Greens Senator Lee Rhiannon puts out the call to end the ‘financial arms race’ that dominates Australian political funding.


Unions NSW and some of its affiliated unions should be careful what they wish for. Their claim before the High Court that NSW electoral funding laws are unconstitutional, if upheld, risks returning NSW to the bad old days of the corrupt corporate donations culture that continues to dog Australian politics.

The NSW election funding laws are far from perfect and some changes are needed. However, anyone concerned about the unsavoury role of political donations would recognise that the current legislation is a vast improvement on the law that Labor and the Coalition parties in NSW exploited so effectively for decades, and that allowed the interests of property developers and big business to run rampant.

At a time when there is a real and urgent need for national laws to end the undemocratic influence of large political donations, the actions of Unions NSW and NSW Labor could turn the clock back on reform. NSW Labor leader John Robertson’s support for a case that could return NSW to the easy money days of corporate fund raisers and massive donations, and a US-style system of big money politics, is disappointing.

Mr Robertson’s statement that the NSW laws mean only independently wealthy people can participate in the political process and that average Australians will be locked out of our political system is misleading. Donations from individuals are capped at $5000pa. Third parties such as community groups and unions not affiliated to a party can still campaign in an election within a spending cap.

The legislative issues relating to unions and elections are complex and there is a legitimate debate to be had about the merits of the extra restrictions effectively placed by the NSW legislation on the election spending tally of Labor and those unions affiliated to the party.

Corporations can take advantage of third party spending too, and the benefit this brings to the Liberal and National parties does not impact on the spending cap of these parties.

A fair solution is to create modest legislative caps on third-party election spending. The argument in support of this is that vast amounts of money should not be able to buy election victories.

The best way to sort out such issues, however, is through proper debate in the community and in parliament about legislative amendments to the current law. It is NOT by running the risk that a court case could bring to the successful NSW funding reform package that has significantly restricted corporate political influence.

Unions have a right to be actively involved in the political process and to collectively organise. At the same time it is essential that we have balanced national electoral funding legislation to rid our democracy of the big money that has tainted it; particularly corporate money.

Unions could also lead a national debate about the power imbalance between not-for-profit organisations such as unions and NGOs on one hand and for-profit corporations on the other. It may be that we should advocate different rules for both, but this is a debate we should be having in the community, not in the High Court.

If the High Court challenge is successful we could see a return to the bad old days in NSW of open slather corporate donations and special access to ministers and shadow ministers based on who can afford to pay.

We need to end the financial arms race that dominates Australian politics.

Five unions have joined Unions NSW in the case, and three states with conservative governments and the Commonwealth are backing the O’Farrell government.

The ban on corporate political donations to parties for NSW elections needs to be defended and extended nationally.

Corporate donations have had a corrupting influence in politics, particularly in relation to some government decisions in the industries of property development, alcohol, gambling and tobacco.

National legislation would also remove the opportunity companies and parties have to circumvent the NSW donations laws.

Currently if state political parties bank company donations in a federal election bank account, rather than an account for state election purposes, they can still accept and use huge corporate donations.

This practice frees up other party money, which may have gone to a federal election war chest, for use in NSW elections. On the surface there is no corporate money in a party’s state election spend but the party is still wide open to influence from its federal election corporate donors.

Other aspects of the NSW laws such as election spending caps also need to be adopted throughout the nation and strengthened.

However, under the Abbott government the chance of national electoral funding reform appears remote. The Coalition is wedded to big businesses and addicted to its massive donations. To date, the Liberal and National parties have been unwilling to ban corporate political donations nationally and create election spending caps.

It could take a political donations scandal to achieve reform, as happened in NSW.

Or reform could be closer than many think if the Palmer United Party continues to spend big on elections and possibly outdoes the Coalition parties with a multimillion dollar advertising campaign.

Maybe then Labor and the Coalition parties will recognise the need to create an even playing field on electoral funding with selected bans and caps on political donations and caps on election expenditure.

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