State and Territory Electoral Laws Can Be Just as Stifling for Charities

It’s important that charities and civil society organisations turn their attention to state and territory electoral laws, writes Krystian Seibert.

Since the end of last year, there’s been a lot of focus on the federal government’s proposed changes to the Commonwealth Electoral Act 1918, which would impose new compliance and reporting requirements on organisations which undertake public advocacy on policy issues, including charities.

Whilst there has rightly been a focus on the Commonwealth Electoral Act and its impact on charities and other so called “third parties”, there hasn’t been much focus on the various state and territory electoral laws which also impose restrictions and requirements on how charities and other third parties can engage in our democratic processes.

Take for example the rules imposed on third parties by the ACT’s Electoral Act 1992. In the ACT, third parties are subject to a cap on how much they can spend on “electoral expenditure” in the year of the ACT’s state election.

Between 1 January and when the election falls in October, they can only spend $40,000 on advertisements, publications or polling where any of this is “intended or likely to affect voting at an election if it contains an express or implicit reference to, or comment on” the election, the government or opposition, candidates and political parties, or any other issue before electors in the election.

Curiously, it does not include advertisements, publications or polling paid for by the ACT government or by politicians using their taxpayer funded allowances!

If you’re a charity or other third party in the ACT, and want to bring an important issue to the attention of ACT voters, be it about education, the environment or another issue, you’ll quickly find that $40,000 does not go very far once you pay for a few billboards, some radio advertisements and the printing of some pamphlets.

That’s what happened to the ACT Law Society in 2013. It was campaigning against changes to third party insurance arrangements for motorists in the ACT and was found to have breached the cap. The Law Society isn’t a charity, but similar organisations in other jurisdictions are. And it’s not hard to imagine that at some point charities focused on the environment, education or another issue may clash with the ACT government. But because of these restrictions, it will be much harder for those charities to challenge government decisions and hold them to account.

Whilst the ACT is a particularly egregious example, there are examples in other jurisdictions too.

In NSW, third parties are subject to a cap on donations of $2,800 per year. You’re classified as a third party if you spend more than $2,000 on “electoral expenditure” in connection with “promoting or opposing (directly or indirectly)” a political party or a candidate “influencing (directly or indirectly) the voting at an election”.

Electoral expenditure is very broadly defined and includes a whole range of activities that charities may engage in during an election. Although charities can’t promote or oppose candidates, some certainly seek to influence the voting in an election when they try to draw voters’ attention to particular issues.

Like with the ACT, there are also caps on how much third parties can spend on electoral expenditure in the year before – although they are quite large at over $1.2 million. However, a government appointed panel has recommended reducing them.

In other jurisdictions, there are varying requirements, detailed here.

The Victorian government is currently proposing to introduce a range of changes to its electoral laws, including introducing caps on donations to political parties as well as third parties.

The Victorian legislation is not likely to impact charities, because the definition of political expenditure by third parties is limited to those supporting or opposing political parties or candidates – something charities can’t do.

But it will impact other organisations such as GetUp!, and there’s always the risk that the breadth of the definition of political expenditure could creep over time if governments are tempted to try silence their critics, which can include charities at times.

It’s fair to say that charities, and civil society organisations more broadly, have not focused much on how electoral laws in general can impact upon their activities. Although few would argue against some basic transparency requirements for organisations which undertake electioneering, the requirements in electoral laws around Australia often go further.

Whilst some may seek to justify caps on donations and expenditure under the guise of “taking the money out of politics”, in practice they can neuter the ability of charities and other civil society organisations to challenge government decisions and hold them to account.

The UK’s experience with their so-called Lobbying Act is a striking example of what can happen, with a recent report highlighting the chilling effect it’s had on advocacy by charities.

Whilst we don’t want a democratic system dominated by players with big wallets, if charities and other civil society organisations want to engage in our democratic process, that costs money. They therefore need to be able to raise money from their supporters, and to spend that money informing voters about the policies of different parties and candidates and what their consequences will be. That’s what happens in a democracy. Caps on donations and expenditure just make their job even harder.

Yes, it will mean that organisations whom many charities and civil society organisations don’t agree with will also be able to raise and spend money in elections – be they the pokies lobby or mining groups. But whilst there may be a temptation to try muzzle them, we must realise that at the same time charities and civil society organisations are also being muzzled.

The federal government’s proposed changes to the Commonwealth Electoral Act came as a bit of a surprise to many, and were a wakeup call. Once they have been dealt with, and hopefully defeated or significantly watered down, it’s important that charities and civil society organisations turn our attention to state and territory electoral laws as well.

About the author: Krystian Seibert is an Industry Fellow at the Centre for Social Impact at Swinburne University of Technology.