FED: On the election money trail

AAP General News (Australia)
02-02-2007
FED: On the election money trail



EDS: Updating with new AEC information on Family First)



By Maria Hawthorne, Chief Political Correspondent

CANBERRA, Feb 2 AAP - It seems inconceivable, but the amount of money earned by political
parties has dropped by half in one year.

In the 2004-05 financial year, which took in barely four months of the October 2004
election, parties raked in more than $150 million.

Yet last financial year, it was less than $75 million - still a substantial figure
but a marked decrease on revenue.

Some of the difference can be explained simply by election timing.

Donors are obviously more fired up to give money to political parties in an election year.

But it can also be explained by changes in the electoral laws to the amounts that parties
have to declare.

Since the 1980s, all donations of more than $1,500 had to be declared to the Australian
Electoral Commission (AEC), which publishes the details annually.

But last year new laws were introduced lifting that disclosure threshold to $10,000
- a plan first raised publicly at the Liberal Party's national conference in 2005.

It is now possible for companies or individuals to donate up to $90,000 to a party
without exposure by donating $9,999 to each of a particular party's state and territory
divisions and its national division.

The laws were made retrospective to December 2005, meaning that the latest figures
include six months of smaller donations being disclosed and six months under the new regime.

It's impossible to gauge the full impact, but Labor's special minister of state spokesman
Alan Griffin estimates the Liberal Party has received at least $800,000 that it did not
have to disclose in the latest figures.

A new coalition of academics, legal figures and independent politicians, Democracy
Watch, calls the new system "the weakest and most corrupting disclosure laws in the developed
world".

They fear it could lead to controversial sources like tobacco companies, casinos and
property developers making bigger secret donations to parties where there may be a conflict
of interest.

And money can be shifted around from state parties to federal and back again to hide
the trail, they say.

For instance, a local developer looking for approval for a project could channel money
through a donation to the state party, which gets handed on to the federal party and then
back to the local council handling the developer's application without discovery or exposure,
Democracy Watch says.

"Nobody should believe this money is donated because of any altruistic enthusiasm for
democracy," the group says.

"Even if there is no direct undertaking on behalf of the beneficiaries, clearly it's
about buying influence."

Even when the donations are larger than $10,000, it can sometimes be up to individual
donors to out themselves.

Hong Kong billionaire Stanley Ho, who controls the Chinese gambling island of Macau,
bought himself a couple of hours with NSW Premier Morris Iemma and state Treasurer Michael
Costa with a $48,000 bid at NSW Labor's state budget dinner last year.

That won him the right to have lunch with the two politicians, but his bidding did
not stop there.

Dr Ho, 84th on the Forbes magazine rich list with an estimated worth of $A8.4 billion,
also shelled out $61,000 in winning bids for a home entertainment package, signed bottles
of Grange and a Rolling Stone guitar.

In all, his total donation to NSW Labor that night was $109,000 - which he duly declared
to the AEC.

Only trouble is, NSW Labor did not declare it in its return.

While it would not classify as a donation for tax purposes as Dr Ho received goods
in return for his money, it falls squarely within the AEC definition of a gift or donation
which must be declared.

There are no returns listed for the conservative Family First's national branch, although
two of the party's state branches have listed donors.

The party's South Australian and Victorian branches both received $10,000 in 2005/06.

Last election the fledgling religious Right party had $1.7 million in donations to
fund its campaign, which succeeded in having Victorian candidate Steve Fielding elected
to the Senate.

AAP mfh/sb/jt/sp/sp

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