Spending cap leaves Labor sitting pretty

The LNP is well ahead of Labor in donors, as well as amount donated, yet the average LNP donor gave only half what the average ALP donor did. The next table explains how this happens.

The table shows the top ten sources of donations by source. Private individuals are by far and away the largest source, and the LNP gets the largest share of that. Unions are the second largest source, and that is virtually monopolised by the ALP.

If it wasn't for the unions the ALP would be out of the game. That's what happens when you take your eye off the ball, industry founders, unemployment is the highest in the country, and a drought is added to that. No one wants to donate to you and you are dependent on those who have a narrow vested business interest in keeping you in power.

Interestingly, while the justification for the changes is that there is too much big money telling our governments what to do mining doesn't feature at all in the top 10. My "Energy" category does include some gas and coal, along with power generators and suppliers of renewable energy, but it is not even 10% of the total.

So here's the fix. You cap the total amount that either side can spend at a figure somewhere around where your opponent might get to, knowing you're going to fall short. You then change the public funding formula so that you'll get there without any fundraising.

That leaves both of you with a surplus, and theirs is even larger than yours. The catch is that the only way you get to spend the surplus is by sending your erstwhile donors to contribute to third party campaigns.

The ALP proposal is that over a four year period you can only donate $4,000 to one party, and a further $4,000 to a maximum of 6 third parties (however a third party is defined). So that is less than the average donation over the last one year period. You can also donate to a candidate, but to a maximum of $6,000 over the same period.

At the same time they are almost doubling public funding with the parties receiving $6 per vote (up from $3.14) and candidates $3 (up from $1.57).

This goes hand-in-hand with a cap on spending. Based on the last election, the ALP would receive $5,747,340 of public money, and be effectively limited to raising (because of the spending cap) a further $2,818,660. For the LNP the numbers are $5,466,114 and $3,099,886.

In just the last 12 months both of the majors have raised more than they can spend.

This is great for the ALP, because they have 26 affiliated unions who can save the money they would have donated and spend $1 million of it each in the next state election. The LNP don't have any third parties in this position.

And there is another advantage accruing to unions. We know from the Trade Union Royal Commission that a lot of union money actually comes from fees paid to them by companies for things like training, along with their union dues.