There’s only one way to fix our donations system

Special interest groups and lobbyists — from big business to unions — must be banned from making political donations. It’s the only way to keep our system squeaky clean, writes Paul Williams.

This week’s prize for cheeky petulance is shared between two very different blokes.

The first is 27-year-old Raphael Samuel who plans to sue his parents for not consulting him prior to his birth. This self-styled “anti-natalist” believes he should be paid to exist because he had no choice in the matter.

But Samuel was almost outdone this week by Chinese billionaire Huang Xiangmo who, while out of Australia, was stripped of his Australian permanent residency for allegedly enjoying too close a relationship with the Chinese Communist Party. The trouble is that Huang, who had donated “at least” $2 million to Australian political parties, is now demanding a refund.

I’m sorry Mr Huang, but Australia’s party system is not Kmart: you can’t get a refund if you’re dissatisfied with the product.

But Huang’s claim does raise serious questions as to why folk donate to political parties, whether they’re wasting their money, and whether our donation laws need reform.

Broadly speaking, people donate to parties for four reasons. The first is loyalty. The Jones family might donate $50 to the local MP’s campaign because she was sympathetic in a constituency matter. Or Mick might slip his brother-in-law $100 because he’s standing as an independent. After all, family is family.

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Huang Xiangmo has asked for his political donations to be returned after he was denied citizenship. Picture: Renee Nowytarger/The Australian

Note that neither of these donations need to be publicly declared as they fall below the state threshold of $1000, and the current federal threshold of $13,800.

But individuals and groups also donate for ideological reasons. Belinda might donate $200 to a Christian candidate because she doesn’t like the “permissive society”, or a “flat tax” group might gift thousands to a libertarian party because they believe all taxation is “theft”.

The third reason, a transactional one, is as different as it is rare. On occasion, a donor will attempt to give a cash donation in the hope the cash will see an immediate change in public policy.

Everything from bank transfers to electoral commission records to published ministerial diaries allow very clear lines to be drawn between donors and ministers — lines that can be followed by any investigative journalist. Serious donors, and virtually all MPs, know this path is folly.

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But donors unfamiliar with Australian political culture — perhaps from a developing country where this kind of lobbying is considered a legitimate method of political engagement — may be tempted to go down this path.

So why do corporations donate? Why did Carlton United Breweries give about $55,000 to federal Labor in 2017-18, with the Australian Hotels Association also donating about $90,000 to Labor and $100,000 to the Liberals? Do they seriously expect the major parties to unwind “lock out” laws because they splashed the cash?

Of course not. CUB, AHA and others instead donate for a fourth reason: to cultivate friendly relationships with government so the channels of dialogue are kept open. In short, donors give big money so party chieftains will at least consider them “good guys” who can, and should, be listened to when offering any future policy advice.

Sam Dastyari lost his career thanks to his links with Huang Xiangmo, but politicians of all stripes accepted donations from him. Picture: Jonathan Ng

The parties love it because campaigning is expensive. But do donors get value for money? Well, is having dinner with an opposition leader worth $20,000 (as was the case in Queensland in 2009) worth it? In most cases no but, occasionally, yes.

That’s why the well-heeled continue to spend big in the off-chance it will make some sort of difference in policy or political climate. While Labor premier Anna Bligh famously banned her MPs from attending such dinners, sadly the practice has crept back into party fundraising these past few years. That means corporate Australia believes, at least at some level, it is influencing policy.

And that belief is enough for voters to demand an overhaul of all state and federal political donation laws.

While Queensland has rightly joined NSW in banning donations from property developers, Queensland — and the rest of Australia — must go further and ban all groups (businesses, trade unions, pressure groups, think tanks) from donating. Only individual voters, enrolled in an Australian electorate, should be free to donate to a maximum of, say, $50,000 in any financial year. Not only does this remove the expectations of corporate money, it also circumvents the major parties’ trick of creating “shelf” companies and other groups to filter donations.

Expect more debate on political donations as we approach the 30th anniversary of the Fitzgerald Report in July.

After all, accountability is better than anything money can buy.

Dr Paul Williams is a senior lecturer at Griffith University