What Just Happened To Federal Political Donations?

The federal parliament just changed political donation laws in Australia and now property developers can make donations to federal politicians.

It’s a massive policy pivot that comes across as pretty shady, and could also ultimately weaken the political voices of people who don’t have money to donate.

What’s The New Legislation?

Let’s look at the new legislation.

Luke Beck: “Last week both major parties in the federal parliament teamed up to pass new laws that change the rules around making political donations to federal politicians.”

That’s Luke Beck, from Monash University.

He explained to me that there have been two really significant changes.

One, is that property developers can now donate money to political campaigns provided they say it’s for federal purposes.

The second, is that neither the property developer nor the party have to tell anybody, unless the amount of money is more than $14,300.

LB: “So if you’re a dodgy property developer and you want to curry favour, or ingratiate to a particular political party, you could donate $14,299 for ‘federal purposes’ and no one will ever know about it.”

What’s The Backstory To Political Donations?

It’s quite a significant change in the law.

Up until now, property developers in QLD, NSW and the ACT were totally banned from donating to federal political parties, because of what they might want in return.

LB: “A series of reports at state levels – in NSW by the Independent Commission Against Corruption and in QLD by the Crimes and Misconduct Commission – shows that certain categories of donors … make donations in order to get actual government provisions made in their favour. So, things like planning decisions, planning approvals.”

When that happens it totally blurs the lines between genuine federal-led policies and ones that are based on bribery.

So to overcome this type of corruption, in 2019 the High Court upheld QLD’s ban on property developer donations and this precedent introduced it to other states as well.

That’s what has now been overridden.

To Do Draw A Line Between State and Federal

But why?

Professor Beck told me that Labour and Liberal parties say the new changes are to ultimately draw a line between state laws and federal laws.

They believe that state laws shouldn’t apply to federal election campaigns.

But federal political donation laws have always been very weak compared to state ones.

State laws for example, have banned big tobacco companies from making political donations in NSW, QLD and ACT, by making it a jail time and financial penalty kind of offence.

And donations to state governments are capped at $1000, which is a huge difference to the new $14,300 cap on federal donations.

What Does This Mean? 

Professor Beck argues this is a clear example of the federal government trying to water down donation transparency, and politicians like Jacqui Lambie and Andrew Wilkie have publicly criticised it.

But not all political donations are corrupt.

If you’re a supporter of a political campaign and truly believe in their philosophy and have money, then it’s totally normal to want to show support through donations.

Professor Beck pointed out that it’s actually an important part of a democracy and it also helps run political campaigns, which are really expensive.

But it becomes a problem when the public aren’t just donating because of their beliefs and are instead trying to buy influence.

LB: “That might be relevant to deciding on whether or not we want to vote for somebody. If a particular politician has practice of taking money from sources that a particular voter thinks are dodgy, that might impact on whether they want to vote for them or not.”

The Takeaway

Professor Beck argues that politicians need to be listening to all people, not just those with money who are willing to offer secret donations.

LB: “It means that young people and other people who don’t have large amounts of money have less power, have less voice, less say in our political system.”

And for those who can donate, the public really needs to know where their money is coming from and for what purpose, so politicians are less likely to do anything they really shouldn’t with it.