Scott Ryan (Victoria, Liberal Party, Shadow Parliamentary Secretary for Small Business and Fair Competition) Share this | Hansard source

The coalition will not be supporting the amendment moved by Senator Xenophon. There are a number of profound differences between the coalition and the government, which I am sure will please some people down the end of the chamber. We have a very transparent electoral system. Is it perfect? No, it is not perfect—no system is—but let's not get bogged down in the idea that there is a profound secrecy about the role and import of donations in Australian politics.

I want to address some of the underlying points raised in the arguments of Senator Xenophon and Senator Feeney. There are problems with ever-increasing regulation. If you speak to many community groups about their involvement in the political process, they say that the compliance regime of a much greater regulatory environment around every cent having to be watched or having to record even relatively insignificant amounts of money has a devastating effect on our civil society. There is an issue also around the different structures of political parties. The Liberal Party of Australia is a much more federal structure than the Labor Party. To start to apply these regulatory models that assume a national office has the power, as it does under the Labor Party, is flawed. Our Liberal Party—and we have the LNP division as one example—has been structured as a federal organisation with extremely limited federal powers for a very good reason. That has historically been the case since it was founded by Robert Menzies.

Senator Xenophon also talked about the Democratic Audit of Australia. I think he said that it was universally held in high regard. Senator Xenophon, I do not mean to put words in your mouth, but I think I have captured the sentiment, and I note that you have nodded. The coalition has real concerns with some members of the Democratic Audit of Australia, but I do not mean that in a personal sense. One of the members has appeared before the JSCEM and has written discussion papers which argue that union money should be treated differently to corporate money and we should have bans on corporate money. That person was Associate Professor Joo-Cheong Tham from the University of Melbourne, who I know from my university days. The idea that we would treat corporate money differently to union money, in my view, betrays an agenda. It is an agenda that not only is in favour of regulation but is about empowering one side of politics.

I will read from a paper written by that person. I am not assigning anything malevolent, but the impact of this change would be to dramatically empower one side of Australian politics at the expense of another. It is a Democratic Audit of Australia discussion paper, Senator Xenophon, so let's not put it up in lights and say that it is something that everyone can sign up to and that all its recommendations would be better for Australian democracy. The paper talks about how business is different from unions. It talks about how union affiliation fees are in fact membership fees even though the individual members of a union have no say over whether their money goes to a political party. It advantages corporate membership over individual membership because it also distinguishes that, if businesses were members of a political party, it would be different again. It even uses the quote out of the Labor Party's great socialist objective, the Labor Party's rules, where it talks about businesses being in control of the means of production, distribution and exchange. So, let's not pretend that the Democratic Audit of Australia is some profoundly independent body that is trying to balance the sides of Australian politics, because I do not think it is. I think its approach, as betrayed by that particular paper, would profoundly unbalance Australian politics.

Let's also go to some of the unbalancing that already exists. In the current environment, if a person wishes to give money to the Labor Party and they are a member of the union, they get a tax advantage, which a person who wants to give money to the Liberal Party or the Greens cannot. If I pay my affiliation fee or membership fee to the union and part of that money including a special levy is then passed on to the Labor Party, or to the ACTU for a political campaign that we know is entirely in line with the objectives of the ALP, then I get access to a second tax deduction. The tax treatment of monies that flow around political parties in this country is profoundly different dependent upon the vehicle and dependent upon the destination. If I wish to give money, or an individual wishes to give money, to the Greens, to Senator Xenophon and his campaign, to Senator Madigan or to someone on this side of the house then what we have is a situation where they will only get access to the single tax-free threshold that a political donation is eligible for. But that is not so if you give money to the Labor Party, because you can go via the union through your membership fee. You can even go through the ACTU. That different tax treatment is a profound imbalance in our political system that exists today.

In turning to the AEC's proposals, they have proposed what we might vaguely call 'the Canadian model'. The Canadian model is a highly regulated, highly restrictive and highly proscriptive model into which the role of civil society in our political process is drawn. It can draw in people from think tanks that publish books. If they are deemed to be part of the political debate, then they are suddenly caught under the regulatory regime. One important aspect, however, of the Canadian approach is that all monies are treated equally in terms of tax-exempt status.

The coalition disagrees with Senator Feeney on many of the points he has made. Senator Xenophon, I accept your motivation, but let's look at some of the real, profound imbalances which already exist and have existed for a long time. The first is the tax treatment of money that flows to political parties which benefits one side greatly at the expense of another.