opinion

Paul Murray: Independent’s fraught stance on campaign cash

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Paul MurrayThe West Australian
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Kate Chaney was the star of a fundraising dinner organised by Nigel Satterley.
Camera IconKate Chaney was the star of a fundraising dinner organised by Nigel Satterley. Credit: Danella Bevis/The West Australian

One of the threads that binds the purportedly disparate group of well-financed independents running against Liberal MPs at the coming Federal election is their demand for a Canberra-based anti-corruption commission.

The corruption-buster push among the “Voices Of” independents had its roots in the successful campaign by former national AMA head Kerryn Phelps for the Sydney seat of Wentworth, which she held for just seven months after the resignation of deposed prime minister Malcolm Turnbull, before the Liberals reclaimed it in 2019.

Phelps chose three main policy targets: climate change, asylum seekers and a Federal body loosely based on the NSW Independent Commission Against Corruption.

A Federal ICAC is likely to play a role in this election because Labor also sees mileage from the Coalition’s intransigence in progressing its plans for a national integrity commission.

So a report just last month by the NSW ICAC should be of interest to those trying to improve standards of integrity in Australian politics, particularly in the vexed area of campaign donations.

Kate Chaney, tells potential voters that she supports a ‘robust’ Federal integrity commission.
Camera IconKate Chaney, tells potential voters that she supports a ‘robust’ Federal integrity commission. Credit: Danella Bevis/The West Australian

The most high-profile independent candidate in WA, Curtin’s Kate Chaney, tells potential voters that she supports a “robust” Federal integrity commission and is appalled at the “destructive influence of vested interests in Australian politics”.

She has a strange way of showing it.

As I pointed out in a column in February, last year, political donations that would be a criminal offence in NSW and Queensland are accepted as a celebrated involvement in the democratic process in WA.

It’s as if human nature — and therefore political behaviour — changes dramatically as you cross the Nullarbor. Who knew?

But it’s something Chaney may do well to consider as she continues to campaign on integrity issues while successfully courting powerful business people for donations.

NSW’s ban on property developers making political donations was part of a suite of transparency measures designed to expose and outlaw the influence of vested interests on politics which had been uncovered by ICAC.

In its latest report, ICAC explains the laws with this quotation: “These reforms are about putting a limit on the political arms race, under which those with the most money have the loudest voices and can simply drown out the voices of all others.”

The High Court has twice upheld the validity of the NSW and Queensland laws and in the most recent judgment argued strongly for their widespread imposition.

“Property developers are sufficiently distinct to warrant specific regulation in light of the nature of their business activities and the nature of the public powers which they might seek to influence in their self-interest, as history in NSW shows,” the High Court said.

The ICAC report noted the High Court had said “guaranteeing the ability of a few to make large political donations in order to secure access to those in power” would seem to be antithetical to the principle of political equality.

One of the issues in the recent ICAC report was whether a Labor benefactor who had disguised a $100,000 campaign donation fitted the narrow definition of a property developer in the legislation.

Although the report found that Huang Xiangmo, chairman of Yuhu Group, “was a property developer in the ordinary sense of the term”, he peculiarly did not fall under the tight definition of one in the legislation.

However, ICAC found the attempt to disguise his $100,000 donation had been done on the basis that Huang was a prohibited person under the law. Yuhu develops commercial and residential properties in Sydney.

Unlike either of the major parties, my campaign clearly lists all donations received in real time. I have the most transparent fundraising campaign in Australia.

And the report also exposed the way developers could avoid the State bans by making donations to associated Federal and State entities instead.

The ICAC said its concerns about the lack of harmonisation of election finance laws across Australia had been raised as far back as a 2014 report:

“Operating at a national level, parties, third-party campaigners and associated entities could take advantage of discrepancies between the laws of the different State and Federal jurisdictions.

“The channelling of donations through different jurisdictions is a way of circumventing the intent of the rules in NSW. As a result, tracking the flow of money — and influence — from donors to campaigners to election expenditure is exceedingly complex.”

And last month’s ICAC report noted that former NSW Labor Party general secretary and disgraced former Australian senator Sam Dastyari — a central figure in the inquiry — gave evidence that accepting funds into the party’s Federal account, which would otherwise be prohibited at the State level, was standard practice.

Sam Dastyari poses during a photo shoot in Sydney. Picture: Jonathan Ng
Camera IconFormer NSW Labor Party general secretary and disgraced former Australian senator Sam Dastyari gave evidence that accepting funds into the party’s Federal account was standard practice. Credit: Jonathan Ng

Counsel Assisting: “And that was your practice when you were general secretary, I take it?”

Dastyari: “Of course, I mean, yeah, you, the rules, the rules are very, very clear. You take, they’re not, let’s be clear, prohibited State donors are not prohibited Federal donors. You take the money, accept the money into the Federal campaign account, and you fully disclose it.”

And Dastyari then showed how simple it was to get around the property developer bans:

“To me what’s incomprehensible about this entire inquiry, to be honest, is that, is if the series of events that have been purported are true, they could have just accepted the money into the Federal campaign account, which is what, how you normally take money from prohibited donors or people above the limits.”

Breathtaking. And quite a good argument in favour of a Federal ICAC to police such deceptive jurisdiction-hopping behaviour.

And it clearly shows the difference in effect between disclosure and prohibition.

ICAC’s response was to suggest that all States — and the Commonwealth — move together in a united front to increase political integrity:

“In Australia’s Federal system, it is not uncommon for there to be nine separate sets of laws regulating many areas of public policy.

“Although the Commission cannot direct recommendations at the Commonwealth Government, it would nonetheless be helpful if there was greater co-ordination between the Federal, States and Territories to ensure that reforms to strengthen legislation in one jurisdiction do not unduly create legislative loopholes in another.”

Which brings us to the dinner attended by wealthy and powerful business people in Cottesloe last week for Kate Chaney, organised by real estate magnate Nigel Satterley.

This newspaper reported Satterley “instigated and paid for the dinner”.

It is well-documented that Satterley fell out with the Liberals in 2016 over the Barnett government’s thwarting of a land development in which he was involved at Kwinana.

Satterley and other developers were behind an opinion poll which was used to try to force Colin Barnett to resign as premier. Satterley has since become a strong supporter of Premier Mark McGowan and a financial benefactor of Labor.

Chaney explained the dinner by saying Satterley lived in her electorate and expressed an interest to help.

Chaney explained the dinner by saying Nigel Satterley lived in her electorate and expressed an interest to help.
Camera IconChaney explained the dinner by saying Nigel Satterley lived in her electorate and expressed an interest to help. Credit: Iain Gillespie/The West Australian

“I attend many functions each week hosted by people interested in my campaign and prefer to outline my platforms first,” she said.

“If people decide that they like what I stand for, then they can donate to the campaign and it will be visible on our donor wall.

“Mr Satterley is free to meet and engage with any or all candidates and politicians. In any case, there has been no contact between my campaign and the Labor Party at any point.

“Unlike either of the major parties, my campaign clearly lists all donations received in real time. I have the most transparent fundraising campaign in Australia.”

But Liberal Senator Ben Small said Ms Chaney had a major problem.

“With overdevelopment a significant issue of concern in Curtin why is the ‘independent’ participating in fundraising with Labor-supporting property developers?” Senator Small said.

CEDA National Chairman Diane Smith-Gander AO at the CEDA WA State of the State event at Crown Perth where Premier Mark McGowan gave the keynote address.
Camera IconThe West also reported that one of the Cottesloe attendees, businesswoman Diane Smith-Gander, donated $1500 to the Chaney campaign. Credit: Danella Bevis/The West Australian

The West also reported that one of the Cottesloe attendees, businesswoman Diane Smith-Gander, donated $1500 to the Chaney campaign after the meal, suggesting it was effectively a fundraiser.

So I raised the issue with Sydney-based lawyer, former legal editor of The Australian, and vice-president of the Rule of Law Institute of Australia, Chris Merritt.

“If, for the sake of the argument, Satterley is a property developer under NSW law, the State’s Electoral Funding Act would make it unlawful for him to make a political donation and for a political party to accept his money,” Merritt said.

“According to the NSW Electoral Commission it would also be unlawful for him to solicit another person to make a political donation. A court would therefore need to determine whether paying for a fund-raising dinner amounted to soliciting others to make political donations.

“The question then would involve two steps. Is he a property developer under NSW law? And does paying for a fund-raising dinner amount to soliciting people to make political donations?

“If Satterley is a property developer as defined by NSW law, and he encouraged people to make political donations, his actions might elicit interest from the Electoral Commission.”

Which brings us back to the Nullarbor Plain.

Property developers are not restricted in their political activities by WA law. And political candidates are free to benefit from their largesse.

So everything is completely above board.

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