Political donations from hotels: bad for our health?

Do political donations influence the decisions governments make about licensing laws, the regulation of poker machines and smoking rules in hotels?

The hotel industry donated more than $3 million to the New South Wales Labor Party in the seven years to July 2005.

Clearly the industry is contributing to the party in power in NSW but significant donations also go to the Coalition opposition. In the same period the Liberal and National parties received about $1.2 million.

Australian Hotels Association (AHA) officials have stated they use these donations to buy access. What happens when that access is achieved is not known. But what we do know is that at the same time these donations flow to the Labor, Liberal and National parties, the MPs from these parties are voting together in the NSW parliament to pass laws that benefit hotels.

The NSW president of the AHA, John Thorpe, clearly realises the importance of donations. He was reported on the ABC’s Stateline in 2004 as saying, “Democracy’s not cheap. And your firm and your company - everybody’s involved with assisting political parties because at this stage we need to keep these people in place to have the democracy we have today.” He repeated these comments in 2006.

The Labor Party came to power in NSW in 1995. Since that time there have been a number of changes to the law that have benefited hotels. Although the Liberals introduced the controversial extended hotel trading hours in 1989, Labor has allowed 24-hour openings to flourish. Currently NSW has over 70 per cent of all hotels in Australia that operate with such licenses.

Social and health problems associated with 24-hour openings are extensive and many residents and social workers have lobbied the Labor government to reduce the numbers of these licenses. Their demands have been unsuccessful and instead the government has responded favourably to hotel lobbying on the issue.

Most of the changes to hotel operations under the Labor government have been to laws governing gaming machines and smoking. The Smoking Regulation Act 1997 re-defined the meaning of an enclosed public place so that smoking was allowed in hotels, as long as fresh air could circulate. But with more countries and other Australian states banning smoking in hotels, pubs and restaurants the NSW government has come under pressure over the past decade to put the health of workers and patrons first.

In early 2006 the government bowed to public pressure and agreed to phase in smoke-free hotels by July 2007. But the hotel industry would not be displeased with this outcome because the so-called ban has been achieved by changing the definition of outdoor areas and not by an outright ban on smoking. Under the so-called ban smoking will be permitted in hotel rooms that are open to as little as 25 per cent fresh air.

In 1997 the Carr Labor Government cleared the way for poker machines in hotels. This was a move that enriched many publicans. Between 1998 and 2003 the government made further decisions, which enabled hotels to receive more money from gaming machines. These changes included: allowing TAB Ltd to enter into agreements with individual hotels to buy machines or to put machines in the hotels for a share of the profits; permitting hotels to buy gaming machines from other hotels; reducing the period the machines must be closed down; making it easier for hotels to apply for an exemption to the new three-hour shut down period of their machines by claiming hardship.

During this five-year period from July 1998 through to June 2003 (donations information for 1997-98 isn’t readily available from the AEC) the Labor Party received over $2.6 million in contributions from the hotels industry. In sharp contrast the NSW Liberal Party received only $570,145 and the Nationals less than $180,000.

Most of this money came in during the two year run up to the 2003 NSW state election. In this period Labor received over $2.3 million while the Coalition opposition parties had donations of $608,090. Prior to the 2003 election The Sydney Morning Herald reported that the hotel industry was concerned about changes to gaming laws expected to be introduced after the March election. The Carr Government was expected to easily win, which probably accounts for Labor’s larger share of the hotel industry donations. After 2003 the hotel industry returned to contributing more equally to Labor and the Coalition.