is that all foreign donations will be banned under this bill. This brings us into line with other nations such as the United States of America, where overseas donations are not allowed. The fourth is that, currently, if a large donation is given, it can be split across states and territories to avoid potential disclosure, and this bill prevents this from happening.

The fifth element is that public scrutiny of political donations and expenditure can be enhanced by reducing time frames for disclosure. The final, sixth, element is that this bill will ensure that election funding is tied directly to genuine election expenditure so that no political party or candidate will financially gain from electoral public funding systems. These are a priority, and the reforms should operate from 1 July 2011.

We are a democratic country but we can make it better. We have a blessed system but we should allow our voters to express their views and wishes without fear of retribution. We are the envy of numerous nations throughout the world but we must always strive to make sure our system is even better and more accountable with more integrity and more transparency. These reforms do just that.

8:52 pm

Photo of Paul FletcherPaul Fletcher (Bradfield, Liberal Party) Share this | | Hansard source

As I rise to speak on the Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2010 I will take a moment to reflect on the question which the member for Blair raised when he talked about trivia nights. He said we have all been to lots of trivia nights. Well, here is a Trivial Pursuit question for you: how many members of the executive of the Labor Party are also senior officials or members of the executive of a union? The answer would be an enormous number. It probably would not be a very good Trivial Pursuit question because it would take too long to answer the question.

The member for Blair said that there was no mention of unions in this bill. That is the precise problem, because what we have here tonight in the bill that we are considering in this parliament is once again an episode in which the Labor Party is putting forward a set of amendments, a set of changes to the laws governing the electoral matters in this country, which are purportedly motivated by a high-minded desire to improve the arrangements under which political funding and other matters are dealt with in this country. And it is uncontroversial, as speaker after speaker from the coalition has said on this bill and on similar bills in the past, that there is always scope for the arrangements in relation to the regulation of political donations to be improved. But when we see, time after time, election after election in which the Labor Party spends very substantial amounts of money on campaigning and then its campaign is reinforced by equally substantial amounts of money spent by the union movement, when we see this time after time and then we see purported reforms which are completely silent on the question of the role of unions, which are completely silent on the question of funds going to the union movement, which are completely silent on the question of expenditures made by unions in the course of political campaigns, then is it any wonder that on this side of the House we look with a certain degree of scepticism on the motives of the Labor Party in putting forward the measures that are in this bill?

Many others before me have observed that there are very convenient arrangements by which union officials proceed in a smooth and uninterrupted fashion into parliament, moving from being a union official at one stage of their career to being a Labor parliamentarian at another stage of their career. It appears to be amply reflected in the very large number of members of this place and the other place on the other side of the chamber who come from backgrounds as union officials or industrial relations lawyers. Indeed, the recent book by former New South Wales Labor minister Rodney Cavalier, Power Crisis, is a very interesting read on the subject of the wholly unrepresentative nature of the modern Labor Party. This bill, which purports to constructively reform the regulatory framework dealing with political donations, fails to address the fundamental policy issues. It is an assemblage of measures purportedly for high-minded motives which is in fact calculated to deliver political advantage to the Labor Party.

I want to make three fundamental points this evening. First of all, the measures in this bill, by virtue of completely failing to address the presence and role of unions in the political process, in effect grant special treatment to the unions and to other third-party organisations which are overwhelmingly aligned with the Labor Party and which have a track record of supporting that party in the election process.

The second point I want to make is that, as on our side of politics we have repeatedly acknowledged, there is a clear need for a more rational framework in relation to the governance of political donations and the coalition has a stated appetite to participate in a rational reform framework. But, as we have repeatedly made the point, no sustainable outcome will be achieved in this area without a bipartisan consensus.

The third point I make is that this bill regrettably falls into a long tradition in which the Labor Party puts forward measures in this area which are purportedly about reform but are in fact designed to grant partisan advantage to one particular side of politics.

Let me turn firstly to the way in which the measures in this bill operate with effect to grant special treatment to the union movement. There is a provision in this bill which requires that donations to all units of a political party be treated as a single entity. But where is the mention in this bill of funding going to the Labor Party on the one hand and funding going to any union on the other also being aggregated when it comes to determining the total amount of the political donations which have been made? There is no mention in this bill of that important issue. This bill is completely silent on that important issue, even though it is very clear to even the most casual observer of the Australian political scene that the union movement and the Labor Party are intimately tied together, as is very clear in the recent book that I cited earlier, Power Crisis. People holding key organisational roles within the Labor Party such as presidents, members of the executive, are very frequently holders of senior offices in the union movement. For example, for Mr Michael Williamson, the current vice-president and immediate past president of the Australian Labor Party, his professional background is that he has been a member of the Health Services Union for over 30 years and general secretary for the past 10 years.

What is the significance of this point? There is nothing wrong with being a member of a union—I have no hesitation in making that point. I myself was a union member in the very distant past. But the important point is this: when it comes to the question of expenditure on political campaigns, it is naive in the extreme to look only at the amounts that are expended by registered political parties and to wilfully close one’s eyes to the very substantial expenditure which is made by the union movement in pursuit of political advantage for the Labor Party. Any attempt to reform political donations and the regime which applies to political donations in this country which is blind to that point—which wilfully ignores that point—is rightly and correctly open to the suspicion that the real motive of the changes is to grant partisan political advantage to the Labor Party. You need merely look at the extensive political campaign run against the coalition in the 2007 election by the ACTU on the topic of Work Choices or at the extensive campaign run against Tony Abbott, the Leader of the Opposition, in the 2010 election to see that the union movement works hand in glove with the Labor Party when it comes to political campaigns and campaign expenditure. Therefore, to propose a set of reforms which purportedly address important issues in the area of regulation of campaigns and campaign donations but which fail to address this most pressing issue is a wanton failure of the overall reform imperative, and leads inevitably to the suspicion that the primary motivation behind these purported reforms is in fact the securing of partisan political advantage for the Labor Party.

Why is it unfortunate that this package of reforms has come forward without addressing that most central and pressing issue? It is unfortunate because no sustainable outcome in this area will be achieved without a bipartisan consensus. Thoughtful people, people of goodwill, can acknowledge that there is scope for the reform of campaign financing. Thoughtful people, people of goodwill, can acknowledge that there are different approaches which could be taken to those which are presently taken in the Australian system. But anybody who looks at this issue objectively, who looks at the various participants in the political process and who looks at the expenditure which is put into campaigning could not but see the obvious fact that a very substantial player in political campaigning in Australia is the union movement. And the contribution made by the union movement—I am sure you would share my horror at this—is inevitably in support of the Labor Party, with some exceptions such as in Tasmania in 2004, as you might very well remember, Mr Deputy Speaker Adams.

The third point I want to make is that we have seen a regrettable tradition from Labor of putting forward measures which are purportedly designed to reform political campaign donations but which instead are designed to secure partisan political advantage. Any of us who live in New South Wales will have seen only too many examples of this, such as the cynical approach of the New South Wales Labor Party, which spent 15 years remorselessly hoovering up donations from property developers. It had a sudden rush of purity in 2009 and argued that it was no longer appropriate to accept donations from property developers and in turn passed legislation to that effect. When we see a political party which claims to be introducing reforms to the political donations system supposedly in the public interest and supposedly for high-minded motives, but which has a track record of introducing legislation in this area on a calculated basis to secure partisan political advantage, there can be very little surprise that those on this side of the House look at what is proposed in a jaundiced fashion.

Let me conclude by reiterating, as others from the coalition have done, that we remain open to genuine and sensible bipartisan reform in this area. Sadly, what has been put before the House tonight does not meet that test. It has been admitted by previous speakers that a primary motivation of the Labor Party in bringing forward this legislation, which is substantially similar to legislation which has been put forward and rejected by this parliament previously, is to give effect to the deal that was done between the Labor Party and the Greens. If we are to make reform in this area, there needs to be a better justification for it than honouring a deal that was made between the Labor Party and the Greens to keep the Labor Party in power. There needs to be a well thought through, solid policy foundation for these changes, a policy foundation which addresses the genuine issues in the area of political donations. Sadly, what has been put before the House in this bill does not meet that test, and it is for that reason that the coalition is not prepared to support this bill.

9:06 pm

Photo of Daryl MelhamDaryl Melham (Banks, Australian Labor Party) Share this | | Hansard source

I rise to support the Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2010. In the last parliament I supported a similar bill that was brought forward by the government and indeed, as chairman of the Joint Standing Committee on Electoral Matters, which I am in this parliament and was in the last parliament, we did an advisory report on that previous bill and, in the main, recommended the passage of that bill with some modifications. I know that the member for Cook is in the chamber and he was on the committee at that time, and there was a minority report by the coalition members of the committee, who wanted further debate on the bill and said that it should be deferred, but the only substantive recommendation they made, which was the second recommendation, was to allow anonymous donations below a threshold of $250, whereas I think back then—and it is what is in this bill—it was a recommendation of $50 only.

I want to address something that the member for Wentworth said. He talked about big business being able to live with being outed in terms of their donations and the unions being able to live with being outed in terms of their donations but said that small business cannot. I have to say this: my view is that everyone should live with being outed for their donations on a reasonable threshold test. We should have transparency and openness. We should not be designing our systems so that there can be hidden donations that can be wound up like the Millennium Foundation does and never see the light of day. Or, if it is the union movement, the same thing applies to the Labor Party. These are basic principles, in terms of a threshold, as to what people should be allowed to donate before there is a disclosure period.

It is interesting that for a very long time, from 1984 to 1991, the threshold level was $1,000. It was raised in 1991 to $1,500 and it was only when the coalition had a majority in the House of Representatives and the Senate in that period of 2004 to 2007 that these new threshold levels came in. When you do the mathematics of them, those new threshold levels allow for substantial donations to be made to political parties and they will not see the light of day. Now frankly, if we are going to have the best politicians money can buy, I want to see who is buying those politicians. And if that means that people will not donate because there is a lower threshold then so be it. Basically, they should be prepared to declare themselves—and I know that in other countries around the world, including the United States of America, people get disclosed on very low threshold levels. So I have always been a low threshold person. I do not discriminate against business at whatever level and, in the 20 years I have been here, I have always argued for a low threshold test. I can remember in the old Hawke and Hawke-Keating governments, and when I was on this committee I was always arguing for a low threshold. Why? Because I want to know who is paying the money.

Photo of Mrs Bronwyn BishopMrs Bronwyn Bishop (Mackellar, Liberal Party, Shadow Minister for Seniors) Share this | | Hansard source

Because it doesn’t hurt you!

Photo of Daryl MelhamDaryl Melham (Banks, Australian Labor Party) Share this | | Hansard source

The honourable member for Mackellar can bellow as much as she wants. She has been a fundraiser for the Liberal Party, and a quite successful fundraiser, as has the member for Wentworth. I think he was the federal treasurer of the Liberal Party and was quite a fundraiser. And they like raising money but not disclosing who has given that money. That is why they like high thresholds—because they do not mind being bought; they just want people not to know who bought them.

Photo of Bob BaldwinBob Baldwin (Paterson, Liberal Party, Shadow Minister for Tourism) Share this | | Hansard source

Mr Deputy Speaker, I rise on a point of order. I ask the member to withdraw. He has just cast serious aspersions against members of the coalition about hiding funding disclosures.

Photo of Chris BowenChris Bowen (McMahon, Australian Labor Party, Minister for Immigration and Citizenship) Share this | | Hansard source

Mr Deputy Speaker, on the point of order: this has been a wide-ranging debate. Members on this side have been very tolerant of a lot of allegations made by the other side in this debate about the motives of Labor members both federal and state. This has been a debate which has been willing, and the member for Banks has been completely in keeping with the debate which has gone before him.

Photo of Bob BaldwinBob Baldwin (Paterson, Liberal Party, Shadow Minister for Tourism) Share this | | Hansard source

Mr Deputy Speaker, I rise on a further point of order, which is that, whilst it may be a wide-ranging debate, the member for Banks has laid a direct assertion alluding to corrupt activities by the coalition seeking to hide funding declarations.

Photo of Daryl MelhamDaryl Melham (Banks, Australian Labor Party) Share this | | Hansard source

On the point of order, Mr Deputy Speaker, I think it would help for me to say that I did not make that allegation. At no stage have I suggested illegal behaviour. I have suggested that the members opposite are operating within the system. It is the threshold levels I am attacking. I will not have it said that I made any allegations of illegality against any member opposite. I have not and I would not.

Photo of Dick AdamsDick Adams (Lyons, Australian Labor Party) Share this | | Hansard source

I will rule on the point of order. This is a very wide-ranging debate. I heard the previous speaker from the coalition make some pretty broad comments about New South Wales Labor. I do not believe that there were any personal allegations against any members and I ask the honourable member for Banks to resume his comments.

Photo of Bob BaldwinBob Baldwin (Paterson, Liberal Party, Shadow Minister for Tourism) Share this | | Hansard source

Mr Baldwin interjecting

Photo of Daryl MelhamDaryl Melham (Banks, Australian Labor Party) Share this | | Hansard source

I want to continue further, Mr Deputy Speaker. For the member for Paterson’s benefit, in over 20 years in this place I have never made allegations against members opposite of illegality, and I have never had reason to. We have a difference of philosophical opinion. This is a philosophical debate as to what a proper threshold is in relation to disclosure and I understand members opposite are operating within the law. I am arguing that the law was only recently changed. It is not working. You can actually have $100,000 distributed to political parties if you do it in a particular way, and it is not disclosed—and you have only got to read our report, which shows that. It has never been challenged. Now, at the end of the day there is this obsession—

Opposition Members:

Opposition members interjecting

Photo of Ms Anna BurkeMs Anna Burke (Chisholm, Deputy-Speaker) Share this | | Hansard source

Order! I ask members to refrain from interjecting across the chamber, especially from the table.

Photo of Daryl MelhamDaryl Melham (Banks, Australian Labor Party) Share this | | Hansard source

The interesting thing is that the members opposite rail against unions. What the members opposite allow is for unions to use the system under the opposition’s preferred system, which would not lead to disclosure. What I am arguing is: if unions want to disclose under the system I am proposing, there would be more disclosure. The unions could run campaigns similar to that of the Millennium Foundation and, in relation to raising large amounts of money under the current law, if the law were changed as we propose, it would mean more disclosure. What this is about is trying to stop disclosure. It is an argument about transparency.

It is also an argument about anonymous donations and foreign donations. I notice that those opposite who were members of our committee—and the member for Cook was one of them—did not rail against specific sections of this bill. I took it from their minority report that there was a general argument about electoral reform and political donations that they thought should be wrapped up into a whole range of things. But in relation to some of the specifics—and I do not say this in relation to the threshold, but in relation to other specifics—I felt that there were no objections to the way in which the committee conducted itself and the evidence on a number of proposals within this bill. There were only a couple. In particular on anonymous donations they went from $50 to $250. That is my recollection of the way the matter was conducted.

I understand there is a philosophical objection. I am saying quite clearly that I believe that there would be more public confidence in the system if there were lower thresholds, if we went back to $1,000 instead of the current system. Let’s have a look at what is proposed. If one goes to the explanatory memorandum for this bill, it says:

The Bill contains provisions that will:

  • reduce the disclosure threshold from ‘more than $10,000’ (indexed to the Consumer Price Index annually) to $1,000 (non-indexed)—

that is something I think the coalition are feral about—

  • require people who make gifts at or above the threshold to candidates and members of groups during the election disclosure period to furnish a return within 8 weeks after polling day …

I would argue that is reasonable. The explanatory memorandum continues:

  • Agents of candidates and groups have a similar timeframe to furnish a return in relation to gifts received during the disclosure period—

in other words, much earlier disclosure. The bill will also:

  • require people who make gifts, agents of registered political parties, the financial controller of an associated entity, or people if they fall within the relevant provision, who have incurred political expenditure to furnish a return within 8 weeks after 31 December and 30 June each year;
  • prevent ‘donation splitting’ by ensuring that for the purposes of the $1,000 disclosure threshold, related political parties are treated as the one entity—

I think donation splitting is something that needs to be addressed, because it is one way of hiding donations. The bill will:

  • make unlawful the receipt of a gift of foreign property by political parties, candidates and members of a Senate group. It will also be unlawful in some situations for associated entities and people incurring political expenditure to receive a gift of foreign property;
  • extend the ban on anonymous gifts to encompass all anonymous gifts except where the gift is $50 or less and received at a ‘general public activity’ or a ‘private event’ as defined—

I know that in their minority report the opposition members of the committee said $250. Further, the bill will:

  • tie public election funding to reported and verified electoral expenditure. In other words, unendorsed candidates, registered political parties and unendorsed Senate groups, who receive at least four percent of formal first preference votes in an election, will receive the lesser amount of either:
the ‘electoral expenditure’ that was actually incurred in an election period; or
the amount of $2.31191 (indexed to CPI every 6 months) per formal first preference vote received …

What is the opposition’s view on that? My understanding is that the opposition was not opposed to that particular proposal because it was not about enriching candidates at an election. The explanatory memorandum continues, stating the bill will:

  • provide for the recovery of gifts of foreign property that are not returned, anonymous gifts that are not returned and undisclosed gifts; and
  • introduce new offences and penalties related to the new measures and increase the penalties for existing offence provisions.

I have heard a lot about bipartisan support. In all my time on the electoral committee, the evidence shows that I have attempted to embrace bipartisanship wherever possible. In a number of areas it is not possible, because we have different philosophical views. That is the reality of life. The opposition might agree to some things; we will not. However, my approach is not to shout down the other side. My approach to conducting the joint standing committee is to allow both sides to obtain evidence, bring evidence before the committee, inform themselves and allow matters to be argued on their merits. Sometimes an argument might have merit but will still be voted down.

In the 20 years that I have been here, there has always been opposition on these particular areas from those opposite. They have never wanted to participate in change to these provisions, because they have always had a view. At one stage Senator Minchin was on the committee while a parliamentary secretary, which is generally unheard of. He was a formidable member of the committee with his vast experience from South Australia. He did not give an inch when it came to disclosure provisions, the Millennium Foundation or a whole range of other things.

I know the honourable member for Mackellar is currently on the committee and I look forward to working with her during this term of parliament to see if there are things we can agree on. If history is any guide, there are things we will agree on and there will be much we will disagree on. And we will not need generators because I am sure the electricity will fly! That is the way it should be. But let’s admit the prejudices we have. It seems to me that those opposite have a real anti-trade-union sentiment running through their veins. They are dirty on the trade union movement because the trade union movement’s involvement has historically been to support this side of politics. That is a legitimate use of trade union resources because, after all, our history is that we came out of the union movement and—

Photo of Mrs Bronwyn BishopMrs Bronwyn Bishop (Mackellar, Liberal Party, Shadow Minister for Seniors) Share this | | Hansard source

Mrs Bronwyn Bishop interjecting

Photo of Ms Anna BurkeMs Anna Burke (Chisholm, Deputy-Speaker) Share this | | Hansard source

Order! The member for Mackellar will remain silent.

Photo of Daryl MelhamDaryl Melham (Banks, Australian Labor Party) Share this | | Hansard source

in terms of conditions for their members, it is honourable. Historically, that is the same as how capital has always supported the other side, in the main. There are some notable exceptions. That is politics. But what we are talking about here is confidence in the disclosure and transparency of our system.

I know, for instance, the honourable member for Cook has longstanding knowledge because of his former position as the state director of the New South Wales Liberal Party. He understands more than most the areas where we might be able to achieve agreement on these matters and lend more credibility to this situation. He also understands how to put the boot in to other areas.

9:21 pm

Photo of Scott MorrisonScott Morrison (Cook, Liberal Party, Shadow Minister for Immigration and Citizenship) Share this | | Hansard source

What we have before us in the Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2010 feels a bit like deja vu. We have been here before. The member for Banks and I have been here before, debating this same legislation, and what it betrays is the lack of an agenda from this government. What we have got is a recycling of the former Prime Minister’s agenda. We have got the leftovers of the former Prime Minister’s agenda and whatever the Greens serve up on their agenda, and that is the policy drift we find with this government. The member for Banks talked about an inquiry conducted by the Joint Standing Committee on Electoral Matters, of which I was deputy chair and he was chair. He made reference to the report and the dissenting report provided by the minority members of that committee. What he did not point out was the fundamental point which I think the government misses—that is, this bill is not even a half measure, not even a quarter measure, not even a tenth measure.

If the government are serious about campaign finance reform, about reform in this area, then they should engage with the opposition and come up with a fair dinkum bill. This is not a fair dinkum bill. This is not a fair dinkum attempt. This is a bill designed to prosecute the advantage of the Labor Party. That is incredibly disappointing, because with all the shrill noises about bipartisanship it does require an element of good faith to come to the table to address the things that we all know in this place are producing the very dangerous cocktail of the politics of money. In the last parliament I said on numerous occasions that we had a fairly unique opportunity in this place to avoid the politics of money spilling over from the cesspit of the New South Wales Labor government and other state jurisdictions around the country and creeping into this place.

There is a real opportunity to do something significant in this parliament. I know the shadow minister at the table, the member for Mackellar, is very keen and very committed to reform in this area. There is an open invitation to the government to come and seriously discuss the issues that need to be discussed. But it is a demonstration of the serious lack of agenda that this government has. ‘Citizen Richardson’, as I suppose we could now call him—none other than the most prodigious power broker the New South Wales Labor Party has ever known—made the observation that this is a government without an agenda, and any assessment of what we see coming before this place on a daily basis I think is an absolute demonstration of that fact. But that is for the government to address. It is not for the opposition to write the government’s agenda. You would think that if they wanted to form government they would actually have an agenda for a government. In this area I think they are as bereft as in any other area that we have responsibilities for in this place.

We want a bill that will deal with the serious issues involved in working against the politics of money dominating our political environment in this country. I would suggest there are three areas we need to look carefully at, the first being political expenditure. While there will be many who will want to prosecute the case that the great ill in the system is who you take money from, if you deal with why the political parties need so much money then I think you are going a long way to addressing the ills that exist within the system. If the question is, ‘How much money do you need?’ and the answer is, ‘How long is a piece of string?’ then we all in this place leave ourselves incredibly exposed and I think this is a very dangerous situation we place ourselves in. The moves made particularly in the Canadian, New Zealand and UK jurisdictions to set limits on campaign expenditure are worthy of consideration and serious assessment. If you can control and regulate the amount of money that is needed then clearly you are not opening yourselves up to abuses in the way that money is then solicited. This is something that I would commend to the House for consideration.

Secondly, if you are going to deal in this area you must deal with third parties. That is the great abuse that we have seen in the New South Wales parliament recently with the haphazard reforms that have been trumped up more recently in that state. What we want is fair dinkum regulation and control of third-party participation in this area. If you want to be a third party like GetUp! or any other group of that nature out of the union movement, you want to participate in the electoral process and you want to run paid advertising in election campaigns then you should be subjected to the same level of scrutiny and conditions and controls as the political actors in those campaigns. By that I mean simply this: they should be completely subject to expenditure controls, and very strict and limited expenditure controls. They should also be subjected to political disclosure of the donations they receive. They should be able to say where they got their money from and not just take it out of the honey pot of union membership fees and make a donation. If you want to spend money as a union in a political campaign then get it off your members honestly by asking them for a donation and disclosing those donations. If that is what you want to do, do it. But that is what you need to do and that is what the process and the system should encompass.

Thirdly, we need to ensure that we recognise practically in this place that, on whichever side of politics you sit in this House, in relation to the compliance regulations that we put into these bills, the people who assist us in our work as members of our political parties are by and large volunteers. We need to ensure that we have compliance regulations and activity that enables them to comply and does not seek to hunt them out as being some sort of criminal participants, when all they are seeking to do is support the political view of their choice. That is a noble thing. People who want to make donations to political parties should be seen as people doing noble things, subject to reasonable regulation. To suggest their participation in the political process is somehow inappropriate when appropriate regulation is in place I think demeans our democracy. If people want to get involved and support candidates, good on them. We need more people who are keen to participate in the political process in this country.

So I plead, in the very short time remaining to me, that we deal with the issue of expenditure caps, that we deal with the issue of third parties most importantly, that we understand that there are people who support us in our political parties who are simply trying to express their support for views and that we do not seek to make the process too burdensome for them to comply. At the end of the day, we need to work together to end the politics of money. This is a half-measure bill and the government need to come up with something serious or they cannot expect the opposition’s support.