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Developers support proposal to ban political donations


The World Today - Friday, 7 November , 2008  12:26:00

Reporter: Jennifer Macey

ELEANOR HALL: Property developers are high rollers when it comes to political donations, but many of them are now supporting proposals to ban donations.

The corruption scandal in Wollongong earlier this year put pressure on the New South Wales Government to ban donations from businesses and property developers who were seen to be benefitting from favourable planning decisions.

But while the developers may be on board, the New South Wales Premier Nathan Rees has now backing away from a promise by his predecessor to implement the ban as Jennifer Macey reports.

JENNIFER MACEY: In an effort to distance itself from the stain of the Wollongong property developer's corruption scandal, the New South Wales Government announced it wanted to ban all political donations.

But the now the Premier Nathan Rees is backing away from that promise made by his predecessor Morris Iemma. He says that while he personally supports more public funding of election campaigns - a total ban could be too hard to implement.

NATHAN REES: If we were to move down my preferred path which is a ban on donations, publicly funded elections, then the difficulties are several-fold.

Firstly you have issues across jurisdictions. Secondly there is arguably, arguably you could draw the conclusion that is a limit on free speech.

JENNIFER MACEY: The New South Wales Government sought legal advice on the issue from constitutional law expert Dr Anne Twomey from the University of Sydney.

She says a ban in New South Wales could be considered unconstitutional.

ANNE TWOMEY: The problem is that in Australia the political parties work at both the commonwealth and the state level so the New South Wales branch of the Labor Party or the Liberal Party for example receive money, donations and that money is then used to support candidates both in state elections and in commonwealth elections.

So if you passed a law saying that New South Wales branches of political parties couldn't receive donations at all, that would affect not only state elections but it would also affect their ability to run campaigns and support candidates in commonwealth elections.

JENNIFER MACEY: And she says if New South Wales were to go it alone - the money would simply be diverted elsewhere.

ANNE TWOMEY: Someone once described this as like a water bed and you press down in one part, say New South Wales on the water bed but all the money that is sloshing around inside just pops up in the other places.

What you have got to do is press down equally right across the country in order to solve this problem.

JENNIFER MACEY: Dr Twomey says an outright ban could be tested in the High Court on the grounds that if could prevent the freedom of political communication.

But Robin Banks from the Public Interest Advocacy Centre says this is a weak legal argument.

ROBIN BANKS: And in other countries like Canada where they indeed have a charter right for freedom of expression there are limits on campaign donations. America has limits on campaign donations and we are using an implied right. Not even an absolute right to, sorry, the Premier is using an implied right to argue that he can't do something but it is certainly in the public interest.

JENNIFER MACEY: Are you disappointed with the decision not to implement a ban?

ROBIN BANKS: I think disappointed would be an understatement. I am extremely disappointed. It sounds like an excuse.

JENNIFER MACEY: And the Public Interest groups have an ally from an unlikely corner. Property developers too say they support a ban on political donations.

Aaron Gadiel is the Chief Executive Officer of the Urban Taskforce of Australia.

AARON GADIEL: Oh no, I think Australia and New South Wales, all the states, should be moving towards a ban on political donations. I think that will improve public confidence in the political decision-making process and make people more comfortable that when decisions are made by government, that are being made in the public interest.

JENNIFER MACEY: But why would you donate to a political party if you didn't expect something in return?

AARON GADIEL: Well you don't. When they make donations to charities and to local arts and cultural organisations, the local education institutions, they don't expect anything in return and it is the same principle applies to political parties.

JENNIFER MACEY: During the last state election the New South Wales Labor Party received $24-million in donations while the Liberal Party only managed to raise $13-million.

The Government says it has introduced some reforms for donations. Anything over $1000 now has to be declared and all gifts are disclosed every six months rather than every election cycle.

But the Opposition leader Barry O'Farrell says the Labor party has backed away from the ban because it needs the revenue to win the next election.

BARRY O'FARRELL: Thirty years ago New South Wales didn't wait for national action before requiring public disclosure of political donations in this state. Mr Rees is simply offering excuses because he and Labor want to try and buy their way to victory at the next state poll.

JENNIFER MACEY: The New South Wales Government says it can't go it alone and will provide its legal advice to the Federal Government's Green Paper on electoral reform headed by Senator John Faulkner.

A spokesman from Senator Faulkner's office says everything is on the table including caps and bans on donations and the Government welcomes any input into designing the paper.

ELEANOR HALL: Jennifer Macey with that report.