There are several pages on this in Andrew L’s co-authored 2004 book Imagining Australia, with the idea also summarised in this SMH op-ed. Instead of giving money directly to political parties, as now, donors would give anonymously to trusts that would then pass on the money to the donor’s selected party or candidate.
The argument is that the parties would have no way of knowing for sure who their donors were, and therefore would have less of an incentive to improperly favour their financial supporters. The anonymity of donations would also get around the problem, which I have discussed in the past, of people being reluctant to get involved in politics because they fear negative consequences if they back the losing side.
Blind trusts are, I think, a more persuasive solution to the latter problem than the former. Given it would be near-impossible to prevent donors telling parties about their donations (in the book, it is acknowledged that donors could provide a receipt), as a method of limiting corruption it’s hard to see that this is much more than the pre-disclosure system with some added bureaucracy. Some donors would prefer to remain anonymous – if only to save themselves future pestering by party fundraisers – but those hoping for something in return for their money are likely to make sure that the relevant people know about their donation.
I’m not a big fan of disclosure laws, which I think are very limited in their capacity to contribute to good government. In most cases, whether or not a policy is good or bad cannot be determined by examining the motives of those who introduced it – only consideration of its likely advantages and disadvantages can do that. In Australia, well-intentioned but misguided ideas are a much bigger problem than corruption.
And the ‘bribery’ that does exist is mostly the pollies bribing the voters, rather than the other way around – as the recent election campaign demonstrated yet again. This is because the main incentive in the system is not to favour interest groups, but to win over voters – no political party is likely to favour the interests of any donor over the wishes of potential voters. It seems that the dubious political donations by the Australian Hotels Association weren’t in the end enough to prevent changes to NSW licensing laws, when the pressure built for Sydney to match Melbourne’s thriving small bars and restaurants.
Improper influence is most likely to be a problem where officials have wide discretion on issues that don’t interest the general public. Even here, disclosure laws are likely to be only modestly useful in joining the dots between particular donations and particular decisions. But I can see the case for some disclosure in preference to laundering the money through blind trusts.
There is no easy formula for striking the right balance between letting would-be donors participate in politics without fear of reprisal and avoiding improper influence. On balance, however, I prefer the current system of donations being disclosed, but only if they exceed $10,500. It’s hard to believe that lesser sums could have any influence, given the overall income of political parties. I oppose Labor’s policy to bring this back down to $1,500. Particularly with coast-to-coast Labor governments, this would intimidate Liberal supporters with interests that can be affected by government decisions.