Don Farrell usually makes headlines when it comes to one trade issue or another. But Farrell, who serves as both a special minister of state and minister of trade, is planning a roll of the dice soon that, if he pulls it off, would earn him a place in the history books for spearheading a major overhaul of Australia’s federal electoral law.
The changes, long in the works, would cap both donations and spending on federal elections and require more timely disclosure of money flows.
But it seems unlikely that the far-reaching reforms, which Farrell wants to put before parliament in the fortnightly session starting on 12 August, will be implemented before the next election, which is due to take place in May next year.
The proposals are generally in line with the majority recommendations of the Standing Parliamentary Committee on Electoral Affairs.
It has been a difficult process, much longer than Farrell had initially hoped. Not only have negotiations with other players dragged on, but the risk of violating the Constitution (which could trigger a successful Supreme Court challenge to the restriction of the implied freedom of communication) and even a shortage of parliamentary drafters have slowed progress.
It is impossible to predict how much of the reform package can be pushed through parliament and how long that will take.
The reforms will include a minimalist “truth in advertising” measure, based on the model used in South Australia. But it could fail in parliament. The Australian Electoral Commission, which has opposed the role of designated police on the streets to judge the truth, will be relieved if it does not go ahead.
And Farrell won’t even try to increase the number of senators for the Australian Capital Territory and the Northern Territory (currently two per senator), because there isn’t enough support.
For Farrell, the main issue is that there needs to be a cap so that spending doesn’t explode further and politicians don’t have to put so much energy into fundraising.
Billionaire Clive Palmer’s massive spending at the last election has obsessed Labor, although his United Australia Party won only one Senate seat for his $123 million spend, secured in Victoria by Ralph Babet.
Farrell says:
Our system must be protected, including from billionaires who seek to influence our elections. The focus of the reforms I will introduce in Parliament is to address the growing threat of big money in politics.
But his package would also protect “real political communication,” he stressed.
All donations of $1,000 or more would have to be made public, and this would be a hard, non-indexed threshold. The current indexed threshold is over $16,900.
There would be a limit on the amount each donor can donate, the exact amounts are still being determined.
Farrell’s changes to donations are nowhere near as far-reaching as the changes the South Australian Labor government has in mind, which would ban all donations.
Under the three-tier proposal in the Farrell legislation, there would be limits on what parties could spend on their national campaigns, and at the state level (to cover Senate campaigns). There would also be limits on spending in a seat.
The main limit would be seat one, and that will be somewhere under $1 million per candidate. Not surprisingly, some of the “teals,” elected after expensive campaigns, are worried about new players. (Monique Ryan and Allegra Spender both ran campaigns that cost more than $2 million each.)
One of the consequences of the limits would be that a party would be able to invest less money in a seat where the party feels the MP is at risk.
The legislation is likely to include an increase in government funding, although the intention is to keep this increase relatively modest, as it is believed that too large an increase would not be well received by the public.
Parties would also receive an amount for administrative costs, which would be new, although they previously received subsidies for specific matters such as updating cybersecurity.
There will be measures in place to capture some of the spending from “key third parties,” such as labor unions, advocacy groups like Advance, and groups like Climate 200, which financially supported a number of community candidates in 2022. But how these will operate remains unclear. This third-party spending is a key issue, and the devil is in the details.
Parties, candidates and other players in the election must maintain a separate campaign account with the Commonwealth for all donations and expenditures. These accounts are audited by the Australian Electoral Commission.
There have long been calls for “real-time” donation disclosure. Under the proposed reforms, donations outside of election periods would be made public within a few weeks. During campaigns, the time would be reduced to weekly, then daily as Election Day approaches.
Farrell believes voters should be able to make their own judgments about donations through real-time disclosures, rather than banning money from certain sectors (e.g. fossil fuel companies).
When it comes to electoral reform, players start from a position of self-interest. So while there have been extensive discussions with the opposition parties, the Greens, the Teals and others, it is a huge task to get agreement – or at least agreement from some players on some aspects.
The liberals are publicly silent. Some of the teals, as newcomers and henchmen compared to the major parties, are vocal.
West Australian Teal Kate Chaney, who has been a frontrunner on election issues, says she wants to see real-time disclosure of donations over $1,000, a political advertising provision that protects voters from “lies” and “a method of reducing money in politics that still allows new challengers”.
She has proposed a model to limit the number of ‘mega donors’ as a percentage of public funding.
“My lens is whether the reforms prevent future competition,” she says. “I realize that people want less money in politics and people don’t want money to influence political decisions. But if private donations are replaced by public funding, then it entrenches incumbent politicians, which is not good for a thriving democracy.”
Goldstein-teal Zoe Daniel remains “suspicious that the major parties will package their proposals as electoral reform when their real aim is self-interest, as has been demonstrated by the recent changes in NSW and Victoria”.
“In Victoria, the Andrews government, under the guise of reform, has erected a $200 million barrier to protect the interests of the major parties and exclude independent candidates who were restricted by a cap of $4,210 in individual donations at the last election,” Daniel said.
The package is expected to have a bumpy parliamentary road, not helped by its arrival so late in the term. It is likely that bits will be peeled off or discarded along the way. Given the timing, it is difficult to see much of it being operational in time for the 2025 elections – the AEC would need some time to get up and running.
Farrell, who is abroad, will be negotiating his changes again. As a pragmatic man of the right-wing Labour party, he knows that if he does not push through as many reforms as possible during this parliament, there is a risk that a re-elected Albanian government will be in the minority, and that negotiating electoral changes will become even more difficult.
Michelle Grattan, Professor, University of Canberra
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