'Crisis situation': The Allan government is scrambling to remake donation laws

Jacinta Allan's government is scrambling to draft new donations laws ahead of the upcoming state election. (ABC News: Danielle Bonica) The Allan government is working to devise new donation laws after the High Court last month found previous laws unconstitutional. Ahead of the state election in November, there are no donation laws in place, meaning there are no laws banning foreign donations, no limit on donations, and no requirements to disclose them. Labor sources say proposed laws will be brought before parliament next month. Link copiedShareShare articleSecret funding will continue to influence Victorian politics for weeks as the government struggles to devise a constitutionally sound donations regime, six months out from the state election. The High Court in April found the state's donations framework was unconstitutional and struck out a whole section of Victoria's Electoral Act. With no donation laws in place, Victorian political parties are scrambling to manage donations in the interim before new laws are enacted, and integrity experts have warned the state is now vulnerable to unchecked influence. In Victoria, following the High Court's ruling, there is no law banning foreign donations, no limit on donations, and no requirement to disclose them. Catherine Williams from the Centre for Public Integrity said this was a "crisis situation" that required an "emergency response". "We now have a regulatory vacuum … and obviously, six months out from an election, this is a situation that concerns us greatly," Ms Williams said. "The danger right now is that money could be flowing into Victoria's electoral system with voters having no visibility of the sources of that money." While Labor is confident that the new donation laws it is drawing up will be constitutional, the Liberal Party is hesitant. Victoria's political donation and disclosure laws have been scrapped by the High Court seven months out from the state election. There is, however, a consensus among political parties that donations received during this blackout period will ultimately need to be disclosed — though doubts continue about whether a donation cap will apply retrospectively. The Allan government wants bipartisanship, and any solution must withstand legal scrutiny to avoid being dragged before the High Court months before the election. While Premier Jacinta Allan declared a month ago that she would act urgently, the government was unable to update the crossbench on any real progress in meetings last week. But Labor sources say a bill will be brought before parliament next month, with time running out before a winter break in mid-June. Jacinta Allan has vowed to move quickly in remaking electoral laws. (AAP: Joel Carrett) Paul Hopper and Melissa Lowe — who ran as independents at the 2022 election — challenged the state's donation rules in the High Court, arguing they unfairly advantaged major parties through unfettered access to legacy cash in their nominated entities while capping donations. The laws allowed the Labor, Liberal and National parties to access funds from the nominated entities built up over decades to make payments to candidates and campaigns outside the cap. This meant the major parties had tens of millions of dollars they could potentially access that minor parties and independents, which could only receive donations capped at $4,970, could not. But the court, in finding the laws infringed on the constitution's implied right to freedom of political communication, went further by striking out parts of the Electoral Act that went beyond the donations cap and nominated entity system to create the current vacuum. There is also now no framework for the Victorian Electoral Commission (VEC) to pay political parties their usual public funding. Melissa Lowe, along with Paul Hopper, challenged the laws in the High Court. (ABC News: Danielle Bonica) Some Labor sources said they did not believe the premier's private office had acted with the necessary urgency in the lead-up to the High Court ruling. They were frustrated that the government dumped plans to restrict access to nominated entities earlier this year, which could have spared the government this disaster. An independent review, handed down in 2023, had also recommended that the government abolish the entities. Other sources, including political rivals, believed the government was working in good faith to get complex constitutional issues right. Some said the main difficulty now was ensuring the new laws were permissible under the constitution, and that both Labor and the Liberals were working constructively. Sources have also speculated that, in the future, the amount of campaign funding major parties could take from their nominated entities would be bound by the donation cap. The Liberal Party has argued that donation caps would need to increase by tens of thousands, multiple sources said, which Labor dismissed. Simon Holmes à Court publicly con

'Crisis situation': The Allan government is scrambling to remake donation laws

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