Victorian politics remains vulnerable to unlimited dark money and foreign donations after the Allan government failed to secure an agreement with the Liberals or the Greens on urgently needed donation reforms. The state is now without caps on political donations or disclosure requirements just months ahead of the November election, following a High Court ruling that struck down the previous laws last month.
High Court Ruling Leaves Loopholes
Under the previous legislation, individuals and organisations could donate up to $4,970 to a candidate, though an exemption existed for money transferred to registered political parties via their nominated entities. While the High Court challenge focused on that exemption, it ultimately deemed the entire section of the electoral act governing political donations unconstitutional. This has left the Victorian Electoral Commission unable to distribute the latest round of public funding and opened the door to large donations, including from foreign sources.
Government Pledges Fast-Tracked Reforms
On the day of the ruling, Premier Jacinta Allan stated that the government would immediately move to restore Victoria’s electoral integrity regime, warning that the state had been left exposed to dark money in politics. She pledged that reforms would be fast-tracked through parliament and backdated to the date of the decision. Since then, Labor, the Liberals, and the Greens have been in negotiations, broadly agreeing on the need to reintroduce donation caps, disclosure requirements, and public funding arrangements. However, they remain divided on key details, including the specific cap level, treatment of nominated entities, and whether laws should be retrospective. As a result, the bill will not be introduced before June.
Party Positions Diverge
Greens leader Ellen Sandell called for strict caps or bans on political donations and for closing loopholes that allow major parties to rig the rules. She emphasised that unlimited dark money from overseas, billionaires, and corporations could now flow to political parties, influencing the state election. Liberal sources indicated they would reject retrospective laws and seek a higher donation cap. Opposition leader Jess Wilson confirmed good-faith discussions were ongoing but stressed that Labor must bring forward legislation.
Crossbench Consultations Begin
In a sign of waning confidence in securing Liberal support, the premier’s office has begun consulting crossbench MPs, including Libertarian MP David Limbrick. Limbrick expressed disappointment over the delay, warning that Victoria is vulnerable to foreign interference without safeguards against foreign donations, calling it a national security risk. Animal Justice party MP Georgie Purcell backed reform but argued that the previous cap was too restrictive for minor parties, giving major parties an advantage. She called for a modest increase to allow smaller parties to compete fairly.
Civil Society Calls for Urgent Action
The Australia Institute published an open letter in the Age, arguing that new laws must be retrospective and fair. The letter, supported by civil society organisations, also demands an independent review and broader public consultation, cautioning that reforms should not be designed exclusively by those with vested interests. The Centre for Public Integrity has urged the urgent restoration of disclosure and public funding rules before a broader overhaul after the election.
