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Steps in the right direction, despite political footwork

8 Apr 2008

John Faulkner’s proposals deserve support, writes NORM KELLY, but don’t go far enough.

LAST week the Special Minister of State, Senator John Faulkner, announced the first wave of electoral reform from the new Labor government. Most of these reforms should be applauded. However there are worrying signs that, like previous governments of both persuasions, the Rudd government’s reform agenda is tempered by the need to maintain partisan advantage.

Two of the government’s proposals are definite wins for transparency. First, the government proposes to reduce the donation disclosure threshold from the current $10,500 to $1000. The Howard government increased the threshold in 2006 from $1500, ensuring that many more donations remained hidden from the public eye. The lower disclosure threshold shows Labor is genuine about transparency.

The Rudd government also plans to do away with the intentional loophole which allows state, territory, and federal divisions of a party to be treated as separate parties. Coupled with the $10,500 threshold, major donors could avoid disclosure by donating $10,000 amounts to separate divisions, almost $100,000 in total. These two reforms are to be commended.

A related reform, the timing of disclosures, has a questionable impact on transparency. The government is proposing more frequent donation disclosure from the current annual disclosures to six-monthly. This is an improvement on the current system of annual disclosures, but it does nothing for voters, who will still only find out about donations long after an election is held.

The technology is available to provide for instant internet-based disclosure, and if Faulkner wants Australia to again be at the cutting edge of electoral law, as he claimed recently, he needs to commit to the maximum possible disclosures before an election. If parties have the resources to accept donations, they certainly have the resources to disclose these on a website.

The proposed ban on foreign donations is well overdue, and will have similar effects to all sides of politics. Although figures for the 2007 election will not be issued until February 2009, the most recent figures (2006-07, a non-election year) show Labor receiving $200,000 from overseas donations. The Liberal Party notably received $1,000,000 from British Lord Ashcroft for the 2004 election campaign.

The final proposal from Faulkner will have a big impact on undermining the fairness of elections.

Destined to be known as the Hanson clause, the government is proposing that public funding (currently $2.10 per vote) will only be provided against verified campaign receipts, to prevent parties or candidates from making a profit from elections. Pauline Hanson received a total of $400,000 public funding for her 2004 and 2007 election campaigns, without spending any of her own money.

While this may appear to be a positive way to regulate public money, the real impact will be on the ability for minor parties and independent candidates to compete in elections on equal terms. The major parties do not have a problem with providing sufficient campaign receipts, as their campaigns are largely funded by private donations, so this change will have absolutely no impact on them. However, parties and candidates who do not receive substantial private backing will be forced into running a conservative campaign budget, and never being able to build up a campaign fund for future elections.

A fairer and more democratic approach would be to allow the difference between public funding entitlements and campaign receipts to be available to offset against future campaign and administration costs. In this way, the money only becomes available if the party/candidate continues to be involved in election campaigns. This would allow all candidates to compete on a more equal footing, while ensuring that public money is only spent on genuine campaign and administration costs.

It is also reassuring that the Rudd government is taking a holistic approach to electoral finance, with the issuing of a green paper planned for later this year. This will allow the broader issues of possible donation and expenditure limits, and a uniform national disclosure regime, to be examined.

The government should be commended for the general thrust, if not all the detail, of its proposed reforms. The previous government’s electoral changes, such as lifting the disclosure limit, earlier closure of the electoral roll, and disenfranchising prisoners (subsequently overturned by the High Court) were backward steps in terms of fairness and transparency.

The real test for this government will be how it addresses the undue influence that larger political donations from business and unions have on Australian democracy. A few weeks ago Kevin Rudd commented that to continue to allow foreign donations would send a message that Australian democracy is up for sale. It remains to be seen if the government has a genuine commitment to ensure that Australian democracy does not continue to remain for sale to Australian interests only. 

Norm Kelly is a member of the Democratic Audit of Australia at the Australian National University. This article first appeared in the Canberra Times.

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