Will independents call for a citizens' jury on political finance reform in Australia?
Political parties shouldn't be setting the rules of the political game, including the rules about political finance
TL;DR: Australian independents should champion a citizens’ jury on political donations and campaign expenditure reform
It’s widely recognised that Australia needs to reform its political finance laws; to illustrate a couple of the issues, about one-third of the nearly $200 million received by parties in the 2020-21 financial year was “hidden money” and nearly a quarter of all donations came from just 10 donors.
Political parties have a conflict of interest when it comes to political donations and campaign expenditure reform; they shouldn’t be setting the rules. But political finance reform is also fundamentally a question about values; an expert commission can’t legitimately or representatively make these value judgments. At the same time, these issues of course require expert input (not least on constitutionality and potentially unintended consequences).
A citizens’ jury best satisfies the criteria of (i) representativeness, but (ii) not through representation by political parties who have a conflict of interest, and (iii) informed and deliberative decision-making. We should task citizens selected via a democratic lottery with deliberating at length on the most appropriate political finance reforms in Australia, with reference to a range of proposals and evidence from experts.
The recommendations of a jury wouldn’t of course be binding; they would need the government’s support to be implemented. Independents are well-positioned to initiate a call for a jury, given their platforms of meaningful citizen engagement and integrity.
The rules of the game shouldn’t be made by any one player
The unfair advantage that redistricting confers on incumbent elected officials in the US (to redraw district lines in their favour) is routinely lamented. The highly political decisions of the US Supreme Court have inspired deep concern about the power of incumbent Presidents to stack the court in their political favour. On the home front, the Coalition’s failure to establish a robust Commonwealth Integrity Commission was roundly criticised, particularly as a self-interested attempt to avoid penalty. Revelations about Morrison’s self-appointment to various ministerial positions have sparked outrage about the potential for an incumbent government to non-transparently depart from fundamental procedural conventions of the Westminster system. Labor has been criticised for making self-interested parliamentary staff cuts without consultation.
And I’ll venture a sporting analogy if political examples aren’t doing it for you: based on current estimates of the clubs’ wealth, I suspect that Tigers fans wouldn’t be too happy if Russell Crowe’s Rabbitohs were tasked with setting the NRL salary cap and vice versa.
What is it about these examples that might make you uncomfortable or angry? One player is setting not just any rules, but the rules of the game, with a clear incentive to do so in a way that favours them. These rules might not be sexy, but they’re perhaps more important determinants of fairness in a society than any other: they’re rules that have profound implications for all the others that are made under them.
Political finance laws in Australia: rules of the game in need of reform
Political donations
In the 2020-21 financial year, about 68 million AUD (henceforth $) or more than one-third of the $177 million that flowed to political parties was “hidden money”. Nearly a quarter of all donations came from just 10 donors, according to analysis by the Centre for Public Integrity, with the ALP and Coalition receiving over 20% of their fundraising from donations over $1 million. We also can’t assess the influence of big money in the most recent election until next year due to the delayed obligation to disclose.
Researchers and civil society organisations have called for, amongst other things, lowering the disclosure threshold, implementing donations caps and strengthening enforcement and compliance.
Electoral expenditure
Electoral expenditure has been described as an “arms race”. Grattan Institute estimates that political parties and candidates spent well over $400 million trying to win in the 2019 election, double what was spent in the 2007 election.
Calls for urgent reform centre on reductions in current spending levels and promotion of equality of participation by setting an amount that is achievable for independents and small parties to fundraise.
The problem
It doesn’t take special expertise to see the danger that buying influence poses for democracy. But for what it’s worth, the High Court, ICAC and leading scholars (Submission 1), amongst others, have reinforced the profound risk that a failure to reform political finance laws poses for our democracy.
Even if you question the actual influence of political donations on specific decisions, at the very least, it can be said that donations buy parties extra resources for campaigning, indirectly buying votes.
In the US, the candidate who spends the most usually wins. And you have to spend a lot of money. Without reform, that’s the trajectory we’re on.
As a sidenote, Australia is falling behind our peers, including Canada and New Zealand.
But who should determine exactly what those reforms are?
Not the parties (including the governing party)
Political finance laws, like redistricting rules, rules about how ministerial appointments are made, the powers of an integrity commission or salary caps, are rules of the game.
Individual players, in this instance political parties, have a clear interest in designing the rules in their own favour. It’s right for the public to approach any policy that the government designs on this issue with a healthy dose of scepticism. It’s certainly difficult not to be sceptical of the major parties’ opposition to some of the most fundamental reform proposals around donations caps, expenditure caps and industry-specific bans in light of the benefits they enjoy under the status quo.
Special Minister of State Don Farrell hopes to introduce real-time declaration of political donations and lower the disclosure threshold from $14,500 to a fixed $1000. Labor’s policies stop short of a donations cap, an expenditure cap and industry-specific bans. Labor has accepted over $75 million in corporate donations since 2012.
The Coalition made some changes while in government, including banning foreign donations and forcing entities to register as “significant third parties”, opening their books to the commission if they spend more than $250,000 on electoral expenditure a year, but this has been criticised as a “move targeted at independent and climate advocacy groups such as the Voices For campaigns”. They did not introduce donations and spending caps, lower disclosure thresholds or introduce real-time reporting. The Liberal and National Parties have accepted over $125 million in corporate donations since 2012, likewise from a range of industries in relation to which specific bans are proposed.
Accusations of bias and self-interest pertaining to parties’ approach to rule-setting have been thrown around left, right and centre: the Liberals have accused Victorian Labor (of changes that would effectively exempt union affiliation fees from donation caps, Submission 35), Labor the Greens (of hypocrisy in seeking ban industry-specific donations) and the Greens the major parties, amongst a host of other combinations and permutations of attack.
Nobody likes the idea that one player gets to set the rules of the game (unless they are that player).
Not experts alone
So why wouldn’t you task an expert commission with the power to determine the most appropriate reforms?
The question of political finance reform raises fundamentally normative, non-technical questions that no amount of expertise can answer legitimately. “The debate over campaign finance regulation is often framed as a debate between liberty and equality.” Under the libertarian approach, stricter political finance regulation might be construed as a restriction on electoral speech, since people communicate ideas by donating money to candidates. Under the egalitarian approach, state regulation of speech is viewed as a necessary protection against monopolisation of political discourse by the wealthy. At a more concrete level, we might also think about questions like, what is the appropriate “balance between avoiding the need to disclose raffle ticket fundraisers and the need to ensure that donations of a value that have the potential to ingratiate a donor to the recipient are disclosed?” (Submission 12). Even if donations don’t appear to directly influence specific decisions, what will the public perceive about their propriety? These are questions for people who can legitimately be described as representative in some form to answer.
Apart from the question of which decision-maker might be expected to deliver the most substantively legitimate result, there’s also a question about who the public is most likely to trust. Even if you could hypothetically select a perfectly non-partisan, independent arbiter, it might be very difficult for the public to trust the idea that bias is completely lacking. Previous Royal Commissions have also been attacked for partisan bias. Former Prime Minister Kevin Rudd, for example, has spoken about the “partisan trap of the kind set by Tony Abbott’s royal commissions”.
Experts would also be ill-equipped to make difficult decisions about managing consequences that some might argue could flow from levelling the playing field on issues of political finance without addressing a biased print media. Views differ on these questions, and they can’t be answered strictly scientifically.
Ultimately, “members of royal commissions cannot be expected to establish or lead social movements;” they must do extra work to “engage with stakeholders, advocates and policymakers” to support their recommendations, and of course, the most important stakeholders are members of the public at large.
…although expertise is of course needed
No-one would argue that expertise isn’t needed to advise on these questions. What rules have other jurisdictions adopted and why? What has been the historical impact of incremental political finance reforms introduced to-date in Australia? What are some of the potential side-effects of political donations reform, given the current state of the media in Australia, for example? What are the constitutional limits? These are just some of the complex questions that experts from various fields are needed to answer. But there’s a critical distinction between conferring experts with power to provide advice on a particular issue and conferring on them the power to decide that issue.
Deliberative democracy as a solution
So we need a process that is (i) representative, but (ii) not representative via political parties (including the governing party) and (iii) closely informed by experts.
It may not come as a surprise to you that I believe a deliberative mini-public is an ideal solution, given these constraints: citizens selected via democratic lottery would deliberate at length (over multiple days) on the reforms they consider to be most appropriate, having regard to the advice of experts. They would be empowered to make the ultimate decisions, given that this question is fundamentally one about values, and they are a body that can be said to be representative of the citizenry to make these recommendations. They do so in a highly deliberative and informed manner.
In fact, for these reasons, many leading political scientists recognise that making decisions about the rules of the game, in relation to which parties and politicians have a fundamental conflict of interest, is one of the most compelling use cases for deliberative mini-publics. Various other jurisdictions, including the Netherlands, British Columbia and Ontario have run deliberative mini-publics on electoral reform. Many states in the US are introducing citizen redistricting commissions.
Independents are well-placed to generate social momentum for a jury on political finance
I’ve argued so far that from a democratic perspective, political parties shouldn’t be the ones setting the most appropriate political finance reforms, and the public has a right to be sceptical of their approach. Conversely, a citizens’ jury would be well-placed to make reform recommendations and has strong potential to deliver recommendations that are perceived as legitimate.
But a citizens’ jury has no legal mandate. It’s still the government who would have to enact the recommendations of the jury. What’s the government’s incentive?
In the dream scenario, the government would recognise that this result could yield a potentially very large trust dividend from many Australian voters who are feeling disillusioned by the state of democracy and deep concern about integrity. Albo has claimed that “it’s time to bring integrity back to politics, and only a Labor Government will do it”, and the move would be consistent with Labor’s defence of a “very strong record of promoting and defending the fairness and integrity of our electoral system”.
But fair to say it’s unlikely without a push. What is extremely promising is the potential for independents and perhaps even former politicians to champion a call for a citizens’ jury on political finance reform. Kevin Rudd’s petition seeking a royal commission into Murdoch media garnered in the order of 500,000 signatures and made a real impact on Labor’s position. A jury on political finance is closely aligned with independents’ platform of meaningful citizen representation, awareness of some of the problems with party politics, and integrity reform, and they have the power to generate major public support.
Who will get in first?
A good piece Rachel. Most of the Federal Independents were elected using large campaign expenditure war chests, including some very large donations - so reform may not be in their interests. In any event, the reality is that Independents do not have real influence for change unless they hold the balance of power. NSW has a reasonably good (but far from perfect) regulatory model, with strict campaign expenditure and annual donation limits. As a NSW Liberal Party MP, I delivered a paper to the Australasian Study of Parliament Group in April calling for further reforms, ideally nationally, following citizen jury deliberation. The paper also addresses the constitutional issue around freedom of political expression, which might be best addressed through an opt-in model. I agree that the subject involves values and value systems. To effect underlying public sentiment, real leadership needs to be shown by the leaders of mainstream political parties, as they mainly set the rules.