Australia to Limit Election Donations to $600,000, Mandate Real-Time Disclosures by 2028

Parties, candidates and donors will all face caps on how much they can spend on election campaigns, but taxpayers will give parties more money per vote.

Candidate placards for council elections at a pre polling booth at Kings Cross in Sydney, Australia on Sept. 12, 2024. AAP Image/Bianca De Marchi

The Australian federal government is hoping to end the “arms race” of election spending by introducing caps for parties, candidates, and donors.

Donations will be disclosed in almost real-time, and the threshold at which they must be reported will be significantly reduced.

The changes would not affect the 2025 federal election but instead, come into force in 2028.

And that looks likely to happen, as Labor plans to introduce the new rules in Parliament on Nov. 18 and hopes to have them passed within two weeks.

They have the federal opposition’s in-principle support, though there are still details to thrash out before that support becomes unconditional.

New Disclosure Rules

Under the new regime, donors would be limited to giving a maximum of $20,000 to a candidate within a calendar year. Candidates would be required to disclose any donations of more than $1,000—a massive decrease from the current trigger of $16,900.

Further, candidates and parties would have to reveal their funders roughly two weeks after the end of a calendar month; which changes to weekly once an election campaign begins; and then daily during the seven days leading up to polling day and the seven days after.

This is to prevent donors and candidates delaying payments until after the election but before bills fell due.

No More Than $600,000 From Any One Source

Along with the $20,000 cap per individual candidate, a donor is also restricted by a higher cap of $600,000.

For example, a donor could theoretically donate $20,000 to one candidate, and $20,000 to another.

Yet one consideration is any donor with the financial heft normally sends large amounts directly to the party, which is then distributed at their discretion.

Candidates themselves also face a limit on to spending of no more than $800,000 in the electorate they are contesting, while registered political parties will be capped at $90 million across the country.

More Money for Winning Votes

The Australian Electoral Commission also stands to pay parties more.

Those who succeed in gaining more than 4 or more percent of the primary vote—whether or not they win—will see their payment from the public purse increased from the $2.914 per vote paid at the time of the last election, to $5.00.

The total cost to the taxpayer could increase from $75 million to as high as $129 million.

If they maintained their vote share, the Labor and Liberal parties would each get nearly $20 million more than they did in 2022, while the Greens and One Nation would benefit by several million, and the most successful independents would pocket tens of thousands more.

Teal MP Critical of Proposal

Independent “teal” MP Kate Chaney was critical of the proposal.

“While a new independent would have to comply with a $800,000 spending cap, it appears that each political party can spend $90 million, shifting that money around to support any member who is being threatened by a newcomer,” she said in a statement.

“Both parties are running scared of the possibility of a bigger crossbench that will continue to hold them to account.”

Special Minister of State Don Farrell said the reforms would “tackle big money in our electoral system and protect our democracy.”

“Years of inquiries and evidence from multiple elections show us that the biggest weakness to our electoral system is big money influencing our political system,” he said.

“Over the last decade, we have seen billionaires repeatedly attempt to sway our elections, not through policy or participation, but through money and misinformation,” Farrell said in a veiled reference to mining magnate Clive Palmer.

Australian Special Minister of State Don Farrell speaks during a meeting via teleconference at Parliament House in Canberra, Australia, on Feb. 6, 2023. Lukas Coch-Pool/Getty Images

The Big Donors

At the 2022 federal election, Climate 200, headed by Simon Holmes à Court, was the largest donor, dwarfing the second highest, from an investment firm, of $290,000.

As might be expected with that level of support behind them, the largest spenders in that election were teal candidates Allegra Spender ($2.1 million), Monique Ryan ($2.1 million), and Zoe Daniel ($1.6 million).

The top 12 spenders were all independent candidates.

However, the changes seem more targeted at billionaires willing to enter the political ring after the United Australia Party (UAP) spent $123 million in the last election to win just one Senate seat.

The relatively high limits set by the current proposal are likely in anticipation of a legal challenge from Palmer, who donated almost all of those funds himself, which he will be unable to repeat with the new $600,000 cap.

On the other hand, the Liberal-National Coalition, which spent $132 million, and Labor, which spent $116 million, would also be curtailed, but only to $90 million.