Next week, Australians will finally be allowed to learn who gave money to political parties in the months leading up to the 2013 federal election. Annual donations disclosures for 2013-14 for parties, associated entities and donors will be made available by the Australian Electoral Commission, including information about donations and other contributions to parties in July, August and the first week of September in 2013. Up to 19 months after the money was paid or the goods and services rendered, with the government elected in September 2013 now midway through its term, voters will learn who was trying to curry favour with it.
Don’t like the absurd delay? Thank the Coalition and Steve Fielding, who blocked Labor reforms that would have required six-monthly reporting.
But the bigger problem is that what we learn from the Australian Electoral Commission’s returns is, literally, and almost exactly, half the story. Under Commonwealth donation disclosure rules, and courtesy of changes in the way political parties are tapping donors for contributions, we’re only being told about the source of half of revenue flowing to all political parties.
The primary reason — as Crikey explained last week in relation to Queensland — is the massive damage the Howard government inflicted in donations transparency with its 2005 changes, which dramatically lifted the threshold for disclosure of contributions from $1000 to, for the 2013-14 financial year, $12,400. Labor also tried to fix these changes, but the Coalition and Fielding blocked its efforts.
But another anti-transparency mechanism for donations is the increasing reliance by the major parties on non-donation contributions, such as annual subscriptions to “business forums” or events at which access to ministers is “sold” to donors. Donors are only required to make a disclosure to the Electoral Commission if they’ve donated to parties or candidates — not if they’ve purchased a good or service with their contribution. Accordingly, many companies elect not to disclose the often sizable contribution to Labor and Liberal fundraising groups or events.
New South Wales state laws require donors to declare contributions whether they’re donations or not. So did Queensland laws brought in by Anna Bligh, until they were Howardised by Campbell Newman last year. Newman dumped six-monthly returns and lifted the threshold to over $12,000. Bizarrely, however, there was one accidental way in which the Newman laws slightly improved transparency: his laws allow parties simply to lodge their Australian Electoral Commission return with the Queensland Electoral Commission for the financial year, but the ECQ publishes those returns long before the AEC does, giving us a slightly earlier insight into Queensland political party finances.
So apart from the checking enabled by NSW laws, the Commonwealth laws mean huge numbers of donors are never revealed to the public (though some corporate donors, like Macquarie Bank, report everything, regardless of legal requirements, for the sake of transparency). The sheer scale of this credibility gap is demonstrated by looking at the revenue claimed by parties compared to the total of their acknowledged donations, in-kind contributions and other forms of fundraising and revenue (such as public election funding, which the parties report). In 2012-13, the federal branch of the Liberal Party said it had received $11.4 million in total revenue, but its returns only accounted for $8.3 million. The NSW Liberal Party said it had received $14.1 million in total, but only accounted for $3.6 million in its returns. The Victorian Liberals acknowledged $13.6 million but only declared $5.6 million in donations, contributions and other revenue. The South Australian Liberals had nearly $4 million in revenue but only reported donation and contributions of just over $300,000.
On average across all divisions of the party, for 2012-13, the Liberals reported just under $75 million in revenue, but identified the sources of only $32.6 million, or just over 43% of that. So just under 60% of Liberal Party revenue was not accounted for under John Howard’s rules. It’s even worse for 2013-14 for the LNP in Queensland — since we don’t need to wait til next week to see its 2013-14 return. The LNP had revenue of $18.6 million in 2013-14 but only acknowledged the sources of less than $7.5 million.
This credibility gap is much less for other parties. Most Labor branches report all donations and contributions over $1000, instead of the legal threshold. As a result, in 2012-13, federal Labor said it had received $14.5 million overall and reported $10.5 million in contributions. Across all divisions, Labor reported 60% of its revenue, compared to 43% across Liberal branches. The Nationals, who only report above the threshold, reported 53% of revenue across the country, though just 40% federally. And the Greens actually reported less on average than the Nationals, at just 45% of their funding across all state and territory divisions. Both the Greens and the Nationals divisions obtained around $8 million in 2012-13 across the country.
Of those four parties across all their divisions, accordingly, we know the sources of only 50.3% of their funding in 2012-13. So you got half the story. And it’s only that high because Labor volunteers more information that it is required to.
It’s a similar situation with the debts and borrowings of the parties, which they also have to report but which are subject to similar rules. The credibility gap is smaller, but still there. Liberal Party divisions’ returns account for the sources of only 74% of the party’s $13 million in borrowings in 2012-13, on average, compared to 92% for Labor’s $8.4 million.
This is democratic transparency and accountability exactly as the Liberals want it — these are their laws, and they use them to full effect to hide more than half of their donors. Remember next week when we see the 2013-14 returns — you’re not being told anywhere even close to the full story.
*Additional research by Crikey intern Rochelle Brown
It would be nice if you could provide a constructive suggestion about just how people with aspirations to run for elected office fund the cost of getting their name out there so that voters know who they are. In the absence of such an idea, we are left with politics being the province of the rich Palmer types who just spend their own money to get elected.
And of course, this article, hyperventilating about Liberal fundraising, has absolutely nothing to say about the tens of millions of dollars the Union movement spends on getting its client party, Labor, elected so it can get its interests looked after.
The unions can spend millions and then donate more millions to organisationas such as GetUp in order to run proxy campaigns on behalf of Labor. Once elected, Labor implements the policies the Union movement tells them to. This is the most obvious and egregious example of interest groups buying political patronage and you have absolutely nothing to say about it.
Am I going to see an article about Union patronage of Labor in Crikey?
Hahahahahahaha!
Why would Crikey need to run an article about union funding of the Labor party when the Libs have their Murdoch propaganda machine to report and exaggerate those figures already.
The fact that you don’t believe transparency is required says a lot about you David – none of it good!
I’d like to see all donations over $500 reported the next day.
What’s the old saying? – you’ve got nothing to be worried about if you’ve got nothing to hide.
And @DavidH – yeah, we know. LNP shonky fundraising good, Labor shonky fundraising bad.
But yes, Bernard, after having a look at the LNP Qld return, to me it seems even more obtuse and dodgy. That is, the declared donation total of $7,486,759 includes a range of in-house donations. From The Liberal Party of Australia, there’s donations of $2,915,479, $95,905 and $348,182. While LNP Nominees (of PO Box 940, Spring Hill) gave donations of $1,000,000, $171,815 and $160,228. And the wholly owned subsidiary of the LNP, Altum Pty Ltd (of PO Box 940, Spring Hill) gave donations of $48,559 and $12,500. So from the declared donation total, $4,752,668, or 63.5%, was actually from the LNP itself!? Somehow how I doubt that this truckload of cash is a result of hard working branch members selling raffle tickets. It would be interesting to know what it actually includes?
There were other listed donations that I found interesting. There was one of $134,064 from former LNP candidate David Lin, who when running for Rankin, was embroiled in some controversy when it was revealed that he had a previous stain on his record for the maladministration of trust funds. Also listed is a $50,000 donation Iwasaki Sangyo, who are currently proposing a controversial resort expansion near Yeppoon. And finally, there was a $100,000 donation from Pondcote P/L. The director of this company is listed as Paul Armand Darrouzet, a marina owner who made his fortune in coal, but who curiously recently testified against Bruce Wilson in the recent Trade Union Royal Commission.
Hmmm, tangled web.
David Hand @ 1
Everyone knows the unions donate to the Labor Party. It’s all on public record. The Labor Party was formed as part of the union movement as a party for the workers. This article is about hidden donations and also about the length of time we have to wait in order to find out who donated to what party.
The point isn’t about who is donating to which party, but the lack of information of such donations before elections. The technology is available to publish information about donations in real time. Surely you’d like to peruse a list of current donors before voting for a political party of your choice?
Is the Australian version of the National Front donating to your political party of choice? We don’t know, but we should know and we could know, if there were political will to do so.