In 2009, Senator John Faulkner introduced legislation in the Senate which would have prohibited foreign political donations. The legislation was defeated by the Coalition in the Senate. A lot of ‘foreign interference’ in Australian political life could have been nipped in the bud if the Coalition had been serious about curbing political donations. Unfortunately, Anti-Chinese sentiment is now driving the debate on political donations. This could have been avoided.
See following, second reading speech in the Senate by Senator Faulkner.
COMMONWEALTH ELECTORAL AMENDMENT (POLITICAL DONATIONS AND OTHER MEASURES) BILL 2008 
Second Reading SPEECH
Wednesday, 11 March 2009
Senator John FAULKNER
(New South Wales—Special Minister of State and Cabinet Secretary) (12.04 pm) —
I thank all those senators who have contributed to the debate on this important piece of legislation, the Commonwealth Electoral Amendment (Political Donations and Other Measures) Bill 2008 . In March last year, the Prime Minister told the 7.30 Report that the ‘time has well and truly come for Australia to have comprehensive campaign finance reform’. This bill is the start of the process.
The first group of measures to start this process concerns the disclosure threshold and reporting periods. This bill will reduce the disclosure threshold from the current CPI indexed amount of $10,900 to a non-indexed amount of $1,000. This will restore proper public scrutiny to donations of this size.
The bill will improve transparency in the funding and disclosure regime by requiring participants in the electoral process to report every six months rather than every 12 months. The bill will also provide consistency by reducing the deadline when the participants in the political process have to lodge disclosure returns with the AEC to a consistent period of eight weeks. This measure will replace the haphazard deadlines currently in the Electoral Act which range from 15 weeks, 16 weeks or 20 weeks, depending on the person or the entity.
To ensure that the new $1,000 disclosure threshold is not avoided by a person giving multiple amounts below the threshold to various branches or divisions of the same political party, the bill will treat donations to different branches of a political party as if the donations were given to the same political party.
The second group of measures concern from whom donations may be received. The bill prohibits the receipt of a gift of foreign property or an anonymous gift outright for some people and entities while for other people and entities it will be unlawful to receive a gift of foreign property or an anonymous gift if that gift is used for political expenditure.
In response to a recommendation from the Joint Standing Committee on Electoral Matters, the government’s amendments will allow low-level anonymous donations—that is, anonymous donations of $50 or less—to continue where they are received through fundraising activities or events.
Finally, the bill seeks to prevent the possibility that some candidates and other groups may obtain a windfall payment of election funding by tying electoral funding to the actual electoral expenditure incurred. Again, in response to a recommendation from JSCEM the government has expanded the definition of ‘campaign expenditure’ to ensure that it does not favour one form of campaigning over another.
As I have outlined, the bill contains urgent measures to address critical weaknesses in the Commonwealth Electoral Act relating to the funding and disclosure regime. I provided details of these measures as long ago as 28 March last year. These measures are very critical and important reforms, although small in number, and they are targeted to deliver a more transparent and accountable electoral system in this country.
In terms of the second reading amendment that Senator Bob Brown has moved on behalf of the Australian Greens, I acknowledge the interest that has been consistently demonstrated by Senator Brown in addressing issues about our electoral system. I acknowledge also Senator Brown’s and the Greens’ interest in this particular issue over a long period of time. It is also true to say that the concept of truth in advertising has had a long and complicated history. Indeed, previous reports of JSCEM have identified the difficulties of legislating in this area and have argued that voters remain the most appropriate arbiters of the worth of political claims that are made. That is just one of the reasons the government does not support this amendment at this time. I do acknowledge, as I think senators would expect me to, that this is an issue which warrants further and detailed consideration for this reason: the question of truth in advertising is being examined as part of the second green paper on electoral reform, which will be released later this year.
I commend to the Senate the government’s view that the green paper process—in other words, considering this issue as part of a raft of broader issues surrounding the campaign process and then having these issues subject to consultation with the public, the states and territories, political parties and others involved in the political process as well as other interested people—really is the best way forward to deal with this important issue. I can indicate to Senator Brown, the Australian Greens and of course to the Senate that the government will examine the question of truth in advertising in that green paper process. As I indicated earlier in my contribution, the government does believe that this bill is a critically important first step in the electoral reform process and I have much pleasure in commending the bill to the Senate.