A concerned politician's guide to donations reform

I think what the Australian political system needs is a real shock to the system. It needs shaking up. And if Senator Dastyari's problems lead to this shaking up, then that's only got to be a good thing.' (Emeritus Professor John Warhurst, ANU, interviewed by ABC journalist Sabra Lane, 8/9/2016)

An earlier paper suggested it was impossible to find any serious defence of the practice whereby political parties rely on large, secret donations to fund election campaigns. That was before labor shadow Minister Sam Dastyari admitted soliciting $1670 from a company linked to the Chinese Government, igniting a much wider debate on the funding of parties and candidates.

Why is the practice so widely condemned? First because of the risk of corruption, seen in the 'tit for tat' secret deals in NSW in recent years, but also in what critics call 'soft corruption' and the High Court has labelled 'clientilism', where there is no actual deal but a symbiosis - an ongoing relationship in which each side knows where its interests lie and acts accordingly.

A typical case of the latter is cited by Luca Belgiorno-Nettis, a wealthy industrialist and former donor to both major parties, who in 1987 proposed and won an unsolicited bid to build a Sydney Harbour tunnel for $750 million. On the ABC program 'Money and Influence' on May 24 he agreed his donations played a role in this success. He now believes the practice of buying access to ministers is wrong in principle.

In addition to this distortion of the democratic process by hard and soft corruption, there is an arguably more serious distortion in the use of large donations in advertising campaigns which aim to saturate TV, print and radio coverage in order to sway public opinion during the election period; the effect is to drown out the voices and dilute the voting power of ordinary citizens.

The latter part of this essay will argue that this distortion of the democratic process by private wealth cannot be reconciled with a principle the High Court has recently found to be implied in the Constitution. While this 'egalitarian' principle has major consequences for the reform of donation laws, it has barely caught the attention of constitutional lawyers and political philosophers.

However that may be, the question is whether current attempts to defend the practice of political donations, or to pursue only limited or token reforms (such as constraints on foreign donations) are plausible, and one way to begin is to get a sense of what the leading politicians are saying, including former PM John Howard, now an elder statesman and Liberal icon, and current PM Malcolm Turnbull.

While intra-party views differ widely, there is a clear Liberal/Labor division based on a distinction argued by Defence Minister Christopher Pyne and Attorney-General George Brandis that it is (in Pyne's words) 'perfectly justifiable' to solicit foreign donations so long as they are not used to pay one's personal debts. Otherwise, it 'doesn't compromise either the Liberal Party or individual MPs, because 'people are entitled to support the political party of their choice.'

Brandis tried to clarify this distinction when questioned by a skeptical Michael Brissenden on the ABC's AM program on 6th September:

Brissenden,

The Greens want to work to reform the donation laws, Labor wants reform, some in your own party want this .... Are you open to the idea?

Brandis