Voices for action on influence peddling: the only ones missing are those who can make it happen

Pathetic disclosure requirements for political donations and half baked regulation of lobbying have been known weaknesses and sources of concern for years at all levels of government particularly for the Feds. What we're learning now about the Mafia and about what passes for 'business as usual' in both major parties surely means the time has come....surely?

ABC Four Corners: The Mafia in Australia

GEOFFREY WATSON SC, COUNSEL ASSISTING, NSW ICAC: When you look at the (Liberal Party aligned) Millennium Forum website or the way in which it organises functions, the idea is that you would be a donor of a particular value and that would get you so much access, whether at dinners or fundraising events of different kinds. It's access in return for a donation.
NICK MCKENZIE: It's all about getting the ear of a politician?
GEOFFREY WATSON: Exactly: and nothing else...
..On how many occasions would you see it that a donation was quickly followed by a request to meet a politician? Then ask yourself: why is somebody requesting a meeting with a politician? It's not just to get to know them. It's to influence them as to their decision making. Of course there's a connection.

Sydney Morning Herald-related article: Glad handing and influence:mafia taking fast track to the powerful:

The amount of money Madafferi and his associates generated for the Liberal Party is likely to be in the tens of thousands of dollars (records show one Madafferi company donated at least $23,000), although the true figure will never be known because of Australia's opaque fundraising disclosure laws...

The federal police investigated the Madafferi donations and lobbying, but stated the "nexus between those donations identified and any political leverage could not be substantiated". They were, in part, blinded by Australia's inadequate disclosure regime. Their inquiry, recently obtained under freedom of information laws, warned that police had found "numerous issues relating to the disclosure of donations to political parties". These "issues" meant investigators have limited oversight of who was donating how much, and why.

Fairfax Media- related article: Political fund raising can't be left to trust

Our system of democracy relies on transparency. If vested interests can get closer to power by donating money, then the public has a right to know about it.

Bernard Keane in Crikey on political donations and disclosure 'rules' as revealed at the Royal Commission:

How bad was Bill Shorten's convenient failure to declare a donation in kind to his election campaign in 2007 from a company? At eight years after the event, it is almost certainly the latest declaration ever. But for $40,000-odd, it's an also-ran. When it comes to our political donation "laws", late declarations and amendments are normal. Political parties routinely get away with declaring hundreds of thousands of dollars in donations years later, long after anyone has stopped scrutinising them. And it's deliberate.....

So what will almost certainly happen to the existing requirements as a result of Shorten's embarrassment? Nothing. Both recent attempts at improving the Commonwealth donation disclosure laws -- John Faulkner's 2009 effort and then the Gillard government's effort in 2013, when Tony Abbott reneged on a signed bipartisan deal for reform -- have come to nought. And while the media will pursue Shorten for his eight-years-late-and-forty-thousand-dollars-short declaration, the Coalition won't have much to say, knowing that there are likely to be plenty of embarrassing disclosures of its own that might emerge from any thorough examination of what parties are being paid. Instead, we'll be stuck with disclosure laws that border on a joke and leave us in the dark about who is trying to buy influence over our politicians.

Sean Nicholls in the SMH on funding reform and a Federal ICAC:

The question mark about influence hanging over both arrangements is another reminder of not only the need for  donations law reform nationally but also the glaring absence of a federal ICAC. Prime Minister Tony Abbott is on the record opposing the move. But last year, NSW Labor gave in-principle support for a federal ICAC-like body and voted to refer it to this year's federal Labor conference. Labor - and Shorten - should embrace the idea and begin pressing the government for action.

Professor Ian Ramsey, the director of the Centre for Corporate Law at Melbourne University, said new rules were needed to ensure complete transparency:

"For quite a number of years now, many people, myself included, have really seen significant limitations in terms of our existing disclosure requirements," Professor Ramsey said. "In particular, there are important issues about the transparency, how much is disclosed, and also how quickly that information is disclosed. "Certainly I think there is a real need for improvement."

Then there's Professor Marian Sawer on The Conversation.

And Independent senator Nick Xenophon wants changes to political donations to end what he calls a "financial arms race" in Australian politics.

There are other voices but..

 Nothing so far from those in the leadership positions that count. Plus ca change..


 

Trust in politicians Episode XXX: "Democracy for Sale"

On ABC Four Corners last night Linton Besser illustrated how a deal to win partial control of a major public utility opened the door on a web of alleged corruption, impacting both State and Federal politics and players on both sides of the political divide, and how the rules that are supposed to regulate political donations can be ignored or corrupted right across Australia. 

It's not just that the Federal and state rules relating to political donations are weak, and as shown, ineffectual. So too those that relate to lobbyists. NSW rules on that front may be ahead of other jurisdictions but recommendations from the ICAC in 2011 still await a response

And as the program points out while we have anti-corruption bodies in the states there is no Federal commission to fight corruption. 

The Greens introduced the National Integrity Commission Bill into Parliament last year. When it came up for debate in May Liberal and National party senators who spoke dismissed the idea out of hand. As Senator O'Sullivan put it:

This government is proud of Australia's position and reputation. Australia is consistently ranked by Transparency International as one of the least corrupt countries in the world. This is a recognition of the net measure of respective coalition governments in this place and in states right across this country. As a political movement, we have a sub-zero tolerance to corruption.

Watch or read the Four Corners transcript. A couple of extracts follow including Senator John Faulkner's call for a lower threshold for reporting political donations and close to real time disclosure, and adding his voice at least to the national integrity commission cause.

An email to my local member

 You too may feel this way -  get it off your chest. My email was headed Red hot.

Mr Turnbull,
Appalled at the deal on election funding and the half hearted "improvements" to the disclosure regime. John Faulkner's shame comment fits all party to this deal. Disclosures from business should be banned in exchange for public financing. If that's going too far, donations should be capped and all over $1000 disclosed in close to real time, not nine months later. Trust is hard won and easily lost. With tough times ahead it shouldn't be frittered away like this.
Peter Timmins.
Potts Point 2011.

NSW makes a welcome start on political donations

Election campaign finance reform in NSW has moved forward with the passage of the Election Funding and Disclosures Amendment Bill yesterday. Much of the media attention has been on the ban on political donations, agreed at the last minute, placed on the alcohol, tobacco and gaming industries to go with the existing ban on donations from developers, and caps for donations and expenditure.There's more to it than that: for a summary see the Premier's Media Release: NSW – first in the country to reform election funding, or for all the detail, the 59 pages of amendment legislation, and the parliamentary debate.

While the changes are as Greens MLC John Kaye puts it a "solid step forward" and the caps on donations (maximum $5000, with identification of donors of more than $1000) reduce to a degree the importance of public disclosure, it's no step forward on that front. In fact it's a step backward. Reporting of donations to the electoral authority is currently required for the six month period to 30 June and 31 December each year (s 89). The Authority is required to publish on its website the disclosures of reportable donations and electoral expenditure "as soon as practicable after the due date for the making of the disclosure" (s 95). 

The amendment bill removes the six month reporting requirement and substitutes a 12 month reporting  period ending on 30 June. No change has been made to the requirement for publication of reportable donations on the web as soon as practicable after lodgement. So while the legislation removes some of the smoke (no pun intended) we're still a long long way from anything close to continuous disclosure of donations. Or knowing at the time NSW voters vote next March who has kicked the can for candidates and parties. All that will be revealed "as soon as practicable"- and well after 30 June.

NSW busy with announcements on integrity

The NSW Government had a busy week on the integrity and accountability front, with Premier Keneally announcing the introduction of legislation into parliament to amend the Protected Disclosures Act (Download PDF), releasing campaign finance reform proposals (Download PDF), establishing a Joint Select Committee on Parliamentary Procedure to see what changes "agreed" in Canberra might be suitable for adoption in NSW, and indicating preparedness to look at the Ombudsman's suggestion of an integrity act for the public service. The Premier branded the last mentioned potentially "symbolic" claiming the state already has "one of the most stable, integral and respected public sector workforces in the world."

Not mentioned in the media release on changes to whistleblower protections is that the amendment bill extends a protected disclosure specifically, to one made by a public official in honest belief on reasonable grounds of "a contravention of government information laws."

Political donations off the record-till February 2012

While there will be plenty of argy bargy about black holes in spending plans during the course of the election campaign, Ari Sharp in the Sydney Morning Herald reminded us of another: that our weak laws do not require timely transparency of political donations, or the identity of those donating $11500 or less. The Opposition managed to see off in the Senate the Government's proposal to drop the ceiling on anonymous donations back to $1000, on the grounds of privacy. But that important right must on occasion give way to other public interests, and it's a clear cut case when those interests go to the heart of the democratic process. Neither major party has shown any interest in something akin to real time disclosure on the internet of donations as they are received.

Donations of more than $11,500 made to parties for each financial year are not disclosed until February the next year, meaning that contributions made now will not be on the public record until February 2012. And despite parties claiming tens of millions of dollars in public funding, they are able to keep their campaign spending largely secret...

'The system is structured to conceal and mislead the public about what's really going on with donations,'' said Brad Pedersen, the founder of Democracy Watch, a non-partisan group committed to curbing the influence of money on politics.''It's quite feasible for all these donations to be immediately declared on the internet, as it is in other nations. We won't know for months who's donating right at this very moment to both the major parties.''

The Age in top form on integrity failings

A terrific report by Katharine Murphy in The Age about the sidelining of the Auditor General from a role in policing money to be spent in taxpayer-funded advertising campaigns- a major integrity reform introduced by a government that had promised to be cleaner than its predecessor. Pulling the Auditor General off the job to now be undertaken by three former public servants stands in contrast to the Prime Minister's "absolute undertaking" in October 2007 "for the Auditor-General to certify whether individual advertisements contain legitimate public information or not."

The Age editorial on this and a related issue of transparency gaps in political donation laws also neatly nails a couple of Federal and Victorian government failings.

Opposition holds out on political donations

I can't do better than Stephen Mayne in Crikey today on the annual release by the Australian Electoral Commission of donations to political parties. It's pretty much the same old ugly story, but a tick for Labor for voluntarily disclosing donations over $1000, while the the Opposition which is blocking the change in the Senate sticks to the letter of the law and anonymity for anything less than $10900. Generally on the disclosure front:

Coalition opposition in the Senate means that not too much has changed on the campaign disclosure front. The figures are still released up to 19 months after the event, there are no consolidated balance sheets, no detailed breakdowns of spending and no restrictions on who can donate. Foreign dictators could pour millions into an Australian political party. Indeed, the Singapore Government gave $20,000 to both major federal parties through Optus, a business whose fortunes are particularly vulnerable to federal laws and regulations.

Two different worlds, we hope...

On top of a myriad of other problems comes this US Supreme Court decision (see Washington Post's rundown) that finds restrictions on corporate spending in electoral campaigns inconsistent with the First Amendment's protection of political speech. The decision comes after decades of effort to limit corporate influence, but does not address the restriction on direct contributions to candidates, and upholds disclosure requirements for groups that mount advertising campaigns for and against candidates. Just why corporations should enjoy rights originally framed for individuals is a question for another day


The NSW Parliamentary Research Service has published this useful  Research Paper - Political Donations and Electoral Finance which summarises the state of play here including constitutional issues that have been raised about state based reform efforts.

NSW Committee proposes changes for lobbyists and political donations

A NSW Parliamentary Committee inquiring into land dealings and planning decisions released an interim report that recommends Government action on lobbyists and political donations. Some of the proposals regarding lobbyists, for example a ban on lobbying for a period after separation from government would bring NSW into line with other jurisdictions: the Committee recommmends (Recommendation 10) NSW review other Australian Lobbyist Codes of Conduct and report to Parliament on improvements.

However other recommendations would move NSW in the direction of Canada's more robust reporting and transparency requirements:

Recommendation 7
That the Premier strengthen the NSW Lobbyist Code of Conduct to require that each minister is informed at regular intervals of contact between government representatives and registered lobbyists.

Recommendation 8
That the Premier strengthen the NSW Lobbyist Code of Conduct by publishing a report on the internet at regular intervals detailing contact between government representatives and registered lobbyists. The report should include the name of the lobbyist, date of contact, meeting attendees (if applicable) and issues discussed.

Recommendation 9
That the Premier strengthen the NSW Lobbyist Code of Conduct by establishing protocols to be applied to all meetings between government representatives and registered lobbyists. At a minimum, the meeting protocols should contain guidelines regarding venues, properly recorded minutes and the requirement for the third party presence of at least one government representative.

On political donations, the Committee notes recent commitments to change by the Premier but recommends full adoption of 47 recommmendations made in a Committee Report in June 2008 2008, only 19 of which have been accepted by the Government to date:

Recommendation 11
That the Premier adopt the model for funding of the NSW electoral scheme proposed by the NSW Legislative Council Select Committee on Electoral and Political Party Funding, and implement the Committee’s recommendations in full. The key provisions of the model are to:
• ban political donations by corporations and other organisations
• cap individual donations
• cap election spending
• make disclosure of donations and election spending more timely and transparent
• introduce greater policing of the electoral funding scheme, and tougher penalties for
non-compliance.

NSW announces clean-up on donations, lobbyists

NSW Premier Nathan Rees had a big weekend, winning on some important issues at the State ALP Conference and announcing an immediate ban on donations to the Labor Party by developers, a ban on the appointment of lobbyists to all public boards and committees, and guidelines to be developed by the Minister for Planning to govern meetings between public servants, lobbyists and other parties. As Anonymous rightly commented on the previous post, announcements are one thing, implementation another. And there is plenty of scope to do more on the lobbyist front. But these are moves in the right direction.

Queensland shapes up for more reform

The Queensland Government Response yesterday to the public consultation about integrity and accountability includes plans for a suite of reforms that again will see that state move ahead of the rest of the field. And promptly- deadlines for action are by the end of the year or mid 2010. Here are some highlights:

Ban the payment of success fees to lobbyists for achieving favourable outcomes from government.

Replace the Code for Lobbyists with a legislative framework for the regulation of the lobbying industry and put oversight in the hands of the Integrity Commissioner.

Introduce measures to require newly appointed public service officers and ministerial staff to disclose whether they have worked as lobbyists in the past two years.

Create a statutory obligation on Members of Parliament to declare their pecuniary interests rather than leave this to Parliament's Rules.

Require all statutory office holders to declare their pecuniary interests.

Publish the pecuniary interests of Members of Parliament and Ministerial and departmental gift registers online.

Reform the Whistleblowers Protection Act 1994.

Hold regular People’s Question Time.

Lower the threshold for reporting some details of contracts from $100,000 to $10,000.

Ensure publication of contracts over $10 million.

Overhaul political donations and campaign funding if the Commonwealth does not act by July 2010.

Pork sale details hard to find

Not only were yesterday's political donations disclosures so long after the event as to be laughable, but the gory detail of large contributions to oil the wheels of democracy by foreign casino operators, developers, unions, ethanol manufacturers, clubs and others reported in today's press still don't add up, according to Malcolm Knox:

"Attempts to make the political donations process more transparent have been hampered by startling discrepancies between donor and recipient declarations in the latest Australian Electoral Commission figures. Of the top 20 donations to the major parties, more than half show inconsistencies between what the donors and recipients say. With the ALP's top corporate donor, the Hong Kong casino billionaire Stanley Ho and his associated companies, the discrepancy is the largest. Dr Ho signed a declaration saying he had given $200,000 to the ALP in NSW on May 29 last year. In the party's declaration, however, ALP official Brendan Kavanagh signed documents saying Dr Ho gave $400,000 on October 31, 2007. With other donations by Ho-related entities tallying up to $700,000, it is unclear whether Dr Ho gave the party $900,000 or $1.1 million. Eight of the Labor Party's top 10 corporate donations and five of the Coalition's top 10 fail to add up. The largest discrepancy was on the Coalition side: Iain Thompson, the company secretary of Brickworks, declared it made three donations totalling $265,000 to the Liberals in the months leading up to the 2007 federal election. But in the Liberals' declaration, there was no sign of Brickworks - or any donation from it."

" For gorsake stop laughing: this is serious."

This famous old Australian cartoon by Stan Cross came to mind today as The Australian Electoral Commission released information about disclosures of donations to candidates and political parties relating to the election....on 24 November 2007... 16 months after we voted. [It's not a user friendly website but if you try to can find gems like Kevin Rudd and Wayne Swan lodged nil returns.]

The Government's Green Paper on electoral reform released just before Christmas was at least straight-faced in acknowledging the problem:

"Clearly the major point of public disclosure, particularly in the absence of comprehensive regulation through bans or caps on financial activities, is to allow the public to form judgements about political parties and candidates and to apply that knowledge in exercising their franchise at the ballot box. However, the.. considerable time lags (permitted by current requirements for reporting and public disclosure) do not allow the voting public to be informed of election campaign finances at the end point of those campaigns when casting their vote." (emphasis added)

Submissions on the Paper close on 23 February.

Minister Faulkner has amendments before Parliament for six-monthly reporting, with donors and parties to have eight weeks to lodge returns and information to be publicly available promptly. Still far too gentle to my mind. And to others. Bernard Keane in Crikey:

"The only problem with Faulkner’s proposals are their lack of ambition. There is no reason why disclosure of donations shouldn’t and couldn’t be required far more often than six-monthly. Nick Xenophon has called for continuous online disclosure during election campaigns. That model could be extended to all donations to political parties and candidates. Why does anyone need more than a few days to report that they’ve given politicians some money?"

Some holiday reading on electoral reform

Cabinet Secretary and Special Minister of State, Senator Faulkner has released the Electoral Reform Green Paper for public comment- submissions invited by 23 February and the Government will also ask the Joint Standing Committee on Electoral Matters to consider the issues raised. Senator Faulkner said the Paper needed to be considered against the background of increasing campaign costs, the need for political parties to raise ever increasing amounts of funds, and the need to address perceptions of undue influence. Another paper canvassing other election related issues will be released in 2009.

Chapter 3 covers current disclosure requirements under Federal, state and territory laws. What a mixed bag but with plenty of reform initiatives on the table in most places, as there needs to be- two states Victoria and South Australia do not have annual or election based disclosure schemes.

Chapter 6 raises the options for change with timeliness one of the key issues [6.65]:

"The effect of the current timeframes is a lag between transactions being entered into and their disclosure which raises a question over their transparency. The public release dates for disclosures relating to the 24 November 2007 federal election are 12 May 2008 for election returns (for candidates, Senate groups and donors) and 2 February 2009 for annual returns (which cover political parties, associated entities, third parties and donors). Clearly the major point of public disclosure, particularly in the absence of comprehensive regulation through bans or caps on financial activities, is to allow the public to form judgements about political parties and candidates and to apply that knowledge in exercising their franchise at the ballot box. However, these considerable time lags do not allow the voting public to be informed of election campaign finances at the end point of those campaigns when casting their vote."

Political party secrecy - one of world's worst

Stephen Mayne in yesterdays' Sun Herald wrote about political parties and election funding and concluded after looking at returns for the last eight years that "Australia has one of the world's worst financial disclosure systems for political parties".

It's not just that there is great mystery about the balance sheets of the parties, it is also that what is disclosed on donations can be so late in the piece as to be irrelevant when the citizens make their choice at the ballot box. There should be no secrets here - see our blog last week on this subject.