Electoral Funding Bill 2018

The Hon. JOHN GRAHAM (22:49): Labor members will oppose the Electoral Funding Bill 2018, but we will not do so lightly. Bipartisanship on electoral matters is highly important. As the Leader of the Opposition said, it is the only way to lodge changes in the New South Wales political system in the long term. I acknowledge the importance of the Joint Standing Committee on Electoral Matters. A number of committee members have spoken in the debate, including the Hon. Courtney Houssos and Chair the Hon. Dr Peter Phelps. They play a good role across parties in analysing an always detailed area of legislative action. However, we will oppose this bill because it takes the opposite of that approach. The curtain went up on the bill only last Thursday. It is a helterskelter attempt to shape the law. After nearly eight years in government, it is a rushed attempt to fix the next election. As a result, Labor will oppose it. I will talk some of the specifics, including the expenditure caps, the acting in concert provisions and some measures that are worthy of support—including some that did not make it into the bill.

The expenditure caps are contained in proposed section 29 (10). The Joint Standing Committee on Electoral Matters recommended that before the cap was decreased the New South Wales Government should consider whether there was sufficient evidence that a third-party campaigner could reasonably present its case within the expenditure limit. No such evidence has been presented. We have talked about some of the issues, but what is the underlying principle? It is a principle I support that working people—some of them on minimum wage—have a right to chip in a little bit each week to express a political view. I am not offended if others do the
same, but it is an important principle that people of ordinary means be able to participate in the political process without joining a political party—although I encourage them to do that.

At the time of the recommendation by the expert panel, all the 2011 third-party campaigns were under the $500,000 proposed as the cap and there was a recommendation for further research. The initial recommendation was then overtaken by events as the 2015 campaigns went above the $500,000 third-party limit. 

The Government has conducted no research, and no justification for the cap was presented in the second reading speech. There is a risk that people will choose to run as party candidates instead of as third-party campaigners encouraged by the gap between campaign and third-party expenditure. In addition, it seems almost certain that there will be High Court litigation if the bill passes in its current form. In the face of those risks members and the public have been given less than a week to deal with the bill and there has been only a single day of debate in the two Houses of this Parliament.

The acting in concert provisions are contained in proposed sections 35 and 58 (5) of the Electoral Funding Bill. The definition of acting in concert is broad and refers to a formal or informal agreement to campaign with the principal object of having a party or candidate elected or opposing their election. That was the subject of expert panel recommendation 32 (c) and was referred to in only a single paragraph of the report. It is very similar to Australian Capital Territory Electoral Act provisions that were introduced in 2012 and repealed in 2015 after a Senate select committee looked at various matters, including the impact of the High Court decision in New South Wales. These are zombie measures that were killed in the High Court and are dead in the Australian Capital
Territory but are being resurrected for New South Wales electoral law. They mirror an obsession in the approach taken in to regulating elections in the United States that in my view is totally inappropriate in New South Wales. 

I had the pleasure of meeting two United States campaigners during the course of the 2010 congressional
midterm elections. One of them was Marlon Marshall, who was the National Field Director for the Democratic Congressional
Campaign Committee [DCCC].

The Hon. Daniel Mookhey: A great guy.

The Hon. JOHN GRAHAM: I acknowledge that interjection. He oversaw the team that ran the field operations for the DCCC. He went on to become a Special Assistant to President Obama and Director of States and Political Engagement for the Hillary for America campaign. Another was Robbie Mook, who went on to become the campaign director for the Hillary 2018 campaign. He joined the Democratic Congressional Campaign Committee in 2009 and was named independent expenditure director in May 2010. The Washington Post reported his role as follows:

… to take over the independent operation—the vehicle through which the tens of millions of dollars raised by the committee will
be spent on television ads. The DCCC ended March with $26 million in the bank.

These are two campaigners known to each other—friends—who were separated, sequestered, legally barred from cooperating, physically separated for the course of the campaign and unable to speak to each other between May 2010 and November of that year. It was a very artificial construct—one that is strained enough in the United States with its gun-for-hire consultant culture, but one that would be a very alien intervention into the political culture we have in Australia. But how does it work in practice in the American system? I am thankful to Roarty and Goldmacher who wrote a story in the National Journal about one campaign and the public campaign memo of Republican Thom Tillis:

The 1,000 word dossier went into remarkable detail about what the North Carolina Republican needed in the closing weeks before
the election: TV ads in Charlotte ("Add 1,000 gross rating points"), digital videos (I'd like to backfill the $250,000 budget"), and
spending in Asheville, a town embedded in the Appalachian Mountains near the state's western edge.

They went on to say:
Campaigns rarely want candid memos like this one to go public during a hotly contested Senate race … it is just as easily read as
an explicit wish list aimed at the inboxes of outside allies with whom he cannot otherwise legally communicate about strategy.
The authors stress in the article that this approach is not illegal. They also detail practices such as "vaguely
outlining ad buys through the media and posting minutes-long 'B-roll footage' of a candidate on their website"

They also say:
… in New York's competitive 11th Congressional District race on the DCCC's site, for instance, the committee says voters in
Brooklyn who subscribe to Time Warner Cable and Cablevision need to "see more about Michael Grimm's 20-count indictments."

What we see in the United States under these provisions is private communication and cooperation banned but public  communication continuing regardless. That is this principle in practice in the United States. It does not even work well in the United States in a political system that is 40 times bigger than in New South Wales. It is fantasy to believe that we could bring that idea here—artificially separate off our campaigns in Sydney and sequester or segregate our more centralised, permanent, political party campaigns. It is a lawyer's answer to a political problem; it is an artifice, an obsession and an imported idea that will cause more trouble than it is worth.

However, some measures in this bill are worthy of support. I support the inclusion of the associated entity provisions, particularly as they are aimed at the activity we have seen from the Free Enterprise Foundation in New South Wales. The disclosure elements of the bill are welcome. The local government expenditure caps are overdue but they are welcome, although they are too complex, as has been pointed out by Mr David Shoebridge. 

I was pleased to see that the developer donations provisions have been retained. I was closely involved with their introduction by former Premier Rees a decade ago. We were told at the time that we would never be able to successfully define this category of persons. I am glad that we proceeded and that the Government has found a way, with the assistance of the Electoral Commission, to further refine that definition. The Government claims it is implementing the Schott report—it is not. The shadow Attorney General and the Leader of the Opposition in this place have already put that case compellingly. Recommendation 14 is not being implemented.

Recommendations 16, 18, 26, 33, 34, 35, 36 and 41 are not being implemented. Crucially, recommendation 2, whereby the Premier takes this issue up nationally, needs to happen. The Premier needs to pursue this issue federally more strongly. I agree with the sentiments expressed by Reverend the Hon. Fred Nile on this issue. There is one other issue that is not being proceeded with that I want speak about, and that is electorate specific funding and section 99F (13) of the existing Act. Recommendation 12 of the expert panel on political donations called for this:

That the electorate-based caps on expenditure by political parties apply to all expenditure which encourages or tries to persuade
electors to vote for or against a candidate in a particular electorate.
The panel was responding to the evidence of Dr Tham, who advocated for the New Zealand election law in this

He said:

[The New South Wales law] creates a huge window that can be exploited for parties to throw resources at a particular seat.

On 9 February 2017 an article from the Australian stated:

More than $816,000 of $2.7 million in funding earmarked for the Greens' March 2015 election campaign has yet to be paid 

It continued:
It is understood the election expenditure breaches could be related to the party's successful campaigns in the state seats of Balmain and Newtown, which are held by Jamie Parker and Jenny Leong.

I note that this matter was later resolved, with The Greens receiving on 10 May 2017 the $981,683 that had been withheld by the Electoral Commission. I make no judgement about this incident as I simply do not know the facts. I do, however, put on the record my concerns about the lack of electoral regulation to stop campaigns effectively breaching the electorate specific caps. It has been pretty quiet in this Chamber in the last few sitting weeks. Now this bill is being dealt with in a rush—dealt with in a rush shortly before the election; dealt with in a rush despite the expert report being delivered in 2014.

I do not want to distract from the fact that ever party has issues in some of these respects and, specifically, the fact that NSW Labor has had its issues over time. I support those issues being dealt with harshly. But this legislation is being dealt with in a rush, against this historical backdrop: On 14 September 2016, $70,000 was paid to the Electoral Commission by former member for Charlestown Andrew Cornwall; on 21 December 2016, $20,000 was paid to the Electoral Commission by Newcastle campaign director Hugh Thompson; on 22 December 2016, $50,000 was paid to the Electoral Commission by former member for
Newcastle Tim Owen; and in February this year the New South Wales Liberals were ordered to repay more than $240,000 after illegal political donations by Ronney Oueik and the member for East Hills, Glenn Brooks. That comes after, on 22 September 2016, a deduction from the election campaigns fund of the NSW Liberal Party of $586,992. That is the background for this attack on working people, for this attempt to fiddle the electoral law. Put aside the envelopes of cash, the developers, the Bentley, its motor still running—

The Hon. Adam Searle: The dog.

The Hon. JOHN GRAHAM: —and the poor dog, prone on the operating table. Here is the point: At the 2011 New South Wales election the NSW Liberal Party received donations totalling $10,873,138.54, and then had to hand back $586,992. That is, those in the NSW Liberal Party handed back more than 5 per cent of the total—they handed back the money but they did not hand back the votes. Think about what that means in an electorate such as East Hills. That member, Glenn Brookes, won that election by 0.6 per cent of the vote, but the statewide Liberal campaign received a 5 per cent donation boost. They handed back the money, but if they had handed the votes back he would not have been elected in the first place.

If you put aside the fact that the member was again caught out overspending in the 2015 election and put aside his campaign's involvement in one of the worst electoral slur campaigns in New South Wales electoral history, the member for East Hills cheated his way into the electorate the first time, cheated his way back and then voted for this bill today in the lower House to stop working people having a say.

The Hon. Don Harwin: Point of order: The honourable member is well aware of the standing orders which say that he should not reflect on a member unless it is by way of substantive motion. What he is doing right now is contrary to that standing order.

The PRESIDENT: I uphold the point of order. The member is well aware that he should not reflect on another member. He used a term—not once but twice—that clearly breaches the standing orders. The member will cease reflecting on another member. If he wishes to do so, it must be done by way of substantive motion. 

The Hon. JOHN GRAHAM: This is a scandal. Why is the Government accepting his vote on this bill? He might have given back the money but the member for East Hills should resign today and give back his electorate to the people of New South Wales. I oppose the bill.