Political Donations 101: cause and effect 2019-2020

THE CAUSE: Reliance on political donations

Individuals and corporations making large or regular political donations are rarely giving money for philanthropic reasons - they usually want something in return.

Sometimes it is access to a prime minister or premier, sometimes access to a particular minister and sometimes it is a barely concealed bribe in order that the donor gets a specific outcome from a particular government.

The Guardian, 3 February 2020:

The Liberal party received $4.1m from a single donor before the 2019 election, one of the largest amounts in political history, dwarfing former leader Malcolm Turnbull’s $1.75m gift before the 2016 election.

The donations, revealed in Australian Electoral Commission disclosures published on Monday, are second only to the $83.3m donated by Mineralogy Pty Ltd to Clive Palmer’s United Australia Party.

Both major parties also took significant sums of money from the fossil fuel industry, including multinational giant Woodside, something environmentalists say explains government inaction in the “face of a rolling national emergency driven by climate change”.

The $4.1m donated to the federal Liberal party and its state branches was given in multiple instalments by Sugolena Pty Ltd, a company linked to philanthropist Isaac Wakil, who made his fortune in the clothing industry and invested heavily in property, with his wife Susan, around the Sydney suburb of Pyrmont…..

The Liberals declared $22.6m in donations Labor $18.2m. Total receipts, which include all donations regardless of the $13,800 reporting threshold, other payments, returns from financial investments and loans, amounted to $165m for the Liberals and $126m for Labor.

Australia’s weak donation disclosure system continues to mask a huge chunk of political financing. 

Analysis by the Centre for Public Integrity shows that $1bn in party income has not been disclosed between 1999 and the last reporting year, almost 36% of total party financing.

But the disclosures that have been made continue to show the significant influence of the fossil fuel industry in Australian democracy. Clive Palmer’s Mineralogy, which gave $83,681,442 to Palmer’s United Australia Party, was by far the single biggest fossil fuel donor.

An analysis by the Australian Conservation Foundation found a further $1.89m in fossil fuel donations to Australian political parties.

“This data explains why even in the face of a rolling national emergency driven by climate change and community demands for change, the government continues to defend and promote the industries that are the root cause of the problem,” ACF’s economy and democracy program manager Matt Rose said.

“Serious donations reform is needed now to make sure our political system works for the benefit of all Australian, not just those with the biggest wallets.”

The biggest fossil fuel donor to the major parties was Woodside, Australia’s biggest LNG exporter. It gave $135,400 to Labor, $136,750 to the Liberal Party and $11,190 to the Nationals. The gas industry lobby, the Australian Petroleum Production and Exploration Association (APPEA), was also a significant donor. [APPEA donated a combined total of $24,990 to the federal Liberal and Nationals parties]

Prime minister Scott Morrison recently identified gas as a key “transition” fuel for Australia’s economy, saying “we need to get the gas from under our feet”. 

He also recently struck a a $2bn deal with the New South Wales government to increase gas supply and reduce greenhouse gas emissions from the electricity sector…..

The federal Liberal party also declared two donations from Adani Mining Pty Ltd totalling $50,000….. [the Australian Electoral Commission identified a combined total of $97,300 as donations directly from Adani Mining Pty Ltd to the federal Liberal and Nationals parties]

Carmichael Rail Network, another wholly-owned subsidiary of Adani Australia, gave $50,000 to the federal Liberal party and $100,000 to the Nationals….. [my red annotations]

THE EFFECT: Requirement to fulfil the terms of the unwritten contract between a political party and its donors

Within the 8 months following the May 2019 federal election the Morrison Government acted to benefit certain of its donors in the gas industry sector.

Santos Limited which had donated a combined total of $42,723 to federal Liberal and Nationals coffers in 2017-18 went on to donate another $78,854 in 2018-19, with this result......

According to Lock The Gate Alliance on 31 January 2020:

The ‘energy deal’ announced today between NSW and Federal Governments looks designed to unleash coal seam gas drilling in north-west NSW, threatening drought-affected farmers and allowing Santos to drain 37 billion litres of groundwater.

Crucially, it will do little to bring down greenhouse gas emissions due to its reliance on dirty, polluting unconventional gas.

Media reports indicate the NSW Government has been compelled by the Commonwealth to make a commitment to supply 70PJ of gas for the east coast market in exchange for up to $2 billion in Federal funding for renewable energy and unquantified reduction incentives.

The volume of gas mentioned in the deal is similar to the amount Santos expects to produce at its proposed water-hungry Narrabri coal seam gasfield.

To facilitate the creation of one or more gasfields in north-west New South Wales the Berejiklian Coalition Government held a second hearing into the NSW Chief Scientist’s recommendations on coal seam gas in NSW on 4 February 2020.

As the Berejiklian Government failed to act on the Chief Scientist's original recommendations, this second hearing was a cause for concern......

Lock The Gate Alliance, 3 February 2020:

CSG hearing round 2 must deliver more than just hot air

The holding of a second hearing into the NSW Chief Scientist’s recommendations on coal seam gas in NSW is evidence the Berejiklian Government is not prepared to deal with the repercussions of the destructive industry, according to Lock the Gate Alliance.

The hearing, to be held tomorrow, is only happening because the Government was unable to properly answer questions about CSG at the original hearing, held in December last year.

Lock the Gate NSW coordinator Georgina Woods said it was even more crucial than ever now for the Government to answer questions about its forgotten promises on coal seam gas, given the state and federal governments look poised to sacrifice the north west following last week’s energy deal announcement.

“It was deeply troubling to watch government representatives scratch their heads when asked basic questions about their oversight of this damaging industry at the last hearing. It demonstrated an alarming lack of attention to the serious risk coal seam gas poses to groundwater in North West NSW,” Ms Woods said.

“Last week’s energy deal with Canberra has raised the very real risk that state and federal governments will run roughshod over the facts and heap political pressure on planning authorities to approve Santos’ destructive Narrabri coal seam gas proposal.

“This inquiry has shown how unready and unaware the Government is for the environmental, social and economic damage that will inflict.

“There is still time to stop Santos’ Narrabri gas project from puncturing holes in a recharge aquifer of the Great Artesian Basin, one of western New South Wales’ most precious groundwater resources. There is still time to make this important area a no-go zone for coal seam gas and safeguard the water resources of north west New South Wales.”

Ms Woods said it was clear from the last hearing that major recommendations made by the Chief Scientist had not been implemented.

“The biggest gaps include failure to provide a three-tiered environmental insurance scheme, failure to establish a standing expert committee, and failure to develop systems that can detect cumulative impacts of the industry on precious water resources,” she said.

“There are 11 expired and unused legacy coal seam gas licences languishing over the farmland, towns, and precious water resources of the drought-stricken north west that have never been through the Government’s new system for assessing areas for gas exploration.

“The NSW Government is leaving farming communities in the north west exposed to unforeseen and irreversible loss or contamination of water resources and other environmental and health impacts from the CSG industry.

“We need a reset from the Government that prioritises water security, people, and the needs of future generations and that means stopping the Narrabri gasfield.”

Brisbane Times reported on 3 February 2020 concerning the Adani Group's strategically timed donations:

On April 5, $12,500 was donated to the Liberal Party; that was four days before then-Environment Minister Melissa Price signed off on the groundwater management plans for Adani's central Queensland mine. 

Another $100,000 was donated to both parties in the month after Ms Price gave final federal approvals to the mine.