EDITORIAL: Reforming electoral donations

Mike Baird in Newcastle last month. TRUE to his word, NSW Premier Mike Baird is ensuring the state’s voters go to the polls next year with an improved electoral donations system.

Mr Baird was under pressure to make changes, following the catastrophic impact of the Independent Commission Against Corruption’s Operation Spicer on the Coalition’s parliamentary standing.

Revelations about abuses of the donations laws sent 10 Liberals MPs to the cross-benches and prompted the members for Newcastle and Charlestown to quit Parliament.

No doubt the reforms as announced won’t go as far as many would like. They stop short, for example, of a fully publicly funded model.

But some aspects will be universally welcomed. The requirement that all donations be published for voters to scrutinise before they cast their ballots is a case in point.

It has been a galling feature of the system to date that details of who bankrolled whom haven’t been available until months after it really mattered.

Under the new scheme, at least voters will have a chance to change their minds about voting for a particular candidate or party if they believe certain donations might adversely influence outcomes in important areas of policy.

Spending caps on donations and on electoral communications will also be imposed, ideally cooling the ‘‘arms race’’ between parties for the costliest and most pervasive campaigns.

Donations to political parties will be capped at $5000 and the cap for individual candidates will be $2000.

Spending caps for electoral communications will also be fixed at $100,000 per party for every seat contested.

Unions will be covered by third party spending caps, which will fall from more than $1million to $250,000.

Politicians caught using slush funds and scams similar to those uncovered by ICAC could face up to 10 years in jail.

It is not entirely clear whether it will still be possible for parties to encourage donors to direct funds to federal offices, from whence they may be able to distribute the money at ostensible ‘‘arm’s length’’. Since donations at the federal level are relatively unregulated and since both major parties have demonstrated a powerful determination to prevent the creation of a federal corruption watchdog, this might still be a tempting option for those wanting to avoid problems with the new NSW law.

Mr Baird has acknowledged that more needs to be done to repair a system that has become badly corrupted.

He has promised that the measures now announced are only a first instalment, with more to follow once the independent panel, chaired by former public servant Dr Kerry Schott, reports back to Parliament later this year.

For now, the first steps are welcome.