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Electoral Matters—Joint Standing Committee—Advisory report on the Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020—Report, incorporating dissenting reports, August 2020


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August 2020 CANBERRA

PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

Advisory report on the Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020

Joint Standing Committee on Electoral Matters

© Commonwealth of Australia

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Foreword

It is a key function of the work of Committees to ensure that any proposed legislation is carefully examined and that the public has an opportunity to contribute to these parliamentary deliberations.

It is also crucial that the Joint Standing Committee on Electoral Matters, in examining Bills, seeks to ensure that any proposed legislation lessens regulatory burdens and red tape which can significantly impact on not only smaller parties and independents but also the wider voting public.

The Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020 contains a number of amendments designed to improve clarity, enhance electoral processes and strengthen electoral integrity in the Commonwealth Electoral Act 1918 and the Referendum (Machinery Provisions) Act 1984.

This Bill makes necessary amendments to sections 302CA and 314B of the Commonwealth Electoral Act, and clarifies the relationship between the electoral laws of the Commonwealth, States and Territories.

To alleviate unnecessary administrative burdens, the Bill also includes a number of practical amendments including; changing the telephone voting method available to Antarctic electors to provide secret voting; changing staffing requirements for the Australian Electoral Commission (AEC) at elections to allow greater flexibility; allowing AEC staff to make administrative marks on ballot papers; allowing pens and other implements to be used to mark votes on ballot papers; minor practical changes to the Senate ballot paper mitigate against excessive ballot width; and streamlining the vote issuing process.

These changes, amongst others, contribute to the AEC’s ability to deliver transparent, consistent and efficient elections while removing unnecessarily prescriptive practices.

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The Committee has therefore recommended that the Bill be passed.

The Committee has also recommended that the Government amend the Bill to clarify that recipients of donations will only be provided exclusive coverage under Federal donation laws where they place donations in a Federal electoral account that can only be drawn down for Federal electoral purposes. This will ensure that the banking and accounting treatment of donations aligns with the legal treatment, supporting a separation of state campaign activity from federal campaign activity. This amendment squarely addresses the main issues raised in submissions.

I would like to sincerely thank everyone who took the time to make a submission for the inquiry into the Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020.

I would like to thank Deputy Chair Senator Carol Brown and my fellow Committee Members for their assistance in this report.

Senator the Hon. James McGrath

Chair

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Contents

Foreword ........................................................................................................................................... iii

Abbreviations ................................................................................................................................... vii

Members ............................................................................................................................................ ix

List of Recommendations ................................................................................................................ xi

The Report

1 Inquiry into the Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020.................................................................................................. 1

Referral and conduct of the inquiry.................................................................................... 1

Purpose of the Bill ................................................................................................................. 1

Technical amendments ............................................................................................ 3

Previous committee inquiry ................................................................................................ 4

Proposed new section 302CA - public election funding ................................................. 5

Queensland and Commonwealth electoral amendments ................................... 6

High Court case......................................................................................................... 8

Current Bill - exclusive laws only where a ‘federal purpose’ .......................... 10

Narrow redrafting of the federal quarantine .......................................... 12

Key views of inquiry participants ..................................................................................... 14

Committee comment .......................................................................................................... 16

Re-purposing of donations .................................................................................... 17

Committee comment .......................................................................................................... 19

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State Parliamentarians or candidates - involvement in federal fundraising .. 20

Committee comment .......................................................................................................... 21

Impacts on Smaller Political Entities ........................................................ 22

Committee comment .......................................................................................................... 23

Other federal financing proposals in the submissions ..................................... 24

Committee comment .......................................................................................................... 25

Modernisation of the electoral process ................................................................ 25

Antarctic electors ....................................................................................... 25

Committee comment .......................................................................................................... 27

Pencils in polling booths ............................................................................ 28

Issuing of votes, flexibility of questions and prescribed sequence ...... 29

Committee comment .......................................................................................................... 30

Workforce flexibility for divisional returning officers, presiding officers and polling place officials................................................ 31

Committee comment .......................................................................................................... 32

Additional views ........................................................................................ 32

Committee comment .......................................................................................................... 33

Appendix A. Submissions .............................................................................................. 37

Dissenting report .............................................................................................................. 39

Dissenting report .............................................................................................................. 43

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Abbreviations

ACF Australian Conservation Foundation

ACT Australian Capital Territory

AEC Australian Electoral Commission

The Bill Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020 (Cth)

Commonwealth 2018 amendment Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Act 2018 (Cth)

DRO Divisional Returning Offices

ECQ Electoral Commission Queensland

LNP Liberal National Party

PDS Prohibited Donor Scheme

PHAA Public Health Association Australia

Queensland Electoral Amendment Act

Local Government Electoral (Implementing Stage 1 of Belcarra) and Other Legislation Amendment Act 2018 (Qld)

Referendum Act Referendum (Machinery Provisions) Act 1984 (Cth)

viii

SES Senior Executive Service

Third interim report Third interim report on the inquiry into the conduct of the 2016 federal election: AEC modernisation

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Members

Chair

Senator the Hon James McGrath LP, QLD

Deputy Chair

Senator Carol Brown ALP, TAS

Members

Senator Marielle Smith ALP, SA

Senator Wendy Askew LP, TAS

Senator Larissa Waters AG, QLD

Mr Milton Dick MP Oxley, QLD

Mr Tony Pasin MP Barker, SA

Mr James Stevens MP Sturt, SA

Ms Kate Thwaites MP Jagajaga, VIC

Mrs Lucy Wicks MP Robertson, NSW

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List of Recommendations

Recommendation 1

1.134 The Committee recommends the Government amend the quarantines provided to recipients of donations (related to receiving, keeping and using a donation), to limit the exclusive application of Federal donation laws in these circumstances to donations that are kept solely in a Federal electoral account. This can be achieved either by:

 banking donations with the Federal arm of a political entity that is a separate legal entity to a State arm, or

 banking donations in a separate Federal account operated by a State arm of a political entity, from which amounts are only permitted to be drawn down for Federal purposes.

Recommendation 2

1.138 Subject to amendments to reflect the recommendations in this report, the Committee recommends that the Parliament pass the Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020, as amended.

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1. Inquiry into the Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020

Referral and conduct of the inquiry

1.1 On 17 June 2020, the Minister for Finance, Senator the Hon Mathias Cormann, referred the provisions of the Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020 (the Bill) to the Joint Standing Committee on Electoral Matters (the Committee) for inquiry and report.

1.2 The Committee advertised the inquiry on its website and issued a media release on 18 June 2020.

1.3 The Committee received 19 submissions, listed at Appendix A.

Purpose of the Bill

1.4 The Bill was introduced in the Senate on 11 June 2020 by the Minister for Finance, Senator the Hon Mathias Cormann, and seeks to amend the Commonwealth Electoral Act 1918 (Commonwealth Electoral Act) and the Referendum (Machinery Provisions) Act 1984 (Referendum Act) to:

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…remedy anomalies in legislation and improve clarity, to enhance electoral processes and allow greater workforce flexibility for the Australian Electoral Commission, so they can use more modern workplace practices.1

1.5 In the speech on the Bill’s second reading, Senator Cormann stated that the Bill will ‘reduce unnecessarily prescriptive practices’ and modernise various aspects of the electoral process. Senator Cormann noted the importance of remaining:

… committed to improving electoral legislation in a non-partisan manner which promotes public confidence, enables our electoral system to evolve in a modernising environment, and strengthens democracy.2

1.6 Schedule 1, Part 1, seeks to make changes concerning public election funding and gifts and looks to clarify the relationship between Federal and State and Territory electoral donation and disclosure laws (proposed replacements for sections 302CA and 314B of the Commonwealth Electoral Act). This change is informed by the High Court decision in Spence v Queensland [2019] HCA 15, in which existing section 302CA was ruled to be invalid as it exceeded Commonwealth legislative power by putting donations outside the operation of State electoral law gifts where they merely ‘may’ be used for influencing voting at a Federal election.3 By contrast, the revised provisions introduced subsequent to the Spence case are drafted in a narrower way to apply only to the assignment of funds exclusively to a Federal purpose.4

1.7 Unlike the original provisions, the revised provisions allow untied donations - those available to be used either for Federal or State ends - to be subject to the concurrent operation of both Commonwealth law and State or Territory law.

1.8 Further, Part 1 of Schedule 1 seeks to clarify the entitlements and claims provisions, mandatory registration and deregistration requirements, and proposes technical amendments to indexation and rounding of public election funding.

1 Senator the Hon Mathias Cormann, Minister for Finance, House of Representatives Hansard, 11 June

2020, p. 69.

2 Senator the Hon Mathias Cormann, Minister for Finance, House of Representatives Hansard, 11 June

2020, p. 69.

3 High Court Of Australia, Spence v Queensland [2019] HCA 15, 15 May 2019, B35/2018, viewed on 24

July 2020, .

4 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020: Explanatory Memorandum,

pp. 3-4.

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1.9 These changes are mirrored in the amendments to the Referendum Act to maintain consistency.

Technical amendments

1.10 Schedule 1, Part 2 of the Bill proposes to amend various aspects of the voting and scrutiny process in the Electoral Act,5 including:

 expansion of the assisted telephone voting methods that are currently available to sight impaired persons, to permit Antarctic electors to vote the same way (to protect the secrecy of the ballots cast by Antarctic voters);

 changes to particular prescribed roles of Australian Electoral Commission (AEC) staff to allow greater workforce flexibility, consistent with modern practices;

 greater flexibility in the vote issuing and administration processes;  removing the requirement for all AEC Divisional Offices to be automatically designated as pre-poll centres, as many office premises are not fit for purpose (for instance where they are not accessible for

voters with disabilities);6  minor practical changes to the Senate ballot paper format, to mitigate against excessive width;  the streamlining of postal votes to be more practical and cost-effective;  removal of the requirement for pencils to be the only writing implement

allowed in polling booths; and  a number of additional minor and consequential amendments.7

1.11 Schedule 2 also changes the staffing composition of the Redistribution Committee within the Australian Capital Territory (ACT).8 Presently the Australian Electoral Officer for a State, usually a Senior Executive Service (SES) officer, is required to sit on a Redistribution Committee. This role does not exist in the ACT, and is filled by the senior Divisional Returning Officer

5 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020: Explanatory Memorandum,

p. 4.

6 Department of Finance, Submission 9, p. 5.

7 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020: Explanatory Memorandum,

pp. 4-5.

8 A Redistribution Committee is appointed when a State or Territory commences a redistribution

which is the redrawing of electoral boundaries to ensure that roughly the same number of electors are in each electoral division. Australian Electoral Commission, ‘Glossary’, viewed on 27 July 2020, .

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(DRO) usually Australian Public Service level 6. The Bill seeks to allow a senior AEC staff member from the ACT to fill this role instead (likely an SES officer).9 The Department of Finance observes that the proposed change would be more consistent with the practice for managing federal redistributions elsewhere around Australia:

This will alleviate some additional workload burden on DROs, especially if a redistribution coincides with an electoral event. It will also ensure ACT Redistribution Committee members have seniority and experience consistent with members of corresponding Redistribution Committees for other States and the Northern Territory.10

Previous committee inquiry

1.12 The AEC put forward a series of submissions to the Committee’s inquiry into the 2016 Federal election. The AEC’s recommendations were discussed at length and endorsed in the Committee’s report on the 2016 Federal election, Third interim report on the inquiry into the conduct of the 2016 Federal election: AEC modernisation (Third interim report).11 A number of the AEC’s recommendations are mirrored in the proposed (Miscellaneous Measures) Bill 2020. These changes include:

 identifying features on ballot papers through administrative mark and/or colour to improve the integrity of the count;  correct drafting error in Form E;  broaden references to polling official;  simplification of the dispatch of postal votes;  pre-poll voting no longer required at all AEC Divisional Offices;  removal of requirement for pencils in polling booths;  flexibility in the questions to ascertain a person’s entitlement to vote and

removal of prescribed sequence for name mark-off and ballot paper issue;  expansion of the assisted telephone voting method to Antarctic electors;  allow polling officials and presiding officers to assist in all aspects of vote issuing; and

9 Parliamentary Library, Bills Digest No. 55, 2018-19, 11 February 2019, p. 3.

10 Department of Finance, Submission 9, p. 7.

11 Joint Standing Committee on Electoral Matters, Third interim report on the inquiry into the conduct of

the 2016 Federal election: AEC modernisation, June 2017, pp. 11-38.

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 amendments to Redistribution Committee staffing composition in the ACT.12

1.13 In response to recommendations made in the Third interim report, the above measures were included in the Electoral Legislation Amendment (Modernisation and Other Measures) Bill 2018. These measures were however removed from the final version of the Bill as passed by both Houses, as it was deemed that there was insufficient time for the Parliament to discuss and the AEC to implement all the changes prior to the next Federal election.13 Only the highest priority technical amendments in that bill were enacted, to assist the AEC in preparation for the 2019 federal election. It was noted at the time that:

The option remains for a future parliament to consider the omitted measures in more detail on a non-partisan basis should a future Bill be introduced that contains these measures.14

Proposed new section 302CA - public election funding

1.14 The Committee’s first Advisory Report on the Electoral Legislation (Electoral Funding and Disclosure Reform) Bill 2017 emphasised the general desire among regulated entities for clarity about electoral laws, to reduce compliance burdens for political actors. At recommendation 11, the Committee recommended that the Government strengthen the reach of Federal electoral law, so that a Commonwealth ban on foreign political donations would be effective, including where amounts are moved around between organisations.

1.15 The Greens on the Committee also specifically drew attention at the time to the burden from the overlay of Commonwealth and State and Territory laws.

12 Australian Electoral Commission, Submission 66: Inquiry into and report on all aspects of the conduct of

the 2016 Federal Election and matters related thereto, p. 34; Electoral Legislation Amendment (Modernisation and Other Measures) Bill 2018: Explanatory Memorandum, pp. 5, 70-77; Parliamentary Library, Bills Digest No. 55, 2018-19, 11 February 2019, p. 12; Joint Standing Committee on Electoral Matters, Third interim report on the inquiry into the conduct of the 2016 Federal election: AEC modernisation, June 2017, pp. 11-38.

13 Supplementary Explanatory Memorandum, Electoral Legislation Amendment (Modernisation and

Other Measures) Bill 2018, p. 1.

14 Supplementary Explanatory Memorandum, Electoral Legislation Amendment (Modernisation and

Other Measures) Bill 2018, p. 1.

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Electoral funding rules vary enormously between the Commonwealth and the various states and territories. This is a serious issue when it comes to placing caps on political donations and the disclosure of donations.15

1.16 In response to recommendation 11, the Government agreed to introduce anti-avoidance rules to address the use of foreign funds in politics. These rules included section 302CA in order to ensure that Commonwealth law applies exclusively to amounts that are used or available to be used in Federal elections, so that foreign donations could not be inappropriately shielded by ambiguity over the jurisdiction in which those funds were intended to be used. Accordingly section 302CA ensured that both donations intended for federal use and those that ‘may’ be used federally, were subject to federal law and consequently were covered by the ban on foreign donations.

1.17 The original version of section 302CA was drafted with an intent that the applicable jurisdictional laws would be clear when a donation is made, based on whether there is an express term attached to a donation obliging it to be used for either Federal purposes, or State or Territory purposes.

1.18 For avoidance of doubt, the Committee’s Second Advisory Report on the Electoral Legislation (Electoral Funding and Disclosure Reform) Bill 2017 recommended that the exposure draft of sections 302CA and 314B be amended to ensure that Commonwealth laws did not apply to amounts that are initially untied but are later repurposed and used for non-federal campaigns. The Government agreed to this proposal and revised the amendments in response to the Committee recommendation 10.

1.19 The major provisions of the current Bill, namely the repeal and replacement of existing section 302CA of the Electoral Act (inserted in 2018) and the corresponding amendments, include further changes in response to the ruling of the High Court of Australia in Spence v Queensland [2019] HCA 15. That ruling followed a series of State and Commonwealth electoral funding and disclosure laws that dealt primarily with foreign donation issues (the jurisdictional boundary provisions were incidental parts of those laws).

Queensland and Commonwealth electoral amendments

15 Joint Standing Committee on Electoral Matters, Advisory report on the Electoral Legislation Amendment

(Electoral Funding and Disclosure Reform) Bill 2017, Australian Greens, Minority Report, April 2018, p. 80.

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1.20 In May 2018, the Queensland Parliament passed the Local Government Electoral (Implementing Stage 1 of Belcarra) and Other Legislation Amendment Act 2018 (Qld) (Queensland Electoral Amendment Act), which prohibited property developers and property development industry bodies making donations to political parties registered in Queensland, and candidates and third parties. The Queensland Electoral Amendment Act commenced on 2 October 2018 and applied retrospectively from 12 October 2017.

1.21 The Commonwealth passed the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Act 2018 (Cth), which commenced on 30 November 2018 and inserted the new sections 302CA and 314B into the Electoral Act 1918 (Cth) (Commonwealth 2018 amendments).

1.22 The Revised Explanatory Memorandum to that Bill set out that:

To implement recommendation 10 of the JSCEM’s second advisory report, subsection 302CA(1) does not apply if a gift is kept separately to be used for a State or Territory electoral purpose. Also, section 302CA does not override State laws dealing with the use of political donations for State electoral purposes.16

1.23 In the interests of clarifying the law to the maximum extent possible, the previous provisions left no area within which Commonwealth and State and Territory laws could operate concurrently. In the interests of removing uncertainty about when the foreign donation ban would apply, the Commonwealth law applied to donations that were not yet assigned to a specific election campaign. The provisions were intended to provide jurisdictional clarity from the start of the donation process, based on the express terms set by a donor about the end-use of their donation (or on the lack of expression of terms).

1.24 The Electoral Commission Queensland (ECQ) initially responded to the passing of the Commonwealth 2018 amendment by communicating to stakeholders that gifts from property developers ‘designated for Commonwealth electoral purposes would be treated as protected by the Commonwealth law and therefore not caught by the [Prohibited Donor Scheme (PDS)]’ in Queensland.17

16 Electoral Legislation Amendment (Electoral Funding And Disclosure Reform) Bill 2018, Revised

Explanatory Memorandum, p. 51.

17 Electoral Commission Queensland, ‘Decision by Electoral Commissioner regarding Spencer matter,

Statement of Reasons’, viewed on 30 June 2020,

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1.25 The ECQ stated that the Commonwealth 2018 amendment prevailed over Queensland legislation, and would allow property developers to make donations to Queensland political parties where amounts were not explicitly committed to a State purpose::

Essentially, the Commonwealth provisions, namely section 302CA of the Commonwealth Electoral Act 1918, enabled Queensland political parties to receive otherwise unlawful donations from property developers, if those donations were either designated to be used for Commonwealth electoral purposes, or might be used for such a purpose.18

High Court case

1.26 Mr Gary Spence, then President of the Liberal National Party (LNP), commenced proceedings in the High Court of Australia after the enactment but prior to the commencement of the Queensland legislation, challenging the validity of the amendment which banned donations from property developers.19

1.27 In Spence v Queensland, Queensland argued that the Commonwealth’s now-former section 302CA of the Electoral Act [Commonwealth 2018 amendment] was invalid. That section had been inserted into the Electoral Act after the Queensland amendments were passed.20

1.28 On 17 April 2019 the High Court of Australia found by a 4 to 3 majority that section 302CA of the Electoral Act (Cth) was wholly invalid. The majority found that the provisions went beyond the reach of Commonwealth legislative power because they purported to claim exclusive jurisdiction over donations that were available for Federal elections, which merely might be

.

18 Electoral Commission Queensland, ‘Decision by Electoral Commissioner regarding Spencer matter,

Statement of Reasons’, viewed on 30 June 2020, .

19 Electoral Commission Queensland, ‘Decision by Electoral Commissioner regarding Spencer matter,

Statement of Reasons’, viewed on 30 June 2020, .

20 Electoral Commission Queensland, ‘Decision by Electoral Commissioner regarding Spencer matter,

Statement of Reasons’, viewed on 30 June 2020, .

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used to incur expenditure for the dominant purpose of influencing voting in a federal election. Relevantly the High Court found that the problematic parts of the provision could not be easily severed and therefore all parts of the provisions which would have clarified the jurisdictional boundary were invalid. The relevant sections are treated as if they were never enacted.21

1.29 The ECQ set out that the ruling has the effect that it was unlawful in the relevant period (between the commencement of the Commonwealth Act and orders in the Spence case) for a prohibited donor to make a donation to a Queensland registered political party:

The HCA ruling means that any donations received by Queensland registered political parties between 1 January 2019 and 17 April 2019, from prohibited donors and regardless of whether it was intended for use for a State or Commonwealth purpose, are unlawful and may be recovered by ECQ as a debt to the State in accordance with sections 276 and 308 of the Electoral Act 1992.22

1.30 The ECQ has since also published guidance on its website, clearly informing the public that Queensland electoral laws incidentally determine the lawfulness of certain donations made for federal purposes (those related to property developer donations) and that Queensland laws also govern the disclosure obligations attached to these donations, irrespective of how these funds are used.

Can federal political parties accept donations from property developers? If a federal party does have the promotion of candidates for election to the Queensland Parliament as an object, it cannot accept donations from property developers. Further, if the latter is also related to a State party that is registered in Queensland (in that one is ‘part of the other’, or ‘both are parts of the same political party’), then a gift made to either one of the parties is taken to be a gift to both. Therefore, political donations from ‘prohibited donors to ‘related parties’ are illegal. … If the federal party does have as the election of candidates to the Queensland Parliament as one of its objects it cannot accept

21 Electoral Commission Queensland, ‘Decision by Electoral Commissioner regarding Spencer matter,

Statement of Reasons’, viewed on 30 June 2020, .

22 Electoral Commission Queensland, ‘Decision by Electoral Commissioner regarding Spencer matter,

Statement of Reasons’, viewed 30 June 2020, .

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gifts from property developers, irrespective of how it wishes to use the funds.23

1.31 Nevertheless, the Supreme Court of Queensland has recognised, even subsequent to the Spence case, that it may still remain open for the Commonwealth Parliament to legislate exclusively on particular areas of electoral law related to Commonwealth elections. Such legislation must of course be subject to respecting the parameters set in the Spence decision. In a joint judgment in the ‘Awabdy’ case, the Supreme Court of Queensland found that:

… the existence of [statutory] inconsistency depends upon the intention of the Commonwealth legislature, the dominant legislature, to express by its enactment, completely, exhaustively, exclusively what shall be the law governing the particular conduct or matter to which its attention is directed. It is necessary to inquire whether the Commonwealth law evinces an intention to cover its particular subject-matter to the exclusion of any other law.24

Current Bill - exclusive laws only where a ‘federal purpose’

1.32 Unlike the invalidated sections, the replacement sections in the Bill remove a claim of exclusive Federal jurisdiction over ‘untied’ amounts (namely donations that are merely available to be used for either Federal or State electoral purposes). The Explanatory Memorandum states that the Bill seeks to ‘clarify the interaction between Federal, State and Territory funding and disclosure regimes’,25 and activates the Commonwealth rules on an exclusive basis only where a donation has a ‘Federal purpose’:

The replacement rules for giving, offering or seeking a gift are all connected to a new fundamental concept of whether a donation had an ‘express’ Federal purpose. Expression of purpose can be communicated by various means including an event invitation, a donation form, correspondence, receipts, and electronic messages.26

23 Electoral Commission Queensland, ‘Prohibited Donor Scheme’, viewed 14 August 2020

.

24 Awabdy & Anor v Electoral Commission of Queensland & Anor [2019] QCA 187, at para 38.

Judgment on the appeal case delivered on 13 September 2019.

25 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020: Explanatory Memorandum,

p. 3.

26 Department of Finance, Submission 9, p. 4.

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1.33 ‘Federal purpose’ is defined in proposed new subsection 287(1) as ‘the purpose of incurring electoral expenditure, or creating or communicating electoral matter’.27 This single terms picks up two existing concepts in the Commonwealth Electoral Act that were both formulated in the same policy process, involving public consultation on the Electoral Funding and Disclosure Bill (JSCEM considered over 200 submissions on that Bill from a number of peak bodies and experts in the non-profit sector).

1.34 The use of a single easily understood term has made the revised versions of section 302CA and 314B easier to read, compared to the more wordy preceding provisions. Electoral Matter and Electoral Expenditure are defined in the Commonwealth Electoral Act at sections 4AA and 287AB respectively. The umbrella concept is a plain English simplification that helps clarify that donation activity falls under Commonwealth law where it is basically aimed at influencing voting in future federal electoral events.

1.35 The narrower term ‘Electoral Matter’ was crafted to suit the circumstances of some actors in the not-for-profit sector who may only occasionally participate in public debate, while having a primary purpose that is non-political, such as a charitable purpose. The term applies various electoral rules to communications that support or oppose the election of persons in a Federal election, whilst not covering non-partisan policy material that is primarily educative, such as analysis by a think tank, submissions to parliamentary committees from an industry association, academic publications and so on. The term was arrived at after extensive JSCEM consideration and bipartisan legislative negotiation, to ensure that electoral laws only applied where appropriate.

1.36 The wider term ‘Electoral Expenditure’ applies to a smaller group of political actors who are the most inherently political creatures. For instance this term applies to political parties, candidates and Federal parliamentarians. This term recognises that most activities by these partisan actors is in the furtherance of electoral objectives. Accordingly subsection 287(3) expands the regulated types of expenditure to include all expenditure by relevant political entities that is in relation to an election. This picks up expenditure on headquarter costs and other administrative overheads, which should clearly be caught by electoral donation laws. By contrast the Commonwealth Electoral Act regards as irrelevant the generic administrative overheads of other entities that only undertake rare or ad hoc

27 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020, p. 3.

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campaigns, such as church groups, neighbourhood associations, or policy-centric academic organisations.

1.37 Professor Anne Twomey and Mr Giacomo Rotolo-Ross neatly summarised how the now established definitions of electoral expenditure and electoral matter provide the basis for the overarching term of Federal purpose:

In short, they apply where the matter is communicated, or the expenditure incurred, for the ‘dominant purpose’ of influencing the way electors vote in a Federal election, such as promoting or opposing a political party or MP in relation to a Federal election.28

Narrow redrafting of the federal quarantine

1.38 The Bill sets out that the exclusive assignment of funds to a federal purpose can occur at different points in the process of making a donation. Under the new rule, an individual donation cannot benefit from a broad omnibus quarantine from state electoral laws. Instead, depending on the circumstances of the donation, there are up to six narrow quarantines that may arise including:

 at the point of seeking donations;

 upon offering donations;

 when giving donations;

 when receiving donations;

 through the manner of keeping (banking) donations; or

 at the point of use (expending donations on an election campaign).29

1.39 The new concept of whether a donation has an expressed Federal purpose means that the allocation of a donation to the Federal jurisdiction has to be put into words and communicated, it cannot just be inferred from circumstances. The Bill will allow either the giver or recipient to expressly communicate if a donation is for a Federal purpose, and this can be clarified earlier in the process than under the old Act (eg: from the offering of a gift or seeking of a gift, not just from the giving of a gift). Under the new provision, silence about how the gift is to be used will not automatically put a gift exclusively under Federal electoral law.

28 Professor Anne Twomey and Mr Giacomo Rotolo-Ross, Submission 16, p. 1.

29 Department of Finance, Submission 9, p. 4.

13

1.40 Where a donation starts as an untied amount and has a Federal purpose attached later in the donation process (for instance when it is banked), then State and Territory laws can apply to the early stages in the donation process, on top of any applicable Federal law that may also operate at the time. For instance State law may regulate the seeking, offering, giving or receiving of donations if there is no expression of a Federal purpose when a gift is either sought, offered or given (sections 302CA(1), (2) and (3)). For instance a State could require disclosure of a gift by a donor if the donor did not declare their donation to be a Federal gift when making the gift.

1.41 Under the Bill donors and recipients are responsible for their respective actions and face State or Federal law, based on their own conduct. Under the Bill, actors are not inappropriately penalised because of the subsequent action of others who they cannot control. For instance quarantine of the donor from State law will be determined solely by how they acted when they offered or gave an amount. If a recipient subsequently uses a donation inconsistently with terms set by the donor, then that recipient will open themselves to relevant consequences under a State, Territory or Commonwealth law including reporting and penalties for example.

1.42 Professor Twomey and Mr Rotolo-Ross put forward that the Bill ensures that the donor and donee will have certainty about the consequences that follow from their choices:

Importantly, in respect of the acts of offering, seeking or giving donations, the federal purpose(s) must be expressed by the donor or donee (as the case may be) at the time - this further narrows the circumstances in which immunity will operate, and avoids the issues of subjectivity and uncertainty that might otherwise arise if such purposes could be merely implied or adopted later on.30

1.43 The new laws are prospective. It is cleaner to gift under a new clear regime (clarify future transactions), rather than trying to validate old actions. Old donations that were found illegal under state law will remain so.

1.44 Section 314B is a mirror provision dealing with disclosure laws that replicates the structure of section 302CA.

1.45 The replacement versions of sections 302CA and 314B include integrity rules to prevent inappropriate exploitation of a Federal quarantine. In the case of receiving or keeping gifts, if a party treats an amount as Federal, but later ‘backflips’ by using the amount inconsistently, then Commonwealth laws is deemed to have never applied. For instance State bans on accepting gifts

30 Professor Anne Twomey and Mr Giacomo Rotolo-Ross, Submission 16, p. 5.

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from certain sources could apply; State caps on election spending could apply; and State disclosure rules could apply. This is highlighted by the Department of Finance, in the following example:

…if a gift to a political party is given for Federal purposes but is subsequently used in an inconsistent way for a non-Federal purpose - for instance in an election regulated by State or Territory law - then exclusive coverage of the Federal law is taken to have never applied to the recipient. This would mean that a political party may need to disclose the amount under State law and may be liable for penalties if the donation was not permitted under State law.31

Box 1.1 Example scenario of 302CA and 314B Party A is running candidates in a Federal election and receives $20,000 in donation receipts from various small, individual donations. Party A also receives a $50,000 donation from a property developer specifically to support the Federal election campaign. Party A spends $40,000 on the Federal election campaign. Party A subsequently spends the remaining $30,000 on a specific State campaign issue.

In this example, Party A would, in the first instance, need to disclose the donation from the property developer under Federal law. The property developer would also be required to disclose under Federal law. Such disclosure, as is currently, would ensure the donation is in the public domain. As Party A has subsequently used some of the property developer donation for a State purpose, Party A is also subject to the funding and disclosure requirements of that jurisdiction, including any penalties that may apply.32

Key views of inquiry participants

1.46 A number of submissions went well beyond suggesting technical amendments to clarify Commonwealth electoral law and instead proposed substantial electoral policy changes, including significant reductions in disclosure thresholds for donations and a shift to ‘real time’ reporting of donations.

1.47 However the most common point of interest in the small number of submissions was on the provisions in Commonwealth electoral law that seek

31 Department of Finance, Submission 9, p. 4.

32 Department of Finance, Submission 9, p. 4

15

to clarify the boundary with state and territory donation laws (sections 302CA and 314B).

1.48 Professor Graeme Orr submitted that it was ‘unobjectionable’ to propose that the admissibility of donations for Commonwealth purposes should be regulated by the Commonwealth Parliament. In contrast to Queensland, he noted that:

NSW donation limits, the first in Australia, exempted ‘federal campaign donations’ anyway. Victoria’s recent regime does similarly. … developer donations are mostly a concern at state and local level, where planning decisions are made.33

1.49 The Liberal Party of Australia supported the Bill:

We believe that Federal Parliament should resist attempts by state governments that seek to impose their own policies about federal donations by means of state legislation, without those policies going through the legislative processes of the Federal Parliament. The Bill would ensure that federal law applies exclusively to donations that are expressly for federal purposes, while fully respecting the application of state laws to amounts used for state purposes.34

1.50 However various other submissions proposed that State and Territory laws should be the ascendant set of laws that prescribe whether and how donations can be given or used for Commonwealth elections. This is quite different from an argument that there should be no provisions to define the jurisdictional boundary, rather it is an argument that Commonwealth electoral law should be encroachable terrain, reshaped in different parts of the country according to the tastes of disparate State and Territory Parliaments.

1.51 The motive expressed in these submissions was that particular ends (such as pursuit of lower disclosure thresholds or bans of certain donors) should justify the means (of using the laws of regional jurisdictions to govern the conduct of national elections).

1.52 For example Professor Tham argued that provincial laws should prevail because - judged against his preferences about disclosure threshold settings

33 Professor Graeme Orr, Submission 1, p. 1.

34 Liberal Party of Australia, Submission 19, p. 2.

16

- ‘the Commonwealth disclosure scheme is weaker than the disclosure schemes in many States and Territories’.35

1.53 Similarly the Public Health Association of Australia argued that if Commonwealth law did not incorporate bans on property developers, then it would permit ‘conduct which State parliaments have concluded is corruptive of good governance’.36

1.54 Submissions received did not however provide evidence that the Commonwealth has a substantive role in regulating property development, which could lead to a conflict between donor and recipient. To the extent this was touched on, it was acknowledged that the Commonwealth level of government does not have a legislative or administrative role in planning or zoning matters at State or local government level.

Committee comment

1.55 Some submissions made a jaundiced argument that all political donations are inherently corrupt transactions, including those from sectors of the economy that are not even subject to bans at State level. This argument was mounted as assertion, rather than based on comprehensive evidence. The vast majority of sectors of the economy are not banned from making donations.

1.56 Little recognition was given to the fact that some individuals or groups may regard it as a part of their civic duty to give donations to support policy discourse, be they individuals, community associations, unions or businesses. Nor was there much recognition in the submissions that democratic freedoms should include the ability to support a preferred vision of society, including through making donations to organisations that are articulate participants in public debate.

1.57 None of these submissions provided a reason to explain how it could be a coherent or preferable legislative drafting practice for State and Territory laws to provide a variety of conflicting statutory codes to ordain conditions, for Commonwealth electoral donations. The authors of several submissions assumed that the statutory regimes of the State and Territory jurisdictions would always include policy settings that better reflect their personal policy

35 Professor Joo-Cheong Tham, Submission 2, p. 4.

36 Public Health Association of Australia, Submission 18, p. 11.

17

preferences, such as relatively low donation thresholds and bans on various classes of potential donors. For example intern Ms Schneider argued that:

… with the Federal scheme as permissive and minimalist where State schemes are generally more structured and restrictive, the application of Federal rules to a greater section of political funding has the potential to undermine the restrictive aims of these State schemes.37

1.58 Putting to one side any value judgements about disclosure thresholds or categories for banned donor classes, the view that State and Territory laws should be supreme is based on assumptions about future legislative decisions by the Parliaments of other jurisdictions. However the future shape of the law cannot be so confidently or categorically presumed and this is therefore an uncertain basis for settling the shape of Commonwealth law.

1.59 If the Commonwealth acquiesces to States and Territories setting rules for Commonwealth elections, then there could potentially be eight sets of rules that set donation thresholds, bans and carveouts for Commonwealth elections: one for each State and Territory. The primary question for the Commonwealth Parliament remains whether Federal electoral donations should fall under a uniform law.

1.60 The lesson from the Spence case is not that it is too hard for the Commonwealth Parliament to clarify its own jurisdictional boundary, the lesson is that particular care is required (respecting principles set out by the High Court in the Spence case).

1.61 Moving from this principle and looking at some practical scenarios, the submissions were useful in drawing attention to ways in which a suitable Commonwealth law could be circumscribed more appropriately.

Re-purposing of donations

1.62 Inquiry participants raised concerns that, in practice, it may be difficult to ascertain the purpose of some donations.

1.63 Professor Twomey and Mr Rotolo-Ross noted that when considering the proposed section 302CA, ‘the key issue is how the donation is actually used’.38 Further, they highlighted that sub-sections 4 and 5 ‘do not [necessarily] require a Federal purpose to be indicated by the donor’ early in the donation process. Rather a donation may be given without any

37 Ms Rebecca Schneider, Submission 3, p. 4.

38 Professor Anne Twomey and Mr Giacomo Rotolo-Ross, Submission 16, p. 2.

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conditions attached and assigned to a federal purpose later in the donation process (for instance where the recipient decides that they want to use an amount federally).

1.64 In these instances, a donation that initially has no jurisdictional purpose attached, can be subject to both State and Federal laws. This appears to be a reasonable treatment where an unallocated amount might be used for elections at either level of government.

1.65 Professor Tham stated that, prior to the Commonwealth 2018 amendment, Commonwealth political funding laws appeared to operate alongside State and Territory schemes. However his submission did not clarify how long that state of affairs had existed. Evidence given to the committee did not suggest that State laws had applied to Commonwealth election donations in a significant way, before passage of the Queensland Electoral Amendment Act in May 2018.39

1.66 Professor Tham raised a more practical concern that, in particular circumstances, gifts could have a purpose that changes between the point when the donation is given and when it is used:

Money is fungible, therefore, contributions earmarked for a ‘Federal purpose’ could easily free up resources for State and Territory elections (including money from public funding payments and investment income) and in that way, support State and Territory election campaigns.40

1.67 Concern regarding this difficulty was echoed by a number of inquiry participants including Ms Rebecca Schneider, Mr Andrew Wilkie MP, Professor Anne Twomey and Mr Giacomo Rotolo-Ross, Queensland Labor Party, Professor Graeme Orr, Associate Professor Luke Beck, The Australian Greens and the Australian Conservation Foundation.41

1.68 The Australian Greens suggested that, in practice, money assigned by the recipient of a donation to ‘a “federal purpose” frees up other income, which

39 Professor Joo-Cheong Tham, Submission 2, p. 2.

40 Professor Joo-Cheong Tham, Submission 2, p. 4.

41 Ms Rebecca Schneider, Submission 3, p. 4; Mr Andrew Wilkie MP, Submission 11, pp. 1-2; Professor

Anne Twomey and Mr Giacomo Rotolo-Ross, Submission 16, p. 2; Queensland Labor Party, Submission 14, pp. 2-4; Professor Graeme Orr, Submission 1, pp. 1-2; Associate Professor Luke Beck, Submission 4, p. 2; The Australian Greens, Submission 5, pp. 2-3; and the Australian Conservation Foundation, Submission 12, p. 2.

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could allow untied amounts be transferred to a State branch or used to indirectly assist in State campaigns’.42

1.69 In other words, because money is a substitutable commodity after it has been banked, the arrival of new donations can allow a recipient to re-think how it prefers to use older donations.

Committee comment

1.70 A political party that contests elections at different levels of government- Federal, State and local council - will make decisions about how much to budget for different campaigns. As new donations arrive and exceed campaign budgets, or fall short of campaign budgets, a party may want to recalibrate how much it assigns to different campaigns. While some submissions contended that this could be an illegitimate practice, it was not apparent how this could by itself be improper if a donation was made on an untied basis (providing a recipient with flexibility as to how the amount is used).

1.71 The more credible concern was whether movements of funds could be engineered to obscure the source of donations. For example GetUp submitted that it had concern that funds could be moved multiple times, describing this as:

Political parties being able to ‘wash’ prohibited donations back and forth between state and federal branches.43

1.72 There is value in having clarity about which jurisdictional laws apply, where donations have been re-purposed. The question then is which laws are engaged in which scenarios.

1.73 The scenario that was raised in some submissions involves an untied amount being initially directed by a party to a federal campaign, but subsequently getting redirected to a state campaign after a new donation arrives that is expressly for federal purposes. Some submissions suggested that in this situation both amounts should be regulated by State law, even though only one donation was ultimately used at state level. On this same view, even though one amount is used for a federal election, the federal law should be displaced in favour of the state law.

42 Australian Greens, Submission 5, p. 2.

43 GetUp, Submission 17, p. 1.

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1.74 Such messiness would not arise if the Commonwealth quarantine for a recipient of a donation is conditional on a requirement that an amount is treated consistently after the recipient first assigns it to federal purposes. Such an approach to close off a potential loophole both addresses integrity risks and removes an area of potential friction with state and territory law.

State Parliamentarians or candidates - involvement in federal fundraising

1.75 The Australian Conservation Foundation put forward a view that that a donation spent on a Federal election campaign could somehow ingratiate a donor with a State politician:

Donations to a State party branch, albeit for a Federal purpose, allow donors the same opportunities to build relationships and influence within the party and carry the same risk of corruption.44

1.76 Professor Twomey and Mr Rotolo-Ross suggested that the proposed changes under section 302CA present a risk that state Parliamentarians could play a role as keynote guests at federal fundraising events.45 An example of this possibility was included in their submission:

One could imagine, for example, functions being held where access to State government ministers was sold to prohibited donors, who when paying for a seat at the Minister’s table, ticked a box stating that the amount paid is a donation for ‘Federal purposes’. This would render ineffective the laudable efforts by some State Governments to reduce the potentially corrupting influence of political donations upon ministerial decisions.46

1.77 The same scenario was elaborated on in the submission from the State Secretary of the Queensland branch of the Australian Labor Party, who provided a hypothetical example of a State Planning Minister being used as guest of honour at an event for property developers (there is no suggestion that such a case has actually arisen).

1.78 Professor Twomey and Mr Rotolo-Ross also provide another hypothetical where a Member of a State Parliament solicits donations to their party, but asks that the amounts to be treated as for Federal purposes. In their example,

44 Australian Conservation Foundation, Submission 12, p. 2.

45 Professor Anne Twomey and Mr Giacomo Rotolo-Ross, Submission 16, p. 3.

46 Professor Anne Twomey and Mr Giacomo Rotolo-Ross, Submission 16, p. 3.

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an older untied donation would then be redirected, to be benefit of the State Parliamentarian.

Committee comment

1.79 There appear to be two solutions to the issues raised regarding the involvement of State politicians in Federal fund-raising, or risks around the re-purposing of donations.

1.80 On the latter issue, State Parliaments have the legislative capacity to prohibit fundraising practices by State parliamentarians or candidates, or conversely to define what kinds of fundraising activities would be legal in their jurisdiction. For instance State law could prohibit individual parliamentarians or candidates in their jurisdiction from organising fundraising for another level of Government, or playing a lead role in such activities. It could be also open to a State Parliament to include more generic anti-avoidance rules, as appropriate to protect the integrity of their respective electoral laws. The Spence case should strengthen the confidence of State Parliaments about their capacity to pass laws to ring-fence their donation rules.

1.81 On the issue of re-purposing donations, the concerns could not arise if Federal quarantines for receiving, keeping and using donations were conditional on directing a donation into a separate Federal account that can only be drawn on for Federal purposes. This would be a ‘lock box’ approach that would make it impermissible for a party to repurpose an amount for State purposes, after placing it under the shelter of Federal law.

1.82 This approach would remove risks about amounts being re-characterised post-facto for State use.

1.83 This is the legislative requirement adopted by some States, to ensure clarity about the location of money that is subject to their jurisdictional laws. For instance the Electoral Commission of Queensland observes that a dedicated state campaign bank account:

… provides the transparency and accountability needed to ensure accurate tracking of financial transactions related to a state election.47

47 Electoral Commission Queensland, ‘Fact Sheet 1 State Campaign Bank Accounts’, viewed on 14

August 2020, .

22

1.84 The State Secretary of the Queensland branch of the Australian Labor Party, Julie-Ann Campbell, proposed another variation on this approach, by suggesting that Federal Secretariats of political entities should be recognised as the ‘legitimate vessel of federal donations.’48 She submitted that:

This practice is preferable to the practice that would be enshrined by this Bill. That is because the federal secretariats of political parties do not have an organisational nexus with candidates across multiple levels of government. Instead, it is focussed upon the promotion and election of federal candidates to federal parliament. … Establishing federal secretariats as the hub for individuals or entities otherwise prohibited from donating at a state level would suitably insulate state parties (and by extensions, state and local government candidates) from any integrity risks actual or perceived, posed by prohibited donations.49

1.85 The Queensland Labor suggestion could provide another option for political entities that have both Federal and State arms. Since not all political entities have a Federal Secretariat, it would be also necessary to permit a State-based entity to establish their own separate Federal accounts for Federal purpose donations.

1.86 A Federal-purpose account would effectively create a sanitised stream of financial activity within a state arm of a party that is fully separated from the State-affairs of the party. It would remove a capacity to shuffle funds between purposes, after they have been committed and banked.

Impacts on Smaller Political Entities

1.87 In favour of the amendments in the Bill, Mr Adamson, Secretary of the One Planet Political Party, recommended that gifts ought to be able to be used by any properly constituted branch of a political party.50 He argued that the Commonwealth Electoral Act is too long at over 600 pages and therefore simplified laws were desirable. Mr Adamson put forward the following suggestion:

48 Julie-Ann Campbell, State Secretary, Queensland Branch Australian Labor Party, Submission 14, p.

4.

49 Julie-Ann Campbell, State Secretary, Queensland Branch Australian Labor Party, Submission 14, p.

4.

50 Mr Edwin Adamson, Submission 8, p. 1.

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Such gifts ought to be able to be used by the recipient party in Australian elections of any Sovereign State body, State or Federal.51

1.88 The Child Protection Party also advocated that any legislative requirements to operate separate bank accounts for State and Federal political parties would put ‘minor parties at a disadvantage’.52 As such, they recommended either the transfer of funds between State and Federal accounts or the operation of a single account be permitted.

The CPP, being registered as a federal and also a state party, must maintain 2 separate bank accounts with all the costs that come with that. Transfers between the separate accounts are not permitted. … The CPP believes that the legislation be amended [sic] to allow the use of a single account for both state and federal purposes with the obvious proviso that records must be properly maintained that show how the money is being used. Alternatively, the legislation could be changed to allow the transfer of monies between state and federal accounts.53

1.89 The Government’s Bill, as introduced, did not require an amount to be in a Federal campaign account as a condition of attracting protection of Federal law. However the Child Protection Party is proposing reversal of requirements that they already are subject to, insofar as they want the Commonwealth to override State laws that require State-related donations to be in a dedicated State campaign account. Contrary to the principles of the Spence case, the Child Protection Party is suggesting that the Commonwealth override State laws in a way that the Commonwealth cannot.

Committee comment

1.90 It could be considered to be an unfair distortion in the political system if only some parties were required to keep their federal donations in a dedicated account, while others were not because of the size of the party. It is notable that the Child Protection Party advised that it already maintains separate accounts.

1.91 It would not appear to be an especially onerous administrative impost, to require that Federal political entities maintain a separate bank account as a

51 Mr Edwin Adamson, Submission 8, p. 1.

52 Child Protection Party, Submission 7, pp. 3-4.

53 Child Protection Party, Submission 7, p. 4.

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condition for being regulated exclusively by federal laws where they receive, keep or use political donations. No evidence was provided to explain how such a requirement, which is increasingly common at State level, might be excessive at federal level.

1.92 Indeed requirements to open dual accounts have arisen in some states already, essentially lowering the impact of any uniform national requirement to open federal accounts for federal campaigns.

1.93 Risks related to campaign finance and improper influence could arise for small players in politics, just as they could for some larger players. A minor party or independent group can occupy a position of balance of power in a State Parliament and may therefore be as decisive as a major player in determining the shape of particular laws. If there is value in keeping federal and State campaign funds strictly separate after they are received, then the principle should equally apply to all recipients of political donations.

Other federal financing proposals in the submissions

1.94 Ms Schneider believed that Australia’s Federal donation scheme, and the ‘substantial time lag’ of some ‘8 to 19 months under the current Federal system’, results in voters not being ‘fully informed of competing candidates’ funding sources before making a vote’.54 Ms Schneider added:

Transparency International [Australia] has recorded a fall in Australia’s overall transparency ranking relative to other nations over time, in their 2020 Report identifying our Federal donation disclosure scheme as the major area of concern.55

1.95 It was the primary recommendation of the PHAA that all ‘political donations should be banned’.56 However, in the event that the current donation disclosure regime were to continue, the PHAA made a number of additional recommendations, including:

 There should be a single national online register of all donations, regardless of the amount, updated daily for real-time disclosures

 The register should include donations in other forms including gifts, attendance at fundraising events, fees for membership of and attendance at networking and other similar forums, sponsorships and hosting events

54 Ms Rebecca Schneider, Submission 3, p. 2.

55 Ms Rebecca Schneider, Submission 3, p. 2.

56 Public Health Association Australia, Submission 18, p. 4.

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 The register should include disclosure of all meetings between donors and political parties and their respective representatives …

 Political donations from companies whose goods cause demonstrable public health damage, such as tobacco, alcohol and gambling, should be banned. 57

Committee comment

1.96 A number of these suggestions were outside the purpose of the Bill, as a technical clarification and machinery improvement Bill, and are more suitable issues for consideration in the context of legislation dealing with substantive policy revisions.

Modernisation of the electoral process

1.97 Inquiry participants had differing views on the modernisation provisions in the Bill, particularly those that related to Antarctic electors; allowing other implements - such as pens - to mark ballot papers; the format of the Senate Ballot papers; the inconsistency of relevant wording in the Act; allowing voting officials greater flexibility to ascertain an individual’s entitlement to vote; and providing functional and practical flexibility for AEC staff.

Antarctic electors

1.98 With regard to Antarctic electors, some inquiry participants welcomed the proposed amendments which would give flexibility to the recording of votes from a very small number of Antarctic electors on research stations and ships in transit during an election.58 This treatment extends the availability of an existing voting method, that is already offered to sight impaired voters.

1.99 Under this system an eligible voter is provided with a registration number and PIN to use to vote anonymously through a secure call centre. A telephone vote is transcribed onto a ballot paper and, repeated back to the voter to confirm. A second AEC staff member checks the recording of the vote to ensure the ballot is marked true to the voter’s instructions, and scrutineers can listen to the process.

1.100 The proposed Antarctic voter amendments depart from the existing method where an Antarctic Returning Officer at each research station or ship rings in ballot details and that officer knows how each person in their workplace has

57 Public Health Association Australia, Submission 18, pp. 4-5.

58 Inquiry participants who supported the proposed amendments include: Professor Graeme Orr,

Submission 1; Mr Edwin Adamson, Submission 8, and Department of Finance, Submission 9.

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voted. Both the new and old methods rely on phoning in details of individual ballot papers. However the new Antarctic system employs a two-step identification process, so the elector’s identity is secret from:

 the authorised officer who transcribes the vote;  the officer who validates the transcribed numbers; and  any scrutineers.

1.101 Associate Professor Teague and colleagues have a research interest in electronic voting and have focussed on this aspect of the Bill, because it is titled as ‘electronic voting’. The only electronic aspect of this proposal however, is that it relies upon use of telephone calls to convey vote details. Associate Professor Teague and colleagues observed that:

… this has been described to Parliament as facilitating phone-assisted voting, but neither the legislation or the Bill actually specifies this explicitly.59

1.102 Professor Orr supported reforms to Antarctic voting issues, but suggested that the Bill could ‘go further to simplify Antarctic voting provisions’.60 Professor Orr suggested that power ought to be delegated to the AEC and proposed that the following section replace Part XVII of the Act:

The AEC must establish procedures to enable Antarctic electors to vote, and have their votes counted, in as secret and timely a manner as is reasonably possible. It is an offence punishable by 0.5 penalty units to breach any such ballot secrecy procedures.61

1.103 Associate Professor Teague and colleagues, however, did not support the proposed amendments regarding Antarctic electors. They reasoned that ‘no remote voting system exists that allows Antarctic voters any real vote privacy or option to verify their votes’.62

1.104 In fact the Explanatory Memorandum is very detailed and clear about how the process relies on an established telephone system as used by blind voters. The details of that method are clearly legislated in the Electoral and Referendum Regulation 2016 at Part 4, Division 1. Moreover the Bill includes new section 202AB(1A) that says the relevant method must be set out in

59 Associate Professor Vanessa Teague, Dr Michelle Blom, Professor Rajeev Goré, Professor Philip

Stark, Professor Peter Stukey and Dr Damjan Vukcevic, Submission 6, p. 4.

60 Professor Graeme Orr, Submission 1, p. 2.

61 Professor Graeme Orr, Submission 1, p. 2.

62 Associate Professor Vanessa Teague, Dr Michelle Blom, Professor Rajeev Goré, Professor Philip

Stark, Professor Peter Stukey and Dr Damjan Vukcevic, Submission 6, p. 2.

27

regulations, comparable to explicit rules that formalise how the blind voting method works. Accordingly the method will replicate existing well-known regulations, and those new regulations will be subject to scrutiny and potential disallowance by Parliament in the usual way.

1.105 The Bill also requires that the same voting method for Antarctic voters must be allowed at referendums and again the details are to be set out in regulations (section 73M(1A)). Parliament will again have the opportunity to ensure that the method reflects what is described in the Explanatory Memorandum and adequately ensures the integrity of the process.

1.106 Professor Orr supported reforms to Antarctic voting issues, but suggested that the Bill could ‘go further to simplify Antarctic voting provisions’.63 Professor Orr suggested that power ought to be delegated to the AEC and proposed that the following section replace Part XVII of the Act:

The AEC must establish procedures to enable Antarctic electors to vote, and have their votes counted, in as secret and timely a manner as is reasonably possible. It is an offence punishable by 0.5 penalty units to breach any such ballot secrecy procedures.64

Committee comment

1.107 It would be an extraordinary delegation of power to the AEC to permit a complete discretion about the voting method for Antarctic voters. The advantage of the proposal in the Bill is that it extends an existing system that is known to be effective, and ensures that there are safeguards to protect anonymity. An open-ended power for the AEC would leave some uncertainty about how well secrecy would be protected. The Bill uses regulation-making powers, so that Parliament can be satisfied that the AEC get the balance right.

1.108 Associate Professor Teague and colleagues, however, did not support the proposed amendments regarding Antarctic electors. They reasoned that ‘no remote voting system exists that allows Antarctic voters any real vote privacy or option to verify their votes’.65

1.109 Rather, Associate Professor Teague and colleagues recommended:

63 Professor Graeme Orr, Submission 1, p. 2.

64 Professor Graeme Orr, Submission 1, p. 2.

65 Associate Professor Vanessa Teague, Dr Michelle Blom, Professor Rajeev Goré, Professor Philip

Stark, Professor Peter Stukey and Dr Damjan Vukcevic, Submission 6, p. 2.

28

Reconsider the sections relating to Antarctic voters. If specific voting methods were intended, then make these explicit, while also mandating clear standards for privacy, verifiability, and security. Otherwise, remove these sections.66

1.110 This inflexible view does not consider the difficulty or cost of returning from Antarctica to Australia to vote during an election. The committee is concerned that reliable methods should be available during an election, to permit Australian voters to exercise their franchise when they are in Antarctica or travelling in either direction. The Bill proposes established methods that satisfy this requirement better than the existing system.

Pencils in polling booths

1.111 The Bill includes an amendment to:

… remove the requirement for only pencils and replaces it with a general requirement that each compartment must have an implement or method for voters to mark their ballot papers.67

1.112 The key condition in the new statutory wording is that any new voting method must be capable of making a mark on a ballot paper. The amendment therefore permits a wider range of products such as biros, felt pens and other such commercially available writing tools. This therefore remains a solution that is predicated on paper-based voting.

1.113 Unless other parts of the Commonwealth Electoral Act were to be changed to redefine the character of the ‘ballot paper’, it is not possible to read this section as being about anything other than writing tools. The Act refers in numerous locations to ballot papers as forms that are ‘printed’ on paper, for instance section 209 says these documents ‘are to be printed using black type face’ (s209(3)). The Act also says that ballot papers can be folded (s209(5)), or written on (s209(6)), or may carry a watermark (s209A). By itself, the new rule that permits the use of pens is nowhere close to being a loophole that opens up a pathway to electronic voting.

1.114 The Australian Greens supported the proposed changes regarding the introduction of administrative markings on ballot paper and a wider range of implements permitted to mark ballot papers. However, they recommended that:

66 Associate Professor Vanessa Teague, Dr Michelle Blom, Professor Rajeev Goré, Professor Philip

Stark, Professor Peter Stukey and Dr Damjan Vukcevic, Submission 6, p. 4.

67 Explanatory Memorandum, p. 27.

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… the Committee should ensure that the scanning solutions (including any tender for procurement of future scanning solutions) can demonstrate that scanning, data entry and scrutiny will not be compromised.68

1.115 The expected result of the amendment, is that the AEC will adopt pens or other ink-based writing tools. These implements usually have a darker imprint than pencils, so could reasonably be expected to scan more effectively than pencil. The questions raised by the Greens could be matters on which the Commission could inform the Committee by correspondence at the appropriate time after testing of the market, without requiring an amendment to the Bill that imports excessive legislative red tape.

1.116 The Child Protection Party was alone in arguing the amendment did not go far enough because retaining the possibility of using pencils ‘introduces a risk, small though it may be, of electoral fraud taking place whereby a voter's selections are erased and changed’69 and suggested that it be amended to:

Each compartment must have an implement or method (excluding pencils) for voters to mark their ballot papers.70

Issuing of votes, flexibility of questions and prescribed sequence

1.117 The proposed changes that would allow voting officials greater flexibility to ascertain an individual’s entitlement to vote were raised by some submitters. The Commonwealth Electoral Act requires officials to use fixed wording to enquire about each voter’s full name, address and whether they have voted previously. The Explanatory Memorandum describes the proposal to allow officials to ascertain specific information in the most sensible way (without prescribing the precise wording of the conversation):

Flexibility in the wording of the questions to elicit the same information means the questions can be adapted to local conditions where necessary. For example in circumstances where a voter has a disability, where the voter may be experiencing loss of hearing, or where voters are from culturally and linguistically diverse backgrounds.71

68 The Australian Greens, Submission 5, p. 4.

69 The Child Protection Party, Submission 7, p. 4.

70 The Child Protection Party, Submission 7, p. 4.

71 Explanatory Memorandum, p. 28

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1.118 The Explanatory Memorandum goes on to provide practical examples of how some flexibility in wording can allow staff to use common sense and issue ballot papers sooner, for instance by asking about a surname first, or allowing slightly different wording in situations where voters misunderstand the questions. The Public Health Association of Australia held the view that the Bill would improve ’electoral processes, electoral administration, vote issuing procedures and improve workforce flexibility for the Australian Electoral Commission’.72

1.119 The Bill proposes the replacement of sections 200DG, 200DI, 221 and 229. These sections concern when voters are entitled to vote, the way questions may be put to voters by officials and elections at which voters are entitled to vote.73 The result of these changes is a degree of flexibility for AEC staff.74

1.120 While the Australian Greens supported the ‘proposed amendments to ss.73CI, 200DI and 229 to allow some flexibility’, their submission was clear to note that:

… removing the prescriptive nature of the questions must not give licence to any polling officer to require a voter to produce identification to satisfy the officer of their eligibility.75

1.121 GetUp expressed concern at the ‘changes to the questions asked of voters by voting officials’, suggesting that:

… this amendment will allow poorly trained and/or ill intentioned voter officials [sic] the license to ask voters for their identification. Getup does not think that this would initially be a wide spread problem, and GetUp acknowledges the efforts that the Australian Electoral Commission (as well as the State & Territory Electoral Commissions) go to in training a sporadic and largely casual workforce.76

Committee comment

72 Public Health Association Australia, Submission 18, p. 3.

73 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020, pp. 18, 21-22;

Commonwealth Electoral Act, sections 200DG, 200DI, 221 and 229.

74Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020: Explanatory Memorandum,

p. 33.

75 The Australian Greens, Submission 5, p. 4.

76 GetUp, Submission 17, p. 2.

31

1.122 The above concern overlooks other relevant parts of the Act. Under the current Act, and the proposed Bill, polling officials are not given any authority to withhold a ballot if a voter does not display identification. Instead the Act requires officials to provide a ballot paper to persons who have positively answered the questions about name, address and previous voting (the entitlement to a ballot paper is based solely on a person’s answers, as set out in sections 200DJ(1), 221 and 231). Moreover the Explanatory Memorandum notes that any issues about a person’s eligibility to vote will be referred to a senior AEC official, rather than left in the hands of a less experienced AEC officer.

In practice, if a person cannot be located on a certified list, is already marked off or if there are concerns over their eligibility to vote, they will be referred to an officer in charge of the pre-poll voting centre.77

Workforce flexibility for divisional returning officers, presiding officers and polling place officials

1.123 The Bill seeks to provide functional and practical flexibility for AEC staff. This proposes to allow the ‘Electoral Commissioner to devolve duties or functions from Divisional Returning Officers (DROs) or Assistant DROs to other staff members’.78 The Bill also seeks to allow for presiding officer or other polling place officials to ‘assist in all aspects of vote issuing and related processes’.79

1.124 While acknowledging the significant workload placed on DROs, the Australian Greens expressed concern that the changes proposed under part two, section 37 of the Bill appear ‘broad and unlimited’.80

1.125 By contrast, the Department of Finance stated that the Bill proposes ‘greater workforce flexibility for the AEC and more nationally consistent processes’.81

1.126 Overall the Department of Finance supported the reduction of ‘unnecessarily prescriptive administrative practices’ in the proposed Bill.82

77 Explanatory Memorandum, paragraph 160.

78 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020: Explanatory Memorandum,

p. 4.

79 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020: Explanatory Memorandum,

p. 34.

80 The Australian Greens, Submission 5, p. 3.

81 Department of Finance, Submission 9, p. 5.

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Committee comment

1.127 This issue begs the question whether the Parliament is prepared to trust officials employed by an independent statutory authority to exercise judgement appropriately and professionally, and to use modern workforce practices such as permitting delegation of decisions down to an appropriate level of officer with requisite skill and training.

1.128 In a typical election there will be millions of decisions required about issuing of ballot papers and hundreds of thousands of decisions about ballot paper formality. If the Parliament is not prepared to trust an agency to manage delegations appropriately, then the alternative requires the Parliament to undertake a high degree of micro-management through legislation. Other witnesses to this and previous enquiries have suggested that the Commonwealth Electoral Act can be excessively detailed and prescriptive in places.83 There was no specific evidence presented to suggest that the AEC is not capable of delegating to the correct level.

Additional views

1.129 The Child Protection Party disagreed with the existing policy reflected in sections 286A and 292G, which comprise minor language changes regarding the requirement for registered political parties, campaigners and groups to receive ‘more than 4% of the total first preference votes cast in the election’ (according to the current Bill) in order to receive election funding.84

1.130 Under the proposed amendments, sections 286A and 292G change to ‘at least 4% of the total formal’.85 This makes no functional difference to how electoral funding is paid to parties, and serves to ensure consistency of language across the Act.86

82 Department of Finance, Submission 9, p. 5.

83 In Submission 1, Professor Orr referred to a paper he co-authored on the balance between

prescription and flexibility: Michael Maley and Graeme Orr, Developing a Legislative Framework for a Complex and Dynamic Electoral Environment (Electoral Regulation Research Network, April 2019).

84 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020, pp. 3-4; Commonwealth

Electoral Act, sections 286A and 292G; Child Protection Party, Submission 7, p. 3.

85 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020, pp. 3-4.

86 Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020: Explanatory Memorandum,

p. 11.

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The CPP, believes that the requirement to achieve the 4% minimum of first preference votes is one factor that disadvantages the minor parties … The CPP believes that this mandatory minimum should be reduced to read ‘at least 2% of the formal first preference votes’.87

1.131 A public audit of the Senate count allowing for greater scrutiny was recommended by Professor Teague and colleagues.88

The absence of rigorous auditing of the paper records means that accidental errors or deliberate manipulation might go undetected, particularly for preferences other than ‘1’ since they are entirely dependent on the electronic process … It is urgent to mandate a full, open, transparent audit of the Senate ballot papers against the electronic preference data, so that the AEC and every other Australian can have confidence that the elected Senators accurately represent the choice of the people.89

Committee comment

1.132 In relation to the minimum threshold of votes for public funding, the Committee notes that this issue is goes outside the purpose of the Bill, which is intended to achieve technical clarification and efficiencies.

1.133 In relation to Senate counting systems, the Committee is concerned that these systems should operate with the highest integrity. These issues are matters on which no other evidence was received during the inquiry and there was no prima facie evidence to suggest that results under the existing system lacked credibility. This matter also did not squarely relate to the subject of the Bill. This may be a topic that suits consideration as part of a separate JSCEM inquiry on a broader set of topics.

Recommendation 1

1.134 The Committee recommends the Government amend the quarantines provided to recipients of donations (related to receiving, keeping and using a donation), to limit the exclusive application of Federal donation laws in these circumstances to donations that are kept solely in a Federal electoral account. This can be achieved either by:

87 Child Protection Party, Submission 7, p. 3.

88 Associate Professor Vanessa Teague, Dr Michelle Blom, Professor Rajeev Goré, Professor Philip

Stark, Professor Peter Stukey and Dr Damjan Vukcevic, Submission 6, p. 3.

89 Associate Professor Vanessa Teague, Dr Michelle Blom, Professor Rajeev Goré, Professor Philip

Stark, Professor Peter Stukey and Dr Damjan Vukcevic, Submission 6, p. 3.

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 banking donations with the Federal arm of a political entity that is a separate legal entity to a State arm, or

 banking donations in a separate Federal account operated by a State arm of a political entity, from which amounts are only permitted to be drawn down for Federal purposes.

1.135 It is a legitimate policy objective to protect the operation of the Commonwealth’s laws and to ensure that there is clarity between Federal, State and Territory electoral laws. The Committee is of the view that the Bill contains the required amendments to safeguard Federal electoral laws and provide stakeholders with greater transparency about the interaction between electoral jurisdictions.

1.136 The Committee’s recommendation for an amendment to the Bill would address concerns about the transfer of gifts between Federal and State levels. An amount in the hands of a recipient would only be exclusively under Federal law where it is fully quarantined within the Federal system, through separate banking in an account that is only permitted to be used for Federal purposes.

1.137 The Bill also seeks to improve the delivery of efficient and transparent Federal elections by enabling AEC staff members greater flexibility; removing overly prescriptive language in the Act; expanding electronic voting methods for Antarctic electors; allowing the AEC to streamline election delivery, and strengthen electoral integrity and administration processes. The Committee recommends that the Bill be passed to provide clarification in these areas.

Recommendation 2

1.138 Subject to amendments to reflect the recommendations in this report, the Committee recommends that the Parliament pass the Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020, as amended.

Senator the Hon James McGrath

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Chair

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A. Submissions

1 Professor Graeme Orr

2 Professor Joo-Cheong Tham, Electoral Regulation Research Network

3 Ms Rebecca Schneider

4 Associate Professor Luke Beck

5 The Australian Greens

6 Associate Professor Vanessa Teague, Dr Michelle Blom, Professor Rajeev Goré, Professor Phillip Stark, Professor Peter Stuckey, Dr Damjan Vukcevic

7 Child Protection Party

8 Mr Edwin Adamson

9 Department of Finance

10 The Centre for Public Integrity

11 Mr Andrew Wilkie MP

12 Australian Conservation Foundation

13 Australian Electoral Commission

14 Australian Labor Party Queensland Branch

15 Ms Kammy Cordner Hunt

16 Professor Anne Twomey and Mr Giacomo Rotolo-Ross

17 GetUp

18 Public Health Association Australia

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19 Liberal Party of Australia

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Dissenting report

Labor members

Labor members of the Committee support passage of the Bill, provided amendments are made to ensure certainty for election participants and provide greater transparency of political donations.

Labor recognises the concerns raised by many submissions to this Inquiry in relation to the proposed amendments to sections 302CA and 314B. However, the Commonwealth Parliament should be able to make laws with respect to Commonwealth elections - without the threat of those laws being overridden by the states. Our priority is for a uniform, transparent federal system which applies equally to federal parties and candidates regardless of which state they live in.

Recognising that the Bill will affect funding and disclosure arrangements in place in the various States, and in particular Queensland, Labor members of the Committee are of the firm view that the commencement date of the Bill should be postponed until after the Queensland state election on 31 October this year. This will provide parties and candidates, as well as the Queensland Electoral Commission, certainty in the lead-up to their upcoming election.

There is also the need for parties to be required to maintain separate federal and state campaign accounts, as highlighted in the submission by the Queensland branch of the ALP. This will facilitate more effective and accountable administration of differing state and territory laws with Commonwealth law and provide an added protection against the funnelling of prohibited donations between jurisdictions.

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Provided these two amendments are made, Labor members support passage of the Bill.

Many of the submissions to the inquiry into this Bill argued for comprehensive donations reform at the federal level. Labor believes that donations reform and improving transparency is paramount to a healthy democracy and addressing the declining levels of faith in our political institutions.

Labor is proud to have continually fought for reform of political donations and improved transparency throughout our political system.

At the 2016 election, Labor committed to introducing a ban on foreign donations and linking public funding to campaign expenditure, preventing candidates and parties from profiting from the electoral system. We have succeeded in securing both of those reforms.

It was the Hawke Labor Government that introduced the first donations disclosure scheme in 1983, with a disclosure threshold of $1,000. The Liberals and Nationals, under John Howard, changed the rules in 2006 to hide who was giving them money raising the threshold to $10,000 and linking it to CPI. That indexation has resulted in the threshold blowing out to the staggering and unacceptable level of $14,300.

Under the current system, donations to political parties, candidates and associated entities can go weeks and months without being disclosed to the public. Annual returns are not published until the first working day in February, meaning it can be up to 19 months before voters know who has made a political donation. This loophole was used to hide Malcolm Turnbull’s record-breaking $1.75 million donation to the Liberal party before the 2016 election for nearly 500 days.

Labor has already introduced two bills for donation disclosure reforms into the Senate: the Commonwealth Electoral Amendment (Transparency Measures—Lowering the Disclosure Threshold) Bill 2019 and the Commonwealth Electoral Amendment (Transparency Measures—Real Time Disclosure) Bill 2019.

These Bills will deliver on Labor’s longstanding commitments to lower the donations threshold from the current $14,300 to a fixed $1,000 and introduce a system of real time disclosure. Labor members of the Committee call on the Government and the Parliament to support these Bills.

It is our further belief that caps on both donations and expenditure should be implemented at a federal level to enhance transparency, fairness, and accountability in our democratic processes. To support these measures, and to reduce the reliance of candidates and parties on fundraising, there needs to be an increase in the rate of public funding of elections. Political fundraising has

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contributed significantly to an erosion of public trust in the integrity of our system of governance and the political framework it operates in. Increasing the rate of public funding reduces the reliance on individual fundraising and prevents the perception that candidates and parties are beholden to vested interests, while ensuring that our democracy is appropriately funded.

In order to further reduce the reliance on fundraising to fund operational activities for political parties and elected independents, Labor members of the Committee also believe the Government should consider the introduction of administrative funding for parties and elected independents to cover ordinary operating expenses. Administrative funding is paid in several state jurisdictions and this is yet another area of electoral law in which the Commonwealth lags behind the states.

We must also ensure that the Australian Electoral Commission, our independent regulator, is properly funded to carry out its role, not just on election day, but also as the regulator of our donations framework, through the provision of a transparent and easy to navigate donations disclosure system. With a global erosion of faith in systems amongst democratic countries, Australia’s parliament must do all it can to reverse the trend and bolster accountability at home.

Labor members support the technical amendments contained in the Bill, many of which were recommended by JSCEM in its review of the 2016 Federal Election, and others which have been recommended by the Australian Electoral Commission. We do, however, note the concerns raised in some submissions regarding the potential for a polling official to request identification from a voter. Labor members of the committee have grave concerns with so-called Voter ID laws and any move towards their implementation in Australia. Overseas experience consistently demonstrates the enactment and enforcement of such laws has the effect of reducing voter participation, particularly for marginalised members of the community. Labor will not support any measures which disenfranchise voters and undermine our compulsory system of voting. We recognise that the current provisions in the Electoral Act are overly prescriptive and that increased flexibility in the form and order of the questions a voter is asked to determine their eligibility is required in circumstances where a voter has a hearing disability or is from a culturally and linguistically diverse background. If the Parliament passes these amendments, it is essential that AEC staff are appropriately and adequately trained to ensure that no voters are asked for identification at a polling place.

Labor members of the Committee wish to thank everyone who took time to make a submission to the Inquiry.

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Senator Carol Brown Mr Milton Dick MP

Deputy Chair Member

Senator Marielle Smith Ms Kate Thwaites MP

Member Member

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Dissenting report

Australian Greens

Many of the changes proposed by the Electoral Legislation Amendment (Miscellaneous Measures) Bill 2020 (the Bill) are necessary technical improvements. However, in a triumph of big money over democracy, and despite an attempt at redrafting, the Bill undermines tougher State-based donation regulations, such as lower disclosure thresholds, donation caps, and prohibition of donations from sectors known to have a corrupting influence.

The Bill is also a missed opportunity to implement critical reforms to improve transparency and integrity measures associated with elections and campaign financing.

The Australian Greens also have concerns regarding:

 The potential for increased flexibility in questions posed to voters to facilitate the introduction of Voter ID; and  Broad delegation of the responsibilities of Divisional Returning Officers.

Undermining State donation laws

Timely disclosure and low disclosure thresholds are essential to ensure that the public has clear line of sight between donors and political influence.

The provisions of the Bill seeking to replace the impugned s.302CA and 314B of the Commonwealth Electoral Act 1918 (the Act) are said to be designed to address the

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High Court’s decision in Spence v Commonwealth.1 However, as drafted, the provisions still allow parties to undermine State efforts to regulate the influence of donations through strong disclosure rules and banning donations.

In response to documented corruption risks, Queensland has introduced legislation to prevent donations from property developers and to require near to real-time disclosure of all political donations. Restrictions in other States also seek to deter corrupt behaviour and allow public scrutiny of donations. Such legislation should be supported, not undermined.

The Commonwealth disclosure scheme is weaker than the disclosure schemes in most States and Territories. Professor Joo-Cheong Tham has said that enacting the amendments in the Bill “will result in weaker regulation of political funding in Australia.” This sentiment was echoed in many other submissions.2

Several submissions discussed the fluid nature of campaign finances and influence within a political party which operates at local, State and Federal levels.3 Professor Anne Twomey and Giacomo Rotolo-Ross refer to the ‘laundering’ of political donations4, while Professor Joo-Cheong Tham describes the ‘hydraulics’ of intra-party political finances which allow money donated for Federal purposes to flow back to State branches without contravening the restrictions that would have applied to a direct donation at the State level.5 Such intra-party donations and transfers are not recorded in a systematic way, making them nearly impossible to track.6

Even where there is no direct transfer of funds, a State party or candidate could still feel the influence of a donation made for a Federal purpose from an otherwise prohibited donor.

The Committee report recommends a further amendment to require donations made ‘for Federal purposes’ to be deposited into a separate Federal account,

1Spence v Queensland [2019] HCA 15; (2019) 367 ALR 587, 603-4 [55] (Kiefel CJ, Bell, Gageler and

Keane JJ)

2 Submissions from Assoc Professor Luke Beck (Submission 4), Professor Graeme Orr (Submission 1),

The Centre for Public Integrity (Submission 10), Mr Andrew Wilkie MP (Submission 11), The Australian Conservation Foundation (Submission 12), and the Human Rights Law Centre (Submission 20).

3 For example, submissions of ALP Queensland Branch (Submission 14), Professor Joo-Cheong Tham

(Submission 2), and Assoc Professor Luke Beck (Submission 4).

4 Submission of Professor Twomey and G Rotolo-Ross (Submission 16), p. 3.

5 Submission of Professor Joo-Cheong Tham (Submission 2), p. 4.

6 Advice from the Parliamentary Library.

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quarantining the funds from State party finances. While such an amendment will go some way towards improving the transparency of transfers, it will not stem the flow of finances or influence.

The Greens have consistently advocated for national efforts to introduce rigorous, harmonised rules for disclosure and regulation of donations. Until consistent regimes are introduced, Federal laws should not undermine State approaches that seek to ensure accountability and transparency.

RECOMMENDATION 1:

Repeal ss.302CA and 314B of the Commonwealth Electoral Act 1918.

The Bill misses an opportunity to strengthen transparency and integrity in relation to political donations and campaign financing. The Australian Greens continue to call for a range of reforms to provide a more rigorous and transparent political donation disclosure regime, including:

 including membership fees and pay-for-access events in the definition of ‘gift’;  disclosure of all donations over $1,000 on an easy to search, public website in close to real time;  an aggregated cap on donations of $3,000 per parliamentary term;  a complete ban on donations from developers, banks, mining companies

and the tobacco, liquor, gambling, defence and pharmaceutical industries to political parties, candidates and associated entities.

RECOMMENDATION 2:

That the government implement the recommendations made by the Senate Select Committee Inquiry into the Political Influence of Donations.

RECOMMENDATION 3:

That the government adopt the Commonwealth Electoral Amendment (Banning Dirty Donations) Bill 2020.

Questions to voters

We are supportive of proposed amendments to allow some flexibility in the way in which voters are asked questions to determine their eligibility. This amendment recognises that many voters have low literacy and minimises the risk that such voters are inappropriately ruled ineligible or subjected to an unnecessary administrative procedure because of the inflexibility of the eligibility questions.

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However, removing the prescriptive nature of the questions must not give licence to any polling officer to require a voter to produce identification to satisfy the officer of their eligibility. As noted in the Australian Greens’ dissenting comments to the 2016 election review report, voter identification requirements have “serious implications for voter engagement for many groups of disadvantaged voters, including itinerant and indigenous voters as well as those escaping domestic violence.”

To ensure that the objective of greater flexibility is achieved without compromising voter engagement, we recommend that each of the relevant sections be amended to confirm that no identification can be required.

RECOMMENDATION 4:

Amend provisions in the Bill regarding flexibility of eligibility questions to ensure voting officers cannot require a voter to produce any document to verify their name or address.

Delegation of DRO responsibilities

The Australian Greens acknowledge the significant workload of Divisional Returning Officers (DRO) during the polling and scrutiny periods, and the benefits of allowing this workload to be delegated. However, the proposed s.37 should be amended to clarify the extent of delegations and ensure that the responsibility for critical tasks cannot be outsourced.

RECOMMENDATION 5:

Amend the proposed s.37 of the Act to:

 reserve the power to declare the poll for a given division to the DRO or Assistant DRO of that division;  explicitly provide for scrutineers to seek a ruling on formality of a ballot from the relevant DRO or Assistant DRO to ensure consistency

of rulings; and  require a register of delegations to be made available to the public.

Senator Larissa Waters

Member