With Coalition, money talks policy walks

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By Leith van Onselen

One of the most disturbing trends from this Coalition Government is the blatant extent to which they are willing to jettison sound policy or offer political favours for campaign donations or other forms of remuneration.

Throughout the post-election period, we have witnessed the so-called “ginger group” of conservative MPs rally against the Turnbull Government’s sensible (and broadly supported) superannuation package because they believe that it reduced political donations flowing to the party, not actual votes.

Liberal senator, Ian MacDonald, encapsulated this view with the following, blaming the superannuation package for the poor election result:

“One of the problems with the campaign was none of us were treated with any respect”…

“It [superannuation] also severely impacted our fundraising because most of those affected and even those who weren’t affected but were concerned that they might have been were traditionally our supporters and very often our very good donors.”

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Senator Eric Abetz made similar claims:

Liberal senator and Abbott supporter Eric Abetz said the policy change had affected voters and Liberal volunteers, who declined to help the party. “It’s an issue that did impact, especially in our volunteer base, and that should never be underestimated,” he said. “We do tend to rely on the self-funded retirees who are very much our core base of supporters.”

Senator Abetz said he knew of one businessman who usually supported the Liberal Party heavily at fundraisers but who declined to purchase tables this year over the superannuation change.

Councils on the Ageing’s Ian Yates nicely espoused the spuriousness of this argument earlier in the week:

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Any exemptions for wealthy estates and the people at the very top end will be a signal to the community that the Coalition has no interest in making super policy fairer and that they govern only for the top few per cent…

The notion that super tax breaks are some kind of reward for Liberal party supporters’ votes, donations and turning up to polling booths is macabre and disturbing.

The Monthly’s Sean Kelly also took issue with the conservative MP’s line of reasoning:

Now just follow the line of thought for a moment. Former ministers are arguing that a policy should be changed – and should never have been adopted – because the people who give the party money aren’t happy. Or to flip it: experienced MPs are saying out loud that a reason to change policy is to attract donations.

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Sadly, this superannuation policy is not the only area where the Coalition has shown an appetite for policy favours in exchange for financial reward.

While there is a long history of Australian politicians going into well-paid private sector jobs after politics – often in the very industries that they used to regulate – rarely has it been so blatantly spruiked as under this Coalition Government.

Back in May, Tony Abbott gave a speech to Parliament where he said:

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“The member for Groom Ian McFarlane was the resources minister who scrapped the mining tax … It was a magnificent achievement … and I hope that the sector will acknowledge and demonstrate their gratitude to him in his years of retirement from this place.”

In saying so, Abbott basically admitted that the Coalition serves the business community first and foremost. And they expect to be rewarded handsomely for it.

In that same speech, Abbott admitted that he once accepted a $5,000 envelope from a well-known wealthy Australian, but later gave it back and asked the donor to instead give a donation to the Liberal Party:

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“I recall quite some years ago, as a relatively new member of parliament, that a well-known millionaire invited me for a pre-Christmas drink. As I was leaving he gave me an envelope and said, ‘That’s your Christmas present.’ When I opened it up it contained $5,000 in cash. I can tell you, the Abbott family in those days could have used that money, but it did not feel right. I rang Bill Heffernan for his advice and he said: ‘Once bought, always bought. Give it back and say to that person, ‘Please write out a cheque for the campaign'”.

That Mr Abbott needed advice at all on the question of a brown paper bag stuffed with cash is worrying. That Mr Heffernan thought is was all OK to just shift the same dough to the party is highly questionable. And that Mr Abbott felt that relaying the entire episode in a recent speech because it was light and humorous suggest a collectively broken moral compass.

Just last week, The AFR confirmed another example of politician-to-industry links, with former trade minister, Andrew Robb, joining investment bank Moelis & Company selling Australian assets to wealthy Chinese under rules that he developed while in Parliament.

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What The AFR article did not mention was that the rules were changed to be highly compatible with Moelis’ offerings.

As noted by Alan Austin recently:

The rationale for generous pensions for MPs is that they can engage in public service – as Malcolm Fraser did chairing an overseas aid agency – and thus avoid the temptation of corporate payoffs…

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So why are these politicians allowed to have their cake and eat it too? Why does the system allow them to effectively grant political favours in return for financial reward?

As demanded by The Monthly’s Sean Kelly:

“Our politicians need to get their crap together, cap donations, and introduce real-time transparency of donations”.

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Too right. Australians deserve to know who is behind the scenes bending the political system and public policy in their favour.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.