Ideas@TheCentre
When dollars defend democracy
Earlier this week, I attended a forum on ‘dollars and democracy’. Its title reflects concern that political donations distort policy priorities and government decisions. To reduce the influence of private money on politics, the federal government plans to significantly expand regulation of political donors. Foreign-sourced donations and anonymous donations exceeding $50 would be banned outright. Gifts of $1,000 would have to be disclosed, down from nearly $11,000 now.
These rules apply to non-government organisations that express political views as well as to political parties. In fact NGOs face greater disclosure burdens than political parties. They must itemise their expenditure between five overlapping categories, while political parties need provide only one total sum. NGOs must report annually on their spending on ‘election issues’, even for future elections with issues that cannot be known for certain. NGO donors are potentially treated very unfairly. Donors’ names and addresses are put on the Australian Electoral Commission website if their gift finances political expenditure, even if the donor is unaware of how their money is used.
NGOs face significant dangers from these rules. Their staff and volunteers risk fines and jail for breaching the rules. NGOS run by political amateurs may not be aware they have any obligations. But the requirements are so unclear that even political professionals could easily make a mistake. The other danger is that NGO donors will be deterred. The disclosure rules give governments the names of their political opponents. This creates opportunities for improperly disfavouring people tendering for government business or applying for government grants. Cautious donors may decide that revealing their NGO allegiances is too costly.
It’s a mistake to think that ‘dollars and democracy’ are necessarily opposed. Private donations to NGOs are a vital part of Australia’s democratic political system. Without these gifts, many views would go unexpressed, many voices would never be heard, and many criticisms of government would never be made. Plans to ban or deter NGO donations have no place in a democratic society.
Andrew Norton’s paper Diminishing Democracy: The threat posed by political expenditure laws was released today by the Centre. Read it online here [http://www.cis.org.au/issue_analysis/IA114/IA114.pdf]
