Whenever you see a politician, just remember that you’re looking at a junkie. Whatever else they may be addicted to — power, caffeine, s-x, the sound of their own voice — all politicians are incurable money junkies.

Bear that in mind while considering the Prime Minister’s commitment last night to reform of Federal political donations. In this edition of Crikey, Stephen Mayne applauds Rudd’s announcement, but wants to see much tighter regulation in areas like spending by political parties and disclosure.

The Rudd proposals are a start, yes. The reduction of the reporting threshold would more than reverse the Howard Government’s increase of the threshold to $10,000, a low point among the many in that Government’s shameful attempts to avoid basic accountability. And the ban on foreign donations, while probably faintly xenophobic, makes a lot more sense with the rise of sovereign wealth funds.

But the overall cap on donations would, as the Electoral Funding Authority of NSW has already pointed out, simply encourage rorting, especially by corporations.

Malcolm Turnbull has proposed a ban on all contributions from entities other than individuals. As some of his more churlish colleagues might point out, that’s easy for a multi-millionaire to say. But even that doesn’t go far enough. Developer lobby group Urban Taskforce Australia wants a ban on all political donations.

This necessarily means public funding for political parties. Taxpayers may find that hard to swallow, but it would eliminate the possibility that corporations, trade unions and wealthy individuals could purchase preferred outcomes from Governments. And by restricting expenditure by political parties, it might also curb the ever-growing excesses of advertising, phone-spamming and mail-outs inflicted on the community at each election.

What it wouldn’t address is third-party advertising, the bane of American political life and, given the success of the ACTU’s Workchoices campaign, something that is likely to grow significantly in Australia. The Hawke Government tried in 1991 to restrict advertising during elections but the High Court conveniently discovered a hitherto-unknown “implied right of freedom of expression”.

It’s also unlikely to attract any serious political support. Given that, here’s a couple more suggestions for the Prime Minister, to add to Mayne’s list: negotiate a consistent or at least complementary regime of reporting across Commonwealth, State and local government — there are currently multiple reporting requirements, which many donors may not even realise.

And get the AEC to significantly improve the user-friendliness of its political donation data site. It is clunky, counter-intuitive and makes serious analysis immensely difficult.

Alex Mitchell writes: Prime Minister Kevin Rudd’s promise to reform election fund-raising will run into a significant hurdle – from the NSW branch of the ALP.

The Sussex Street machine has turned collecting party funds into an art form with more than $22 million collected in the run up to the March 2007 election, two-thirds of it from developers and the pub industry.

In some business circles the techniques for extracting donations are referred to as “obtaining money with menaces”.

When the anti-corruption inquiry into Wollongong City Council started to probe developer donations to ministers and MPs, there was panic in the ranks. A senior party official got in touch with the Liberals and Nationals (and presumably the Christian Democrats and Shooters, but NOT the Greens) to suggest a truce on feeding the scandal over political donations.

The official used words to the effect: “This could turn into mutually assured destruction (MAD). None of us is going to benefit if we keep slagging each other off over donations. Why don’t we call a truce on this one?”

Apparently the Coalition parties told him that he must be dreamin’.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey

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