Political donation reform – are big donors buying improper influence?

Political donation reform – are big donors buying improper influence?

Political donations are a problem. Donations might be buying influence and can easily encourage corruption. Not even playing by the rules guarantees transparency.

There are good reasons why people want to donate to political parties, but there are also bad reasons. When the bad reasons outweigh the good, it is time to look for change.

There are many suggested improvements to our donation laws. While they keep honest folk in line, most proposals are weak and ineffective against people looking to rort the system.

Our incumbent party receives more funding from every possible source than the rest of our parties combined. That does not lead to strong democracy.

I would like to see reform to our donation laws to restore public trust in our political parties and candidates.

Politicians constantly review how the influence of political donations at every level of politics, so there is plenty of research to go on.

Ban certain interest groups from making political donations

Talk about closing the barn door after the horse has bolted. This approach, often championed by The Greens, identifies industries with an “unsavoury track record in influencing decision makers”. Essentially, wait until the damage has been done, then apply a band-aid. It is weak, ineffective, and easy to circumvent.

Ban political donations completely

Democracy generally needs money to work. Someone has to pay for the advertising of policies and candidates. Increased public funding for candidates is normally the other side of this particular proposal. Canberra politicians currently exploit the best of both worlds, having increased their public funding without closing off political donations.

After-the-fact Integrity investigations and consequences

As with banning certain interest groups from donating, this approach waits until the damage has been done. It is an important check for whatever system we have in place, but my philosophy is “prevention is better than the cure”.

The consequence for an offence is 50 “penalty units”, which comes to about $40,000 for a company or $8,000 for an individual, or 6 months in jail.

This approach puts a price tag on an improper donation. If the influence is worth more than $40,000, an organisation might risk the fine. Jail time is obviously a bigger deterrent.

Opt-in for public funding

This is a proposal I would like to explore further. Parties and candidates would be able to opt-in to a public funding scheme, but opt-out of receiving private donations.

NSW has dismissed this approach as “too difficult to administer”. Personally, I cannot see the difficulty. South Australia has an opt-in funding scheme, though it is attached to reporting and spending caps rather than receiving private donations.

An opt-in public funding scheme seems a good compromise.

Spending caps and public funding

Incumbent politicians have a significant advantage at election time, particularly government MLAs. This advantage will forever tilt the odds in favour of returning representatives rather than electing the best people for the job.

An MLA’s time in office should be allowed to speak for itself. The advantage is earned if they have been working hard for and in their communities. If they rely on putting hordes of roadside signs with only their name out for recognition, the advantage is not deserved.

I would like to see the spending cap and public funding tightened for incumbents:

  • Government MLAs should be restricted to 25% of the spending cap, and receive 25% of the public funding amount for primary votes.
  • Opposition and Crossbench MLAs should be restricted to 50% of the spending cap, and receive 50% of public funding amount for primary votes.
  • Non-incumbent candidates should remain at 100% of the spending cap, and receive 100% of the public funding amount for primary votes.
  • Further, the threshold of primary votes to earn public funding should be lowered for non-incumbent candidates from 4% to 2%.


  • Initiate a review of political donations with a few to making the system more transparent, easier to manage, and fairer for non-incumbent candidates.
  • Participate in the existing processes to review Electoral legislation.


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