Electoral reform legislation to cap political donations passed the Senate last week, with many crossbenchers expressing their fury at the process and the major parties claiming the moral high ground as they joined forces.
Trade Minister and Special Minister of State Don Farrell has been handling the negotiations for Labor. After the deal was done, he spoke to the media in the corridors of the press gallery. ‘There’s now a cap on how much you can spend in an individual electorate’, he said. ‘That must be good for all ordinary Australians who want to participate in the electoral process.’
MP Zali Steggall, the former Olympic skier who won Tony Abbott’s seat in 2019, popped up behind Mr Farrell and said, ‘If you’re so sure, why won’t you send the bill to an inquiry to ensure that it is democratic and fair?’
She’s got a point. The final amendments to the bill were reportedly so rushed that some MPs hadn’t even read them before they were put to the vote.
These latest reforms won’t affect the 2025 election, but they will affect the next one.
According to Steggall, that means unless the legislation is repealed, it will be very difficult for future independent candidates to challenge major party incumbents.
Crossbenchers could be heard calling out ‘where’s the democracy?’ when the amendments returned to the House of Representatives.
Loopholes
There are good things about the electoral reform legislation. Individual donation thresholds (lowered to $5,000) will be required to be lodged within weeks, instead of annually, which should limit the influence of ‘dark money’. There will be an $800,000 spending limit per candidate. Labor says these changes will prevent billionaires taking over Australian politics.
Unfortunately, major loopholes remain which allow serious money to flow unhindered to major parties who are campaigning across the state or country, effectively allowing disproportionate influence in marginals, for example, but not to independents who are targeting individual seats.
The Australia Institute has pointed out a number of flaws in the legislation which have not been addressed, including the extreme haste of its introduction and lack of review, the ‘nominated entity’ exception (investment funds and foundations which are not subject to caps, widely used by the ALP and Coalition), and the fact that established parties and incumbent MPs will receive tens of millions dollars more in public funding to compensate for lost political donations, while independent candidates and new parties will receive nothing to compensate them for lost donation revenue.
The really big problem is that the caps on political donations are per party, or per independent candidate. Beneath the surface of each party monolith – what’s visible to the Australian voter – are actually large groups of parties, with each of those being able to receive donations up to the cap. The new legislation will seriously limit the abilities of newcomers to fundraise, while leaving established parties much less constrained.
Elections to become more expensive
In spite of Don Farrell’s claims that the reforms will put ‘downward pressure’ on the cost of elections, the price effectively paid by taxpayers for each vote will rise, from $3.50 to $5.
Crossbenchers have pointed out this will disproportionately assist the major parties, particularly when you consider the additional funding flowing to them for ‘administration’ costs.
Liberal Senator James McGrath dismissed the outrage of the crossbenchers when he told the Senate, ‘As a former campaign director I can say to the teals, if they can’t get their message out in a seat with $800,000, then they need to look at their message or they need to look at what they are spending that money on.’
Actually, Australia Institute figures show the average spend per seat by the Coalition in the last election was over $800,000, with far more being spent on key marginals, and on former Liberal heartland seats won by the teals, such as Kooyong and Warringah.
Victorian independent MP Helen Haines, whose predecessor in the seat of Indi, Cathy McGowan, began the wave of community-based independents by defeating Sophie Mirabella (now working for Gina Rinehart), called the reforms ‘a dupe of democracy’.
Labor’s valiant defender Van Badham took to social media to declare that such criticism was ‘incredibly patronising to the hundreds of thousands of Australians who are active members of existing political parties – committed servants of a very healthy democracy…’
So, get bigger and become a party or go home, effectively. If new, independent voices can’t compete with the megaphones, too bad.
It does beg the question though, would a political movement like the Australian Labor Party have had any chance if it was being created now, under these conditions?
Originally from Canberra, David Lowe is an award-winning filmmaker, writer and photographer with particular interests in the environment and politics. He’s known for his campaigning work with Cloudcatcher Media.
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