Beware consequences of integrity bill to govern foreign donations

Parliament is currently considering a Bill aimed at improving the “integrity… of Australia’s electoral system” by adding ‘public accountabilities’ to civil society. The bill aims to do two things: radically restrict foreign donations and add significant new transparency obligations and donation limits to ‘non-party political actors’.

Rules against certain donations would not be needed if the public believed that politicians behaved ethically in the first place. But we have spent several weeks lost in an ethical and moral drama over Barnaby Joyce’s conduct and subsequent resignation as Deputy Prime Minister. It’s not surprising we live in a time where trust in the political class is very low.

Nevertheless, both goals of this bill are misguided; with significant undesirable and unappreciated consequences.

The proposed wording of this bill extends far beyond what an ordinary person would consider political actions. Public expression of views on an issue that may be before the electors is something that happens all the time, is deemed a political purpose.

A group spending as little as $50,000 in a financial year, say, hiring a single researcher to look at heritage protection and planning policy, might be caught under this provision, and have to comply with onerous reporting and compliance obligations. It does not need to be proven to be linked to any political party; indeed it may be captured by these new rules even if it is completely independent of the political process.

The compliance obligations alone would have a chilling effect on debate, but the principle behind this bill is also wrong. It essentially legitimises ad hominem attack. It seeks to knock out ideas and contributions from people based on who they are funded by.

This approach is already too prevalent in public discourse: there is too much tribalism and too little thinking, where people decide their position on the basis of loyalty. Not only is this the cause of much of the hypocrisy that is rampant in politics, it is also making it impossible to implement complex reforms.

Ironically, despite the declining trust in politics, insiders and politicians, increasingly there is a belief that the only way to ensure ‘independence’ is to provide government funding. Funding from private sources is treated with inherent suspicion, as if the ideas being promoted are invariably tainted by their source.

Yet the public sector is no less biased or self-interested than the private sector.

Supporting ideas you think are important with your money is a principle worth defending. It is not inherently unfair that one person is in a position to afford a greater contribution than someone else. We do not seek to limit the time someone can donate to a cause just because some others have less time available to donate.

And of course, if you regulate and restrict private funding for ideas and debate, inevitably this will lead to call for more public funding.

This too is already a significant problem. Not only do we spend hundreds of millions essentially on politics, the not-for-profit sector is also already far too dependent on government funding. The Productivity Commission found in 2010 that government funding of NFPs outweighed philanthropic contributions by a ratio of nearly 4:1.

The government clearly resents having to fund antagonistic advocacy from the largely left-leaning NFP sector. This is an issue to take up with the parliament, specifically the crossbench, which is preventing them from defunding these groups. Their proposed solution will only make it harder for those not funded by government to put opposing views. It may make the government’s perceived problem worse.

The point of public debate is the competition of ideas, not the worthiness of the people presenting them. To put it bluntly, calls for socialism are not bad because they are coming from people funded by China, but because socialism is a terrible, failed system.

This is not the same as saying that corruption or illegal interference in the political process is okay. We must diligently combat this interference, but we must also differentiate between illegal corruption and legitimate persuasion through the force of ideas.

If our ideas are strong enough, we don’t need to stop opposing views being promoted. If our anti-corruption protections are robust enough we do not need to fear opening up to private contributions, whether they are time, speech or money. Moreover, civil society thrives by groups of citizens joining together to promote causes they believe are in the public interest. We should not seek to limit this.

Removing restrictions may be a better way of improving the integrity of our system than adding more red tape.

Simon Cowan is research manager at The Centre for Independent Studies.