Democracy: The Threat Posed by Political Expenditure Laws - The Centre for Independent Studies
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Democracy: The Threat Posed by Political Expenditure Laws

NGO donations put at risk by electoral laws

The federal parliament is close to passing new laws which will ban or deter donors to non-government organisations, says a new report being released on Friday.

The report Diminishing Democracy: The Threat Posed by Political Expenditure Laws by Andrew Norton, explains that reforms to electoral law affect organisations which express views on political parties, candidates, or election issues.

Foreign-sourced donations for political expenditure would be prohibited. This would include expatriate Australians who cannot draw on Australian bank accounts. It exposes staff of international organisations to possible jail sentences if they spend foreign-sourced donations on Australian political campaigns.

“Political protectionism has no place in a society open to foreign ideas and people. We wouldn’t close down the internet or ban international visitors because they bring political views that are not ‘made in Australia’. Donations are another legitimate way in which people living outside Australia contribute to our political debate,’ says Norton.  

Anonymous donations of more than $50 for political expenditure would also be made illegal. Groups passing around a donations bucket would need to keep detailed records to stay within the law.

The electoral law reforms will also significantly increase the scope of existing disclosure rules. Groups spending as little as $1,000 in six months on political expenditure would have to itemise their spending and report donations of $1,000 or more. The current threshold of $10,900 a year means that small volunteer groups do not need to understand complex disclosure requirements or fill in confusing Australian Electoral Commission forms.

Fines for bungled disclosure paperwork would increase from $1,000 to $13,200 if the law passes.

Donors will need to be disclosed regardless of whether they support the political expenditure or even know about it. This is a major issue for multi-purpose organisations that sometimes express views on political issues. For example, charities mainly help disadvantaged people but also call for policy changes.

‘Organisations involved in political commentary risk losing donors who do not want their names and address placed on the public record,’ says Norton.

The laws will require organisations to disclose spending for future election issues. This means that NGOs will have to guess what will be an ‘issue in an election’ before election campaigns take place.

 ‘Political expenditure laws go too far and will diminish Australia’s democracy,’ says Norton.

The embargoed report is available at https://www.cis.org.au/issue_analysis/IA114/IA114.pdf

Andrew Norton is a Research Fellow at the Centre for Independent Studies.
He is available for comment.

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