A temptation worth resisting - weakening political donation rules

Every day brings Australia closer to July 1, when the Coalition takes control of the Senate. And almost every day it seems the Coalition's policy wish list for July 1 and beyond gets longer.

Last week we learnt from the Liberal Party's Senate strongman Eric Abetz that the laws covering donations to political parties are set for an overhaul. The proposed changes will impact on our democratic processes and so they should be debated in depth.

Abetz and his colleague Nick Minchin argue that electoral laws governing donations need to be loosened. They say the limits at which disclosure of donations must be made should rise from $1,500 to possibly $5,000. They also advocate a rise from $100 to $5,000 for tax-deductible political donations.

This is a recipe for deception. If such a system were introduced, the public would have even less access to information about who bankrolls Australia's political parties.

Abetz and Minchin are conveniently ignoring the Australian Electoral Commission's comprehensive set of 95 recommendations on disclosure and transparency, which are before Parliament and awaiting consideration.

These recommendations came via the Joint Standing Committee on Electoral Matters, and summarise other reform proposals made by the AEC to Parliament since 1993. Governments of both political colours have been ignoring their own electoral experts for 12 years.

The recommendations cover such matters as increased disclosure by associated entities (front organisations that raise money for political parties), complete disclosure of any donations from outside Australia, and a requirement that all payments at fundraisers should be considered donations.

The latter recommendation is crucial, since vast amounts of money are raised by political parties at dinners and other events, yet this money is not considered as donations. This means individuals and companies paying thousands of dollars into a party's coffers do not have to submit donors' forms to the AEC.

These are quite modest recommendations that would go some way to ensuring the transparency and public scrutiny that ought to be fundamental to our democratic process.

When they take control of the Senate it will be very tempting for the Coalition to set up a funding regime that would allow its backers to make regular donations with minimal oversight.

But the Liberals would be wise to look at what some high-profile members of their own constituency are up to when it comes to donations. A number of top companies are reassessing their once generous ways. Lend Lease, BHP Billiton, National Australia Bank, Rio Tinto and AMP have all decided to stop donating to political parties. Some of their CEOs are reported to have said that they have decided that giving political donations is just not worth the grief they were getting from shareholders and the public.

So while most companies still believe that making political party donations serves their business interests, a reassessment is going on in some quarters.

Corporate democracy, where those with money can buy privileged access to ministers, and their influence is related to the amount of money contributed, is increasingly on the nose.

There is growing awareness that donations to political parties detract from the democratic process. Former ALP federal president Carmen Lawrence, former Labor NSW secretary Eric Roozendaal and NSW Liberal whip in the Legislative Council Don Harwin are all on the public record criticising the present regime on party donations.

But come July 1, the Coalition leadership - no doubt envisaging another Menzies era stretching ahead of them for decades - could well be tempted to lock in a funding regime that favours their donors.

The Liberal hierarchy should follow the example of Lend Lease and the other multinationals that have deserted the party donors club, and ask themselves whether changing the electoral disclosure laws will be worth the controversy and accusations that will be generated.

On July 1 the Liberals will have the power to change the laws; but they won’t have the power to change people's cynicism about the unsavoury influence donations have on the political process.