Inside Story

Political integrity: Victoria goes part of the way

More reforms are needed to ensure the integrity of party fundraising and regulate lobbyists in Victoria, writes Joo-Cheong Tham

Joo-Cheong Tham 9 November 2011 720 words

Photo: mbbirdy/ istockphoto

BARELY a week after the Victorian government introduced legislation establishing its Independent Broad-Based Anti-Corruption Commission, the premier, Ted Baillieu, unveiled what he described as a “tough new Code of Conduct to reform political fundraising and lobbying.” Are we witnessing a new era of integrity in Victoria?

The government’s code is admirable in at least one sense. Because money follows power, the flow of political donations tends to favour governing parties. This means that restrictions on party fund-raising, even when they're uniformly applied, have a disproportionate impact on the campaign budgets of governing parties. Despite this, and despite complaints from Coalition backbenchers and party officials, the government introduced a code of conduct that applies only to Coalition MPs. And unlike Labor governments in Queensland and New South Wales, it has not been prodded along this path by public perceptions of government corruption.

Credit should also go to Baillieu and his colleagues for several specific reforms. The commitment to early disclosure of donations of $100,000 or more within a single financial year will improve timeliness and transparency. Important, too, is the requirement that ministers, parliamentary secretaries, ministerial advisers and senior party officials who become lobbyists must disclose their former official role (or roles) to the Registrar of Lobbyists and to those they are lobbying.

The code also deals with Liberal Party fundraising mechanisms that operate outside the strictures of party rules and, at times, fail to comply with disclosure obligations. The code of conduct means that from March next year government MPs (including ministers and parliamentary secretaries) and their supporters will no longer be allowed to operate independent fundraising accounts. All fundraising accounts will be administered by the central offices of the Liberal or National Party.

Yet these are not – as the government portrays them – “landmark reforms.” The move to centralise party fundraising is largely internal Liberal Party housekeeping; in New South Wales and Queensland, by contrast, political donations must not only be disclosed but are also capped. And the regulation of lobbyists in Victoria still lacks a crucial feature: a requirement that summaries of meetings between lobbyists and government representatives be made public.

Most importantly, though, it is doubtful whether the code of conduct will stop the sale of access and influence by the Coalition parties. The ban on ministers’ attending party fundraisers has been replaced by a series of tepid measures: ministers and parliamentary secretaries are reminded to avoid conflicts of interest and not to accept funds conditional on supporting particular government decisions (this would be bribery); and fund-raising material “produced to invite attendance may identify the guest” – the MP, that is – “but should not represent the function or event in a way which claims privileged access to a decision maker.” Nowhere in the code is privileged access through payment explicitly prohibited. The upshot is that ministers can headline party fundraisers involving the sale of access and influence provided they are not promoted in too vulgar a manner. Rather than curtailing the sale of privileged access, the obvious risk is that the code will drive such practices underground.

The other question mark concerns enforcement. The code seems to rely solely on the normal processes of political accountability – a vital but inadequate discipline. An independent statutory agency is needed, with powers to investigate alleged breaches of the code and, at the very least, establish the facts in each case. Allegations will invariably be contested. Leaving them to be sorted out through political processes will inevitably result in unedifying political point-scoring, providing convenient cover for the guilty and tainting the innocent; both will be corrosive of public trust. In New South Wales, the Independent Commission Against Corruption has the power, in certain circumstances, to investigate breaches of parliamentary and ministerial codes of conduct. In Victoria, similar powers could be given to the new Independent Broad-Based Anti-Corruption Commission.

The Baillieu government should be congratulated for attempting to deal with party fundraising through its code of conduct, especially with the Labor opposition resisting pressure to reform its own fundraising practices. But the government’s changes fall well short of what is required to protect Victoria’s democracy from the corrupting influence of money.

So, no, we are not witnessing a new era of integrity in Victoria. •