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High Court Throws Out NSW Election Donation Laws; Victory For Unions And Corporations

The High Court has upheld a challenge to New South Wales’s election donation laws.

The challenge was brought by Unions NSW to the changes legislated by the O’Farrell government in 2012.

The effect of the challenge is to invalidate the changes and make it legal for unions and corporations to donate to political parties. Money spent on election advertising by unions affiliated to the ALP will now not be included in the ALP’s expenditure limits.

The High Court’s decision does not affect earlier provisions that cap the level of donations and limit the level of donations from tobacco, alcohol, gambling and developer interests.

Text of a media release from the NSW Greens on December 21, 2013.

High Court creates new constraints on cleaning up politics in NSW

The important task of cutting the influence of corporate dollars over NSW politics was made much harder this week by the High Court’s decision to strike out the 2012 changes to the state’s election funding and donations law, according to Greens NSW MP John Kaye.

Donations from corporations, unions and other organisations to political parties are once again legal, and election advertising expenditure by Labor-affiliated unions will no longer impact on Labor’s own expenditure limits.

Provisions in the NSW Election Funding, Expenditure and Disclosures Act introduced before 2012 were not challenged and remain in force, including a $5,500 a year limit on each donor to a political party. Donations from the alcohol, tobacco and gambling industries and real-estate developers remain illegal.

Dr Kaye said: “While banning campaign donations from corporations remains a Greens policy objective, the High Court’s decision means any change with a chance of surviving another constitutional challenge will require some innovative thinking.

“Reform is far from over but the next attempt will have to be better designed to ensure it does not impinge on the rights of union members.

“While Premier Barry O’Farrell says his enthusiasm will not be deterred by the legal setback, there is not much point pushing ahead with a bill that will be struck out by the Court.

“No one has yet advanced a realistic set of changes that will not run foul of the implied free speech rights that the High Court found in the Australian Constitution.

“Everyone, the Greens included, will have to rethink their strategy on the next step in cleaning up politics in NSW.

“The Greens have a history of working with whatever government is in power when they are willing to take serious steps to clean up the damaging donations-for-favour culture in NSW.

“We remain committed to the project of cleaning up NSW politics.

“The High Court decision will allow corporations to donate up to the cap of $5,500 per year.

“That is an unacceptable outcome that biases government decision making towards the wealth and power of big business.

“NSW politics has been re-opened to ‘policy for sale’ corporate donations.

“The High Court did not strike out the changes made before the O’Farrell government came to power.

“Real estate developers will still be banned from donating.

“The 2010 Greens amendment that locks out tobacco, alcohol and gambling dollars remains in place.

“The history of the flow of funds into the coffers of political parties in NSW shows that these industries were able to exert the greatest and most damaging influence over the state’s laws.

“Unfortunately there is now an open invitation from the High Court for these industries to challenge the ban.

“It would be very bad outcome for this state to wind the clock back to the bad old days where every industry could carpet bag its way into laws and decisions that suited it,” Dr Kaye said.

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Malcolm Farnsworth
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