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Funding furphies – How ACT political parties come up with the cash

By John Hargreaves - 14 September 2015 7

legislative-assembly

During the week, I had a look at the ACT Elections website and focussed on the annual returns for the political parties in the ACT. The findings were very interesting indeed.

The prevailing wailing from the Libs is that the Labor Party get its income from the pockets of problem gamblers via the Labor Club.

The Libs bellyache and say Labor should divorce itself from that dependence. Former chief ministers have said as much. Well let’s see where the parties get their money from.

The ACT Electoral Commission gave the ALP $125,000, the Libs $167,700 and the Greens $20691. Hare-Clark at work.

Look at how much the Labor Club gave the ALP in the latest returns. The donation of money was minimal. The majority amount of support it gave was for room hire waiver for party meetings. The same is said for the CFMEU, the Southern Cross Club and the Burns Club.

I found it interesting that the Libs haven’t declared any in-kind support for its branch meetings so I can only assume that one of the following is true:

  • They pay for room hire, which is unlikely for a party owing $317,500 to the National Bank
  • They hold branch meetings in someone’s home, in which case the numbers of card carriers would be really low
  • They aren’t having meetings.

Clubs gave the ALP $63,600 in in-kind support for their meeting room hire. How dare they?

The public office holders give money by way of levies to their parties. I don’t know what the arrangements are for the Libs and Greens but the amounts reported show an interesting story. I have just tallied up the amounts declared as receipts and not as donations. To include these figures would make the variations even wider.

The ACT ALP received $91,700 from their public office holders, the Libs $39,900 and the Greens $23,400. Obviously the Libs don’t cough up as much to the party which put them there.

The Asia Society of Hong Kong paid the ALP $8,000 for Mr Corbell to travel to Hong Kong to attend an event. But note that this is there for all to see. It is not dragged out kicking and screaming ,and I’m pretty sure there was no chopper ride in there.

The ALP received $244,100 from the 1973 Foundation. This foundation was set up to provide an alternative revenue source divorced from the Labor Club’s activities. Its principal source of money derives from investment in G8 Education Ltd, the largest child care company listed on the ASX. Not a pokie in sight. The Foundation also derives money from Westpac. Again, not a pokie in sight.

The Libs get their support from a range of individuals and firms in smallish amounts like $2,000 here or $5,000 there, with the occasional $7,800 thrown in.

But they also received $285,900 from LJ Hooker, as rents received from buildings they own. As rents are moneys earned by the party as the owner of the real estate, the figure is not required to be listed as a donation. Sneaky that!

These buildings are a bit old now. Would the Libs benefit from a removal of the lease variation charge if they wanted to sell up and redevelop elsewhere? Hmmm! What do you say Messrs Hanson and Smyth?

They also got another $18,100 from Stratsec, which I think is rent also. Happy to be corrected on this one.

The Caesar’s wifey Greens got their money from periodic payments from members in small amounts and an amount of $20,000 from one Stephen Pradgham . Very generous individual.

The debts returns were interesting. The ALP owed $12,000 to a company called Co-ordinate, the Greens owed $5,100 to the Tax Office and Superannuation Holdings between them, and the Libs owed the National Bank $317,000. This Libs’ figure is down on last year from over $400,000.

It begs the old pollie mantras ….. if you can’t manage your own financial affairs, how can you manager the Territory’s finances? Good question that!

So now, some general comments. The good news is that all this was available on the public record for all to see. There is no dodgy record keeping. Or is that true? Doesn’t my memory tell me that the Libs were in trouble for not declaring their returns properly last time?

But it is true that we can all see how they are funded and make judgements about perceptions of conflicts of interest.

Speaking of which, let’s return to the beginning and address the nonsense of the ALP dependence on the pockets of problem gamblers. The biggest contributor by a long shot was a Foundation whose source of income is in child care. The general public expressed disquiet when there was a close association between the ALP and the Labor Club.

The 1973 Foundation was created, and now invests to achieve an alternative revenue source. This information is available on the public record thanks to the Electoral Commission. So let’s not have any more of this nonsense about a conflict of interest in the review of gaming laws in the ACT.

The Libs’ major source of revenue is from real estate. One could argue that the Libs have a conflict of interest in wishing to maximise their income to address the massive debt they have accumulated. One could argue that they should not take part in debates around changes to planning and taxation laws which would directly benefit themselves. They will benefit from any change to the lease variation charge.

The Greens rely on individual zealots to fund their party. Good on them, I say. I think that possibly, they will never be in a position to take government in their own right and the best they can do is the blackmail the government of the day, and this could be a reason why the private sector won’t cough up.

Interestingly, one former MLA had massive numbers of shares in Ethical Investments Ltd, a company which manages portfolios for people who only want to invest in sustainable and greenie-type investments.

How come that firm doesn’t support the party most like themselves and which advocates for legislation to ensure that the public sector super funds are invested ethically? Interestingly, there aren’t that many companies like this one so perhaps a cornered market exists.

Interesting, eh?

What’s Your opinion?


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7 Responses to
Funding furphies – How ACT political parties come up with the cash
Nilrem 9:28 am 15 Sep 15

justin heywood said :

“The ALP received $244,100 from the 1973 Foundation. This foundation was set up to provide an alternative revenue source divorced from the Labor Club’s activities. Its principal source of money derives from investment…….. not a pokie in sight.”

Disingenuous. The 1973 Foundation uses pokie money to buy property, then funnels the profits back to ACT Labor, thus setting up a (very) thin veneer of respectability to the source of the funds.

That is the whole point of the 1973 Foundation.

Yep. I’m a progressive politically. I can’t stand how Labor is hooked on this trade in human misery.

justin heywood 7:06 am 15 Sep 15

“The ALP received $244,100 from the 1973 Foundation. This foundation was set up to provide an alternative revenue source divorced from the Labor Club’s activities. Its principal source of money derives from investment…….. not a pokie in sight.”

Disingenuous. The 1973 Foundation uses pokie money to buy property, then funnels the profits back to ACT Labor, thus setting up a (very) thin veneer of respectability to the source of the funds.

That is the whole point of the 1973 Foundation.

Nilrem 3:36 pm 14 Sep 15

“Speaking of which, let’s return to the beginning and address the nonsense of the ALP dependence on the pockets of problem gamblers. The biggest contributor by a long shot was a Foundation whose source of income is in child care. The general public expressed disquiet when there was a close association between the ALP and the Labor Club.”

So the Foundation’s source of income is childcare, but where did the principal come from to make the income? Pokies.

Garfield 12:57 pm 14 Sep 15

John Hargreaves said :

Garfield said :

Good to see you haven’t lost the art of creating spin to support your team John. Googling “1973 foundation” comes up with a number of articles about multi million dollar transfers from the Labor Clubs to the foundation since 2011. The Labor Clubs may not have directly contributed much to the Labor Party in the most recent year, but the Foundation was established with club money. It was also interesting to read in a CT article of 13 May 2015 that the only receipt disclosed by the Foundation was $456,000 from real estate firm CBRE. Could it be that the 1973 Foundation was also investing in real estate, just like the Libs?

My point is that each party should be treated equally, not just the ALP being accused of being pariahs. The Libs always shout conflict of interest when the ALP talk about pokies yet when the Labor Club divested itself of money to the ALP, for which the club was established in the first place, and they go for non-pokie related revenue source, the ALP still can’t get it right.

Contrast that with the Libs who have real estate investments and don’t get it that they may have a conflict of interest, or even a perceived conflict of interest where they will benefit directly from changes to the lease variation charge.

Double standards me thinks.

as for the CBRE bit, it is noteworthy that you know about where the funds for the 73 Foundation come from. Can you tell me the real estate holdings of the Libs? I bet not. the ALP is being transparent but I can’t say that about the Libs.

and what do you say to the level of debt carried by the Libs? $317,000 debt tot the Nat Bank! contrast that with the $12,000 for Labor and $5,000 for the Greens. Where are these financial geniuses? The blue tie set are supposed to be the better and more responsible financial managers of the three parties.

The fed Libs shout debt is bad, the local Libs have more debt than many mortgage holders. Good financial managers, my foot!

Your article was designed to say the link between the ALP and the clubs had been broken, while conveniently not mentioning the source of funds in the Foundation. The clubs contributed $378000 in 2010/11, the year the foundation was established, $3600000 in 2011/12 and $2500000 in 2013/14. With an average of almost $1.3m per year over the last 5 years, who’s to say there won’t be more in the future?

Hasn’t it been a long known fact that the Libs hold real estate? It seems to me that Labor politicians bring it up on a regular basis, just as Liberal politicians bring up the Labor Clubs. Re the specific real estate holdings of the Libs, I can’t tell you because I can’t be bothered doing a title search but anyone who is sufficiently interested can easily find out. Re the LVC, yes there is a potential conflict of interest there for the Libs depending on what properties they hold and whether they want to vary the leases, just as there is a conflict of interest in the ALP opposing pokies pre commitment, or allowing people to feed more money though the machines in shorter timeframes.

As to debt levels, the Libs have $317,000 of debt. While down from the previous year it is more debt than they had for some years prior to the 2012 election. The Labor Clubs have $10.6m of debt to Westpac which was first declared in 2010/11 – the year they started putting money into the foundation, and the debt hasn’t been reduced at all since then. As the clubs are owned by the Labor Party, per Jon Stanhope’s City News article of March this year, that debt has to be included when looking at the parties.

With the rental income you mentioned above, I’m guessing the Libs properties may be worth $2.5m. According to Stanhope’s article, the proposed sale of the clubs in 2009 was generating bids of significantly more than $20m. Since then profitability seems to have dropped, which would have reduced their value, but lets call it say $25m plus say $6-7m in the foundation. The Libs therefore have a loan value ratio of 12.68% and Labor has at least 33%. In terms of debt levels, Labor looks to be carrying significantly more debt than the Libs.

Now you asked who are the better economic managers of their own affairs. Certainly in the past Labor did much better than the Libs, accumulating significantly more assets through the clubs, but in recent years Labor’s debt has risen significantly more than that of the Libs, suggesting that while they have a much smaller asset base to work with, the Libs have been managing it better than Labor has been managing their larger asset base. This isn’t to say that the Libs have been good managers, as their position looks to have gone backwards, just that Labor appears to have been worse.

watto23 12:13 pm 14 Sep 15

Garfield said :

Good to see you haven’t lost the art of creating spin to support your team John. Googling “1973 foundation” comes up with a number of articles about multi million dollar transfers from the Labor Clubs to the foundation since 2011. The Labor Clubs may not have directly contributed much to the Labor Party in the most recent year, but the Foundation was established with club money. It was also interesting to read in a CT article of 13 May 2015 that the only receipt disclosed by the Foundation was $456,000 from real estate firm CBRE. Could it be that the 1973 Foundation was also investing in real estate, just like the Libs?

This is a major gripe of mine. Political parties get funding from donors. It is blatantly obvious that donation is to ensure policies are made to protect the donors interests. If the donors interests are not in the best interests of the ACT or Australia, for the voters its tough luck or we can try to vote in a minor party or independent.

At the very least all political donations should be as transparent as they can be, just like politicians expenses and entitlements should be also.

Note this applies equally to both parties as I’m not a believer in unions or business knowing whats right for the ACT or Australia. You only need to look at places like the USA when groups with vested interests control the policies of the government and the people are worse of for it.

John Hargreaves 11:04 am 14 Sep 15

Garfield said :

Good to see you haven’t lost the art of creating spin to support your team John. Googling “1973 foundation” comes up with a number of articles about multi million dollar transfers from the Labor Clubs to the foundation since 2011. The Labor Clubs may not have directly contributed much to the Labor Party in the most recent year, but the Foundation was established with club money. It was also interesting to read in a CT article of 13 May 2015 that the only receipt disclosed by the Foundation was $456,000 from real estate firm CBRE. Could it be that the 1973 Foundation was also investing in real estate, just like the Libs?

My point is that each party should be treated equally, not just the ALP being accused of being pariahs. The Libs always shout conflict of interest when the ALP talk about pokies yet when the Labor Club divested itself of money to the ALP, for which the club was established in the first place, and they go for non-pokie related revenue source, the ALP still can’t get it right.

Contrast that with the Libs who have real estate investments and don’t get it that they may have a conflict of interest, or even a perceived conflict of interest where they will benefit directly from changes to the lease variation charge.

Double standards me thinks.

as for the CBRE bit, it is noteworthy that you know about where the funds for the 73 Foundation come from. Can you tell me the real estate holdings of the Libs? I bet not. the ALP is being transparent but I can’t say that about the Libs.

and what do you say to the level of debt carried by the Libs? $317,000 debt tot the Nat Bank! contrast that with the $12,000 for Labor and $5,000 for the Greens. Where are these financial geniuses? The blue tie set are supposed to be the better and more responsible financial managers of the three parties.

The fed Libs shout debt is bad, the local Libs have more debt than many mortgage holders. Good financial managers, my foot!

Garfield 10:27 am 14 Sep 15

Good to see you haven’t lost the art of creating spin to support your team John. Googling “1973 foundation” comes up with a number of articles about multi million dollar transfers from the Labor Clubs to the foundation since 2011. The Labor Clubs may not have directly contributed much to the Labor Party in the most recent year, but the Foundation was established with club money. It was also interesting to read in a CT article of 13 May 2015 that the only receipt disclosed by the Foundation was $456,000 from real estate firm CBRE. Could it be that the 1973 Foundation was also investing in real estate, just like the Libs?

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