The pitfalls of political donations: A guide for staying within the rules

Extract from ABC News

By political reporter Stephanie Anderson

Updated 9 Sep 2016, 7:39pm

Photo: Former speaker Bronwyn Bishop and Senator Sam Dastyari broke the rules and faced the consequences. (ABC News)

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So, you are a politician and you have been given something for free — do you need to declare it, decline it or keep it all to yourself?

Here is our guide to the rules for politicians accepting gifts, donations and having bills paid on their behalf.

Personal gifts and donations

The first place new politicians should look is the Department of Finance's Entitlements Handbook, which outlines the rules for what gifts politicians can keep and what they must make public.
It states all politicians are required to disclose:

• Any sponsored travel or hospitality received valued at more than $300
• Gifts valued at more than $750 received from official sources — being an Australian or foreign national, state, provincial or local government or a person holding an office in such a government
• Gifts from non-officials valued at $300 or more

This could include items such as a Rolex watch (like the one Chinese businessman Li Ruipeng gave Stuart Robert), an $1,195 Mont Blanc pen or a $3,000 bottle of Grange (both of which were given to former NSW Premier Barry O'Farrell, who did not declare them).
The Commonwealth Electoral Act 1918 also regulates donations to political parties and candidates.
The Act requires the name and address of the donor if the donation made it over the disclosure threshold, currently set at $13,200, with donors and parties required to submit an annual return at the end of each financial year.
This requirement ultimately allows anyone interested to link donors, such as the Yuhu Group (which has donated hundreds of thousands of dollars to both major parties) to a number of individual contributors through shared details.

Photo: Stuart Robert attends a meeting in China with prominent Liberal Donors. (Supplied: Minmetals)

International donations

The Act does not distinguish between Australian donations and those made from people or organisations overseas.
This means foreign donors, like Australians, can donate up to $13,199 anonymously — and they can do so multiple times, as they can donate to individual branches as well as associated entities.
These are organisations with links to a political party, such as unions, think tanks, or dedicated fundraising groups. They accept donations and then pass those on to the relevant party.

Photo: Senator Sam Dastyari (fourth from left) and Yuhu Group chairman Huang Xiangmo (fourth from right) at Sydney film premiere. (Supplied: ACETCA)

The Parliamentary Library reports that Australia is one of the few countries which allows donations linked to foreign governments, while in countries like New Zealand, foreign donations are capped at $NZ1,500.
The Joint Standing Committee on Electoral Matters had previously had an inquiry into political donations, but it lapsed when the double dissolution election was called.
It is now up to the new committee to determine whether it will be re-established.
Only the Liberal Democrats and the Australian Electoral Commission responded to the inquiry before it was suspended, but neither mentioned foreign donors.

Paying debts

Little information is publicly available surrounding the guidelines for allowing third parties to pay a politicians' debt.
But — as both Coalition and Labor politicians have pointed out — Senator Sam Dastyari did not break any rules by asking for companies to pay for a number of bills.
Labor frontbencher Mark Dreyfus identified the area as being in need of reform.
Mr Dreyfus told the ABC today that there was no breach of the rules, saying the incident had given politicians a reason to focus on donations reform.

"I don't think anyone is suggesting that there should be no gifts at all," he said.

"Foreign donations is a quite different question."
Senator Dastyari has also rejected insinuations that the payments influenced his comments on foreign policy, something that would have been a breach of ministerial standards.
The Statement of Ministerial Standards states that ministers can accept gifts, but "must not seek or encourage any form of gift in their personal capacity".
The statement adds that ministers must ensure they don't come under any financial or other obligation to individuals or organisations "to the extent that they may appear to be influenced improperly in the performance of their official duties".

The pub test

Photo: Labor Senator Sam Dastyari fronts the media in Sydney on September 6, 2016. (AAP: Dean Lewis)

But even if politicians play by the rules, they can stumble on the "pub test" — whether the public think their behaviour is acceptable.
It was ultimately public perception which led to Bronwyn Bishop resigning as Speaker after chartering a helicopter to take an 80-kilometre flight from Melbourne to a golf course near Geelong for a Liberal Party function.
It was also the reason alluded to by Senator Dastyari when he resigned from the frontbench yesterday, saying that the public response and continued discussion of his actions led to his "difficult decision".