Committee recommends wide-ranging crackdown on foreign donations

Foreign donations to political parties, associated entities and third parties should be banned, a parliamentary committee has recommended, with a view to potentially banning foreign donations for any group or person engaging in political activity.

The Joint Standing Committee on Electoral Matters’ second report arising from examining the issues of the 2016 federal election has — as expected — recommended that Australian political parties, their associated entities and third parties be banned from accepting donation from foreign citizens and entities. This excludes dual Australian citizens, expats living overseas, and non-citizen permanent residents, but the committee says a new inquiry will need to be held to figure out how to prevent foreign funds being channeled through organisations and people engaging in political activity who do not fit into the above categories.

This was, as Crikey previously suggested, the Coalition members and senators on the committee hearing the call from the Minerals Council of Australia’s complaints about environmental groups campaigning against their members’ project and targeting specific electorates, while most were not being completely transparent with the origins of their funding. The Coalition members said in their report (heavily quoting MCA evidence) that they believed that forcing these organisations to abide by the same rules as political parties was simply “leveling the playing field”.

Both Labor and the Greens oppose the changes. In Labor’s dissenting report, the party said that it was unclear why the Coalition would be pursuing it given there was a lack of evidence to support expanding the fundraising and disclosure obligations to these groups:

“The Coalition proposal has a very wide ambit and Labor members of the Committee are concerned that it may lead to unfortunate, presumably unintended, consequences in terms of imposing wide-ranging restrictions on the capacity of not-for-profit organisations to draw attention to their causes. These causes could very well cover the field of Australian public discourse — from overseas aid, to indigenous advancement. What sort of government would seek to shut down, or monopolise, these conversations?”

The Greens said it would “drastically curtail the role of civil society” and suggested there were partisan reasons behind the Coalition’s recommendations.

“This is a highly partisan approach by the Liberal-National parties that would disadvantage some community groups working for the social good while not capturing groups such as the Minerals Council of Australia which is funded by large membership fees, which are not technically donations, from companies that are completely or largely foreign owned.”

Liberal Democratic Senator David Leyonhjelm said the committee had not heard evidence to support a ban on foreign donations, and could not prove that foreign actors were using donations to influence Australian elections.

Prime Minister Malcolm Turnbull and Opposition Leader Bill Shorten have both flagged their support for the ban, subject to the committee’s report, so it is likely that the initial ban for political parties will sail through Parliament, once the government decides to legislate for it.