Victorians To Pay Political Parties $6 A Vote Under Tough New Donation Laws

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Updated July 30, 2018 13:17:47

Victorian Opposition Leader Daniel Andrews launches Labor's campaign.>> Photo: Every donation over $1,000 will have to be disclosed under the new laws. (AAP: Tracey Nearmy)

>Related Story: Fact check: Is Victoria set to legislate the strictest political donation laws in the country?

>Related Story: Victoria's foreign donation ban in doubt as Opposition rejects 'fake' reform

>Map: Melbourne 3000

The Victorian Parliament has just passed new rules on political donations, which have been dubbed the strictest in the country by the State Government.

The overhaul made it through the Upper House on Tuesday night before receiving the final tick of approval from the Lower House.

Here's why the changes matter.

What exactly has changed?

Donations in Victoria will be restricted and capped under the new reforms — there will be

no more foreign donations

and domestic ones will be limited to a maximum of $4,000 every four years.

Every donation over $1,000

will have to be disclosed to the public.

Under the current rules, only donations over $13,500 are disclosed on the Australian Electoral Commission (AEC) website, and anything less can be completely anonymous.

The only existing restrictions on political donations are that gambling licence holders and casinos cannot donate more than $50,000 a year.

Donations are only disclosed in annual returns after an election. But the new rules will require political parties to

tell the electoral commission what they've taken within a month of receiving it.

The Government said the changes are about

increasing transparency and

preventing influence on political decision-making.

But the Opposition is against the changes because they will increase the cost to the taxpayer.

Victorian opposition leader Matthew Guy>> Photo: One of the biggest donors to the Matthew Guy-led Liberals is the Cormack Foundation. (AAP: Julian Smith)

How much money goes into politics now?

Quite a lot. An analysis of political donations disclosures over the past four years shows

the Victorian branch of the ALP took

in more than $11 million in donations and other receipts.

That's according to annual disclosures made to the AEC from the 2013-14 financial year to 2016-17.

The Victorian division of the

Liberal Party received

nearly $30 million.

Those figures exclude what both parties received from the electoral commission and payments from the tax office.

But it's still difficult to know exactly how much of that is donations, because the party gets to decide what is a donation and what is an 'other receipt'.

The term 'other receipts' is broad and includes payments such as income and dividends.

But it could also include payments which blur the line on donations,

like the costs charged to attend fundraising dinners.

And since donations under the threshold do not have to be disclosed, the actual figures would be likely be even higher.

Donations, other receipts made to Labor: 2013 - 2017

Federal Secretariat$297,510
Other receipts$5,890,903



Source: Australian Electoral Commission

Donations, other receipts made to Liberals: 2013-2017

Federal Secretariat$5,119,444



Source: Australian Electoral Commission

Who are the big donors?

The biggest donor to the Liberals is the Cormack Foundation, which has donated

more than $10 million to the party since the 2013-14 financial year.

The Cormack Foundation was set up by senior Liberals in the late 1980s after the sale of conservative radio station 3XY. 

The party's relationship with the foundation has deteriorated recently to the point of court action, after the foundation donated money to other conservative political parties.

Vapold is another associated entity which is operated for the benefit of the Liberal Party, which paid about $3 million to the party.


new donations laws would

shake all of this up, since parties can only nominate one associated entity and any donation to them would be treated like one to the party.


External Link: The biggest donors to the Liberals

Labor has its own associated entities. Labor Services and Holdings Trust paid more than $2.1 million to the Victorian branch, while Progressive Business contributed about $1.4 million to party coffers.


External Link: The biggest donors to Labor

But the party

collects big money from unions, and not all of it is counted as donations.

In a four-year period unions donated close to $1.4 million to the Victorian Labor Party, but they paid

another $4.5 million in other receipts.

While they are not declared as such, many of these payments are union affiliation fees, which are not affected by the proposed donations overhaul.

However, the Government said that money cannot be used for campaigning.


External Link: Union payments to Labor

But if donations are capped, who pays for elections?

That would be you — the taxpayer.

The cost of the changes is estimated at

about $45 million for every political term.

Victorians already pay a percentage of elections, calculated based on the number of votes received by each candidate.

In 2014, that was about $1.65 for every first preference vote received by a party.

The new legislation would

award parties $6 for every Lower House vote and $3 for every Upper House vote.

Calculating those rates reveals a

huge difference in funding from the Victorian Electoral Commission.

Calculating party funding under new system

Party2014 payout from VECFunding calculated at new rates
Source: Australian Electoral Commission

But that's not all

The Government also said it would pay $40,000 to each MP to deal with the

administrative costs of adhering to the new rules.

But when the Opposition withdrew its support, the Government

needed the backing of minor parties for a bill which many said would disadvantage them.

In a last-minute sweetener, the Government put forward changes that gives

$200,000 to independent MPs or the first MP in a party.

The second elected MP gets $70,000 and the third to 45th MPs each receive $35,000.

That money can be spent on office space, staff and equipment — but not political campaigning.

How much will each party get with administrative costs?

PartyNumber of membersAmount of money
The Nationals7$445,000
The Greens8$480,000
Shooters, Fishers and Farmers Party2$270,000

*only one member, each receiving $250,000




The costs to the taxpayer are running up, but crossbench MP Fiona Patten only agreed to support the bill if the Government

looked at introducing a cap on election spending.

But with the November election looming, many of the changes will not be in place for this campaign.

Topics: elections, government-and-politics, states-and-territories, state-parliament, parliament, liberals, alp, political-parties, melbourne-3000, vic

First posted July 28, 2018 08:24:56


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