The Australia Institute’s submissions to the Victorian Electoral Matters Committee parliamentary inquiry into the last Victorian election and independent review of electoral law make the case for election reforms to address truth in political advertising laws and find that the state’s electoral laws favour the major parties and incumbents despite their stated goal of levelling the playing field and providing equal participation in the electoral process.

Key points:

• Truth in political advertising laws still have not been implemented despite support from all the major parties, and their recommendation by the Victorian Electoral Matters Committee in the inquiry into the previous election.
  • South Australia and ACT provide a roadmap for implementing successful truth in political advertising laws.
• Donations from the Victorian public are very restricted, but union fees, corporate memberships, levies on MPs and their staff, donations from political candidates and money from assets are not.
  • The Victorian Labor Party received more money from its staffers and 70 MPs via levies than it did from the remaining six million Victorians via donations.
  • The Victorian Liberal Party received more money in dividends from a subsidiary (Vapold Pty Ltd) than it did from six million Victorians via donations.
  • One candidate donated $110,000 to their own campaign, 24 times larger than the maximum donation any other Victorian could make.
  • One party received a $250,000 membership fee from a single person.
  • Donors who have given as little as $1,100 to a political party or candidate have their full name and suburb of residence revealed, but the details of corporations who pay membership fees to parties have not consistently been disclosed.
• Incumbent Victorian MPs have huge advantages compared to independent challengers.  Over a four year electoral cycle, incumbent Victorian MPs receive over $2 million in benefits including salary, staff and entitlements. They also receive public electoral funding.
  • New entrants and challenger candidates rely on donations to fund their campaigns.
  • The donation cap of $4,320 makes it difficult for new entrants to raise the funds for a successful campaign against an incumbent.
• To make the Victoria upper house more effective and give Victorians more say in their government, Victoria should follow NSW, SA and WA and adopt a state-wide electorate for the upper house.
  • This would allow for the abolition of Group Voting Tickets without reducing proportionality.

On donation caps and the level playing field

“Victoria’s donation cap is a Pyrrhic victory for integrity. It increases the advantages held by wealthy candidates (whether running for parties or as independents) and increases the financial power of MPs, corporations and unions relative to other donors, including members of the public,” said Bill Browne, Director of the Democracy & Accountability Program.

“The $2 million in benefits received by each incumbent Victorian MP over the 4-year election cycle gives them huge advantages over minor or micro party and independent challengers. Changes to Victoria’s political finance laws should lower barriers to entry to make elections a fairer fight.

“Victoria’s major parties are publicly funded to the tune of tens of millions of dollars an election cycle, and can rely on levies, corporate memberships, union affiliation fees and investment assets to make up any shortfall – leaving them barely affected by strict limits on how much the Victorian public can donate. It is minor parties and independent candidates who face an uphill battle when donations are capped.

“While the influence of some wealthy and influential people and companies may have been reduced, the exceptions to the donation cap mean that outsized payments from certain privileged political players now cannot be countered by large political donations from others.

On other electoral reforms

“With Labor, the Coalition and the Greens all supporting truth in political advertising laws in principle, Victorians will be asking why it is still perfectly legal to lie in a political ad.

“Controversy over Group Voting Tickets marred the last election. Adopting a state-wide electorate to elect Victoria’s Legislative Council would increase representativeness and proportionality and allow for the abolition of GVTs.”