Dissenting Report from Labor Senators

Labor Senators are proud of Labor’s record when it comes to improving transparency and accountability around political donations.
Labor has a proud record of policy and reform around donations and has taken real steps to take action, including the introduction of the Commonwealth Electoral Amendment (Donation Reform and Transparency) Bill 2017 into the Parliament.
Labor Senators on this committee thank the members of the Joint Standing Committee on Electoral Matters for their work and continue to emphasise that the Electoral Matters committee is best placed to inquire into issues regarding the political influence of donations.

Labor’s Policies on Political Donations

Labor’s suite of donation reform and accountability policies include:
(a)
Banning foreign donations;
(b)
Requiring all donations above $1000 to be disclosed;
(c)
Banning donation splitting;
(d)
Banning anonymous donations above $50;
(e)
Linking public funding to campaign expenditure;
(f)
Work to develop a system of real-time reporting of donations and contributions supported by an administrative funding model;
(g)
Introducing new offences and increasing penalties for breaches; and
(h)
The creation of a National Integrity Commission.
Without going into detail on each policy, transcripts from the public hearings will indicate that such policies have the broad support of witnesses.

Response to Chair’s Draft Recommendations

Labor Senators note Recommendation 1 and believe it should be reworded to reflect the need for a broader approach to donation reform, given the broad range of concerns covered in Chapter 3:
(a)
The committee recommends that the Australia Government consider ways in which payments, donations and subscriptions can be better categorised and disclosed to the Australian community.
Labor Senators support Recommendation 2, which goes to the regulation of third parties and their expenditure, save for the reference to expenditure caps which is covered later in these comments on Recommendation 10.
Labor Senators support Recommendations 3, 4, 5 and 6, which support Labor’s $1000 disclosure threshold, improved reporting in annual returns for political parties, real time disclosure and the improved presentation of Australian Electoral Commission political finance data.
Labor Senators believe that Recommendation 7, which relates to the proposal for a donations cap, requires further consideration. Such caps raise significant constitutional concerns and may have unintended consequences. Labor Senators acknowledge policy development in relation to donations caps undertaken by then Special Minister of State John Faulkner in the first Electoral Reform Green Paper (December 2008).
Labor Senators support Recommendation 8, which calls for a ban on foreign donations.
Labor Senators do not support Recommendation 9. Such industry specific bans raise constitutional concerns and have been the subject of High Court litigation. Labor Senators note that it is open to political parties to voluntarily decline to accept donations from specific industry sectors. For example, the Australian Labor Party has long refused to accept donations from tobacco companies. Labor Senators note that, despite claiming to oppose corporate donations, prior to the 2010 Federal Election the Australian Greens accepted a $1.7 million donation from Graeme Wood, founder of online travel company Wotif.com. Despite claiming to oppose gambling donations, prior to the 2016 Federal Election the Australian Greens accepted at $500,000 donation from Duncan Turpie, a high-end gambler and member of the secretive Punters’ club.
Labor Senators note Recommendation 10. Labor Senators believe that a cap on expenditure should not be ruled out in the future as a policy option, but reforms to donation transparency should be implemented as a priority and the outcomes of these changes evaluated.
Labor Senators support Recommendation 11, which calls for improved powers for the AEC and changes to penalties.
Labor Senators support Recommendation 12, as Labor supports the establishment of a National Integrity Commission.
Labor Senators support Recommendation 13, save for the reference to a donations cap which is covered in comments about Recommendation 7.
Labor Senators support Recommendation 14 which aims to improve the harmonisation of Commonwealth and State regulation of political donations.

Beneficial Ownership

A broad range of stakeholders also supported the creation of a register of beneficial ownership, which would improve transparency and particularly help to uncover donation splitting and the ultimate source of donations from legal entities:
Senator KETTER: The issue of a public register of ultimate beneficial ownership: do you think this will play a part in political donation reforms?
Dr Zirnsak: Absolutely. It would be one of the benefits of having an ultimate beneficial ownership register. You would, ideally, know who is behind an entity. It would help restrict people from using various corporate legal vehicles to conceal their identity or the fact that they're behind it.1
Labor Senators support the creation of a register of beneficial ownership and draw attention to Recommendation 19 of the Senate Economics References committee report into Foreign Bribery, which states that:
(a)
The committee recommends that Australian Securities and Investment Commission expand the register of beneficial ownership to require companies, trusts and other corporate structures to disclose information regarding their beneficial ownership; and that this information be maintained in a central register.
Senator Chris KetterSenator Carol Brown
Deputy ChairLabor Senator for Tasmania

  • 1
    Dr Mark Zirnsak, Committee Hansard, Thursday 2 November 2017, p. 19.

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