Right: property developer Huang Xiangmo is quoted as saying (in a Chinese-language newspaper) that Australian politicians were `not delivering ... We need to learn how to have a more efficient combination between political requests and political donations.'
Arguments against banning foreign, corporate and union donations to political parties
1. Political campaigns are very expensive to run Commentators have noted that with the increasing expense of employing media advisers and paying for exposure in a variety of media outlets the cost of political advertising is increasing. In 2013, Professor Sally Young of the Australian National University noted, '1969 was the last campaign that wasn't tailored mainly to TV. From 1972 onwards, the parties have focused both their "paid media" strategies (commercial advertising) and their "free media" (media management) activities upon TV. But in 2013, with fragmenting media audiences diminishing television's impact and audience reach, the major parties took a multi-faceted approach. While TV ads were still the major component of their communication strategies, these were supplemented by other forms of communication including both digital and one-to-one methods.' The result of this diversification of campaign media outlets appears to have been swelling campaign costs. In Australia, political parties are not required to detail how they spend their campaign funds; however, the total expenditure figures that are released indicate the scope of the spending. The federal government, followed closely by state governments, is often among the top one or two advertisers in Australia. In 2007 it was reported the New South Wales government spent more on advertising than McDonald's or Coca-Cola, with the investment continuing to grow. Graeme Orr, electoral law academic at the University of Queensland, has claimed, 'Campaign expenditure no longer starts and ends in an election year, but is an ongoing and tightly orchestrated marketing exercise.' The Coalition, for example, spent close to $100 million on advertising in the 2004 election year, but over the period between 1996 and 2005 it spent almost $700 million. In his book The Law of Politics, Orr noted that 'in relative terms, money politics in Australia is not too far behind America'. The extent of this expenditure helps to explain why, despite frequent attempts to regulate campaign donations, parties are actually reluctant to do so. They believe they need large budgets to get their message out effectively. There is also concern that if there is a marked inequality in expenditure between the major parties then this will give the party that is able to spend the least a lesser chance of winning government. In an opinion piece published in The Conversation on June 2, 2016, Emeritus professor Marian Sawer, from the Australian National University, stated, 'In Australia, the cost of television advertising and associated market research has driven political parties to chase ever-greater donations." 2. Limiting donations to individuals would dramatically reduce campaign funds According to analysis of Australian Electoral Commission disclosures, Australia's major political parties would lose the vast majority of high-value donations if only individuals on the electoral roll were allowed to donate. In the 2014-15 financial year - the most recent available - the Liberals disclosed more than $10,400,987 nationally in donations but only $1,085,482 from individuals. Labor received $7,193,902, only $703,200 of which came from individuals. The Greens gathered $1,842,649 but this would have been reduced to $199,014 had they only received donations from individuals and the Nationals would have gone from $613,233 down to zero dollars. It is argued that if corporate and union donations were banned, political parties would find themselves unable to properly present their positions to the electorate and the quality of political debate and information would be reduced. Such a reduction, it is claimed, would undermine Australian democracy. This trend has been developing for some time. In an analysis written by Carmen Lawrence and published in September 2007 by the Australia Review of Public Affairs, Lawrence noted, 'an increasing proportion of donations comes from large individual, corporate and institutional donors-so-called "plutocratic" financing-as opposed to "grass roots" sources such as membership dues and donations from party members and supporters. Analyses of party finances from 2001-02 indicate, for example, that the Liberal Party derived around 74 per cent of their private funding from corporate sources in that election year, a rise of approximately ten per cent from the previous election year (1998-99)...All the parties now rely heavily on private funding-approximately 80 per cent for the major parties, most of it spent on advertising and electioneering.' One of the contributory factors to this trend is that membership of Australia's political parties has declined over the years, so they are less able to raise money from membership fees. Parties do receive some public funding, but not enough to pay for election campaigns. Instead, they claim they have to bolster their coffers by appealing to the public and corporations to donate funds. The dilemma was outlined by Professor Graeme Orr from the University of Queensland. Professor Orr stated, 'Political campaigns and organisations need resources. Here lies a central democratic conundrum: how to regulate to improve political integrity and equality, without unduly restraining political liberty and activity?' 3. Restricting donations to individuals would favour parties with wealthier support bases There is concern that precluding unions from making donations to political parties would damage labour-based parties, such as the Labor Party. According to this line of argument, conservative parties, such as the Liberal Party, have a larger support base among wealthy elites as well as corporations. If unions and corporations were prevented from making campaign donations, then, it is predicted, the conservative parties would attract more funding from their wealthy private supporters. With a less wealthy support base, the Labor Party and others would be disadvantaged. Australian Council of Trade Unions president Ged Kearney has indicated that unions would oppose a move against their right to donate, saying 'a democracy where only the wealthiest individuals and formal political parties are allowed to actively participate is no democracy at all'. The point has been made in a more subdued manner by Law professor Graeme Orr of the University of Queensland. Professor Orr has stated, 'The favoured conservative position is to ban organisational contributions to parties...It's a model that would benefit the Liberal Party, which embraces a network of well-heeled individual donors. And within the party, it would further empower MPs in well-off electorates.' Gina Rinehart, the chair of Hancock Prospecting and Australia's wealthiest woman has been cited as an example of a private individual who makes large and regular contributions, in a variety of forms, to the Coalition. In October, 2013, it was reported that Ms Hancock had donated $50,000 to Agriculture Minister Barnaby Joyce's election campaign. The same news report indicated that at least nine Coalition MPs have declared in their register of interests that Ms Rinehart has supplied free travel, hospitality and accommodation. The Labor Party already claims to be under-resourced relative to the Coalition. In the three years leading up to the 2013 election, the Coalition has revealed that it has received $220 million compared to the Labor Party's $170 million. In an article published in The Conversation on August 26, 2013, it was stated, 'When Labor is out of office, or sure to lose it, it encounters a significant fundraising disadvantage and returns to depend on union contributions.' 4. An effective democracy depends upon the right of 'political communication' In 2012, in a case brought by the union movement, the High Court overturned a New South Wales government law restricting donations to individuals on the basis that it represented a breach of the constitution's implied right of 'political communication'. The High Court endorsed a previous ruling which had found there is a need 'for there to be a free flow of political communication in order that electors can form judgments. Mason CJ observed that freedom of communication could not be understood as confined to communications between electors and elected representatives, candidates or parties. It cannot be so confined because the efficacy of representative government depends upon free communication between all persons and groups in the community. An elector's judgment on many issues will turn upon free public discussion, often in the media, of the views of all those interested.' The High Court thus ruled that groups as well as individuals should be able to make financial contributions which promoted democratic debate and thus that unions could not be barred from making campaign contributions to political parties. Others who have argued for the right of unions and corporations to make campaign donations also claim that those who make financial contributions are not simply acting out of self-interest, but are acting in what they believe is in the best interests of the nation. David Fawcett, a South Australian Liberal Member of the House of Representatives, has stated, 'There are many people-businesses, corporations and private individuals-who feel passionately enough about wanting to see government in the flavour and character that suits their own ideology, but it is not about their individual interests; it is about the interests of the nation-and that is not just true for the coalition.' A similar claim was made by Tim Ayres, the New South Wales secretary of the Australian Metal Workers Union (AMWU). Mr Ayres stated, 'The system fails without activist citizens and organisations engaging and taking responsibility for political debate and action. That is why banning donations would stifle democracy... It is fundamental to all of our freedom that everyone can play on the field of democracy.' It has been argued that preventing unions from making political donations denies working class people of one of their few available opportunities to influence governments. In an opinion piece published in Overland on September 14, 2016, Chris O'Regan, a Brisbane unionist stated, 'To deny unions the most direct mode of collective political participation - donations and campaign expenditure - doesn't advance the cause of working people, who currently have little relationship to politicians and little chance of shaping policies that govern their lives.' 5. Bans on foreign donations to political parties are unenforceable Banning foreign donations would not automatically end the practice. Many companies have complicated ownership structures that include branch companies located in other countries such as Australia. Therefore these companies could potentially find loopholes in the law by donating through local affiliates. As Professor George Williams, Dean of Law at the University of New South Wales, and a member of Civil Liberties Australia, noted in a commented published on September 5, 2016, 'Foreign interests can also avoid identification by donating via front organisations or third parties.' Further, if the aim is to reduce foreign influence, merely banning donations from foreign companies may not achieve this. Australians with close overseas connections or who are dual citizens could continue donating. Minshen Zhu, the businessman who paid Senator Dastyari's debt, is a Chinese-Australian with reportedly has strong connections with the Chinese government. Another reason it is impossible to know the extent of political donations is the use of 'associated entities'. These are basically fundraising organisations for political parties; they invest money and receive donations on behalf of the party. Each year, they need to report to the AEC how much they made/received, but they don't have to break this figure down to specify donations and donors, meaning that corporations et al can remain anonymous. Associated entities are major contributors to political funds, accounting for 40% to 90% of revenue, depending on the year. Donating through 'associated entities' allows foreign and local corporations to support the campaign funds of Australian political parties without disclosing their 'gifts'. |
Found a word you're not familiar with? Double-click that word to bring up a dictionary reference to it. The dictionary page includes an audio sound file with which to actually hear the word said.