O’Farrell’s donations cap could lead to a radical shakeup of political parties

You wouldn’t know it from the coverage but the proposed changes to electoral donations in NSW could lead to the biggest shake-up of political party structures we have seen in a long time. Its impact could extend well beyond NSW and across the country.

The Election Funding, Expenditure and Disclosures Amendment Bill 2011 is the first attempt in Australia to restrict political donations to individuals. The rationale for the Bill is that it closes loopholes left by the Keneally Government when it introduced caps on donations to political parties and restrictions on electoral expenditure.

Under the proposed amendment, donations for political purposes will be restricted to individuals on the electoral roll and party affiliation fees will be banned. Electoral expenditure by political parties and any affiliated organisations will also be grouped together under a single expenditure cap.

It will severely limit the capacity of organisations with an affiliate structure that engage in third party campaigning. Groups such as Unions NSW, peak business and environmental organisations are effectively banned from receiving funding from affiliates for political activities. It also effectively legislates against political parties have affiliate members. A membership structure, based on individuals is practically mandated.

The amendments create a disincentive for affiliation to a political party. Affiliated organisations will be forced to choosing between participating in political parties as an affiliate or being able to campaign electorally as a separate organisation. It is an absurd situation. Political parties and their affiliated organisations are not one and the same and often disagree. Andrew Norton provided a good example where both would be penalised:

The ALP will be guilty of an offence if the spending of one or more of its affiliated unions pushes the collective union/ALP spend over $9.3 million. Yet presumably the ALP cannot control the unions. To take an example from the previous NSW Labor government, if Unions NSW campaigned against electricity privatisation during the restricted campaign period (from 1 October the year before the election) not only would the Labor Party have an unhelpful campaign, they could also be punished for something that did not do and did not want.

Understandably, Unions NSW has threatened to take the Bill to the High Court and challenge its constitutionality. However, if the challenge does not succeed, there may be massive implications, particularly for the ALP.

Unless ruled to be unconstitutional, an amendment that restricts donations to individuals is likely to pass both houses of NSW Parliament. Support may come from the Greens as their policy position is to prohibit “donations from corporations and other organisations to political parties, candidates, associated entities or elected representatives.”

The proposal to group electoral spending by affiliates with political parties may not necessarily pass. NSW Greens MLC John Kaye has indicated that the Greens would move amendments to exempt third party issues-based campaigns. However, it is likely that restrictions on affiliates advocating election votes would be maintained as Kaye indicated that the proposal to restrict donations to individuals is ''tough on Labor, but creates a level playing field”.

Furthermore, the adoption of restrictions in NSW may encourage similar legislation elsewhere. Agreement by the Greens and Liberals to restrict donations to individuals and effectively ban affiliation fees is very possible in other states and territories. Both may see a relative electoral advantage by weakening links between Labor and its affiliated unions. It will gradually close any loophole that allows transfers from other state ALP branches.

The ALP will, as a result of these actions, become more reliant on individual members and supporters. They will become the only source for money and campaigners. Unless membership levels turn around, the situation will necessitate far reaching party reform. What was suggested in the ALP National Review will not be enough. The debate about party reform will shift to being about electoral survival and having the resources to run an election campaign.

The reforms that will be adopted is hard to predict. There are a number of possible outcomes and most are likely to involve root and branch changes to party structure. Changes may include:

1. introduction of a rank-and-file component in the election of party leader at state and federal level;
2. a reassessment of how the formal trade union link operates, including a push to dilute the influence of unions;
3. lowering of barriers to participation in the party (whether through making party membership easier or including “supporter” participation); and
4. a greater say by rank-and-file members over administration and policy (more direct elections/rank-and-file preselections).

The main purpose of the changes would be to encourage more members. There will be a greater need to rally the party base to get donations and campaigners needed to win elections. Despite the objections of some, self-interest and the desire for electoral success will drive these changes.

These changes won't only be isolated to the ALP. Any electoral success and substantial growth in membership is likely to encourage other parties to adopt similar changes. The gradual acceptance of One Member One Vote in leadership ballots by all political parties in Canada is case in point.

It may not have been intentional but party reform might be coming sooner than expected, courtesy of the NSW Government. The question is whether any of Australia's political parties will be prepared for what may be coming.

Read more »

Posted in: affiliated organisations,alp,barry o'farrell,donations,elections,freedom of association,freedom of speech,new south wales,omov,party reform

Why Australian Young Labor reform matters

Across the world, the declining electoral fortunes of social democratic parties have led to discussions about the need for internal party reform. In Australia, the National Review has framed the ALP’s debate about party reform, to be had at this year’s National Conference in December.

Since the Review’s release, there have been many discussions across the ALP about the merit of primaries, direct election of President and National Conference delegates and the role of trade unions within the party. There has been one glaring omission from ALP reform debate though. Absent from the National Review was any mention of the role of young people currently within the ALP or how to keep them in the party. In particular, nothing was said about the current or ideal role of Young Labor.

Young Labor has a mixed reputation depending on who you talk to. Some think of Young Labor as a joke, others highly regard it as providing the on-the-ground campaigners that help win elections. Whatever one thinks of it, excluding Young Labor from the reform discussion ignores an important fact. Young Labor shapes a large section of the party membership. Many future parliamentarians, ministers and party leaders are a product of Young Labor. How people learn to operate in Young Labor, what they experience and what behaviours are normalised often shape how they act in later years. Some of the worst behaviours within Young Labor have been highlighted in the media in the past and it isn't hard to infere its future impact.

While the National Review spoke about the "need for a change to long established patterns of behaviour and culture," it did not recognise that much of that culture and many of those behaviours are shaped and reinforced by people's experiences in Young Labor. Changing the culture of Young Labor is likely to lead to change elsewhere in the party. The best catalyst to bring about that change that in culture is by reforming of Young Labor through the adoption of direct elections by rank-and-file members at all levels.

By introducing direct elections, individuals running for positions will need a platform and talk about what they will deliver if elected. People will need to present their case and convince people to support them on the basis of merit. It will encourage a shift towards debates about ideas and values and being active on issues that matter to young people such as improved education policies, marriage equality, abolition of youth wages rather than whether you have the votes of a handful of aligned delegates.

Such a shift from an insular behind-the-scenes approach towards a more outward approach of engagement and campaigning should be encouraged within the ALP. It will encourage a culture of greater accountability to members and in the long-run, the party will be better off for it because those important political skills needed during election campaigns and in Government will be developed.

Direct elections for Young Labor must be conducted under one member one vote (OMOV). A vote should be given to every member under the age of 27 who has been a member for at least a year so they all have a say in who their local, state and national Young Labor Executives are, who their Young Labor delegates to Young Labor, State and National Conference are and who the President is at a state and national level. The move by the NSW ALP to adopt an online vote for the newly established Policy Forum provides a model of how direct elections for Young Labor could be conducted, addressing concerns about the financial cost of direct elections.

Young Labor reform is far from impossible as it is easier than reforming the rest of the ALP. The ALP National Executive has the power to reform Young Labor and bring about this change. Everyone needs to realise the importance of reform and to seriously consider it. The future electoral success of the Labor Party might just depend on it.

Read more »

Posted in: alp,labor,party reform,young labor