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Election funding – a right or a rort?

By John Hargreaves 5 February 2018 14

Federal donations

She-Who-Must-Be-Obeyed and I were chatting about the way public funding is doled out in the ACT recently and whaddya know? An article hit the media about disclosure and limitations on federal donations and spending for elections. Now, didn’t this open a can of worms for our often lively discussion?

Firstly, just to re-acquaint you on what is the go in the ACT, the law changed a bit recently. A wander through the ACT Electoral Commission’s website is a revealing trip.

The Assembly changed the rules to remove the cap of $10,000 on donations but lowered the limit on disclosure of donations to $1,000. The idea here is that receiving money didn’t necessarily corrupt the system as long as the donations were publicly disclosed so that everyone knows where campaign funding comes from.

But, they decreased the limit per candidate on expenditure from $60,000 to $40,000. This needs to be taken with the view that the Assembly had just increased in size from 17 Members to 25 Members. Under the old system, a party fielding 17 candidates would attract an expenditure limit of $1,020,000 but in an Assembly of $25 Members, the maximum a party could attract is now an indexed (to CPI) of $1,000,000, thus decreasing the spending limit by $20,000.

From where I’m sitting, it is the expenditure which influences elections, not the donations. And it doesn’t matter how rich a party is, it can only spend up to the limit.

But of course, others can spend up to $40,000 if they are a third party campaigner or an associated entity, like unions, business entities formed for the purpose of supporting a party, or a political lobby outfit like GetUp!

So if you’re a member of a political party and your mob fields a full list, you get the corporate benefit of up to $1,000,000 in campaigning. But stiff if you contribute your own money to get yourself elected within the party structure. In the ACT Liberals, a candidate must cough up about $3,000 to be pre-selected and then are expected to contribute to the party coffers. In the ALP, fundraising goes into a central fund, but candidates can spend their own cash. In both cases though, candidates are given a spending limit (which is incorporated into the party’s overall spending limit) so that the corporate effort is not unduly compromised.

The votes gained by these party preselected candidates are aggregated and as long as the party as a whole gets more than 4% of the vote in a given electorate, the public funding of $8.23 per vote as at 2016 is credited to the party’s bank account.

The candidate gets SFA. Successful candidates get applause and unsuccessful ones get condolences.

I know of one candidate in a previous election who mortgaged the family home, spent over $30,000, got elected and received not a penny from the party. A claim against taxation was possible but that only reduced the burden. This is not an isolated case. My advice to intending candidates is that if they don’t have $10,000 they can throw away, don’t even think about it!

For independent candidates, and non-party MLAs, the limit on their expenditure is $40,000. But to spend this kind of money, you have to either have it or raise it. Now, who is going to fund an unknown (or even a well-known) independent candidate and not want anything in return?

These candidates also have to get at least 4% of the vote in the electorate or they have wasted the spending.

In the electorate of Brindabella in 2016, there were 48,238 votes cast. So you needed 1,930 votes to get your electorate funding. In Ginninderra it was 48,526 (1,941), Kurrajong 49,900 (1,996), Murrumbidgee 51,296 (2,052) and in Yerrabi 52,500 (2,100).

Now you’d reckon that it should be a breeze to get around 2,000 people to vote for you eh? Not so. The current crop of Assembly members holds no independents at all. And… the major two parties fielded 5 candidates in each electorate so earning the maximum spending limit but Labor got 12 seats and the Libs 11 seats. This means that there were 13 Labor and 14 Liberal candidates who lost out and got nothing for their efforts and no recompense for their expenditure. If each one spent about $10,000 this would be $130,000 and $140,000 respectively down the drain.

But the parties themselves got a heap of money refunded. Labor attracted 93,811 votes and got about $772,100, the Libs 89,632 votes ($737,700) and the Greens 25,096 votes ($206,500). According to the Electoral Commission’s disclosure returns, the ALP spent $985,242, the Libs $962,020 and the Greens $320,687. So the taxpayer refunded the ALP about 78%, the Libs 77% and the Greens 64%.

That’s democracy for you. Or is it?

Why is it that a candidate has to get 4% when a party can aggregate their 5 candidates to achieve the same 4%? Why is it OK for a party to pocket the public funding and make the unsuccessful candidates pay for the privilege of being cannon fodder? Successful candidates get rewarded with a four-year contract at about $200,000 a year (and more if a ministerial or leadership position comes their way).

My SWMBO and I reckon that in a true democracy, public funding should be given to the candidate. Period. If a party wants to raise funds and put a corporate entity to the electorate, fine, but not to the detriment of candidates themselves.

So, our system is that a candidate gets $8.23 (indexed to CPI) for every vote they get. If you get 15,000 votes you get up to $123,450 but if you get 200 votes, you get up to $1,646.

But we also say that you don’t get reimbursed simply a per vote figure, you get reimbursed $8.23 per vote up to the limit of your personal expenditure on the election. And this amount is deducted from the total public funding allocated to the party in which you are registered.

But… and here’s the rub.. there needs to be protections against rorters. I remember in a federal election Pauline Hanson did not win, but as a party-heavy, got over the minimum votes limit and pocketed hundreds of thousands of dollars for losing the election. Her party coughed up the campaign costs but she pocketed the public funding.

Democracy is a funny animal, and public funding to prevent corruption is a vexed issue. Any thoughts psephologists?

What’s Your opinion?


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14 Responses to
Election funding – a right or a rort?
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John Hargreaves 4:12 pm 08 Feb 18

To Matt Donnelly, Riotact is usually not a site for the publication of party views but the views of individuals who don’t toe the party line or who want to defend/promote an individual position. As for the Liberal Democrats, in this day and age, the terms are mutually exclusive.

    Matt Donnelly 11:43 am 09 Feb 18

    RiotACT has been publishing Liberal Democrats posts and comments for quite some time now. I recommend checking out my piece from last August on electoral reform.

    You requested views on public funding during elections. I provided you with six paragraphs on the subject but your reply is a dig at our party name? Pretty lame, John. I thought you wanted a discussion.

Matt Donnelly 4:22 pm 06 Feb 18

The ACT Liberal Democrats believe that expenditure cap rules unduly favour incumbents and unreasonably limit political communication by third parties. The caps should be removed.

Reducing the electoral expenditure cap to $40,000 from $60,000 per candidate and third party campaigner was an unnecessary fettering of free political speech. There is no sound evidence that funding caps meet their intended purpose of addressing undue influence on political campaigns.

The ACT Liberal Democrats opposes government funding of things that private individuals or organisations are willing to pay for voluntarily.

At $8 per first preference vote, public funding of political parties and non-party candidates for ACT Assembly elections is as unjustified as it is outrageous. It’s the highest in Australia and overwhelmingly supports the major parties.

The funding is not meeting its intended purpose of reducing the risk of donors buying favourable policies. The underlying problem is that governments intrude into our lives too much. There would be less need to lobby a government that did less. As it stands, business success can often depend on favourable ministerial decisions and there is no shortage of people keen to enlist the government’s support to impose their views on the rest of us.

Public funding forces taxpayers to contribute to parties they would never support voluntarily. It is ludicrous that their money pays for virtually every political poster, leaflet and television advertisement. The amount of public funding rose by 319% in the 2016 Legislative Assembly election compared to the preceding election. The three major parties disproportionately received 97% of the public funding despite achieving only 86% of the first preference vote.

The ACT Liberal Democrats considers that this public funding should be abolished. However, if public funding is retained, it should be made equivalent to the smallest level of funding elsewhere in Australia and the 4% vote threshold should be eliminated as this discriminates against minor parties and independents.

Garfield 1:29 pm 06 Feb 18

I believe that public funding of election campaigns strengthens democracy in that it allows minor party and independent candidates to give voice as to why they should be elected instead of voters just choosing between the existing parties with a profile. The caveat is that it needs to be equitable and that’s not the case in the ACT now. The 4% threshold excludes the majority of minor parties and candidates, meaning the major parties are effectively passing legislation to fund themselves while excluding most other candidates. The fact those parties force their candidates to substantially fund their own campaigns, means the parties are profiting from the current high level of funding, which should not happen.

John also failed to mention the administrative funding of more than $22,000 p.a. per MLA that goes to the Parties for essentially nothing. The campaign profits and administrative funding is no doubt used to fund staff and other costs that are not direct electioneering expenses, giving the major parties another financial advantage over other candidates. Anyone striving to understand why politicians are held in disdain by many people in our society shouldn’t have to work too hard.

    John Hargreaves 4:10 pm 08 Feb 18

    I agree with most of this post. However, the $22,000 is per MLA and goes to all elected office holders, via the party they belong to or individually if not in a party. This is something I think needs addressing because it gives a sitting candidate an advantage. So well pointed out. I don’t agree with the view that many in the voting public hold politicians in disdain and those who do have never met one, nor seen how hard they actually work.

    Garfield 1:58 pm 09 Feb 18

    John, I deal with lots of people from all different backgrounds in my work and sometimes chat about politics with them. Condemnation and disdain for politicians is almost universal. You should look up trust surveys. Only around 13% of people trust politicians as a class, usually putting them just ahead of used car salesmen.

Blen_Carmichael 11:18 am 06 Feb 18

“Ben’s use of the term “parasitic class” is unfortunate. “

Unfortunate, but accurate.

“Capital Retro talks about a dictator like Mussolini. Not only is this slander and libel and actionable by the CM if he were to feel aggrieved.”

I don’t think you’re well-versed in defamation law if you think that such an action would succeed. Also it’s rich of you to get all high dudgeon about supposedly defamatory remarks when you and your mates have had the protection of parliamentary privilege.

“But for some reason, many in our society have not only a lack of respect for those who put their hand up for public office, but a disdain for them.”

John, your homework tonight is to thresh out the clause “But for some reason”.

    John Hargreaves 4:07 pm 08 Feb 18

    “But for some reason” is gutless. Give facts or withdraw. I doubt if most in the voting public have a disdain for those who put their hands up for election. It is a courageous thing to do, exposes folks and their families to political voyeurism and is a big ask. Only the bitter and twisted would think any other way, usually without cause.

    Parliamentary privilege is just that – a privilege and those who abuse it should be called out. As for slander and libel, those who denigrate others using pseudonyms, ought to check out legal precedent on “online and social media” slandering.

    I use my own name on everything I write, I have always done so and my name has been in the phone book with my address before, during and after public office. This is not the act of a coward but pseudonyms are unless there exists a history of trolling. In your case, I doubt this is the case because you are too free with wild accusations and ill conceived terminology.

    Blen_Carmichael 5:34 pm 08 Feb 18

    ““But for some reason” is gutless. Give facts or withdraw.”

    Withdraw what? Incidentally, the phrase “But for some reason” was yours, in which case you’re implying that you yourself are gutless, which doesn’t make sense.

    “This is not the act of a coward but pseudonyms are unless there exists a history of trolling. In your case, I doubt this is the case because you are too free with wild accusations and ill conceived terminology.”

    I’m not the one who starts his column with the usual ‘I spat out my cornflakes reading this’ and which contains a surfeit of exclaimation marks, so ease up on the charge of wild accusations. and ill conceived terminology.

    And what’s this about pseudonyms being the act of a coward? Hmm. You’re implying that I use a pseudonym. Let me ask you a very simple question, John: what makes you think – or what makes you think you know – that I use a pseudonym?

John Hargreaves 10:52 am 06 Feb 18

My response to Ben_Carmichael and Capital Retro is that one should really try to disguise one’s prejudices. Ben’s use of the term “parasitic class” is unfortunate. I have no doubt that there are many pollies throughout the land who are parasitic but it is not a class. there are heaps of well meaning pollies who don’t take advantage of possible perks, who do the job for altruistic reasons but are lumped into a bunch of bad apples. But for some reason, many in our society have not only a lack of respect for those who put their hand up for public office, but a disdain for them. Sad really.

And Capital Retro talks about a dictator like Mussolini. Not only is this slander and libel and actionable by the CM if he were to feel aggrieved, it shows again a prejudice. He/she says that democracy is not delivering but yet we all have the power to remove non performing MMLAs and have done so in the past. Democracy is working but it is just not delivering what CR wants. Again, sad really.

And both miss the point. I was seeking views on public funding as an alternative to donations to remove the possibility of corruption, even though we have had no corruption in the ACT since self Govt came in. Some will point to undue influence perhaps but there is not evidence of personal gain through political favours.

Grimm 3:37 pm 05 Feb 18

Gotta be kidding.
Fund your own campaign. None of you should get a cent of public money to run for office.
As far as I am concerned, you are all rorting the public purse.

Alan James 1:47 pm 05 Feb 18

Taxpayers should not fund political candidates, they take enough out of the public purse when elected.

Blen_Carmichael 11:55 am 05 Feb 18

“My SWMBO and I reckon that in a true democracy, public funding should be given to the candidate.”

How does a sense of entitlement and sticking one’s hand out for public dosh a case of “true democracy”, John? Given politics now is dominated by careerists, why should the increasingly-burdened taxpayer have to subsidise a parasitic class?

Capital Retro 8:40 am 05 Feb 18

In 12 months time there will only be two problems in the ACT.

The first one will be how to repay the enormous Territory debt and the second one is how to get the trams to run on time.

If we have a dictator like Mussolini we can achieve that because clearly, democracy is not delivering.

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