Political donations are much bigger than most think

Photo by Andrew Quilty

Contributed by Jim Hayes

It is no secret that the Australian political system is seriously corrupted through large scale donations to political parties. Just how much these donations amount to is hidden behind grossly inadequate disclosure laws and lack of policing. This means that there is a dark money channel, funneling funds to gain influence over the political system.

We now have a glimpse of the scale, thanks to data released by the Centre for Public Integrity, showing that 35 percent of all contributions since 1999 came from unknown sources. This amounts to $1 billion. But note. This is only for the available data. It could be much more.

The Australian Electoral Commission has just released the latest list of donations, although in September last year, the auditor general found the AEC was not doing enough to punish political donors that break the rules and was failing to ensure donors were providing accurate and complete financial information.

Putting together the available data we can see is that most the known donations have come from only 20 donors. It is not going to be different with the unknown donations.

Australia’s weak laws are allowing political parties to hide the origins of their donations and provide mega-donors the ability to exert disproportionate influence.

The Australian Electoral Commission released on Monday the latest tranche of donations data for the 2019-20 financial year, which will show the largess shown to parties in the wake of the last federal election.

Aside from Clive Palmer’s Mineralogy, the biggest political donor has been the Cormack Foundation. This is a front for major donors to the Liberal Party, and it handed over $61.4 million.

Labor received a significant amount through ALP Holdings and John Curtin House, although much of the money raised comes from the unions.

These amounts are a small part of what is involved. Inadequate reporting and disclosure are part of the problem. Donors can break down a donation through a list of fronts. Only amounts over $14,300 are recorded on the register.

There is also the possibility the possibility of using virtual networks and cryptocurrency, as a major vehicle to hide the identity of the real donors. We know it’s there. We don’t know how big it is.

Add that individuals can be bribed in the old-fashioned way.  This won’t come up on any register either.

Funding political parties, directly or indirectly, is designed to generate a payoff. Money is not handed over without the expectation of something is return.

We can get a fair idea of how extensive this is, by considering who benefits disproportionately from a government’s policies and actions.  

Australia’s political system is corrupt. This is at its worst federally. The states do have some legislation, even is still grossly inadequate, putting legal limits on donations. This may cut back those that are above board. It does nothing to halt donations through the back door. Corruption also exists at the state level.

An inquiry into corruption would help to reveal more and be a positive move for those who want this cleaned up. In the end, it won’t change anything much.

Only by banning all donations and replacing them with public funding of political parties, can there be some control. There would still be no guarantee. This needs a political system that does not require big sums on money.

Is this possible? It is.  But it requires the replacement of what we’ve got, with a much more democratic and representative political structure, operating from the bottom up and transferring the authority downwards.  

This would pull down the power of big donors and limit the authority of politicians, at the same time, as it raises that of communities and sectors of Australian society. The mechanism for this is a matter for debate and consensus.

The alternative is to continue with a corrupt system.

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