Donations Reform in NSW


Lee Rhiannon launched the Democracy for Sale project in 2001 while a member of the NSW Upper House. In 2002 she introduced the state’s, and probably the nation’s, first Bill to limit corporate donations. The Bill, which would have banned developer donations, was defeated on the combined vote of the Liberals, Nationals and Labor MPs.

After years of campaigning by the Greens Democracy for Sale team and community organisations, the major parties began to budge in 2008 when the then Labor government introduced laws for more regular disclosures of political donations. They also promised to ban non-individual donations, but this policy was dropped by the Labor government after Iemma was replaced as Premier.

In 2009, the Labor government, then lead by Premier Nathan Rees, brought in legislation that placed a ban on donations from property developers.

In late 2010, new legislation was passed that banned donations from the tobacco industry and for-profit liquor and gambling industries and imposed caps on expenditure by political parties, candidates and third parties. The legislation also changed how public funding of elections is distributed.

Finally, in February 2012, legislation was passed that banned all donations from corporations and other organisations. The ban also applied to union affiliation fees.

However, in December 2013 the High Court overturned the ban on corporations and associations making political donations in NSW. The case had been initiated Unions NSW.

While the NSW government introduced new electoral funding legislation in 2014 that puts some limits on corporate political donations there is still a great deal of work to be done to build a fair electoral funding system.

 

Timeline of Reforms in NSW

High Court expands definition of ‘corruption’ and upholds prohibiting certain donors 2015

In McCloy & Ors v State of NSW, the High Court upheld the ban on donations from property developers and redefined corruption. We have largely moved beyond “quid pro quo” corruption to what the High Court has described this week as a “more subtle kind of corruption” known as “clientelism”. It is where “officeholders will decide issues not on the merits or the desires of their constituencies, but according to the wishes of those who have made large financial contributions valued by the officeholder”.

Political Donations Final Report (Schott Report) 2014

This inquiry was established by the Baird government in response to political donations that came to dominate NSW politics in 2014. While the inquiry concluded that it is not in the public interest to ban political donations they found that the current political donations system has numerous loopholes and openings for corrupt activities.

 

Mining and Contracting with Government (Corruption Risk Reduction) Bill 2014
Greens NSW Upper House MP John Kaye moved this Bill that if passed would prohibit donations to political parties from mining companies or from companies that have a contract over $50,000 with the NSW government.

 

Election Funding, Expenditure and Disclosures Amendment (Restrictions on Political Donations) Bill 2014
Greens MP for Balmain Jamie Parker and John Kaye moved Bills in both houses of parliament that if passed would have made it illegal for associated entities such as the Millennium Forum or the Free Enterprise Foundation to channel or launder donations to political parties. The Independent Commission Against Corruption at the time was investigating illegal election donations to the NSW Liberal Party through associated entities.

 

Election Funding, Expenditure and Disclosure Amendment Bill 2014
This Bill introduced by the Baird government and passed with amendments was partly in response hearings at the Independent Commission Against Corruption that exposed systematic rorting of the electoral funding and donations system. As a result of these developments a Liberal Premier, two Liberal Ministers, the Liberal Party secretary and eight Liberal backbenchers resigned or stood aside. A number of former Labor ministers were also caught up in the ICAC investigations.

 

Election Funding, Expenditure and Disclosures Amendment Bill 2011 

This bill was the first significant election funding Bill brought by the O’Farrell Coalition government. The Bill banned all donations from corporations and other organisations. It also prohibited union affiliation fees going to political parties.

 

Election Funding, Expenditure and Disclosures Amendment Bill 2010

This Labor government legislation introduced caps on spending, changed the system of election funding, introduced administrative funding, and required third parties spending money in an election campaign to be registered and abide by spending caps.

 

Election Funding, Expenditure and Disclosures Amendment (Property Developers Prohibition) Bill 2009

This legislation prohibited donations from property developers to parties or candidates.

 

Election Funding Amendment (Political Donations and Expenditure) Bill 2008

This Labor government legislation brought in changes to the disclosure regime that according to the Premier would improve transparency and accountability.

 

Environmental Planning and Assessment Amendment Bill 2008

Sylvia Hale’s amendments to this Bill would have established a ban on donations from developers to political parties.

 

Environmental Planning and Assessment Amendment (Restoration of Community Participation) Bill 2008

This Greens private members bill, introduced by Sylvia Hale, would have banned developer donations. The major parties used parliamentary tactics to ensure that this Bill was never voted on in the House.

 

Developer Donations (Anti-Corruption) Bill 2003

This Greens private members bill, introduced by Lee Rhiannon, would have banned developer donations, ensured disclosure of donations, and amended the the Election Funding Act 1981 and the Local Government Act 1993 to include anti-corruption measures.