Tags: Electoral Reform, Democracy, Political Donations, Donation Disclosure, Legislation
Ms O’CONNOR (Clark – Leader of the Greens) – Mr Speaker, I move –
That the bill be read for the second time.
I can indicate that we will be calling a division at the end of our Private Members’ time.
Mr Speaker, in a healthy democracy, citizens have a voice and a vote as active participants in society. In democratic societies, all individuals and groups, regardless of race, religion, gender, identity, wealth or sexual orientation, have a role to play in shaping law and policy. In lutruwita/Tasmania, as in many democratic societies, constant vigilance is needed to ensure the foundations of our democracy are strong. This requires a robust, strategic response. It also requires the political courage to drive real change beyond political self interest and in the public interest.
The proportion of Tasmanians enrolled to vote has been increasing since 2010, from 95.1 per cent to 96.6 per cent last year. Despite this, the number of voters turning up to vote at elections is declining. Tasmanian participation in civic and political groups declined from 12.8 per cent in 2014 to 12.2 per cent in 2019. That said, we have a long and proud history of civil society standing up and exercising its democratic right to peaceful protest in this state.
A 2018 assessment of apathy in Australian politics found 20 per cent of voters are generally uninterested, 25 per cent are not interested in election campaigns and 33 per cent do not care who wins elections. The author, David Campbell, concludes that despite ‘an exponential increase’ in education and information availability over the last 29 years, it is likely that the extent of citizens’ political interest and knowledge has changed little since Athens, which is the birthplace of democracy.
This finding challenges our understanding of what influences people’s engagement with politics. Even though the link between education levels and political knowledge and participation is well documented, an increase in the overall level of education in Australia has not resulted in greater participation rates. While other changes to key influences, such as income inequality and age, should be increasing political participation and knowledge, this does not appear to be happening. This illustrates the complexity of civic engagement in our democracy.
The decrease in participation of citizens has, however, been matched with a declining trust in politics. Polling by the Australian National University shows trust in political leaders and government has dropped and satisfaction with democracy has deteriorated. Lack of trust in politics often has a negative impact on civic participation, although this is by no means a simple relationship either.
In 2018, ABC Fact Check found Tasmania’s donation laws would become the weakest in the country after the Victorian Government undertook reforms. In the years since, Victoria has reformed their laws. New South Wales, Queensland, Western Australia and the Northern Territory also passed reforms enhancing their political donations and expenditure framework.
As we know, in 2018 the gambling industry poured untold, unknown millions of dollars into one of the major parties in this place. In 2021, the gambling industry poured untold, unknown monies into both the major political parties in this place. Because of our weak donations disclosure framework, Tasmanians will not find out how much was declared that went to the major parties at this last state election until after February next year.
So, Tasmania has dropped even further behind the rest of the country than when it was declared to have the weakest donations laws. The Government’s proposed reforms would still leave us with the weakest laws in the country. They certainly are not aspirational. There does not seem to be a desire to lift us from being the nation’s laggards to the nation’s leaders on electoral integrity. Our bill would position Tasmania as the strongest, from the nation’s laggard to its leader. Our bill sets a cap of $3000 on aggregate political donations from the same source per electoral term.
The argument for a limit on the value of donations is simple. Money buys influence and the larger the sum, the larger the influence. The Senate Committee into the Political Influence of Donations noted that:
Although proving that donations buy political outcomes is difficult, the anecdotal evidence of this link is compelling.
The relevance of the sum of money donated is well summarised by the comments of an anonymous politician in the 2018 study:
If someone donates $1000, they support you. If they donate $100 000, they have bought you.
The influence of smaller donations should not be discounted as they can contribute to long term relationship building policies in more subtle ways. In 2018, a formal Liberal Party treasurer, Michael Yabsley, described habitual soft corruption in the donations process, where donations are tied to a commitment to meet with particular ministers or political leaders. Yabsley called for a cap of $500.
The Senate committee recognised that any donations cap is relatively arbitrary and, on balance, recommended a donations cap of $3000 per term, per donor. This is the model we have adopted in our bill.
Regulations to cap donations should have two broad objectives: to decrease the political influence of a donor by limiting the size of donations; and to reduce the imbalance of a person or corporation’s ability to support political preferences based on wealth. A $3000 per term cap on donations in Tasmania would curtail the potential influence of any given donor, as risking the loss of revenue from a single donor would be much more palatable for political parties.
The average amount Australians donated to charity in 2017 18 was $764. As many members of this place know, Tasmania, per capita, is the highest giver to charity in the nation. This equates to $3056 over a four year term, close to the $3000 donations cap proposed by the Senate committee and adopted in our bill. While this does not completely eliminate the wealth disparity between potential political donors, it does mitigate it.
Various jurisdictions in Australia have banned donations from foreign actors and the property, tobacco and gambling industries. Canadian donation laws go further, allowing only natural persons who are citizens or permanent residents to donate to political parties. We have adopted the Canadian model as a simple, straightforward means to ban corporate donations. It also drastically reduces the prospects of gaming the system by using shell corporations to avoid the donation cap threshold.
Tasmania’s donation disclosure framework is currently only covered by inadequate federal legal requirements. Federal laws require reporting by February on the previous financial year’s donations. This means donations can take up to 18 months to be disclosed to the people. There was general agreement amongst submitters to the 2018 Senate inquiry that disclosure in real time was the most desirable approach to donation disclosure. Real time disclosure means setting a relatively brief timeframe from the time of receipt to the public disclosure of a donation. Under the current system, disclosure is at a fixed date, which could be well after an election, when a report of all donations required to be disclosed must be submitted.
Queensland requires donations to be disclosed seven business days after receipt, except in the seven days before polling day, when donations must be disclosed within 24 hours. This ensures virtually all donations received before an election are publicly available for scrutiny.
Victoria, the only other state to adopt real-time disclosure laws, requires a 21-day time frame which is not optimum for public scrutiny just prior to an election.
The Government’s proposal in its draft legislation, which I am sure the Attorney-General will talk about shortly, is for donations to be disclosed seven business days after being received during an election period. That is welcome but it does not ensure Tasmanians would go to the polls with clarity about funds that come into party coffers in the week or the day before polling day. The Queensland model is much better at improving transparency in the last seven days of the campaign. That is why we have adopted this nation’s best model.
Tasmania and Victoria are the only Australian jurisdictions without expenditure caps for lower House elections. Federal elections also do not have expenditure caps. This means that an election campaign and a contest is not a level playing field because some of the larger parties closer to the corporates can attract many more donations from vested interests. Most jurisdictions impose a cap on spending for independent candidates and a cap on parties. This cap can often be distributed across electorates in excess of a candidate’s electoral cap.
Other than the ACT, all jurisdictions differ from Tasmania in that they have single member electorates therefore the prevailing formula would not work for Tasmania. In 2013, despite the Premier misremembering this morning, the Labor-Greens government’s Electoral Amendment (Electoral Expenditure and Political Donations) Bill 2013 passed the Tasmanian House of Assembly but stalled at the first reading stage in the Legislative Council, which we all knew at the time was the work of Liberal-supporting members in the Legislative Council to prevent that bill from passing the Legislative Council because it was in the then opposition’s interests for it not to pass. The bill would have imposed expenditure caps of $75 000 for candidates and $750 000 for a party, increasing by $1000 and $10 000 per year respectively.
Our bill introduces the same model exactly, appropriately indexed since 2013. A key distinction between the bill’s model and what occurs in other jurisdiction is the overall party cap is not tied to the number of candidates or the number of electorates in which a party runs. Historically, parties in Tasmania either run five candidates in each electorate or in some cases six, or fall well short of the proposed expenditure cap. For example, in 2018 the Liberals, Labor and Greens all fielded five candidates in each electorate. The other parties to run candidates were the Jacqui Lambie Network, Tasmanians for Tasmania or T4T, and the Shooters, Fishers and Farmers Party. T4T did not spend any money; the Jacqui Lambie Network spent $93 255; and the Shooters, Fishers and Farmers Party spent $59 314. In short, there is no evidence of any need for a party cap to be tied to the number of candidates a party feels in a given election and a given electorate.
The proposed party cap is 10 times higher than an individual candidate cap. The average electorate expenditure would therefore allow for twice as much expenditure as an independent candidate to cover the campaigns of five party endorsed candidates. On an individual level this would provide for lower candidate expenditure for endorsed candidates compared to independents. Given parties have access to professional electoral apparatus dedicated volunteer workforces and can promote a shared platform, this unproportionate system is justified on the grounds that it engenders more equity between independent and party candidates.
The Electoral Amendment (Electoral Expenditure and Political Donations) Bill 2013 was consulted on at the time by the then attorney-general Brian Wightman. It did not create any controversy other than among the Liberals in this House and their allies in the other place. Given the acceptance of the proposed expenditure cap and the historic, practical irrelevance of adjusting the cap’s formula based on the approach of other states, it was not considered to be a need to alter the proposal.
In Australia, public funding of election campaigns operates as a reimbursement of electoral expenditure based on the lower value of a dollar figure per first preference vote or total electoral expenditure. The intent of public funding is to level the playing field somewhat for candidates and reduce the reliance on and influence of private donations.
Every Australian jurisdiction other than Tasmania and the Northern Territory has legislated public funding of elections. Progress has been made in the Northern Territory with a 2018 inquiry recommending public funding. The NT government accepted this recommendation in principle but has yet to enact the changes.
The funding rate in jurisdictions across the country ranges from $1.97 to $8.62 per first preference vote, averaging at $4.38. In determining an appropriate funding level, it is worth noting that the 2011 inquiry into the funding of political parties and election campaigns by the federal parliament’s Joint Standing Committee on Electoral Matters found the public funding scheme at the time had not been effective at curbing the increase of election spending. Our assessment of expenditure since then suggests that this is still the case. This suggests that in a vacuum, that is without restraints on expenditure and without controls on who can donate, public funding has done little to curb the influence of political donations. However, the federal scheme has not operated in an environment with strict expenditure and donation caps or with bans on donations from corporate interests.
The effect a public funding scheme would have where other limits are in place remains to be seen but we believe it would help to level the playing field. The committee did, however, recognise that repealing the scheme would have a detrimental effect on minor parties, suggesting that the objective of levelling the playing field has been effective.
Adopting the Australian or Commonwealth rate would provide Tasmania with the second lowest cost after Western Australia of any state scheme while also providing, under our assessment, the highest proportion of electoral expenditure covered by public funding based on projections of 2018 expenditure under proposed new donations rules.
Considering the available evidence of effectiveness, the effect of other reforms, the costs to the public purse and expectations of the general public, tying the Tasmanian public funding rate to the Australian rate was considered to be a reasonable first step. It is certainly much lower than what is proposed by the Government in its draft bill.
Each jurisdiction where public funding for elections occurs requires a minimum of 4 per cent of the primary vote for eligibility with the exception of 6 per cent in Queensland. The 4 per cent minimum vote threshold was criticised by the federal parliament’s Joint Standing Committee on Electoral Matters which noted:
Minor parties and independent candidates can attract significant electoral support without passing the 4 per cent threshold for receiving public funding.
The only rationale for a threshold canvassed by the committee was cost saving purposes.
Public funding schemes are based on a monetary value being assigned to a first preference vote. As such, there is a strict ceiling, that is, the number of enrolled voters on amounts payable. Excluding eligibility on the basis of a voting threshold therefore has minimal implications for public cost but may deter potential candidates who are not in a financial position to risk not qualifying for a rebate.
Our assessment of candidates and political parties that receive less than 4 per cent of the vote on aggregate across the electorates they ran candidates in during the 2018 Assembly election, determine that number of votes would have been excluded for payment under a 4 per cent scheme was 12 234 out of 334 871 total formal votes in the 2018 state election. Under a $2.87 per first preference vote scheme, which mirrors the Commonwealth scheme, a 4 per cent threshold would have saved approximately $35 000 from a total $947 684 bill. This is a paltry 3.6 per cent saving.
Many of the reasons for reform of electoral finance laws in relation to political candidates and parties also apply to third parties. Third parties can also be used in an attempt to circumvent electoral laws. For electoral finance regulation to operate effectively, there need to be appropriate enforcement mechanisms and financing of enforcement activities.
Truth in political advertising laws are provisions which prohibit false statements in political advertising during election campaigns. These laws can establish offences that allow for the removal of statements. South Australia was the first jurisdiction in Australia to introduce truth in political advertising laws in 1985, although the Commonwealth laws were passed in 1983 but repealed a year later.
In 2020, the ACT passed laws modelled on South Australia’s truth in political advertising framework. The South Australian provisions, which ban a statement purporting to be a statement of fact that is inaccurate and misleading to a material extent, were found to be the strongest example of such a law by 2019 United Kingdom analysis. Despite some issues with the legislation, the assessment found the laws to be reliable, workable and fair.
The scope of truth in political advertising laws is deliberately tight. They apply to ‘a statement of fact that is inaccurate and misleading to a material extent’. In South Australia, the Electoral Commission has to seek legal advice from the Crown Solicitor’s office to determine if a statement is misleading, which takes considerable time. The South Australian commission has also received paperwork, some 20 to 25 centimetres high, in the form of supporting documentation. Such tactics could be used to delay a decision until after election day, particularly during the crucial last days of a campaign. On this basis, we have drafted our provisions to not have appeal rights.
Every member in this place knows the current legal inadequacy around our electoral laws is failing democracy and the Tasmanian people. We have to push back against the corporatisation of democracy that corrupts our governing institutions. As elected representatives, we should always be vanguards of democracy. We should always do what is right, openly, honestly and in the public interest. We should never, ever allow our precious vote to be bought.
Legislation like the Future Gaming Market Bill, which is now back, amended, with this place, should never happen again. That kind of legislation, the context in which it was drafted and debated, the capitulation of the official Opposition on it, has eroded public trust and we need to restore public trust. Democracy is precious. We are privileged to be in this place because Tasmania is a democracy and we have a responsibility to protect the democratic foundations on which we stand and hand them on to those who come after us, even stronger.
Our bill would go a long way to restoring public trust and taking the dark money out of politics and that is what we should all agree needs to be done.
I commend the bill to the House.
The proposed laws when considered collectively, in our opinion, would still be the weakest of any state or territory in Australia.
Cassy O'Connor MP | Submission | 28 Sep 2021
Introduction of electoral expenditure limits, donation caps and real-time disclosure, regulation of third-parties, etc.
Cassy O'Connor MP | Greens Bill | 11 Nov 2021
What we do not know is the source of 92 per cent of Liberal Party donations received in the year 2019-20.
Cassy O'Connor MP | Parliamentary Activity | 23 Mar 2021
The report of the review into Tasmania's political donations laws has been sitting on your Attorney-General's desk since late last year.
Cassy O'Connor MP | Parliamentary Activity | 15 Sep 2020
The Tasmanian greens Submission to the Electoral Act review.
Cassy O'Connor MP | Submission | 18 Feb 2019
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