Labor and Coalition parties face multi-million dollar repayment after High Court ruling
Labor and the Coalition were forced to repay millions of dollars in donations they received from former investment funds after the Supreme Court ruled that the use of those funds was actually illegal.
Age It can reveal that the state government has received legal advice saying money received by major parties from organizations that nominate them cannot be used to campaign in this year’s state elections.
The latest development in the donation saga after the Supreme Court as Victorians head to the polls in less than six months repealed state campaign finance laws It will cause major damage last month, causing a significant drop in the cash reserves of major parties.
The nominated entities are legacy investment funds that Labor, the Liberals and the Nationals have relied on for decades to fund their election campaigns.
The funds contain millions of dollars; The Liberals’ Cormack Foundation is worth about $120 million from property sales and proceeds from a Melbourne radio station.
When Victoria’s election finance laws were overhauled in 2018, a cut was introduced to strict donation limits that allowed major parties to have unrestricted access to these funds.
The special treatment given to these organizations formed the basis of the Supreme Court’s decision last month to strike down Victoria’s donations laws after they were challenged by independent candidates Paul Hopper and Melissa Lowe, who claimed the rules stifled political communication.
Since the laws were repealed on April 15, there are effectively no limits on political donations or any disclosure requirements.
As the Allan government deliberates on legislation to close the gap, three sources with knowledge of the discussions confirmed: Age He said that the major parties had to repay the money they received from the organizations they nominated candidates during this term of the parliament, otherwise this could affect the elections to be held in November.
The sources, who spoke on condition of anonymity because they were not authorized to speak publicly, said the legal advice informing the legislation showed this was necessary.
Following the Supreme Court’s bombshell decision, the Victorian Electoral Commission has removed data showing how much these nominated organizations have paid since 2022.
But Simon Holmes, a co-convener of Climate 200, said the Court’s “Wall of Benefits” website (an online portal showing benefits unavailable to independent competitors) includes sizeable figures based on research conducted before the VEC removed the data from its website.
He noted that the Cormack Foundation announced donations of $8.1 million to the Liberal Party of Victoria between financial years 2022 and 2025, but that this included funding for federal election campaigns that was not affected by the court’s decision.
in 2018 Age He announced that a deal with the Cormack Foundation would result in the Liberal Party receiving $2.5 million for the 2018 state election and $3 million for the 2022 poll. This doesn’t mean similar amounts have been donated yet for this year’s campaign. One source estimated that the amount to be repaid could be over $1 million.
According to the Australian Electoral Commission, Labour’s nominated organization, Labor Services and Holdings, has announced a payment of $6.8 million to its Victoria branch in the 2024-25 financial year; however, this may also include valid federally used funds.
A Victorian government spokesman did not respond to specific questions about legal advice.
An opposition spokesman said: “We continue to meet with the government in good faith but cannot comment on the details of a bill we have not yet seen.”
As part of the overhaul, the government increase the annual donation limit It will reach at least $10,000 (twice what it is now) during negotiations with the coalition and MPs.
Shadow attorney general James Newbury said his party wanted to work with Labor but needed to ensure the laws were not repealed again, while he was open to the $25,000 cap if he could strike a deal with the Coalition.
If the $10,000 annual cap becomes law, it would not take full effect until after the November election. Instead, parties will be able to receive donations of up to $5,000 for this fiscal year and up to $5,000 starting July 1.
Prime Minister Jacinta Allan has also promised to make the law retroactive to the date of the Supreme Court decision.
Despite this, Climate 200 donated $40,000 to the campaigns. independent candidates Sophie TorneyShima Ibuki, who tried to oust Opposition Leader Jess Wilson at Kew, and running against former Liberal leader John Pesutto At Hawthorn.
On Thursday, the organization also provided independents with $140,000 in administrative funds that were not used for the campaign and were available to parties and independents if elected.
Under the government’s proposed legislation, taxpayer-funded administrative payments to registered parties would be increased, giving $300,000 for the first elected MP, $100,000 for the second MP and $55,000 for every MP between the ages of three and 45.
“Whatever the Allan government decides, it will not effectively do anything significant to equalize the situation.
A playing field that would give independents the same starting lines for their campaigns as the majors
parties,” Torney said.
A government spokesman said public funding was “the foundation of free and fair elections”.
Start your day with a summary of the day’s most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.
