Unions Take Donations Reform To The High Court


For many of us involved in community organising, campaigns are often seen as a contest between organised money and organised people.

Whether it is a campaign against public sector job cuts or the battle to protect our land and water from coal mining and coal seam gas, it is about mobilising people against the financial resources of governments and industry.

That is why many saw the O’Farrell government’s move in early 2012 to ban political donations from corporations and other organisations as a significant moment. The corrupting influence of these donations was being removed and the job of those seeking to organise people for political outcomes was about to become a little easier.

Almost two years later, Unions NSW, with the backing of five individual unions and public support from NSW Labor leader John Robertson, will challenge those reforms in the High Court.

The Unions NSW case, as outlined in their written submission, argues that donations represent "political communication", for which there is an implied freedom in the State and Commonwealth constitutions. This communication enables voters to exercise "true choice" in elections. Unions NSW contests that the status of the "communicator", whether an individual, corporation or other organisation, is not relevant.

On face value, the unions are saying that "money equals free speech" and to restrict the ability to donate, is to limit freedom of speech. Taken to its natural conclusion it seems a justification for open-ended political donations and expenditure by individuals, unions and corporations alike.

This is a similar argument to that made in the United States in the 2010 Citizens United v. Federal Election Commission case that led to the development of "Super PACs" or Political Action Committees. These Super PACs are able to raise unlimited funds from corporate and organisational donations and spend unlimited amounts independent of party campaigns.

Greens NSW MP and spokesperson for the Greens on Democracy, John Kaye responded to the launch of the case saying:

“The unions are playing with fire if they bring down on NSW the same untrammelled rights of corporations to express themselves through the money they splash about in politics as has been created by the US Supreme Court Citizens United v Federal Election Commission decision. It would be unfortunate if the unions’ case delivered a springboard for… corporations to once again corrupt state politics.”

The numbers speak for themselves: in the 2011 NSW State Election year, the Coalition took over $11.7 million in political donations and Labor $3.75 million. Since the new laws took effect, political donations to the major parties have fallen to well below half of previous non-election year levels. For the year to 30 June 2012, Labor received just $790,000 and the Coalition $880,000.

The NSW Labor Leader John Robertson has publicly supported the Unions NSW challenge. He has claimed the O’Farrell reforms advantage wealthy individuals and said, "banning donations from community organisations, unions, disability advocacy groups and peak bodies will lock average Australians out of our political system.''

But this argument ignores a fundamental element of the O’Farrell reforms that ensures political parties and unions can continue to spend significant amounts on election campaigns raised from individual donations. Surely this is a style of fundraising that suits the community organising model of unions and public advocacy groups much more than corporations or industry peak bodies.

Many union members must be scratching their heads about the Unions NSW case and Labor’s support for it. A win by the unions could be a loss for their members and the issues they care about. It would re-open the door to a flood of corporate donations that would swamp grassroots campaigns. Instead of mobilising their members to make the most of these laws, the union peak body is expending member funds to run a case that could return the state an old system that has been shown to be broken.

Given the obvious risks here, it is hard to see the Unions NSW challenge as anything other than an effort to defend the financial and organisational influence of unions over the ALP.

In 17 months the key issues of the 2015 NSW state election are likely to be the government’s public sector wage freeze, unfair and retrospective changes to workers compensation, planning reforms that benefit developers over communities and ongoing attacks to the environment including from coal seam gas and coal mining. For those engaged in the battle between organised money and organised people, the last thing that is needed is a return to the corrupting influence of money in politics. Yet that is the very thing the Unions NSW case could bring about.

Launched in 2004, New Matilda is one of Australia's oldest online independent publications. It's focus is on investigative journalism and analysis, with occasional smart arsery thrown in for reasons of sanity. New Matilda is owned and edited by Walkley Award and Human Rights Award winning journalist Chris Graham.