Where's the money in the Wollongong Council fiasco?

SEXUAL favours aside, money is at the heart of the Wollongong Council fiasco, and the question must be asked: cui bono, or, who benefits?

The answer of course is the NSW ALP and through a fairly direct route, and ultimately and inevitably, the federal ALP, though the pathway there is a little more circuitous. As developer Frank Vellar has told NSW's unusually active Independent Commission against Corruption, three current Wollongong councillors solicited him for a bribe and he was in no doubt where it, or some of it, would wind up. Vellar told the inquiry he met councillors Frank Gigliotti, Zeki Esen and deputy lord mayor Kiril Jonovski at the Flame Tree Cafe in Wollongong. The Flame Tree lacks a ``Table of Knowledge'' but is still apparently favoured by those wishing to conduct business with the 'Gong's wheeler-dealers. In a recording of a phone conversation Vellar had with his wife on October 18, 2006, after the meeting, he said: ``The first time in my life I have been, ah, put into a position of, ah, of yes or no in terms of a, a bribe.'' ``You give me this and we'll approve that,'' Vellar said to his wife. He continued: ``And, I mean, they're talking, like, you know, 20 plus ... It goes to their political, ah ... political slush fund for them individually.'' But of course if a political slush fund goes to these individuals, it relieves the local branch of demands on its funds, which in turn means there is more money to kick up the line to the state office, which in turn has more money to give to its federal friends when the call comes. But here's the thing, Senator John Faulkner, Prime Minister Kevin Rudd's Special Minister of State, and a keen vigilante on ethics during the Howard government's years, is anxious to institute campaign funding reform, and so are a number of prominent Liberals. Faulkner, who yesterday was at a Cabinet meeting in Brisbane following the community Cabinet meeting held there on Sunday, told me he is particularly keen to ensure that candidates are only reimbursed from public funds for genuine election campaign expenses but he also supports lowering the threshold for disclosure of donations from $10,000 to perhaps $1500 for individuals and organisations, including trade unions. By tackling that disaster and through the introduction of serious reforms, the Rudd Government could set a standard in political ethics for the western world. This is not the first time this issue has been raised in this column, but it is worth noting that, while senior Liberals have flagged the matter, there has been little bipartisan agreement. The problem for the Labor Party _ until Faulkner's courageous call _ is that it has always been inextricably enmeshed with the trade union movement upon which it relies for finances and when in office, it rewards the trade unions. There is a popular perception that big business influences the conservative side of politics in the same manner, but that is demonstrably not so. Businesses are reluctant to give money to one side of politics and not the other _ trade unions show no such even-handedness. Business leaders cite legitimate worries about their shareholders' interests, trade union leaders have never indicated they give a fig for the views of their members when it comes to kicking the can for the ALP. Business organisations have no key representative body such as the unions' ACTU, and there would be screams of outrage if any business grouping attempted to play a role in party politics akin to that the ACTU plays within the ALP. Numerous past treasurers of the Liberal Party including John Calvert-Jones and the current shadow treasurer, Malcolm Turnbull, have made the same points over the past decade when pointing at the disparity in contributions made to the two parties. Turnbull reiterated his argument yesterday and again called for genuine funding reforms, citing a submission he made to the Joint Standing Committee on Electoral Matters in August, 2005, in which he proposed that as only individuals are permitted to vote or stand for parliament, only individuals should be able to financially contribute to campaigns. He suggested that the Electoral Act be amended to provide that candidates and political parties be prohibited from spending money for electoral purposes other than funds received from the Australian Electoral Commission as part of public funding, or donations received directly from individuals who are Australian citizens or otherwise on the electoral roll and who certify that the funds contributed are from their own or spouse's resources. Under his proposal, political parties could not, for example, spend funds which they had received from trade unions or from corporations on campaigns. He also recommended that an annual cap, perhaps as low as $500 per individual be considered, and that to encourage support of the political process, donations should be tax deductible. Such a proposal might not prevent the exchange of sexual favours for planning approvals but it would go a long way to cleaning up the ALP's inherent funding conflicts. Memo to Faulkner: I can put you in touch with the shadow treasurer if you wish to garner bipartisan support in the Lower House for your proposal. You have my number. Best wishes, Piers Akerman.