The author has declared no conflicts of interest in writing this opinion piece, aside from an interest in campaign finance.
Australia’s current weak campaign finance regulatory framework is severely undermining democratic values. High-disclosure limits and a series of loopholes allow private sector firms to exercise a more significant influence over political actors than the average Australian voter. The disenfranchisement is evident through the overall decline of trust and confidence in Australia’s democracy. As outlined in the previous article, belief in Australia’s democracy has declined rapidly between 2013 and 2018 from 71.70% to 40.56%. A primary concern is the power and influence of big business over the major political parties.
This article will examine Australia’s current campaign finance system and highlight the existing loopholes that plague the regulatory framework.
In Australia, the federal legislative provisions within the Commonwealth Electoral Act 1918 allow the corporate financing of campaign contributions with minimal regulatory safeguards. Because of this existing system, Federal political parties still heavily rely on private firms to make contributions to election campaigns, leaving policymakers vulnerable to corporate influence. Yet, to try and mitigate this, the Australian Federal Government did establish the Australian Electoral Commission (AEC) in 1984 to minimise this risk and increase transparency utilising financial disclosure regimes. The visibility of these contributions being made public is contingent upon the contribution being over the minimum disclosure threshold of $14,000, leading to the exploitation of disclosure regulation loopholes.
Private sector firms can still manipulate the minimum disclosure threshold transparency measures to donate undisclosed donation payments to political parties and candidates. Consecutive Federal Governments have adjusted this minimum disclosure threshold which the AEC maintains over the past two decades from $10,000 in 2005 to $14,000 by 2020. Private sector firms exploit this minimum declaration threshold by making multiple donations just under this disclosure limit. Political parties are not required to declare or provide these donation receipts (Edwards, 2017). While $14,000 as a minimum disclosure threshold is comparatively low compared to the enormous contributions that private firms make. The main concern is that it still well above what a regular voter can afford to contribute to a political cause.
Furthermore, the manipulation of the minimum disclosure threshold by private sector firms also allows the concept of donation splitting. The act of donation splitting is where private firms divide up quite large payments into smaller amounts and make multiple separate payments concealed under the minimum threshold (Edwards, 2017). As the current disclosure threshold is $14,000, private firms can make an undisclosed total contribution of $126,000 by splitting their overall donation sum across the 9 Federal political party branches. Because of this manipulation of the AEC disclosure transparency framework to donate undisclosed amounts, private sector firms can still influence policymakers.
These methods are only some of the ways private sector firms can accrue influence over Federal policymakers. Additionally, it has been a core reason for the accumulating distrust between the Australian public and government officials. Therefore, campaign finance laws must undertake significant reform.