Independent MP Zali Steggall’s best contribution to the cause of integrity and transparency — one of her favourite causes — might have been to illustrate how farcical the current political donation disclosure rules are.
According to Nine newspapers, Steggall’s campaign-funding vehicle received $100,000 from Sydney’s Kinghorn family, but failed to disclose it for the 2018-19 financial year.
The problem is, under our existing laws, the non-disclosure of the Kinghorn donation was almost, but for some paperwork, perfectly OK. The donation was notionally composed of $12,500 from each of eight donors.
The disclosure threshold that year was $13,800, so no disclosure was required. But John Kinghorn sent Steggall’s campaign a cheque for $100,000 — in effect bundling all the donations together. That pushed it over the threshold. If he’d sent eight cheques in different names, there would have been no problem.
Splitting donations is a time-honoured way of evading political donations rules. Famously, construction firm Brown & Root funnelled hundreds of thousands of dollars in donations to the young Lyndon Johnson in the 1930s, in gross violation of donation laws, by having each employee contribute individually to him. It continues to this day in Australia, where you can donate up to $14,500 to each state and territory branch of a political party without disclosing it. But money is fungible, and state and territory branches of parties shift money between each other routinely.
Judging by the volume of dark money in our political system — in which some branches of both sides of politics only reveal the origin of the minority of their revenue — you can bet donation splitting is an important mechanism for evading disclosure requirements.
It’s expected of the major parties, of course, so it comes with a particularly foul odour when a supposed cleanskin, a politician who has made a virtue of her calls for integrity and a better standard in public life, is revealed to have engaged in the same sort of evasion.
And it’s not that hard to adhere to a higher standard. Labor and the Greens commit to revealing all donations above $1000, regardless of official disclosure thresholds. One Nation and Clive Palmer’s outfit — regardless of what you think of them — reveal every cent of their revenue.
Steggall’s non-disclosure reveals another broken feature of our disclosure laws: there are no consequences for non-disclosure.
Steggall and her team, and Kinghorn, corrected their 2018-19 information in early 2021. By major party standards, that’s almost on time. The fundraising arm of Steggall’s predecessor in Warringah, Tony Abbott, declared a $25,000 donation in 2010 four years later. In 2015, the Victorian ALP corrected its disclosures for the 2007 election campaign as Bill Shorten went to the trade union royal commission to explain them. In fact, late donation disclosure is routine, particularly among state branches.
The issue sparked a fight between the Australian National Audit Office (ANAO) and the Australian Electoral Commission (AEC) in 2020. The ANAO undertook an audit that found around 20% of party donation returns were late, and criticised the AEC for not pursuing the offenders aggressively enough. The AEC responded that they had limited resources and were reluctant to use them taking legal action against parties, preferring “consultation and education”.
Former Liberal Party federal treasurer Michael Yabsley, author of Dark Money – A plan to reform political fundraising and election funding in Australia, says the failure to disclose makes Steggall’s position untenable. “Steggall has spectacularly failed to live up to her own standards. All she can rely on is that her only offence is to have done what all the other parties and candidates have been doing for decades.”
Yabsley pointed out that the donation was a major part of Steggall’s election warchest — 9%. “Single handed Zali Steggell has created her own massive trust deficit. The electorate marks hard those who do not practice what they preach.”
“As a political fundraiser for 40 years, I have fessed up and am happy to call myself a ‘poacher turned game keeper’.”
“Zali has just signed up as ‘game keeper turned poacher’.”
“Political fundraising is like law enforcement generally. For every offence we know about there are many we don’t. We now need to know just how dirty are Zali Steggell’s hands when it comes to political fundraising.”
“The only option is to put the broom through the whole process of political fundraising and election funding in Australia,” Yabsley said.
The AEC responded that they had limited resources and were reluctant to use them taking legal action against parties, preferring “consultation and education”.
There’s far too much of this nonsense among regulatory agencies generally, and it’s obvious that’s just the way the governments (state and federal) and the parties like regulation to be, but here the AEC provides a stellar example. The AEC surely knows exactly how effective its consultation and education is. It would be interesting to see how much work the AEC is putting into helping parties (and independents) get around the already flimsy rules and exploit all the loopholes, even though it seems likely most of parties know just what to do already. Kinghorn and Steggell appear to be guilty mostly of being too innocent about how to work the system. As Keane says, it was a completely unnecessary blunder that exposed Steggell to this criticism. If only they had received ‘consultation and education’ from the AEC in time look what embarrassment would have been avoided.
But respect to those parties who are open about their funding anyway, and don’t exploit the many legal ways available to bury it all from any public scrutiny.
I don’t think that Mz Zali is part of the broiler chook empire.
It is true that much like every APS agency, and particularly oversight and regulatory agencies, the AEC doesn’t have enough staff. I doubt very much that it is “nonsense” to claim it has “limited resources”.
I’m sure it is true. But it’s still nonsense. The government sets up regulatory agencies, gives them contradictory objectives, inadequate powers and feeble legislation, starves them of resources and pretends we have a regulatory system. The whole thing is nonsense, a pretence of regulation, and deliberately so.
We need more like Steggall in parliament – which means getting rid of the Coalition root ‘n branch.
Yabsley weighing in – he’s still a Liberal at heart – no matter what he professes and writes now.
“The system” was all right when it was working for him.
Let’s remember there’s more joy in heaven over one sinner… etc.
Yabsley’s self-description as poacher turns gamekeeper is accurate, and his assault on the current lack of any useful regulation of political
bribesdonations is (of course) well-informed and a very solid contribution to the argument. He makes a very convincing witness when he describes how bad it is. Of course he does, and it’s a hell of a lot better than just keeping his head down and saying nothing. It really does not matter at all if he remains a Liberal. So long as he’s a Liberal who stands firm for political party finance reform that’s good enough on the issue in questionHe can afford to do that now – he’s no longer benefitting from a scheme he used to benefit from, did so much to institutionalise and normalise.
….. “Sure I used to hold up banks, steal cars, beat up little old ladies and shoot people. But I’m reformed now. I wanna be a copper!”
Your comparison fails and entirely misses the point. Yabsley, and all the other party treasurers, were not and are not breaking laws. That’s pretty much the whole issue. The laws are crap.
And who makes the laws – to benefit whom/what?
Your point is? All governments make laws to suit themselves. So?
Yabsley is doing a very good job of exposing how bad these laws are. So, again, what is your point?
His point like always is ‘the LNP is the root of all evil in this world’.
Ay hes. And, like the famous stopped clock, he’ll be right some of the time.
Now that Michael Yabsley has gamekeeper insight can he shed any light on blind trusts?
If he takes off that blind-fold?
Why is it a “ lax approach to campaign disclosure” to have conformed with the AEC requirement as it was understood to apply to the 2019 donation, but afterwards, on questioning of the detailed receipt by the AEC, to issue in 2021, a correction statement?
The innuendo attempted is to put Steggall in the same bundle as the sleaze merchant disclosure avoiders who for decades now have funded mainstream and some fringe parties, often in a clandestine manner, expecting favours. The mud directed at Steggall does not stick, least of all given the context of her 2019 campaign as an independent newcomer, staffed with volunteers and funded across a potpourri of supporters hoping to put an end to the Abbott incumbency. If Steggall had not been such an outstanding exemplar of independence and integrity in her term of office, the Nine network would not be digging so hard to find some mud to sling at her.
BK sees the attempt to (ab)use the $14,500 limit as the problem, not the slip up. (In fact he says the slip up does us all a favour.) The Greens and the ALP have a $1,000 limit, Palmer and Hanson have a $0 limit. The $100,000 donation to Steggall was split into $14,500 lots. She accepted 9% of her funding from a donor who sought to avoid disclosure.
Couldn’t agree more, Paul.
“If Steggall had not been such an outstanding exemplar of independence and integrity in her term of office…
Splendid example of double-think or, if you prefer, cognitive dissonance. If Steggall was really such an outstanding exemplar of independence and integrity in her term of office she would surely not be involved in an artificial scheme used to disguise how she was funded.
Solution is simple. Any donation that should have been but wasn’t disclosed should be forfeited to consolidated revenue. “Oh you’ve spent it already? Oh dear, you are now bankrupt, here comes Mr Section 44. Bye bye”
And Yabsley is just part of the bigger Liberal Party apparatus trying to get Warringah back into their camp.
Keep at it, Michael Yabsley. The Boys’ Club attacks on an MP of Steggall’s stature guarantee to swing more votes her way from women in Warringah.
“And Yabsley is just part of the bigger Liberal Party apparatus trying to get Warringah back into their camp.”
Of course he is. He’s a Liberal, so what else would he be doing? But you say it as though it’s a criticism rather than normal everyday politics.
It does not have any bearing on whether he’s right that Steggell, like so many more, including obviously the Liberals, is hiding donations by a legal sleight-of-hand. Except Steggell lacks the competence to get away with it.
There’s a statement on Zali Steggell’s Twitter today saying she did in fact declare that money. Not surprising there are attacks on some Independents in current climate. Esp considering their principled stand in opposing the undemocratic excesses of the Religious Bill.
I very much hope Steggell is re-elected, but in this matter it seems she is being a little cute. Yes she disclosed “the money”, but apparently not the donor(s) until the AEC ruled that she had to. There was no reason for Steggell to stick with the overly generous threshold of $13,800. She should have adopted the same approach as the ALP and Greens ($1,000) or Palmer and Hanson ($0). Nor was there any reason for her to allow a family trust to split $100,000 (9% of her funds) into lots of $12,500. Perhaps inexperience and/or ignorance were excuses then. They will not be this time around, and that is as it should be.
Remember how “the perfect is the enemy of the good”…..something that might be haunting the Greens but they won’t admit it of course…
You’re right. Her explanation is very much cute. She took a donation that was a big chunk of her entire funding and helped the donors disguise it by breaking it into bite size chunks. Then she screwed up by taking one cheque for the lot instead of accepting the cheques separately. Now she’s trying to say that everyone takes money from coal because everyone has a pension fund so why pick on her. WTF? She would have done better to just say it was stupid and wrong.
As usual, it is the cover-up & fatuous excuses that do most damage.
Would that they’d just say ‘fair cop, I goofed‘ – as perfected by the ever gurning Peter Beatty?