Incumbent NSW MPs enjoy $2 million in incumbency advantages, on top of head-start from the state’s political finance laws

by Bill Browne
A polling booth at Carlton South Public School during the NSW state election in Sydney, Saturday, March 25, 2023. More than four million New South Wales voters will head to the polls today to determine the 58th Parliament of NSW. (AAP Image/Dean Lewins) NO ARCHIVING
AAP Image/Dean Lewins


Research from the Australia Institute demonstrates that the NSW electoral system’s donation caps, spending caps and public funding benefit established parties and incumbent MPs at the expense of new parties and independent candidates.

In addition, sitting Members of the Legislative Assembly (MLAs) receive over $2 million in publicly-funded incumbency advantages over each four-year electoral cycle.

The Australia Institute’s submission to the Joint Standing Committee on Electoral Matters inquiry into the 2023 NSW State Election also highlights how the state has missed key democratic reforms, including full preferential voting and truth in political advertising.

Key Findings:

  • Incumbent MPs enjoy enormous advantages, at the expense of challengers, new parties and independent candidates. These advantages are valued at over $2 million dollars for an MLA over the four-year cycle, and over $1 million for a Member of the Legislative Council (MLC).
  • Major parties in NSW are majority publicly-funded, at roughly the same proportion as some government bodies like art galleries, but aren’t subject to the same regulations and responsibilities as other publicly-funded bodies.
  • Donation and spending caps favour major parties, both explicitly because party-only exemptions exist and implicitly because they are less dependent on donations and spending than their rivals.
  • Public funding, including election campaign and administrative funding, favours major parties and sitting parliamentarians because of who meets the eligibility criteria—at the expense of new parties and independent candidates.
  • The donation cap for someone giving to a registered party is effectively over four times higher than the cap that applies when giving to an independent candidate.

“Voters should have a wide range of candidates to choose from at election time. Currently, the election machinery and inequality in political financing mean new candidates face an uphill battle to run for election,” said Bill Browne, Director of the Democracy & Accountability Program at the Australia Institute.

“The system preserves the status quo for the established players and makes it harder for new voices to join our parliaments. Most importantly, it limits the choice available to NSW voters.

“NSW donation disclosure laws are good on paper, but their flawed implementation means NSW voters will still struggle to find out how their politicians are funded.”

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