KIM WINGEREI. Political Donations is a Scourge on Democracy

Despite the many rules in place to regulate it, donations remain a scourge on our democracy. The ill conceived ‘Funding and Disclosure’ bill is stalled in the Senate. What we need are simple regulations or maybe even banning political donations altogether.

In a previous post I argued for the banning of all political donations. It is a simple solution to the vexing problem of how to avoid politicians being swayed by their pecuniary interests.

The ‘Electoral Funding and Disclosure Reform Bill’, introduced to Parliament in December 2017, is anything but simple, which is one of the reasons it is currently stalled in the Senate. It is an excruciatingly complex bill that still doesn’t achieve its intended purpose – curbing foreign donations to political parties. (See Marian Sawer’s and Joan Staples’ on these pages for more details.)

One of the main criticisms of the bill is that it is not confined to parties or representatives, but attempts to throw a wider net that also covers charities and advocacy groups such as GetUp. Knowing how our current ‘liberal’ government is waging war against all opinions not their own, the inclusion of the latter an obvious intended consequence. (How charities got caught up in it is beyond me, so obviously ridiculous not even worth discussing.)

This bill, and others currently before the Parliament – such as the proposed amendments to the ‘Espionage and Foreign Interference Bill’ – are knee-jerk reactions to the Sam Dastyari debacle of last year and the other revelations about Chinese interference into our affairs. And indirectly the ongoing investigations in the US about Russian meddling in the election of Trump.

It all misses the point. The Funding and Disclosure Bill and other such proposed regulations are focused more on the donor than the recipient. But donors are not the main problem, nor where they come from. The recipients of donations is where the focus needs to be. Specifically donations to elected representatives and their parties. They are the ones open to being compromised which is what we want to avoid.

The Chinese Government, Vladimir Putin, and for that matter Donald Trump and Malcolm Turnbull, all have it within their remit to exert influence. So does Gina Rinehart when she wants to hand a fat cheque to Barnaby Joyce (under the disguise of a ‘farmers prize’); and so does any Gold Coast real estate developer bringing a bag of cash to the Mayors office (hypothetically speaking, of course).

Once upon a time in my early business career I was told by a consultant to a big contract I tried to close that all I needed to do was to contribute to his new yacht and the deal was mine. I could have, and thus been corrupt. I didn’t and lost the deal with my integrity intact.

I am not for a moment suggesting that the actions of the Chinese or the Russians or some business people or consultants are OK. As far as the latter goes, attempted bribery is a crime, it becomes corruption when the recipient accepts the bribe.

And the same goes for political donations. I don’t begrudge Gina Rinehart wanting to spend her money, but if it is not even an option for her to donate to a party or a favourite politician, she won’t. And if it is done covertly it’s a bribe and a crime. I would imagine including illegal donations would be a relatively minor amendment to existing bribery and corruption legislation.

There is, of course, a reasonable argument for allowing ‘general’ political donations, much of which is no doubt given without ulterior motives. Former Liberal leader John Hewson and others have long argued for limiting donations to individuals only. An idea with considerable merit as long as it also caps them (to an amount well below what billionaires would consider loose change). But even then, regulation wold be required for the necessary public scrutiny and to avoid multiple donations below the threshold.

The other argument for political donations is that they help to fund the political parties in general, and elections in particular. Both the Liberals and Labour are $100 million dollar enterprises that rely on donations – witness the unsavoury fight over the Cormack Foundation in Victoria to see just how desperately they rely on it – and thus they would fight hard against the abolishment of donations. Just as hard as they resist a federal corruption watchdog, another common sense reform long overdue.

Public funding of the 2016 federal election was $53 million, roughly one third of the total cost of that election. I would argue that in our very affluent country we can afford for the costs of elections to be paid in full by the public purse. It’s a small price to pay for having qualified candidates and representatives freed from funding worries and the potential risk of inducement that comes with it.

The only other alternative to banning political donations (and inducements of any kind) is to mandate immediate (real-time) and full public disclosure; not the mismatch of rules and regulations that exist today (such as the arbitrary $13,500 disclosure threshold for donations, but not 2 x $13,499). The best regulation is almost always to keep it simple, and it is also time the Australian Electoral Commission was told to enter the digital age and modernise its archaic operations.

In my book – “Why Democracy is Broken – A Blueprint for Change” – I propose a new model of democracy where the role of the political party is effectively removed from its current role as the unwanted middle-man between the voters and their representatives. In that scenario the political parties become more like advocacy groups – an important function in a modern democracy.

Advocacy groups, including ‘think tanks’ and other such forums, are cradles of ideas, arenas for fresh thinking and avenues for championing causes. Their role is paramount to an open, dynamic democracy where public debate is welcomed, not shackled by the narrow and adversarial prism of self-centered partisanship.

Advocacy groups must by definition be independent of the public purse and as such free to fund themselves, including from donations. We need more open debate in this country, advocacy groups help serve that purpose; hence channeling donations towards them away from political parties serves democracy. The Gina Rinehart’s of this world are free to set up and fund their own groups, as they do; and in that context I also have no problem with Xi Jinping establishing  a propaganda unit in Canberra. As long as it is open and transparent and adhering to Australian law; and doesn’t donate to politicians (or any government officials for that matter).

Mr Xi may even learn a thing or two about true democracy. Or he’ll tire of the lack of influence he’ll have when everything is in the open. Fact is, this whole debate is all about transparency.

 Kim Wingerei is a former business man, turned blogger and author. His first non-fiction book: “Why Democracy is Broken – A Blueprint for Change’’ is now available.

Follow @ kimwingerei.com