When former Victorian premier Dan Andrews introduced the “strictest donation regime in Australia” in 2018, outlawing political donations larger than $4,320 and introducing a ban on foreign donations and a strict penalty scheme for those that did not comply with the rules, it looked like the epitome of a fair go. After all, giving every person an equal opportunity without discrimination or favouritism is what makes our country great.
I’m sure I was not alone when I cheered on these new rules, thinking that they would keep the Parliament from pandering to big donors with deep pockets. Wealthy people buying political influence through donations is basically as old as time itself, resulting in policies that don’t benefit regular folk but rather specific or niche interests.
And yet, upon close inspection, these 2018 rules are anything but fair. In fact, what the Liberal and Labor parties in Victoria didn’t want you to know was that they had rigged the game. How? By exempting a whole bunch of cash from the scheme to the tune of millions of dollars via their nominated entities.
What’s a nominated entity? It’s a handy pot of money that each party established before the strictest donation regime was introduced, and which is not required to comply with these new election laws. A nominated entity can transfer any amount of money it wants to a political candidate or party. No caps and no disclosures required. Nominated entities have a significant advantage when it comes to earning money, as they have income generating assets such as shares and property revenue.
For example, in Victoria, the Labor Party’s nominated entity, named Labor Services and Holdings, donated $3.1 million to finance Labor’s successful 2022 campaign. Similarly, the Liberal Party’s Cormack Foundation, which according to the ASX is worth a whopping $118 million, donated $2.5 million to the Victorian division of the Liberal Party.
When I ran as an independent candidate for the seat in Caulfield in the Victorian election in 2022, every single dollar I raised was through hard work and hustle. I hit the phones. I called people I knew. A few people made introductions. Each donation over $1,100 was recorded within 30 days on a publicly searchable database with the name of the donor listed.
Some people gave me $20; others gave me $1,000; a small handful gave me the maximum amount. The cap on donations was tricky to navigate, as I couldn’t accept a free office space I was offered in East St Kilda because the in-kind donation amount far exceeded the donor cap. Disappointingly for me, I had a donor that wanted to give me $50,000, but I was unable to accept it and instead had to settle for $4,320.
My campaign was carefully planned around my available funds. I couldn’t afford large billboards or advertising because the donor caps were so low, while my opponents booked out every bit of publicly available advertising space, from telephone booths to massive billboards. As an independent candidate I had to fundraise incremental amounts to be able to have a chance at campaigning.
I have no problem complying with strict funding rules, but the Labor and Liberal parties were cheating their way through them via their nominated entities. While I always had to comply with the $4,320 donation cap, they only had to comply with new donors, while their nominated entities were free to give out as much cash as they wanted.
The current Victorian rules are unfair because they create an uneven playing field between independent candidates and any parties which did not have a nominated entity appointed prior to July 2020 when the legislation came into effect. Major parties wrote the law to suit themselves.
I am now part of a group of five independents who all ran in the 2022 Victorian election who are looking to challenge this inequitable source of campaign funding.
We are mounting a legal challenge which will involve asking the High Court of Australia to declare that Labor’s 2018 funding rules are invalid on the basis that these laws, which allow for nominated entities, are an impermissible burden on the implied freedom of political communication.
The implied right to freedom of political communication was recognised by the High Court in 1997 in the seminal case of Lange v Australian Broadcasting Corporation. This freedom is grounded in the freedom of communication between the voters and their representatives.
We think we have a pretty strong case that argues that nominated entities interfere with this freedom by restricting independent candidates, and we’ve written to Premier Jacinta Allan to tell her that. She has not yet replied to our letter outlining our issues, but without a change to the current law, we intend to take this case to have it heard by the High Court.
In the words of Dennis Denuto, one of the original Aussies fighting for a fair go, we want to take this to the High Court because “It’s the constitution … it’s justice, it’s law, it’s the vibe.”
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