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Proposed reforms to electoral law have stalled since late last year, leaving independents to wonder if a marked lack of open consultation means the government is stitching up a deal with the Coalition behind closed doors. By Mike Seccombe.
Labor’s electoral and donation reforms threaten independents
Jacqui Lambie’s assessment of the Albanese government’s planned changes to electoral law, and the man behind them, is typically colourful.
“You could not trust Don Farrell as far as you could put a boot up his arse,” says the blunt-spoken Tasmanian senator. “This is not about what’s best for Australia, it’s about what’s best for the Labor Party.”
Clearly a majority of federal parliamentarians agree with her sentiments, if not her language. That’s why the proposed changes failed to pass the Senate last November.
The final days of the last sitting saw the Albanese government engage in a fevered round of horsetrading to secure passage of a long list of bills. More than two dozen were forced through with the support of crossbenchers. Several others passed with the agreement of the Coalition parties. Labor’s hope was that the electoral changes also would get through with the votes of the Liberal–National opposition, but they did not.
The conservative parties could not be enticed to back the complex package, despite the prospect that some provisions would cut the flow of funding to independents and minor parties, to the mutual advantage of Labor and the Coalition.
Indeed, Farrell – who as special minister of state is responsible for the proposed legislation – has repeatedly privately stated that the prime purpose of the changes is to protect the two-party duopoly.
Among several instances reported by Jason Koutsoukis in these pages last year was one in which Farrell regaled a small group with a story of being approached by Simon Holmes à Court, convenor of the Climate 200 group, which helps bankroll “community independent” candidates.
In Farrell’s telling, Holmes à Court complained that the proposed changes would entrench the two-party system and lock out challengers. According to Koutsoukis’s sources, Farrell quipped: “I mean, that’s the fucking point!”
Multiple analyses of the package of measures by groups concerned with issues of transparency and democracy, including the Centre for Public Integrity, The Australia Institute, Transparency International Australia and the Australian Democracy Network, concluded that the proposal would seriously disadvantage challengers to the major parties. Nonetheless, the Coalition baulked at provisions in the proposed legislation that would provide for greater transparency around political donations.
At the end of November, the Farrell plan fell over, but that’s not the end of the story.
In order to secure crossbench support for those dozens of other bills on the final sitting day of last year against opposition obstruction, the government cut various deals and made various promises, among them that there would be further engagement with the cross bench over the summer sitting break on electoral reform.
“This,” says ACT Senator David Pocock, “was one of the conditions of support for the guillotine on the final day of parliament last year. The PM didn’t just commit to us privately; he publicly committed to consult with the cross bench over summer.”
Pocock even quotes Albanese’s words: “ ‘I’ve committed to the cross bench to see if we can progress that reform’, talking about electoral reform.”
“And since then,” says Pocock, “we’ve heard not a peep.”
Last week, Pocock and the Western Australian MP Kate Chaney, who have together been the point of contact for the independents on electoral reform, wrote to Albanese and Farrell, citing several publicly made promises of talks.
Despite the commitments, they wrote, “the crossbench has not yet received any proposal on how these discussions could be progressed. Given the importance of electoral reform and the need for transparency in our democratic processes, we urge the Government to fulfil this commitment and engage with the crossbench.”
In response to questions from The Saturday Paper, Farrell’s office insisted negotiations had taken place but would not say with whom.
The office of the relevant Greens spokesperson, Senator Larissa Waters, confirmed one meeting in mid-December, “but since then, nothing”.
The electoral reform bill is back on the notice paper for next week – it’s expected to be debated on Thursday, February 6 – which raises the suspicion that Labor is trying to stitch up a deal with the Coalition or has already done so.
Nothing would surprise Lambie. On electoral reform and other issues of concern to the cross bench, she says: “Their promises have not been in good faith at all.”
In purely party-political terms, it is not hard to understand the sense of urgency the major parties have about the need to change electoral laws. Both sides are threatened by rising support for independent and minor party MPs and senators.
As Bill Browne, director of the democracy and accountability program at The Australia Institute points out, almost a third of votes cast at the 2022 election were for a minor party or independent.
On the basis of current polling, there is a strong chance that neither Labor nor the Coalition will be able to form majority government.
“So they want to get it done before the election because it will only get harder to pass if there’s a minority government,” Browne says. “So it’s potentially now or never for them.”
In their letter, Pocock and Chaney called on the government to split the Electoral Reform bill. This arrangement would send the more complex and controversial parts of the bill to a Senate inquiry, “so that the uncontroversial elements – such as real-time donation disclosures and a reduced disclosure threshold – can be passed without delay in the next parliamentary sitting period”.
Even these elements are not entirely uncontroversial, however. The minor parties and transparency advocates might favour the proposed reduction in the disclosure threshold for political donations from $16,900 to $1000 each calendar year, but the conservatives claim such a reduction would discourage their donors from giving.
It is fair to say that almost everyone else is supportive of the transparency aspects of the package, such as the provision that all donations would have to be declared within a month outside election periods, weekly once an election is called, and daily in the final week before polling day. There is also comprehensive support for a broader definition of what constitutes a gift.
These would not be hard changes to make, Chaney says. She and Pocock brought their own proposed legislation last year to improve funding transparency and limit the amount any single donor could give a political party.
That draft legislation proposed a cap equivalent to 2 per cent of the total public money spent on party funding – roughly $1.5 million. It was almost universally supported by other members of the cross bench but not by the major parties.
Says Chaney: “The Labor Party has said for a number of years that its policy is to have greater transparency, and it could have put that through on any day of this parliament, with crossbench support in both houses.”
Chaney has already imposed greater transparency rules for donors to her campaign.
“We built a website in a week that disclosed every cash donation in real time,” she says. “People have the option to be anonymous, as they’re legally allowed to. Only about 10 per cent of my donors have chosen to do that.”
Such unilateral action brings disadvantages and has resulted in media stories about who is backing Chaney. “But we’ve got no idea who’s funding my opponent. It could be Gina Rinehart. She lives in my electorate. But we don’t know.”
Chaney’s invocation of the name of Australia’s richest person is not random. The member for Curtin has repeatedly named Rinehart, under protection of parliamentary privilege, as an exemplar of the inadequacy of current donation laws.
In February 2023, Chaney cited ABC reporting of undisclosed donations from Rinehart to the Liberal Party. She told parliament that the billionaire had given $300,000 over two years.
“This enormous sum was undisclosed because it was transferred by a third party, the Sydney Mining Club. This sum is more than the total that Hancock Prospecting has declared in donations to all political parties since 1988. Who knows if there is more...
“What influence has this hidden donation brought? What deal was made between Ms Rinehart, the Sydney Mining Club and the Liberal Party for the receipt of this money?”
Chaney’s questions are even more relevant given recent events here and in the United States. Rinehart celebrated at Mar-a-Lago with other supporters of Donald Trump when he won the US presidency in November. Subsequently, in a statement to The Australian Financial Review, she revealed she had a private meeting with Trump’s richest and most influential backer, Elon Musk.
Musk reportedly spent US$277 million backing Trump and was rewarded with a job leading a new agency, the Department of Government Efficiency, tasked with slashing as much as $2 trillion, or 30 per cent, from US government spending.
Within in a month of the election, Musk’s personal fortune had increased by some $170 billion.
Rinehart told the AFR their meeting gave her “a chance to congratulate Elon on his leadership to drive an office of government efficiency, to cut government waste, this being much needed in Australia too”.
Last week, Opposition Leader Peter Dutton, as part of his reshuffle of the Coalition shadow ministry, announced he had given Senator Jacinta Nampijinpa Price new portfolio responsibility for “government efficiency”.
It could be a coincidence, but Simon Holmes à Court sees a parallel.
“Gina could be shovelling money into this election as we speak,” he says. “She’s been hanging around with the oligarchs at Mar-a-Lago, learning from Musk how investing a couple of hundred million can be incredibly lucrative.”
In Holmes à Court’s view, the failure of the government to get electoral changes through parliament last year, including constraints on “megadonors”, is not just a “huge missed opportunity”.
“If it turns out that Gina’s or Clive [Palmer]’s billions have a big impact at this election,” he says, “everyone will be very upset with Labor for flubbing this opportunity.”
As to whether the government plans real reform of Australia’s electoral laws or is more concerned with nobbling the chances of minor parties and independents, including the 30-odd candidates Climate 200 will be backing at the election, well, we’ll likely find out on Thursday.
This article was first published in the print edition of The Saturday Paper on February 1, 2025 as "A gain of duopoly".
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