Major parties rush through scandalously self-serving legislation on election funding

One of the great political traditions is how Friday is known as “taking out the trash” day.

That is, if you have some bad, dodgy or unpalatable news that you are obliged to deal with, you release it in a flurry late on a Friday, when people are less likely to be paying attention.

Australia’s major political parties are not ones to hold with tradition though, it seems.

This week we have seen them engage in a monumental “taking out the trash” moment by rushing through scandalously self-serving legislation on election funding on the second-last sitting day of the parliamentary calendar before either a budget, or an election, or possibly both.

A positively buoyant prime minister was bouncing around Parliament House on Thursday looking more cheerful than he has in months, having landed hate crime laws, electoral funding changes, and childcare funding, prompting an outbreak of frenzied speculation that we are about to go to the polls.

Beyond the legislative wins, the sense that — in the machismo of parliamentary question time — the government had actually finished the week on top, seemed to also be contributing to the PM’s good mood.

Why’s that? Well, think about the stories that have been dominating the news in the past couple of weeks.

There’s the ongoing story of the cost of living of course. The Reserve Bank is widely expected to cut interest rates next week and, in political terms, the Coalition was on a hiding to nothing in attacking the government on the cost of living since Labor was able to simply point out all the cost-of-living relief the opposition had opposed.

Then there was the spectre of Donald Trump and his tariffs on steel and aluminium.

The Coalition charged in with its usual assault on the PM: that he had been too weak and slow to head this off at the pass. But then there was a phone call with the US president which gave Anthony Albanese some breathing room on steel.

It looked like the story was taking off again 24 hours later when US officials started to complain that Australia had breached undertakings on aluminium and would therefore still be penalised.

When it became clear the breaches were based on verbal agreements apparently given to the US by former prime minister Scott Morrison, that also took some of the wind out of the Coalition’s attack.

And then there was the prospect of politically exploiting the horrendous video of NSW nurses threatening to, or claiming to, kill Jewish patients.

Peter Dutton argued that such people should have their citizenship revoked and questioned how they had got it in the first place. Well, he should have known the answer to that question since it turned out the male nurse on whom his attack was based got his citizenship while Dutton was home affairs minister in 2020.

Electoral donation legislation the great unifier 

For once, in this parliament, it seemed the government was not just sitting like a hapless duck in the crosshairs of a question time attack.

The psychology of these battles still matters in politics. But however bitter that battle it is, it can’t beat the coming together of self-interest that we saw in the electoral donations legislation.

The legislation was so rushed that parliamentarians were loudly complaining that they had not even seen the amendments being proposed while they were being debated.

A lot of the focus in the coverage of this legislation — which will only affect federal elections after this year — has been on the caps on donations it puts into law which appear to wildly favour the major parties over independents.

That focus is legitimate given how the legislation is structured — and some of the details that have only been emerging since it was passed through the Senate late on Wednesday night.

But the “uneven playing field” of which the crossbench independents are complaining are literally only half the story (or possibly even less).

“This is the most transparent electoral reforms that have ever occurred in this country,” Special Minister of State Senator Don Farrell primly opined on Thursday.

“And the whole process pushes downward pressure on the cost of elections so ordinary Australians have a chance to be elected, not just those candidates who are supported by the billionaires and the millionaires.”

There’s so much to unpack in those few sentences.

Let’s start with “transparent electoral reforms”. On the positive side, there are indeed a couple of good bits of this legislation relating to the speed with which we will find out in future who has been donating to which political party or candidate.

But as to the process of getting these laws through parliament, it was the complete opposite of “transparent”.

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Then there is Farrell’s declaration that “the whole process pushes downward pressure on the cost of elections so ordinary Australians have a chance to be elected, not just those candidates who are supported by the billionaires and the millionaires”.

Really? There was a splendid moment of political jousting on this when Farrell ran into independent MP Zali Steggall in the press gallery on Thursday morning.

“A 47 per cent increase in how much the public will pay politicians per vote,” she responded to Farrell’s declarations.

“A 47 per cent increase. Think about that,” she proclaimed for the cameras.

Steggall was talking about another part of the legislative package: a deal on public funding, not just for election campaigns, but for political parties.

Taxpayers fund political campaigns by reimbursing successful candidates per vote. Currently, they receive $3.39 per vote. Under the new laws that will go up to $5 a vote.

But in addition to that, political parties receive taxpayer funding for “administration” costs.

The Centre for Public Integrity estimated that in the financial year leading up to the last election, political parties received $67.8 million in public funding. Based on that number, the cost of public funding to political parties is about to rise to at least $100 million, and on some estimates as much as $140 million to $150 million over the next few years.

So much for Farrell’s “downward pressure on the cost of elections”.

Caps argument has holes in it

The government and opposition would claim that the other arm of the cost of elections — the so-called “arms race” in political donations from private individuals and organisations — has also been dealt with via the caps put on donations.

Except the caps looks more like the top of a salt and pepper shaker.

The $50,000 cap on individual donations each year looks reasonable to start with. Except an individual donor could make that donation to each division of a major political party to top their donations up to $450,000.

What’s more, the Liberal Party, for example, also has around 83 “associated entities” which gives some idea of how a lot more money could easily be funnelled through the system.

Both Farrell and his equivalent high-minded counterpart in the Coalition — Senator James McGrath — both dismissed the independents’ outrage at an $800,000 spending cap being put on individual candidates when political parties have a $90 million overall cap, within which they can funnel resources into particular seats.

“As a former campaign director [for the LNP] I can say to the teals”, McGrath told the Senate, “if they can’t get their message out in a seat with 800,000 dollars, then they need to look at their message or they need to look at what they are spending that money on”.

Really? Figures compiled by the Australia Institute recently showed the average spend per House of Representatives candidate in the 2021 election was just under $800,000 for Labor, just over $800,000 for the Coalition and just over $600,000 for community independents.

And those are average figures. Imagine what might have been spent in the hotly contested marginal seats, or seats like Kooyong in 2022 where the treasurer of the day, and possible heir apparent to the leadership, Josh Frydenberg, was facing what would be a stunning defeat at the hands of Monique Ryan.

The caravan is going to move on rapidly from this story as election fever takes hold. But there is still plenty of rich pickings to be had when we go through the trash.

Laura Tingle is 7.30’s chief political correspondent.