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Further implications
Few governments or oppositions in Australia have shown any real enthusiasm for regulating political donations. Time and again, attempts at reform have appeared tokenistic and essentially stalling devices.
On October 15, 2015, the Senate referred an inquiry into political donations to the Joint Standing Committee on Electoral Matters. The terms of reference of this inquiry referred to previous recommendations the Standing Committee had made in 2011. In four years there has been no government response to the 2011recommendations.
Understandably the Committee chose not to consider the matter further without a government response to its previous work. No response was received before the dissolution of the Senate and the House of Representatives prior to the 2016 elections.
With a range of significant issues having emerged from the July 2 poll - including the Australian Electoral Commission's administration of the election, the use of campaign material and messages purporting to be from Medicare, and the influence of campaign donations - separate spinoff inquiries are likely to follow. This will mean another inquiry into electoral funding.
Senator Sam Dastyori's resignation as manager of opposition business in the Senate and shadow spokesman for consumer affairs, after it was revealed he may have broken Labor Party rules on political donations by allowing Chinese donors to make payments on his behalf for travel and legal bills makes an inquiry into political donations all but inevitable.
Following Dastyori's resignation New South Wales Greens senator Lee Rhiannon and South Australian senator Nick Xenophon put a motion before the senate urging it to back a ban on foreign donations. Just before the motion was put, the Labor opposition added its name.
What will come of this of this call remains to be seen. Though a ban on foreign donations has long been supported by Prime Minister Malcolm Turnbull, support for the call across the Liberal Party seems shaky. Liberal Party director Tony Nutt has warned of potential dangers and difficulties in seeking to ban foreign political donations while Foreign Affairs Minister and Deputy Liberal Party Leader, Julie Bishop, has stated, 'There are many instances of donations being made by naturalised citizens, by dual citizens, by companies that are incorporated in Australia. And like other businesses across Australia they can choose to make a donation to a political organisation...'
Any review of Australia's system of political donations would need to be more wide ranging than one which addressed only foreign donations. Senator Xenophon has drafted a further motion calling for a full-blown inquiry into the donations system. Xenophon has stated, 'We need to have a root-and-branch review of political funding and donations in this country.'
Areas which would need to be addressed include full public disclosure of donations (both corporate and individual); timely and perhaps on-going disclosure of donations; a cap on the size of donations and parties' use of 'associated entities' to disguise from whom they receive donations.
A total ban on corporate or union donations is unlikely and has already been rejected by one High Court ruling. What might be considered is a ban on particular types of corporate funding from groups which are deemed to have a negative social impact, such as donations from the gaming industry. A ban of this kind has been put in place in New South Wales.
However, what appears to be occurring is that, rather than real enthusiasm for reform, each of the major political parties is using political donations as a stick with which to beat the other. The Coalition's current focus on banning corporate and union donations appears to be aimed at wrong-footing the Labor Party which would not be prepared to accept a ban on union donations. Each party can safely assert the need to limit or ban foreign donations (it plays well into the growing xenophobia in Australia); however, their genuine support for taking such action remains questionable. Even the Greens and the Xenophon parties' attempted reforms may in part be motivated by the fact that the current system favours the major parties.
It will be interesting to see how long it takes whichever party is then in power to respond to the next set of recommendations from the Standing Committee on Electoral Matters.