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About this inquiry

On 21 September 2016, the Special Minister of State, Senator the Hon Scott Ryan, asked the Committee to inquire into and report on all aspects of the 2016 Federal Election and related matters.


The Committee is conducting a review of political donations as part of its inquiry into the conduct of the 2016 federal election.



Past Public Hearings

20 Nov 2018: ACT
29 Jun 2018: Parkes, ACT
20 Feb 2018: West Perth, WA

1. Introduction

1.1
The 2016 federal election (the 2016 election) was held on Saturday, 2 July 2016. The election was unusual in two ways – it changed the method of voting in the Senate and it was the first double dissolution election held since 1987.
1.2
Either one of these events would be significant, but combined they put particular focus on the Senate election.
1.3
It also was the first national electoral event after the mishandling of Western Australian Senate ballot papers during the 2013 federal election, resulting in the High Court declaring the election of Western Australian Senators void.
1.4
Investigations by Mick Keelty AO (the Keelty review), the Australian National Audit Office (ANAO) and this Committee’s predecessor led to recommendations for reform of the Australian Electoral Commission’s (AEC’s) election management and ballot handling processes.
1.5
The AEC had tested reform measures at several smaller electoral events, including House by-elections in the seats of Griffith (Qld) on 8 February 2013 and Canning (WA) on 19 September 2015. However, the 2016 election was the first opportunity for the AEC to test the implementation of the reforms at a national level.
1.6
Since the election, fifteen Senators and Members have been replaced or faced by-elections due to issues relating to section 44 of The Constitution. This has maintained an unusually high public focus on the 2016 election and the work of the AEC. The Committee undertook a detailed consideration of matters relating to section 44 in its May 2018 report: Excluded: The impact of section 44 of Australian democracy.
1.7
The Committee acknowledges the commitment to reform demonstrated by the AEC since the 2013 federal election, including its continued willingness to work constructively with the Committee on its modernisation program to ensure public trust in Australia’s electoral management and ballot paper handling.

Conduct of the inquiry

1.8
It is usual practice for the Joint Standing Committee on Electoral Matters (JSCEM) to review the conduct of the most recent federal election in a broad-ranging inquiry. On 20 September 2016 the then Special Minister of State, Senator the Hon. Scott Ryan requested that the Committee undertake the inquiry, providing detailed terms of reference.
1.9
In setting these terms, the Minister requested interim reports on two issues that had been the subject of substantial media coverage and community debate during the election campaign:
the authorisation of voter communications; and
the extent and use of foreign donations.
1.10
The Committee issued interim reports on each of these issues and a third interim report on AEC modernisation.
1.11
In total, the Committee received 228 submissions (Appendix A) and held nineteen public hearings (Appendix B) across the country, informing the inquiry.
1.12
As with the approach taken by JSCEM in its report on the 2013 election, this report only addresses issues that the Committee felt warranted further discussion. Full statistics on the election are available in submissions to the inquiry, specifically the submission from the AEC.1
1.13
This report addresses the longitudinal issues that have consistently arisen in election inquiries conducted by this Committee and its predecessors–issues that remain unaddressed. The Committee has already addressed the most pressing issues in its interim reports addressing the terms of reference as requested by the Minister.
1.14
This report acts as the Committee’s ‘watching brief’ over long-term electoral issues and highlights issues that it feels its successor in the 46th Parliament should actively address.
1.15
As established by the Committee’s interim report on political donations, the report considers all these issues in a framework of principles for a trusted electoral system. These principles are:
Transparency–electoral processes are visible and easily scrutinised by all participants;
Clarity–all actors in the electoral system–voters, candidates, and the AEC–know what is required of them;
Consistency–regulations support a level playing field; and
Compliance–regulations are enforceable with minimal, practicable compliance burdens.
1.16
These principles establish a framework that the Committee uses to guide its consideration on how to enhance and strengthen Australia’s democracy. It would be tempting to dismiss a federal election as an event that happens every three years; and that only electoral experts, the AEC, and the Electoral Matters Committee, are concerned about in the interim.
1.17
Free, fair and transparent elections are the foundation of our democracy. Without confidence that our Parliament has been properly elected, we cannot be confident in the decisions of the Parliament or the Executive. It is therefore essential that we continue to scrutinise and enhance all aspects of our electoral management and delivery.

Interim reports and Government responses

1.18
The 2016 election was characterised by a new Senate voting system and a double dissolution election.
1.19
Additionally, a number of issues were the subject of substantial media coverage and community debate during the 2016 election. The Minister requested interim reports on these issues as a matter of priority, being:
1
the authorisation of voter communication; and
2
the extent and possible regulation of donations and contributions from foreign sources (foreign donations).

Authorisation of voter communication

1.20
In December 2016, the Committee provided an interim report on authorisation of voter communication. Although authorisation of election material has always been a feature of Australian elections, the 2016 election highlighted deficiencies in the regulatory regime in relation to authorising campaign materials via new media such as social media, email, SMS and robo-calling.
1.21
The Committee’s report recommended that the Commonwealth Electoral Act 1918 (Electoral Act or the Act) be amended to explicitly address the matter of authorisation of electoral materials.
1.22
The Government responded to the interim report by introducing the ‘Electoral and Other Legislation Bill 2017’ to the House on 30 March 2017. In introducing the Bill to the House, the Minister stated:
This bill responds to the committee's recommendations by requiring that three categories of communication include an authorisation:
Firstly, all paid advertising, regardless of the medium used to communicate it, or the source of that communication. This extends a current requirement that applies to paid advertising on the internet.
Secondly, certain communications (whether paid or unpaid) made by or on behalf of entities with disclosure obligations under the Electoral Act. These include registered political parties, candidates and third-party campaign groups whose expenditure on influencing elections exceeds the disclosure threshold, and donors whose donations exceed the disclosure threshold. In this category, a number of exceptions are made, including for personal and internal communications, news and editorial content, satire, research and opinion polls.
Thirdly, longstanding provisions that require authorisations for certain forms of printed material will be retained—for example, leaflets, flyers, posters and how-to-vote cards.2
1.23
The Bill was passed by both houses on 11 September 2017, received assent on 14 September 2017 and commenced on 15 March 2018.3
1.24
Amendments to the Criminal Code Act 1995 (Cth) passed the House on
6 February 2018 and the Senate on 18 June 2018. The amendments introduce new criminal offences and an injunction power to prevent people from impersonating a Commonwealth body.4

Foreign donations

1.25
In March 2017, the Committee provided an interim report on the options available to Parliament to regulate donations from foreign sources. The Committee’s report recommended a prohibition on political donations from foreign entities.
1.26
The report also established the four principles that the Committee considers fundamental to a trusted system for political donations, as outlined above. These four principles have guided the Committee’s consideration not only of foreign donations, but as a subset of political donations more generally.
1.27
The Government responded to the interim report by introducing the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017 to the Senate on 7 December 2017. In introducing the Bill, the Minister stated:
Reform is necessary to support the integrity of Australia's electoral system, and Australia's sovereignty, by ensuring that only those with a meaningful connection to Australia are able to influence Australian politics and elections through political donations. It will also ensure that the Commonwealth's electoral funding and disclosure regime keeps pace with international and domestic developments and provides transparency for Australian voters.
The Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017 will improve the consistency of the regulatory treatment of all political actors. This includes political actors that have emerged in the Australian political landscape, who neither endorse candidates nor seek to form government, yet actively seek to influence the outcome of elections through their campaigning activities. While this is a positive indicator of the strength of Australian civil society and civic engagement, it is important that these actors are subject to the public accountability of more traditional actors, such as registered political parties or candidates.5
1.28
The Bill was then referred to this Committee for inquiry and report, which it did on 9 April 2018.6 The Committee’s report proposed a range of amendments to the Bill, based on the principles noted above.
1.29
The Government responded to the Committee’s report in October 2018 by referring proposed amendments for inquiry and report. The Committee reported its findings on 15 October 20187 and the Senate passed the legislation on 15 November 2018, and the House passed it on 27 November 2018.

AEC modernisation

1.30
It was apparent to the Committee in the early stages of the inquiry that there were a range of issues that required early attention by the inquiry. These issues related to the capabilities of the AEC to deliver electoral services expected of it in the 21st century, due primarily to technological and procedural limitations.
1.31
As a result, the Committee issued its third interim on AEC modernisation specifically addressing:
the introduction of new technologies for election delivery;
complexity of electoral legislation; and
management of the temporary election workforce.
1.32
The Committee recommended that the Parliament enact a range of technical amendments to the Electoral Act and the Referendum (Machinery Provisions) Act 1984, as recommended by the AEC to improve consistency, procedures and integrity of the electoral process.
1.33
The Committee also recommended additional funding be provided to the AEC for modernisation for future elections and recommended a range of operational and training actions for the AEC to undertake.
1.34
The Special Minister of State introduced the Electoral Legislation Amendment (Modernisation and Other Measures) Bill 2018 to the House on 29 November 2018 in response to the Committee’s report.8
1.35
In addition, the Committee has been concurrently undertaking an inquiry to engage in further oversight of the AEC in relation to its modernisation activities. The AEC has also provided updates on its implementation of the Committee’s recommendations.9
1.36
These matters will be further addressed in this report.

Political donations–discussion paper

1.37
In September 2017, the Committee issued a discussion paper seeking views on political donations reforms. In that paper, the Committee flagged its intention to:
identify flaws in the current electoral system;
identify characteristics of a future electoral donation system; and
develop reforms and recommendations to deliver this new system.
1.38
During the course of examining this issue in detail, the Committee was asked to inquire into the Government’s Electoral Funding and Disclosure Reform (EFDR) Bill, as noted above. The Committee’s report on that Bill answers a number of the issues raised in the discussion paper.
1.39
The Committee had originally intended issuing an interim report on political donations, however, it decided not to do so given a number of the matters that were addressed in its reports on the EFDR Bill.
1.40
The Committee’s review of political donations is included at Chapter 6 of this report.

Cyber-manipulation of elections

1.41
Over the course of the inquiry, the issue of cyber-manipulation of elections– the interference of social media bots and foreign interference in electoral events–became an issue of international concern. The Committee decided to consider whether it had had any impact on the 2016 election and so adopted new terms of reference addressing this issue.
1.42
This report presents background, discussion, evidence and initial recommendations. As the Committee’s consideration of these issues progressed, it was invited to be part of an ‘International Grand Committee’ being convened in London by the United Kingdom House of Commons Digital, Culture, Media and Sport Committee. The International Grand Committee included representatives from Committees of the UK, Canadian, Irish, Argentine, Brazilian, Singaporean and Latvian Parliaments–highlighting the global seriousness of the issues under consideration.
1.43
Rather than delay this report any further, the Committee has chosen to present its initial findings (Chapter 7) and will continue consideration of cyber-manipulation and disinformation under a new reference.10


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