As teals attended drinks with Albanese, Dutton and Labor struck election overhaul

Furious teals have threatened to use the balance of power to reverse Australia’s first laws curbing big money donations in politics, turning the crackdown into an election issue as the teal movement urged voters to punish the parties for cutting them out of negotiations about how much money they can raise.

Labor struck a deal with Opposition Leader Peter Dutton on Wednesday night to clamp down on donations at the same time independent MPs were at an event at Anthony Albanese’s Canberra residence, paving the way for a late Wednesday night Senate vote on the reform.

Independents MPs were dealt out of the negotiations after they opposed most of the bill. Credit: Dominic Lorrimer

Teal MP Kate Chaney, who led negotiations on behalf of the crossbench, urged Australians to use their vote to punish the major parties for what the well-funded group of teal MPs, Greens and transparency groups have called an attempt to thwart independents.

Special Minister of State Don Farrell’s success securing a deal with the Coalition, first reported by this masthead, was a major win for Labor which had for years campaigned to stop billionaires like Clive Palmer spending tens of millions to sway elections. Previous attempts to change electoral funding rules, including by the Gillard government, were dashed after failing to gain bipartisan support.

Farrell has accused the teals of hypocrisy for calling out other parties’ integrity while fighting to keep millions in funding from Climate 200. But Chaney said the proposal would cap spending by individual candidates while allowing big parties to run national advertising unavailable to independents.

“Making sure there is transparency and accountability in our democracy is a priority for me and a factor that would be important for me in deciding who I could work with,” Chaney said when asked if she would use the balance of power to wind back the changes.

The first step in deciding whether to reverse the changes would be reviewing the Labor-Liberal deal, she said, urging voters to “speak to them in the only language they understand, and that is votes”.

The government delayed the legislation in November after details could not be agreed with the opposition. On Tuesday, Labor agreed to a Coalition demand to raise the amount MPs and parties can receive from one source from $20,000 to $50,000, according to sources on both sides who could not speak publicly.

Farrell also agreed to increase the threshold for donations to be disclosed from a proposed $1000 to $5000. The current threshold is $17,000.

An earlier draft would have limited at $20,000 the amount unions and business bodies could receive from member organisations for national political campaigns. This has been amended to $250,000, clearing one of the final hurdles to get the deal done.

Teal independents, who have received millions in funding from the Climate 200 organisation, did not win any of their demands after the group did not support the government’s proposals on spending and donation caps.

In the government’s eyes, this dealt the independents out of the equation, though the independents claim Labor never intended to pass the laws in agreement with any party other than the Coalition.

The teals wanted to proceed only with transparency elements of the proposal, which create timelier and more thorough public disclosure.

Chaney and her independent colleagues were at an event at The Lodge on Tuesday evening. It is the first time independent MPs have specifically been invited to The Lodge since the 2022 election, as Albanese faces the prospect of a hung parliament where Labor could be forced to rely on the crossbench’s support to form a minority government.

Climate 200 has been running about $15,000 worth of online ads targeting viewers in Canberra during parliament this fortnight, saying: “Dutton has struck a dodgy deal with the government that will MASSIVELY advantage Labor”.

Farrell has spent much of the term trying to win support for the overhaul of electoral financing that will mean the next poll due by May will be the last at which wealthy political backers, such as mining magnate Clive Palmer and climate campaigner Simon Holmes a Court’s crowdfunding group, can donate an unlimited amount to politicians.

The Centre for Public Integrity said in a statement: “It is an affront to our democratic process that the Electoral Legislation Amendment - significant, complex legislation which concerns the very foundations of our democracy - is proceeding without proper parliamentary process and scrutiny.”

Albanese said on Wednesday morning that the scale of money in Australian politics “defies our democracy”.

The rules will not apply at the upcoming election, but the one after. They include a national $90 million cap per party for election spending, state caps for senate campaigns, and an $800,000 cap per candidate in an individual seat.

To offset the gap in funding from private sources, taxpayer funding for political parties will grow from about $3.50 per vote to about $5.

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