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

by leave—I move Greens amendments (1) to (4) on sheet 7274 Revised:

(1) Schedule 2, item 1, page 18 (line 4) to page 19 (line 1)

(2) Schedule 2, items 2 to 6, page 19 (lines 2 to 11)

(3) Schedule 2, Part 2, page 20 (lines 1 to 5)

(4) Schedule 2, page 18 (lines 1 to 3), omit the headings.

These amendments are very much needed. We do need changes to the legislation. A number of speakers have identified areas where this legislation needs to be improved and we have all had our own experiences from running in elections and working in election campaigns where you see these problems up close.

The essence of the Greens amendments is to ensure that we do not end up with an electoral system that makes it harder for smaller parties, Independents, and new groups that wish to engage with the democratic process from being able to do so. The bar is being raised too high here and it is very serious. When you double the amount of money that has to be paid to put up a candidate, when you start looking at a full Senate team ticket in each state and when you start looking at running candidates in a number of House of Representatives seats, or in all seats, it becomes very costly.

It was interesting and quite informative to hear Senator Sinodinos in his contribution. He spoke about how much elections have changed. He said that people want authenticity, that they are moving away sharply from previous voting patterns, and talked about how Independents are thrown up because of the vagaries of the electoral system. So he paints a picture that we can all see: there is a shift and we cannot be so assured of how people will vote. It is certainly not like it was a decade or more ago.

However, what was revealing in what Senator Sinodinos said is that, while he was acknowledging the diversity that people are looking for so often when they go to vote on election day, the system that the coalition and Labor appear to be about to vote together on here will make it much harder for newly-emerging parties and Independents to run because it is so costly. To say that that is not the case really highlights how out of touch Senator Sinodinos is. Let us look at what the costs are. Doubling the nomination fee to $1,000 for a House of Representatives candidate and to $2,000 for a Senate candidate does raise the bar considerably. What we need to remember here—and people in this chamber have this experience—is that when you are establishing a party you are not just running in one seat, although certainly that might apply to Independents, but you are gradually moving to run in more and more seats so people get to know you, you are able to increase your vote and you are able to highlight your policies to more sections of the Australian population. Now it will be so hard to do that because the fees to run a full Senate ticket in one state will jump from $6,000 to $12,000 and to run in all seats in the House of Representatives will be $150,000.

Speaking from the Greens' experience, I have been in the party since the early 1990s when we did not run in every seat, but at each election we would gradually run in more and more seats and for a number of federal elections in recent times we have run in all seats. It has been a big cost burden on our local groups, on our state and territory sections and on the national party, but it was something that we worked hard to do. I imagine that the other smaller parties endeavour to do the same thing, but this will be a real bar to being able to achieve that, particularly if they are new parties just getting going. I am sure senators are keeping an eye on who will be running in this election. There are a number of smaller parties out there talking to their members so they can put in for registration under the AEC to run in the coming election. They will now have this huge financial burden about to hit them, come this election, and it will be quite prohibitive for many of them.

I go back to underlining how out of touch Senator Sinodinos and some of his colleagues are. Essentially what they are saying is, 'Yes, we can see the Australian people are looking for more diversity when it comes to voting and they're looking for alternatives to Labor and the coalition parties, but we're going to make it harder for those other voices to get a go and be able to run in the elections.' If it is hard to get going, it is hard to maintain yourself and come back and run in future elections. So the Greens strongly urge other senators to seriously consider these amendments and their importance to the democratic process.

With regard to the number of nominators for an unendorsed candidate increasing from 50 to 100, that also involves an additional barrier for smaller parties, particularly those that are first establishing. I think these are matters we need to give close attention to and I look forward to hearing the debate.

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

I will not say what I plan to say twice, because I know Senator Madigan's proposed amendment deals with substantially similar issues and I have indicated to Senator Madigan that I will be addressing a number of those in my response to his amendment. I will indicate that the coalition will not be supporting the amendments moved by Senator Rhiannon.

There are a number of things Senator Rhiannon mentioned that I think are improved by considering the wider historical context. I would suggest a couple of things. Yes, there is an increase in nomination fees for the Senate, but I think the increase in fees pales in comparison with the cost of actually running a campaign, which I accept both Senator Rhiannon and Senator Madigan have raised as also being costly. The other thing I would point out is that in the past nomination fees have actually been substantially higher. In fact, at our first election I believe the fee was £25 which, particularly in proportion to average weekly earnings, would represent quite a substantial jump. The coalition believes, as we said in the report of the Joint Standing Committee on Electoral Matters, that these changes are necessary. I will go into more detail when I respond to Senator Madigan's amendment.

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern and Remote Australia) Share this | Link to this | Hansard source

I do not want to take part too deeply in this part of the debate but simply to refer to the mover of the amendments lamenting how the Greens could not afford to run candidates because of the cost. I just want to alert senators to the fact that it is the Greens political party that has received the largest ever single political donation of any party in Australia's history: $1.6 million from an individual donor. Some of the arguments I do not debate, but I just want to say that I think Senator Rhiannon speaks a little tongue-in-cheek when she says the Greens cannot afford it, when they are the recipients of such significant donations from individual wealthy donors. Not only that; much to the chagrin of the Labor Party, the Greens have also received donations from some of the faceless people that run the country—that is, the union movement and the union bosses. The Greens picked up a nice little swag from a couple of 'recalcitrant'—as far as the Labor Party is concerned—unions, so for the Greens to be crying poor diminishes the debate before the chamber.

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

Again Senator Macdonald just gives misinformation to the chamber. At no stage did I say that the Greens could not afford it. I was talking about smaller parties in general and particularly giving emphasis to emerging parties. This is about ensuring that the democratic process allows the new forces that are thrown up within our society that want to engage with the electoral process to do so. That is what I was talking about, and at least he could be accurate when he comes into this chamber.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

On behalf of the government, I indicate that we will not be supporting the amendments being moved by the Greens. I will at this juncture set out in more detail the government's position and contest some of the positions put forward by Senator Rhiannon. I begin, Senator Rhiannon, by thanking you for your contribution, but evidently the government has reached some different conclusions in promoting this legislation. We do not believe that the changes proposed in this bill represent the barrier or disincentive to democratic participation that you say they do.

The changes proposed in this bill, as I said in my earlier remarks, are to increase the nomination fee from $1,000 to $2,000 for Senate candidates and from $500 to $1,000 for candidates in the House of Representatives. That is increasing a number that was last set in 2006, and that will be, by the time the next election comes upon us, some seven years ago. We believe that an increase is appropriate. I suspect you may too, although you have not spoken to that. We certainly do not believe that the increase described here is a significant disincentive to our citizenry. The changes proposed in the bill will also increase the number of nominations required for unendorsed candidates—that is, those who are not endorsed by a registered political party and are not sitting Independents—from 50 to 100 electors, including for each candidate in a Senate group. I think you said in your remarks that this was a barrier to the diversity of candidates being offered to the Australian people, and again I submit that that is not the case. In fact, for candidates speaking to the diversity to which you perhaps aspire, I do not think we could say that moving from 50 to 100 signatures of unique electors is a dramatic impost upon such a candidate. For anybody putting themselves up for public office in a division of some 90,000 persons or in a state of millions—potentially many millions—that is not an onerous number. Both of these measures have been recommended by the Joint Standing Committee on Electoral Matters, and the joint standing committee obviously made those recommendations in the context of having considered those issues and indeed having held a public inquiry.

The proposed level of fees reflects the significance of nominating to be a candidate in a federal election, and I am sure we will all agree it is a most significant thing. In 1905 the nomination fee was 25 pounds. The government is of the view that the proposed new levels of fees—$1,000 and $2,000—are no more significant than those which applied in 1905. The government also notes that section 173 of the Electoral Act provides that the nomination fee is to be refunded by the AEC if the candidate is elected or if the total number of first preference votes polled in the candidate's favour is at least four per cent of the total number of votes polled. This might seem blindingly obvious, but I think it is important for us to remind ourselves and anyone listening to this debate that in fact these are moneys which are for the most part returned to candidates, and that is a very significant point. Accordingly, a candidate is able to obtain a refund of the nomination fee if they or their Senate group can poll the requisite four per cent of the first preferences. Given the well-documented increase in the informality of votes where the ballot paper is large and complex, the government is of the view that the public interest in some candidates having to pay increased fees is far outweighed by the public interest in making it easier for the voting public to complete their ballot papers so that their vote can be counted.

A critical part of our system is the integrity of our system—making sure that all of those candidates and Senate groups that are running are indeed bona fide candidates seeking public office in good faith. We do not want to see a proliferation of candidates or tickets which are there for no other purpose than to provide preferences. I am sure that again is a resolve that we all share, and the government believes that these are amendments which strengthen our system and attend to those objectives that we all share.

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

I indicate that I will support these amendments, but I do prefer the incremental approach taken by Senator Madigan in his amendments. I think that if we want to safeguard against, if not bogus groups, groups that may not be bona fide and may be there as a preference funnel for other groups then the best way of doing that in a way that is, I think, more democratic is to raise the threshold.

The threshold has been raised to 100 in the Senate. I think there is an argument to raise it even higher—to say, 500, the same as that for a political party—on the basis that those groups will then have the right to have their names above the line in a group of two or more, as is the case in the South Australian Legislative Council. That is an approach that could be looked at.

I am concerned that there is such a significant jump in fees. If we are worried about groups running that do not have the bona fides, if it is a community group that does not have much by way of funds, this will act as an impediment for it to run, but if it is a group that is backed by, hypothetically, Clive Palmer, I am sure he can fund many, many candidates if he were so minded. That means that we can still have a tablecloth-size ballot paper with people who are well resourced. With $50,000 they could still have 25 groups, which would make the ballot paper almost unwieldy. That is the sort of thing that we should be considering.

A greater safeguard against bogus groups—groups that lack genuine bona fides—would be to have a higher requirement for nomination. It may even go beyond the 100 that is being proposed. That is something that would have more merit. Also, we need to consider it in the context of the relative size of states. Getting, say, 100 signatures in New South Wales is a tiny proportion of voters compared to a much smaller state. It would still be a tiny proportion but in relative terms, if you are from one of the bigger states, you have a much bigger pool of people to go to in order to get those nominations quickly once an election has been called.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

I will respond very briefly to some of the particular points made by Senator Xenophon that were not picked up in my earlier response. Senator Xenophon obviously took interest in one particular facet of my remarks and that went to, I guess, the integrity of our electoral system and making sure that candidates are there with a bona fide purpose. My only point would be that the regulatory regime that the parliament has prescribed for elections deals with most of the matters you talked about, in the parts of the bill that deal with registration of political parties. As you would be familiar with, there is a requirement that for a party to be registered it must collect 500 names. There are various other obligations. Once a political party is successfully registered, it has an entitlement to receive public moneys and to have the name of the party appear on the ballot paper. Those obligations upon and rights of registered political parties and the general regime that applies to registered political parties deal with most of the points you are making. I think that is an area of governance where our political system has the issue amply covered.

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

The question is that schedule 2 stand as printed.

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

I move my amendment to the Electoral and Referendum Amendment (Improving Electoral Procedure) Bill 2012 on sheet 7281:

(1) Schedule 2, items 4 and 5, page 19 (lines 6 to 9), omit the items, substitute:

4 Subsection 170(3)

           Repeal the subsection, substitute:

(3) For the purposes of paragraphs (2)(b) and (c), the sum to be deposited by or on behalf of a person nominated for an election (the nomination fee) is:

  (a) to be determined using the table in this subsection; and

  (b) to be in legal tender or in a cheque drawn by a bank or other financial institution on itself.

(4) The nomination fee for an indexation year is the amount (rounded down to the nearest dollar) worked out using the following formula:

Indexation factor for indexation year × Nomination fee for previous financial year

where:

           indexation factor means the indexation factor for the indexation year under subsection (5).

           nomination fee for previous financial year means:

  (a) for a person nominated as a Senator—the nomination fee for the previous financial year for a person nominated as a Senator; and

  (b) for a person nominated as a member of the House of Representatives—the nomination fee for the previous financial year for a person nominated as a member of the House of Representatives.

(5) The indexation factor for an indexation year is the number worked out using the following formula:

where:

           index number, for a quarter, means the All Groups Consumer Price Index number, being the weighted average of the 8 capital cities, published by the Australian Statistician in respect of the quarter.

(6) The indexation factor is to be calculated to 3 decimal places, but increased by .001 if the fourth decimal place is more than 4.

(7) Calculations under subsection (5):

  (a) are to be made using only the index numbers published in terms of the most recently published reference base for the Consumer Price Index; and

  (b) are to be made disregarding index numbers that are published in substitution for previously published index numbers (except where the substituted numbers are published to take account of changes in the reference base).

(8) In this section:

           indexation year means the financial year starting on 1 July 2017, and each subsequent financial year.

Listening to the debate over the last half an hour or so, I do not doubt that the major parties do not think that there is any problem in seeking to double the fees for nomination for both the House of Representatives and the Senate when they share in $51-odd million of electoral funding between them.

Sitting here today and listening to the debate, I know that the House is full of a lot of economic rationalists, but now we have democratic rationalists. Who are you to exclude people from the political process? What is your empathy for how hard it is for small and minor parties and independents to get the funding needed to run a campaign? In my case in Victoria, my whole campaign was run on $20,000-odd.

The fact is that we have a sad day here today, where an amendment to stagger the nomination fees to have incremental increases over four years, instead of a big hit, for the minor and smaller parties and for the independents will probably be defeated in the chamber. As I said earlier, I am under no doubt now as to why the duopoly that we face in the retail sector is now on the verge of being cemented in the political process.

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

I would like to address the issues raised by Senator Madigan; both the matters raised in the second reading debate with respect to these amendments and the matters he has just raised. I agree with him, initially. While this is not my portfolio, I do represent it for the coalition in the Senate, and I agree with him wholeheartedly that we should not be calling players in the political process, or trying to remove their ability to participate by referring to them as, 'nutters'—that was the word that I think Senator Madigan used—or 'fringe players'. That is not appropriate and it is for the people to decide. I do not believe it, and I sincerely believe that people on this side of the chamber do not believe that either. My record on belief in free speech, absent legislative controls—some of which exist in this country today—I think is testament to that particular view.

The coalition does not believe that these increases actually impose an undue burden. We do impose a burden on those who participate in the political process by being candidates in anything more than voting. We actually do impose a burden on citizens by virtue of compelling them to vote and compelling them to enrol—these days they do not get a choice in the latter.

We do impose a burden on those who participate in the political process by virtue of the registration system and the compliance regime we have for candidates. I would contend that, to many smaller groups in the community, the compliance regime is actually a much greater burden than the nomination fee. That is my experience, having worked in this particular area and having spoken to many community groups for a long time. It is something about which I have gone on record before at JSCEM hearings and estimates hearings when we have had these discussions with the AEC and indeed in this chamber.

So whether or not we impose a burden for participation I do not think is the question. We do that. We talk about registering political parties and we have a requirement for a number of nominators to nominate someone if they are an Independent. There is the requirement to disclose political funding. All of those apply to candidates and to political parties. So the question before us with this legislation and what was before the joint standing committee was: what is the degree of burden that it is legitimate to impose?

I understand the frustration of Senator Madigan; I do actually have sympathy for the position of small parties. I note in this case that there are issues around the impact on the longstanding and legitimate smaller parties in this country. The Democratic Labor Party has been around in this country for coming up on 60 years. It has had members in this chamber for many decades. In fact, Senator Madigan's election at the last federal poll was testament to the longevity of that political organisation. I understand what Senator Madigan has just said—that there will be an impact upon him and his party. But we also have to be aware that there are other small groups who do not have that longstanding commitment or those bona fides with respect to the Australian political process. We do need to guard against groups that nominate purely in order to harvest preferences.

If I could refer to an example where I think this is causing a problem with legitimacy in the political process, it is in Victorian local government elections where, due to the lack of third party scrutiny and the sheer number of candidates and the ease of nomination, most people have absolutely no idea who they are voting for. You get a little booklet from the VEC. There is not the same amount of information provided by the media, nor is there probably the same degree of community interest, I hasten to add, as there might be for federal politics. But it is also clear from anecdote after anecdote that there are examples in local government elections in Victoria of people running as what might be called preference vehicles. The little booklet goes out and they will nominate a how-to-vote card and recommend people vote a certain way and, due to the electoral systems often used, those preferences can be critical.

We have to guard, in my view, against this level of disengagement resulting in a similar event occurring at the federal level. We did make a change a while ago to the Electoral Act that prevented political parties nominating more than one candidate because of, in my view, a loophole—some may view it as an historic position—in the Electoral Act that allowed political parties to nominate more than one candidate at a particular election. In one famous example we had well over half-a-dozen examples—I think it could have been in double figures—of one particular party using that legal right and privilege to nominate more than one candidate at a by-election in the last parliament. I do not think, given the general, fair and reasonable community understanding of our political process, that that was a reasonable thing to do. I think the parliament acted reasonably to say, 'Political parties get the privilege of nominating someone, but they nominate a single candidate.' That was, again, an example of a burden that was imposed on political participants, but one which the parliament felt was reasonable.

On this particular example, I have had discussions with Senator Madigan. I think that these particular amendments are a reasonable burden, but I accept that they are a burden. They reflect the fact that we have logistical issues in managing the ballot papers for, particularly, the Senate in our larger states. It does not particularly apply to members of the House of Representatives.

I would also refer to the example that, when that threshold is reached, the money is refunded. That is not to dismiss the fact that I appreciate a cash-flow issue would apply to those who have to pay the deposit. It is true to say that the larger political parties are beneficiaries of substantial amounts of political funding. I do accept that point.

The alternative is a situation where a lack of confidence can develop, not through the actions of people in this chamber or parties or Independents represented in this chamber—I hasten to add and say as genuinely as I can—but through a number of groups that I have seen on Senate ballot papers over the last 10 years who have never appeared on another Senate ballot paper. They have been once-off groups.

It is pretty clear that there have been similar figures involved in multiple groups by multiple names where preferences have consistently gone in one direction. I do not think that adds to our political process, I do not think it makes it easier for the voters to understand who they are voting for and I do not think it adds to the legitimacy of the result. With all due respect, Senator Madigan, and I am trying to understand the situation as best I can, the coalition will be supporting the retention of the schedule as outlined in the bill.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Senator Madigan, I know it will not come as any surprise to you that I declare the government is not supporting the amendment proposed by you. I think I have already spoken, when dealing with the Australian Greens' amendments, about the reason for the government supporting the bill. I endorse the remarks just made by Senator Ryan, someone who has obviously contributed very seriously to the JSCEM process, and I know he has had a long and abiding interest in electoral matters and the laws governing Australian elections.

We do not believe that the changes are onerous. We do not believe that they will serve as a draconian disincentive to our citizens participating in elections. We are of a view that they strike the right balance in maintaining the integrity of our system and ensuring that our election system remains the strongest in the world.

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

I will address some of Senator Ryan's comments on preference harvesting and speak about local government in Victoria, where both major parties have failed in some elections to run candidates. I would suggest that if you are worried about the size of the ballot paper you stop putting up dummy candidates as Independents. This is a commonly known thing that happens on both sides. Both major parties do this. Stop slurring the minor, smaller parties that do not participate in this. You may say that you are not doing that but, in effect, that is what you are doing. We have, as I said, the new term 'democracy rationalists'. The fact is that we have democracy rationalists in this place now.

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

It is fair to say that I have been called an economic rationalist quite often, Senator Madigan, including by some people on my own side, but I am not sure entirely what you mean. With respect to local government, I agree entirely with your point. I need to add that in Victoria the Liberal Party has never run candidates, nor has the party organisation had a role in local government elections. I have to put that on the record. Liberals have undoubtedly run in local government elections, but the Liberal Party organisation has consistently chosen not to, despite the fact that some have said we are. Liberals run. Of that, I have no doubt. We have the Lord Mayor of Melbourne, who is a very open and prominent Liberal, and we have those Liberals all round the state, but the organisation has not. So I do think it is fair to highlight that.

I again hasten to add, Senator Madigan, that this is a burden. I accept that, and I was not trying to slur minor political parties. You say that this is the consequence of what I am saying—I am trying to choose my words very carefully—but I also suggest that it would be unfair to say that people have not tried to misuse various political processes over time to preference harvest. I mentioned local government merely because I think that is where we have an example of preference harvesting or preference strategies being used which can confuse the voter because of various other factors. The Liberal Party as an organisation—I say this clearly—does not have a role in local government elections, and in the foreseeable future, I understand, does not intend to have a role, while individual members of the party do.

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

The Greens do support these amendments. It was interesting to hear some of the comments by senators from Labor and the coalition parties on why they will not be supporting them. I think it is worth us remembering that these amendments are actually very minimalist.

I acknowledge that the Greens amendments that we saw, which were very important, were voted down. That would certainly have been our preferred position in not raising the bar. But what we have here with the amendment before us is not stopping the rise; it is just saying, 'Don't bring it in immediately. Be reasonable.' It is allowing parties, candidates and Independents to be able to get things organised so the burden will not be so onerous, but again we are seeing the Labor and coalition parties collaborating to make it more difficult.

You have heard from a few senators spelling out the damage this can do to the democratic process. It was interesting when Senator Feeney came in on the debate. What did we hear him say? He said he endorses the remarks by Senator Ryan. It is very troubling when you see the two largest party groups come together and collaborate in this way. Senators in this House are creatures of the electoral process. We know that, come election time, there are so many issues people feel passionate about. There will be new parties thrown up, but now it is harder. We heard Senator Feeney also say that he does not believe it will be onerous or a disincentive. Certainly senators from the coalition use similar arguments—they are saying that it strikes a fair balance.

Maybe there will be a similar number of candidates running, but the people who will particularly lose out are those who do not have much income, people who are already disadvantaged. One group I have seen are becoming very active at the moment. My colleague Senator Rachel Siewert is doing a great deal of work with single parents, single mothers, who are being extremely disadvantaged because the government is taking money off them. Some of them might choose to run in the election. This will make them think twice about it. But I imagine that some of them, because they are so disturbed by what is happening to them, will want to engage in the political process, and here we have the bar raised so high. To say it is striking the right balance is just so out of tune with reality.

Senator Madigan made the point about not abusing the people who choose to run in the electoral process. Some of them may not come back at another time, but many of them do. They plod away, working out how they can gradually get support. It is worth remembering that probably more than half of the federal election candidates will not get their nomination fee refunded. So on so many levels there is a financial burden, but we are adding to it at an excessive level and it will be very damaging. I thought that Senator Ryan's comments about local government elections and that his party does not run candidates was splitting hairs. We see this in New South Wales: for years and years, over many election campaigns, the coalition have said they do not run in local government elections, but there they all are, active members within their own party, carrying out coalition party policies when they get into local government. When they run for elections they do not inform voters of the party they are a member of and what they actually stand for. Again, there are concerning levels of misinformation, but the Greens are pleased to vote for this amendment. It is important to remind the chamber that this is a very minimalist amendment. How could you possibly vote against something that only gives some time before the full amount kicks in?

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

I indicate that I support Senator Madigan's amendment. It is a compromise position and I think it is very fair. There was the example given by Senator Rhiannon about a group of single parents, single mothers, who want to run at the next election. I acknowledge the work that Senator Siewert has done with groups that are concerned about those draconian changes to their benefits, which I also opposed. Why shouldn't they be allowed to run? Why shouldn't they be allowed to at least focus the minds of the major parties in particular? If they do get a groundswell of community support through running a virtually no-budget campaign—through Facebook, through social media, which you can do nowadays—why should they have the disincentive of having to stump up at least $4,000? It would be prohibitive for a group such as that. That is a very good case study that Senator Rhiannon has put up.

I am not picking on Clive Palmer. I am just using him as an example of a person who is interested in the political process, as he is entitled to be, who does have a bit of spare cash around the place. If he stumped up $100,000 he could have 25 separate groups, with two candidates each, running for the Senate. The logistics of that would make the Australian Electoral Commission shudder because it would be a tablecloth ballot paper. I do not think there would be any printer in the country that would be able to print it in one piece. You would have to glue it together or stick it together in some way.

This will act as a disincentive to genuine community groups. It will not prevent abuse from those that have the money to abuse the system in terms of the tablecloth ballot paper scenario. That is why we need to come back to the necessary reform, which would be that, if there is a genuine groundswell in a particular state or community, then having a slightly higher threshold for candidates would be a more amenable way of dealing with the issue to make sure people who are nominating have other people in the community backing them. That could include a requirement to have several hundred people nominate them rather than what is being proposed. I think that would get rid of the abuse. What is being proposed now would impact on groups such as single parents who might want to make a stand at the next election against the draconian changes to their benefits.

The TEMPORARY CHAIRMAN: We are dealing with item 1 on sheet 7281. The question is that the amendment be agreed to.

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

I move amendment (1) on sheet 7344:

(1) Page 29 (after line 25), at the end of the Bill, add:

Schedule 4—Disclosure of certain gifts

Commonwealth Electoral Act 1918

1 After section 304

  Insert:

304A Disclosure of certain gifts

Person must disclose certain gifts

(1) A person must give a return to the Electoral Commission, in the approved form, if:

  (a) the person is:

     (i) a candidate; or

     (ii) a member of the House of Representatives; or

     (iii) a member of the Senate; and

  (b) the person receives one or more gifts from a donor during a financial year; and

  (c) the total amount or value of the gift was, or the total amount or value of the gifts were:

     (i) equal to or more than the amount prescribed for the purposes of this paragraph; or

     (ii) if no amount is prescribed—more than $10,000.

Registered political party must disclose certain gifts

(2) A registered political party or a State branch of a registered political party must give a return to the Electoral Commission, in the approved form, if:

  (a) the party or branch receives one or more gifts from a donor during a financial year; and

  (b) the total amount or value of the gift was, or the total amount or value of the gifts were:

     (i) equal to or more than the amount prescribed for the purposes of this paragraph; or

     (ii) if no amount is prescribed—more than $10,000.

Return to be provided within 24 hours or 30 days

(3) The return must be given to the Electoral Commission:

  (a) for a gift or gifts received during an election period—within 24 hours of the time that the person receives the gift or gifts; or

  (b) for a gift or gifts received at any other time—within 30 days of the time that the person receives the gift or gifts.

Contents of return

(4) The following information must be given to the Electoral Commission, in the approved form:

  (a) the name of the person, corporation or other entity, that provided the gift or gifts;

  (b) the name of the candidate, or the name of the member of the House of Representatives or Senate, that received the gift or gifts, as the case may be;

  (c) if the candidate, or the member of the House of Representatives or Senate, is a member of a registered political party—the name of that party;

  (d) the date that the gift was received, or the date (or dates) that the gifts were received;

  (e) any such other information prescribed by regulations for the purposes of this paragraph.

Electoral Commission must publish information

(5) The Electoral Commission must publish a return provided under subsections (1) or (2) on the Electoral Commission's website:

  (a) for a gift or gifts received during an election period—within 24 hours of the time that the return is given to the Electoral Commission; or

  (b) for a gift or gifts received at any other time—within 1 week of the time that the return is given to the Electoral Commission.

304B Offence of failing to disclose certain gifts

(1) It is an offence if:

  (a) a person, a registered political party or a State branch of a registered political party is required to give a return to the Electoral Commission under section 304A; and

  (b) the person, registered political party or State branch of a registered political party fails to give the return to the Electoral Commission within the period specified in subsection 304A(3).

(2) Where a person, registered political party or a State branch of a registered political party commits an offence under this section, an amount equal to the amount or value of the gift or gifts is payable to the Commonwealth and may be recovered by the Commonwealth as a debt due to the Commonwealth by action in a court of competent jurisdiction.

2 Subsection 307(1)

  Omit "Where no details", substitute "Subject to subsection (3), where no details".

3 Subsection 307(2)

  Omit "Where no details", substitute "Subject to subsection (3), where no details".

4 At the end of Division 4 of Part XX

  Add:

(3) Subsections (1) and (2) do not apply to a return that would otherwise be required to be given to the Electoral Commission under subsections 304A(1) or (2).

The aim of these amendments is to improve transparency in relation to political donations. Voters deserve to know where political parties, candidates and individuals get their financing from in a timely manner. Australia's disclosure regime lags far behind other countries, and it is vitally important we catch up. These amendments expand donation disclosure requirements to cover individual MPs, senators and candidates, including independent senators, candidates and parties. If any of these individuals receive a gift or gifts totalling over the threshold amount, they must provide a return to the AEC within 24 hours during an election period or 30 days outside an election period. The same requirements apply to political parties, including state branches.

This amendment sets out the form which returns must take, including the requirement for details of the giver and recipients, the party the recipient belongs to if relevant, the date the gift was received and any other details set out in regulations. Once the return is received, the AEC must publish it on their website within 24 hours during an election period or within a week outside an election period. The amendment also creates an offence in line with existing offences in the act where the Commonwealth may recover the amount of the donation, or equal to the donation, if the requirements for disclosure are not met. In other words, it is the same framework or penalty and it is something that will sharpen the mind of anyone who does not comply by having to return the donation.

This amendment is an important step in improving Australia's disclosure requirements. We know the current system is well below par. I am concerned that any planned changes will not be made in time to be effective before the next election. Australian voters deserve to know where the money comes from in a timely manner. My issue is not so much with the threshold. My issue is that at the moment a donation can be made on 1 July 2011 and we do not hear about it until 1 February 2013. That 19-month period of time is simply unacceptable for there to be transparency and disclosure.

In my second reading speech I mentioned William Hanna. In fact, I was wrong. I made a reference to a quote from Mark Hanna who ran the successful US presidential campaign for William McKinley in 1896. He said: 'There are two things that are important in politics. The first is money and I can't remember the second.' Well, this is the sort of thing that we need to avoid. I do not want us to have the best democracy that money can buy.

It is very important to ensure greater transparency in disclosure and for the capacity for this to be provided online, with adequate resources, out there for everyone in a timely manner for the electorate. I wish I had known about some of the donations in the course of the poker machine debate because it would have been very useful for the public to know that not just at election time but in the course of important parliamentary debate. I urge my colleagues to support this amendment in terms of a more timely regime of disclosure in relation to political donations.

David Feeney (Victoria, Australian Labor Party, Parliamentary Secretary for Defence) Share this | Link to this | Hansard source

Thank you, Senator Xenophon, for that contribution. I am tempted to say there is good news and there is bad news. The good news is I wholeheartedly agree with the sentiments in your remarks and the bad news is that I am not supporting the amendment you have moved today. The reason for the bad news is a very cogent one, you will be pleased to know. That is that there is a government bill before this Senate that proposes to meet several of the concerns you highlighted here this afternoon.

The Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2010 has been before the Senate since 17 November 2010. The government remains committed to that bill, which contains a number of fundamental changes to the funding and disclosure requirements contained in the Electoral Act. In particular, the amendments to the Electoral Act contained in that bill will reduce the disclosure threshold from more than $10,000. As you know, it is indexed to the consumer price index annually. I understand it will be $12,100 in the next financial year. Our legislation would change that to $1,000 non-indexed per annum. The bill would require people who make gifts at or above the threshold to candidates and members of groups during the election disclosure period to furnish a return within eight weeks after polling day. Agents of candidates and groups have a similar time frame to furnish a return in relation to gifts received during the disclosure period.

The bill would require people who make gifts, agents of registered political parties, the financial controller of an associated entity or people who fall within the relevant provisions who have incurred political expenditure to furnish a return within eight weeks after 31 December and 30 June each year. That would have the practical effect of changing the reporting period from 12 months to every six months and would do quite a deal to change the time frame that Senator Xenophon spoke to just a moment ago. It would prevent donation splitting by ensuring that, for the purposes of the $1,000 disclosure threshold, related political parties were treated as the one entity. It would make unlawful the receipt of a gift of foreign property by political parties, candidates and members of a Senate group. It would also be unlawful in some situations for associated entities and people incurring political expenditure to receive a gift of foreign property. It would extend the ban on anonymous gifts to encompass all anonymous gifts except where the gift is $50 or less and received at a general public activity or a private event as defined in the bill. It would tie public election funding to reported and verified electoral expenditure. It would provide for the recovery of anonymous gifts of foreign property that are not returned and undisclosed gifts. It would introduce new offences and penalties related to the new measures and increase the penalties for existing offence provisions.

Since the introduction of this 2010 bill, the government has also received two reports from the Joint Standing Committee on Electoral Matters which also recommend significant change to the funding and disclosure requirements of the Electoral Act. The first of these reports of November 2011 entitled 'Report on the funding of political parties in election campaigns' contains 30 recommendations for changes in this particular area. The second JSCEM report of September 2012 entitled 'Review of the AEC analysis of the Fair Work Australia report on the HSU' contains 13 recommendations in response to the 17 recommendations that were made by the AEC to the Special Minister of State in May 2012.

As senators will appreciate, changes to the funding and disclosure provisions of the Electoral Act, while controversial, have not dissuaded this government from actively seeking to negotiate a response to those JSCEM reports that will guarantee lasting reforms in this area and which can be implemented in a practicable way to the benefit of all stakeholders. As the government's negotiations and consideration of these matters is well advanced, with plans already announced for the legislation, it would be premature for us to agree to the amendment proposed by Senator Xenophon without addressing the whole of the political funding and disclosure scheme. As I said at the outset, Senator Xenophon, the good news is the government wholeheartedly agrees with the aims, objectives and the values that drive them. I guess in due course I will commend the Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2010 to you and to the Senate.

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

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

I agree with Senator Ryan in what he said that the same rules should apply to both union and corporate donations. He talks about the tax treatment and I think it is fair to say that there ought to be a consistency in the tax treatment as well. What Senator Ryan has failed to do is acknowledge that there are some real issues in the transparency of political donations in a way that is not about red tape. It is about ensuring that we do not wait six or 18 months for donations to be disclosed. The Democratic Audit of Australia, I think, do good work. It does not mean that I agree with all that they do. I think they do good work in strengthening our democratic processes at least in terms of transparency and accountability, and that is something that needs to be done.

With those words I think that this amendment about having real-time disclosure during an election campaign, or within 30 days outside an election campaign, is far preferable to the very comprehensive response given by Senator Feeney on behalf of the government. There will be improvements, but I do not think those improvements go anywhere near far enough. On that basis I maintain that this amendment is the preferred course and now is an appropriate time for it to be dealt with.

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

The Greens do support this amendment. It was welcoming to hear Senator Feeney—

Progress reported.