Ideas@TheCentre
The Danger of Disfavour
With the Greens and independent MPs both pushing political donations reform, this looks like one certain outcome of an inconclusive election.
There are many proposals for change, but most observers support more disclosure of political donations. A $1,000 threshold for donations disclosure is commonly suggested, including in the Green-Labor pact signed this week. Under the current system, donations below $11,500 need not be disclosed.
It is widely assumed that more disclosure increases the integrity of the political process. But it is not at all clear that this is the case.
If we assume that politicians are inclined to favour their financial supporters, it follows that they will also be inclined to disfavour the financial supporters of their opponents, by denying them access to ministers, appointments to government bodies, funding for their associations, and contracts with government agencies.
Disfavouring is much easier to hide than overt favours. Whether there is a donations trail or not, favours are usually easily detected. We know who receives government appointments, and which organisations benefit from government grants and contracts. But silently overlooked people, requests and applications generate no public evidence.
What donations disclosure does is give governments a convenient list of people who support their opponents. The disclosure regime doesn't just apply to political parties but also non-government organisations that comment on political matters. So spending just $1,000 opposing the government on only one issue could put your name on a 'do not assist' list.
If we had a small government that confined itself to a few core services, this may not matter much. But when we have a big government that spends more than a third of national income, and which cannot resist meddling in almost every activity, it creates real risks. So many people need to interact with government that numerous potential political donors may be deterred by the fear of future political disfavour.
The secret ballot was a great Australian democratic innovation, designed to let people express their views free of political intimidation. We should reject any law that gives the federal government more scope to inhibit its opponents.
Andrew Norton is a Research Fellow at The Centre for Independent Studies. His CIS paper Diminishing Democracy: The Threat Posed by Political Expenditure Laws was published in 2009.
