Mark Bishop (WA, Australian Labor Party) Share this | Link to this | Hansard source

We are dealing with amendment (1) on sheet 7344 moved by Senator Xenophon.

Nick Xenophon (SA, Independent) Share this | Link to this | Hansard source

Prior to question time—or what was meant to be question time—there was a spirited debate and contribution by Senator Ryan which I appreciated in relation to this amendment. He raised issues about the problems with the democratic audit of Australia saying they were not completely impartial because they recommended rules for campaign financing that would favour unions and penalise corporations. I unambiguously state that the rules should be the same. You should not favour unions or big corporations. You should apply issues and the rules equally; that includes donations where they are made by individuals via a union, or individuals via a corporation. I think that is important and I want to make that clear. I still believe that the democratic audit, on balance, contributes usefully to the debate on issues of democracy in this country and I think it makes a valid point in its submission to this bill that it believes that the postal vote system favours incumbents and political parties. I think that is an issue that is legitimate and ought to be addressed.

This particular amendment says that the current disclosure rules with respect to political donations are woefully inadequate. When a donation is made it ought to be disclosed within 30 days, so long as you are above the prescribed limit, which is about $11,900 at the moment. Senator Feeney, on behalf of the government, indicated that the next tranche of amendments of reforms to the electoral laws in this country would include more timely disclosure of every six months compared with every 18 or 19 months that potentially occurs now. Given the lag between a donation made on 1 July 2011, you would not know about until 1 February 2013, because that is the potential lag. We need to have more timely disclosures.

Hopefully, Senator Ryan will acknowledge that someone who was not for more government intervention in the United States was no less that George W. Bush. I remember a statement he made a number years ago—either when he was running for President or when he was President—talking about the need for having much more timely disclosures and that the internet could be used; online disclosure could be done virtually instantaneously. This is not about extra regulation or red tape, it is about trying to find a mechanism, provided the threshold is a reasonable threshold. My issue at the moment is not with the current threshold; my issue is with letting people know when those donations were made in a timely manner. What is being proposed by the government does not address those issues.

Before we go to a vote on this, I note the words of Doris Haddock, who was an American citizen who in 1999 at the age of 87, a great grandmother, walked across the US from the Pacific to the Atlantic coasts in protest of the influence of big money in politics. She told the 1999 Reform Party Convention that a person:

… ought to be able to run for a public office without having to sell his or her soul to the corporations or the unions. Fundraising muscle should not be the measure of a candidate. Ideas, character, track record, leadership skills: those ought to be the measures of our leaders.

Those words are relevant in the context of this debate. Those words are relevant in the context of requiring greater degrees of transparency and disclosure in our political donations.

I indicate that I will be seeking to divide on this amendment. I note the support of my colleagues from the Australian Greens and Senator John Madigan from the DLP, and I am very grateful for that support. We need to get on with this sooner rather than later. I look forward to the next tranche of amendments that the government will be putting up. Every opportunity that can be taken to reform our electoral laws to make them more transparent, to make disclosure much more timely, ought to be seized. This is one of those opportunities.

John Madigan (Victoria, Democratic Labor Party) Share this | Link to this | Hansard source

Earlier this afternoon when Senator Ryan rose to speak about Senator Xenophon's amendment he spoke about unions and their funds, and the member's funds that are paid to unions by way of their membership fees. I think we need to clarify this: all people have a right to collective bargaining, Senator Ryan. What is the difference between members of the VFF or the NFF? That is collective bargaining. As are members of VECCI or the Australian Industry Group or the Real Estate Institute of Victoria, or whatever it may be.

As much as those people are entitled to collective representation, so are unionists, working people, allowed to have collective representation also. Picking up on your point that members' contributions to a union's funds are tax deductible, I think you will find that if you are a member of the AiG, VECCI, the VFF or the NFF, those contributions would also be tax deductible. So I think we have to be very careful as we erode the rights of one that we do not erode the rights of all, because these things set a precedent and precedents can come back to haunt people.

As far as Senator Xenophon's amendment goes, I support anything that offers transparency and accountability. I think any party, no matter who it is, no matter how large or small, should be prepared to disclose what donations they get, however large or small they are. On that basis I support Senator Xenophon's amendment.

Lee Rhiannon (NSW, Australian Greens) Share this | Link to this | Hansard source

The Greens also support this amendment, moved by Senator Xenophon. It provides an important step in cleaning up the complex way disclosure is presently managed. I did note Senator Feeney's comments. He said that the government will not vote for this amendment because the government has its own bill. On first hearing that sounds good, particularly when he says that its bill is to improve disclosure, make it more transparent and more timely. But then he tells us that he is referring to the Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2010, which is a bill that has been sitting there for three years. That is why we need to support the amendment that Senator Xenophon has brought before us. We have waited three years and Senator Feeney thinks it is a good argument to say, 'Well, we have this bill sitting here.' It is also worth remembering that, while it does cover these important issues of lowering the level of disclosure from presently pushing up towards $12,000 down to $1,000 and of more timely disclosure, Labor should have made some progress when it first was elected. It is worth remembering that this problem that we have came in when the coalition had control of both houses of parliament and the laws were wound back in a very unsatisfactory way. Labor did vote with the Greens and other minor parties, I understand, against that change. But here we have the situation where Labor for the last six years could have changed the law. It has had a bill for three years, we have talked about it for six years, and it has not changed. That is why we need the action and I am very pleased that we are able to explore the issue this evening.

The law was changed in December 2005 when we went overnight from knowing that the public could find out who was donating if they gave a donation above $1,500 to all of a sudden having it changed to $10,000 and linked to the CPI. As we know, it is now up to about $11,900. That means that we have had a great deal of donations that have been hidden from public scrutiny. It is worth reminding ourselves how extensive this is, which underlines why we need the amendment that we are considering tonight. If you go back to 2005 when this change was made, which is basically what Senator Xenophon's amendment deals with, at that time Senator Eric Abetz and the Liberal Party federal director, Brian Loughnane, stated that the new $10,000 disclosure threshold would make little difference to public scrutiny. A lot of people doubted that; it is a big change. Once again their words were shown to be quite misleading.

The Greens Democracy4sale research project examined the 2004-05 data, the disclosure data that the Australian Electoral Commission puts out on 1 February each year. That was the last time we saw donations having to be disclosed that were $1,500 or higher. Data for the New South Wales Liberals showed that only 58 per cent of donations, about $3.2 million, would have been identified if the new disclosure threshold had been applied. So clearly it was a large amount that would be hidden. Figures for the National Party are also interesting. In 2004-05 the Nationals reported 148 contributions of $1,500 or more. We would have had no details about most of those contributions if the law had already been in place. That gives us some idea of the money that is coming in about which we have no idea who it is coming from. Of the more than $1.3 million the Nationals received in 2004-05, 63 per cent would be identified, with 37 per cent hidden from public view. So what Senator Ryan is really saying when he says they do not want the bar changed and he talks about too much regulation is that they want to avoid public scrutiny. This is a very important point because at the time Senator Abetz and the director of the Liberal Party argued that 90 per cent of the dollar amount donated would still be available for public scrutiny. I understand that the exact amount that Senator Abetz argued at the time was 88 per cent of the dollar amount still being available for public scrutiny.

That has certainly not been the case when you look at the figures and compare those from 2000-05 to later years.

This is a worrying trend and underlines why we need to have amendments like those before us. In fact, we need to look even more deeply into the whole issue of disclosure. As we have been waiting for this legislation from the government to come on for so long, I think it is worth us taking the opportunity that these amendments afford us to just consider the changes we do need with regard to disclosure because, yes, we need to get the bar down—$1,000 seems very reasonable—and it needs to be done in a timely manner. In these days of electronic spreadsheets and websites whereby it so easy to coordinate, it would be very easy to have the donations put up probably within a matter of hours.

We also need to clear up what is declared and the penalties for non-compliance. This really does go to the issue of resources for the Australian Electoral Commission. Often you find out that the rules have been broken but nothing happens, and it just goes on because there are not the resources for the Australian Electoral Commission to look into it in detail. When it comes to disclosure, it is very unclear what you are actually looking at. It needs to be differentiated at least between fundraisers and money donated. A very important issue that comes up time and time again when you talk about disclosure is that the money that a donor puts in should be aggregated. It should not be possible for a donor to give small amounts of money, thereby staying under the threshold and out of public scrutiny in that way.

For the record, in the 2011 state election the Greens in New South Wales enacted their commitment to continuous disclosure by publishing details of donations that were received. The amendments before us address just a part of this, but it is an important step towards bringing forward a healthier disclosure system. Labor may have promised action on this front but we still have not got it. We know that the legislation has been sitting there for three years, and that is why we cannot keep waiting. We have some amendments before us now. The Greens support these amendments, and I urge all senators to support them.

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

I just want to briefly respond to Senator Madigan's comments about my comments before question time. I actually agree with him. I hope I did not misconvey the point that I was trying to make. He makes the point about legitimate collective bargaining, which is guaranteed in the Fair Work Act and in competition and consumer law. I am not challenging that at all. The point that I was making earlier, which Senator Madigan has responded to, was about where the money ends up and the means by which money that political parties get hold of is treated differently.

Senator Madigan rightly referred to tax deductibility not only of union dues but also of membership of professional associations or industry groups like the AiG or the Real Estate Institute or, for that matter, groups like the AMA. The difference is that those groups do not hand money to political parties as membership fees. The point I was making, Senator Madigan, was in regard to the fact that someone who chooses to contribute money to the Labor Party through their union membership fees and then also through a donation or through their membership of the Labor Party more directly is availing themselves of two different tax-free thresholds. They are availing in terms of the tax deductibility of that money. The union money is deductible in one way, whereas the money for membership is deductible in another way. It means that in that all-important sense the money that unions hand over to the ALP is tax free, whereas the money that individuals or that corporates may hand over to another political party or, indeed, to the ALP itself is dealt with primarily, if it is above the deductibility threshold, out of post-tax income, which actually leads to a very different real cost of that donation.

The point I was making about the comments from that particular member of the Democratic Audit was that a structure which favours corporate membership such as the unions have—which is a corporate membership sense of the Labor Party, where the body is the member as opposed to an individual-based membership, which I understand the Democratic Labor Party and the Liberal Party have—is not equal tax treatment of the money that goes to political parties. It has nothing do with collective bargaining, and I do not wish to do anything about the collective bargaining space; it is purely about how the tax system treats the money that political parties get hold of.

I note that in Canada the tax system actually counts tax deductibility as part of the public funding amount, and all moneys that go to political parties that are tax deductible are treated equally. There are no different routes, whether it be by union membership fees or by donations. I think that is an important point. We do not want to have an unlevel playing field with money in politics in terms of its legal treatment. I was not trying to make a point about collective bargaining in that sense at all. I think this could be resolved without having any impact on collective bargaining, because the examples you mentioned, such as dairy farmers and their collective bargaining with a milk processor—all those things—would be untouched. The issue here is about money that flows to political parties from what is rightly pointed out to be the historic arrangement they have with unions, but that should not give them a financial advantage over other participants in the political process purely via the tax system.

With respect to the contribution from Senator Rhiannon, I will not stand here and be lectured on transparency by a political party that does not allow the media into its national conference.

Lee Rhiannon (NSW, Australian Greens) Share this | Link to this | Hansard source

That's not true.

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

That is transparency—how you form your policies. It is about how the Greens come up with the policies which they then put as a gun to the Labor Party's head and force them to implement. It is about how the Greens come up with the policies that they use in their balance of power and negotiating position in this Senate to force onto the Australian people. Real transparency, Senator Rhiannon, is not about someone who donates $1,000.50; it is actually about political party processes. All the other political parties represented here are not afraid of transparency. They do not lock the media out of their national conference for fear that the truth about the extremist base of the party might actually be on the national news. Transparency is as much about information about our operations and how we come to decisions, and that is something in which the Greens are profoundly lacking. I will not be lectured about transparency by them.

Mark Bishop (WA, Australian Labor Party) Share this | Link to this | Hansard source

The question is that amendment 1 on sheet 7344 be agreed to.