Federal election 2016: Turnbull’s $1 million for Liberals

Malcolm Turnbull donated $1 million of his own money to bail out the Liberal Party during the federal campaign.

Malcolm Turnbull made the donation in the second half of the eight-week campaign as his party struggled to compete with Labor’s cashed-up, union-bolstered advertising spending.

Malcolm Turnbull donated $1 million of his own money to bail out the Liberal Party during the federal election campaign, so desperate was the party for finances.

In an unprecedented move, the Prime Minister made the donation in the second half of the marathon eight-week campaign as his party struggled to compete with Labor’s cashed-up, union-bolstered television advertising spending.

Mr Turnbull’s narrow election win enabled him to claim a mandate this week to push through controversial superannuation ­reforms, putting him on a collision course with his backbench and some senior ministers. Super is being blamed as the policy that robbed the party of donations during the federal campaign.

The donation was a tightly kept secret, known only to the party’s federal direct­or Tony Nutt, federal treasurer Andrew Burnes and a small number of Mr Turnbull’s closest confidants.

Sources close to the federal campaign told The Australian the money provided by Mr Turnbull was a donation not a loan. It is understood not to be tax-deductible.

The donation is understood to have been made in the final weeks of the campaign and went into the general pool of funds to help pay for television advertising, direct mail-outs in key seats and polling. It was made as the Liberal Party was struggling to respond to Labor’s aggressive scare campaign on Medicare.

The Australian revealed this month that the Liberal Party was forced to cut television advertising for two to three days during the federal campaign so it could save its money for the final week.

The party was so desperate for funds midway through the eight-week campaign that it frantically approached powerful donors.

Billionaire James Packer was one prominent businessman ­approached multiple times by senior party figures and individual candidates during the campaign.

It is not known whether Mr Packer chose to help the party.

The Australian understands the Liberal Party under the new team of Mr Nutt and Mr Burnes is now either in debt or broke, pending incoming funds from pledges made during the final week of the campaign. Former party treasurer Mich­ael Yabsley said the federal Liberal Party was an organisation that had been struggling financially for 20 years. “I said at the end of 2010 that the Liberal Party was on the brink of insolvency: that was the case then and I believe it’s the case now,” Mr Yabsley said.

“The fact that the Prime Minister has to put his hand in his pocket is pretty strong evidence of that.”

Mr Yabsley said the Liberal Party had a small membership base and little engagement with the corporate world, while Labor was able to rely on the union movement and the support of other organisations such as GetUp!

Liberal Party federal director Tony Nutt today denied as “false” suggestions the party was either in debt or broke.

“The party’s finances are soundly managed by the honorary federal treasurer, Andrew Burnes. Donations to the Liberal Party are disclosed in accordance with the requirements of the Electoral Act,” he said.

Mr Turnbull’s wealth has been estimated at about $186m. He ­invested in internet provider ­OzEmail in 1994, with his $500,000 stake turning into a ­reported $57m fortune five years later when he sold out. The pinnacle of his international property portfolio is his waterfront home in Sydney’s Point Piper, worth ­upwards of $50m.

Labor has sought to turn Mr Turnbull’s business success into a political sore point, using it to claim that he is out of touch with families in marginal, lower-socio-economic electorates.

Neither Mr Turnbull nor the Liberal Party denied that he had made a $1m donation to help ­salvage the campaign’s finances.

The Australian asked the Prime Minister’s office whether the $1m was a loan or a donation; whether his donations to the federal campaign were made personally or through a company structure; whether he made more than one donation during the campaign; and on which dates he donated.

In response, his spokesman said: “Donations to the Liberal Party are disclosed in accordance with the requirements of the Electoral Act.”

When asked similar questions regarding Mr Turnbull’s donation, a spokesman for the Liberal Party issued a near-identical statement: “Donations to the party are disclosed in accordance with the law.”

The donation will be made public next February, when the Australian Electoral Commission publishes donations from the election. They need to be lodged by November.

While it is unprecedented for a prime minister to save a financially stricken party during an election campaign, former Liberal Party treasurer Ron Walker donated $5m in the 1996 campaign before John Howard’s election. It was structured as a loan but it is unlikely Mr Walker ever saw the funds again.

In the final week of this year’s campaign, before the television blackout, sources on both sides of the political divide estimate that the Labor Party spent $6m on television advertising while the Liberal Party spent $8m.

However, Labor was supported by additional television advertisements paid for by the unions.

The fundraising effort by the Liberal Party was lacklustre, with little co-ordination about who would be approaching the party’s major donors. Apart from disorganisation in the Liberal Party headquarters, the Coalition’s superannuation policy is being blamed as another reason fundraising dollars dried up.

Self-funded retirees, in particular, declined to donate or volunteer to the party.

One senior Liberal source said: “To say it (super) had no impact is ludicrous. Donations dried up, there was tremendous anger.”

During the election campaign, deputy Liberal leader Julie Bishop was one of the first to raise concerns with the senior leadership group about how hard Medicare and superannuation were biting. She was joined by Christopher Pyne, Peter Dutton and Barnaby Joyce, who also raised the alarm about the concerns voters had.

The party’s response to Labor’s Medicare campaign was slow. This was partly due to a lack of financial resources to properly combat the scare campaign, in which voters were incorrectly told that Medicare would be privatised under a Coalition government.

It is not the first time Mr Turnbull has donated to the Liberal Party. When Mr Turnbull was federal Liberal Party treasurer in 2002, he donated $150,000 to the Menzies Research Centre, where he was the chairman.

During the 2004-05 financial year, he donated almost $140,000 to the NSW Liberal Party.