Speech: Reply to the Governor-General

Senator RHIANNON  (New South Wales) (12:12): The Governor-General's speech on behalf of the Turnbull government failed on many counts. It failed on one of the most critical issues that this government should be grappling with: how we protect our democracy. The word democracy did not actually appear in the speech at all. There was a vague mention of democracies in general but not Australian democracy and the urgent reforms that are needed.  

 

We know that critical issues bedevil our society. Democracy—that is, the involvement of people in every way possible, in a most democratic way—will be critical to solving those issues, particularly around climate change but also in addressing inequality, environmental issues and social justice issues. People have a right to have a say and a right to be involved. It is particularly critical for this parliament, where corporate power dominates. It is so hard to get reforms in around lobbyists, around political donations and around how parliament itself works. This new parliament has just kicked off, but again you can bet your bottom dollar that corporate power will be the core problem in how this parliament works. 

 

The Greens have a suite of measures to deal with this, and I hope I have time to get to them. But right now what I think is particularly relevant—and it is relevant because it comes from the Prime Minister's home state—is the New South Wales Independent Commission Against Corruption, ICAC. It is also very relevant because Malcolm Turnbull is the Prime Minister and he needs to be learning those lessons in New South Wales and ensuring that we improve and safeguard our democracy at a federal level. Yesterday, in New South Wales, the Spicer report was handed down. Now what is centre stage of so many of the problems that have come out through the work of ICAC and through the Spicer report is the Free Enterprise Foundation, and it rears its head time and time again. Essentially, it is a slush fund for the Liberal Party, and it should be wound up by the Prime Minister as a first step in a major overhaul of political donations. That should have happened before the election. We went through a whole election where, again, the Prime Minister was not addressing this, and neither was the Leader of the Opposition. At the very least, they should have disclosed the donations they were taking. It is long overdue to have donations disclosed in real time. But I will come to the changes that are needed shortly. 

 

The New South Wales Electoral Commission has confirmed what many have suspected for a long time: that the Free Enterprise Foundation has been used by senior Liberal officials as a way to offer anonymity to donors. The New South Wales ICAC has received evidence that the Free Enterprise Foundation was used to wash prohibited donations. So it sits there as a major problem, and a problem at the heart of the Liberal Party and this very government. 

 

But let us look at the Spicer report itself. It probably was a bit unfortunate that it came out on the first day of parliament. Maybe some of my colleagues here did not have time to give it the attention that it deserved. But I certainly urge that they really tune in to what is going on here. The statements I have heard previously from members, in the numerous debates we have had about political donations, and particularly about corruption, that, 'We don't need a national ICAC because we don't have corruption here,' are just sounding more and more ludicrous. How do you know what goes on if you do not have a body to investigate it? 

 

But back to the Spicer report: the findings are damning. It is an explosive report of prohibited donations, funds and non-disclosures leading up to the Liberal Party state election campaign in 2011. The report found that groups associated with the Liberal Party funnelled political donations through the Free Enterprise Foundation to avoid scrutiny. There it is again—more evidence, clearly set out in the findings. Clearly, the intent of senior Liberals here was to accept money from developers, who are prohibited donors in New South Wales—and they knew it. They knew it. This was clearly meant, once those laws came in in New South Wales, to get around them. The great irony here is that, coming into that election in 2011, the Liberals and Nationals were clearly going to win—Labor was so on the nose. But they were so locked in to taking political donations that they were actually breaking the law to do it. 

 

Going back to the report: former Liberal MPs also sought to evade the law around the disclosure of donations and a ban on property donors in New South Wales. They included former police minister Michael Gallacher, former energy minister Chris Hartcher, and former Liberal MPs Garry Edwards, Tim Owen, Andrew Cornwell and Chris Spence. How embarrassing—all those Liberals caught up in these scams, in this breaking of the law. Another two former Liberal MPs, Craig Baumann and Darren Webber, evaded the disclosure of developer donations. 

 

But it does not stop with the Liberals. Former Labor MP Joe Tripodi engaged in serious corruption. 

 

And, while there were no adverse findings against Senator Sinodinos by the New South Wales ICAC, the Australian Electoral Commission found that he had been involved in what they called 'arrangements'—again, in their words—that: 

 

… provided the factual and legal matrix upon which non-disclosure was made by the Party. 

 

It is quite delightful, the way that was expressed! But I will come back to Senator Sinodinos shortly. 

 

The Free Enterprise Foundation, as I have said, was used to channel donations to the Liberal Party for its state election campaign in New South Wales, again—and it needs to be repeated time and time again—to disguise the true identity of donors. That means that you are getting around the law; that is what is going on here. There are all these people who get up and say they want to uphold the law, and who abuse people who try and improve society. This is about undermining democracy and thwarting attempts to ensure that the public knows who is donating to political parties. What it really highlights is that we need to bring in bans and caps on political donations. 

 

To go back to the report: there was an example of a cheque sent to the Free Enterprise Foundation from Lindsay Partridge, the managing director of Brickworks Limited. The cheque was to the value of $125,000. It came with a letter that said: 'We trust this donation will provide assistance with the 2011 New South Wales state election campaign.' Brickworks received government grants totalling $17 million, including $14.6 million of grants relating to the Clean Technology Investment Program. 

 

The relationship between the government and Brickworks Limited does warrant federal investigation, and I pay tribute to the former Greens parliamentary leader, Christine Milne, who requested that Operation Spicer investigate the grants in 2014. She was told that the New South Wales ICAC does not have the jurisdiction to do that, and I would again say that that is further evidence of why we need a national ICAC. 

 

The Operation Spicer report has shone a light on the deep web of lies, dishonesty and corruption in New South Wales, but it does not stop at borders. Nobody can argue that any further. 

 

Some of the findings of the report, including the commentary on Brickworks, warrant investigation at a federal level. This really does put the spotlight on the need, as I have said—and we will say it more often and more loudly: there is a need for a national ICAC. 

 

It is no wonder that the Liberal, Labor and Nationals parties do not want to back the Greens' call for such a commission or our call for far-reaching reforms around political donations, because they are just locked in. Just as we saw Labor, Liberal and Nationals voting together today on the terms of parliament, doing a deal there to benefit themselves, here we are seeing them backing each other up and not bringing in the reforms that are so needed. 

 

I saw it in New South Wales: the scandals get to a point where you cannot but bring in the reforms. Mr Turnbull and Mr Shorten should really move before their parties get caught up in the scandals that inevitably will flow. 

 

What is happening with the New South Wales ICAC is getting us closer. It is starting to open up this Free Enterprise Foundation. But we have not heard the whole story by any means. 

 

In April this year, Labor and the coalition voted down a Greens Senate motion for an equivalent of a federal corruption watchdog, and in May they voted down a motion calling for political donation reform. So it is on the record—how Liberals, Nationals and Labor are working together on these issues. 

 

I will just say a little bit, which is obviously relevant to this discussion, about Senator Sinodinos. Senator Sinodinos had both a relationship with Australian Water Holdings and his role as treasurer of the Liberal Party. This issue has been canvassed considerably, and I acknowledge that the Liberal Party is out there saying that he has been cleared of any wrongdoing. But, again, I would urge people to read much of the evidence as well as the final report, because while there were no adverse findings against Senator Sinodinos the Electoral Commission did find it necessary to report, as I said, on the so-called arrangements he was engaged with. 

 

What we do know is that Senator Sinodinos in 2009 signed a letter as finance director of the New South Wales Liberal Party to MPs and senators, warning that the changes that occurred in the law in New South Wales with regard to donations would have a significant adverse impact on the party's fundraising ability. Now, I acknowledge that the fact that that was said could be interpreted as the now senator doing his job. What is interesting is that in three days the Liberal Party received $629,000 from one donor, but no-one on the finance committee, including Senator Sinodinos, admitted to knowing anything about this. What is significant—and remember the figure, $629,000, which is obviously a lot of money—is that the records show that in the year before the prohibition on donations from property developers the Free Enterprise Foundation donated only $50,000 to the New South Wales Liberal Party. So is it a fair assumption that there were those working in the Liberal Party who realised that once the law came in they needed a way to launder donations, and that is why we saw such a huge increase in the amount of money coming from the Free Enterprise Foundation once the ban on developer donations came in? And I do want to put on the record that the Greens, in the early 2000s, moved a bill for a ban on developer donations, something that we were ridiculed about in the New South Wales parliament. 

 

Senator Williams:  I bet you didn't ban Wotif. 

 

Senator RHIANNON:  I am happy to acknowledge the interjection from the senator. What we saw, and why eventually Labor brought in the change to the law, is that it became so onerous, so smelly in terms of how developers were interacting with the Labor government, that Labor, at the death knell of their time in government, brought in this legislation. We now know that people who were connected with the Liberal Party then came up with ways to accept the money. 

 

When Senator Sinodinos was questioned by ICAC, when he gave evidence, his replies regularly were, 'I cannot recollect one way or the other'. Another response from him was, 'It was not a process I involved myself in.' He certainly had many phrases that would trip off his tongue to say that he was unaware of these things going on. Again, when you read the evidence, when you read the reports, you are left with the impression that when it comes to Senator Sinodinos we have not heard the full story. There are now more and more voices coming out talking about the need for political donation reform. And, while I have expressed concern at the failure of the Leader of the Opposition and the Prime Minister to take this up during the election period, people associated with their parties have taken it up. I pay tribute to former senator Mr Faulkner, because it is something that I know he really did try to advance. And I was very interested that just recently former Treasurer Mr Wayne Swan spoke about the possible adverse influence of overseas donations. So the voices are starting to build up, and the momentum is there for change. This is where we need leadership from both sides, for the opposition and government to actually act. 

 

What is also very relevant when considering the momentum that is occurring around the need for reforms regarding political donations is a High Court case last year that was precisely about developer donations. Again, I have spoken about this before, and I will continue to use this case in this debate, because it is very significant in that the court analysed the very nature of corruption, the nature of political donations and the impact they are having. The case makes the point that corruption in Australia has largely moved beyond quid pro quo corruption to what the High Court describes as a more subtle kind of corruption known as 'clientelism'. This kind of patron-client corruption comes about when a politician or a political party becomes so dependent on the financial support of a wealthy patron that they—and these are the words of the High Court—'compromise the expectation, fundamental to representative democracy, that public power will be exercised in the public interest'. The essence of the problem we have here— 

 

Senator Williams:  Just like the CFMEU. 

 

Senator RHIANNON:  and I again acknowledge that we have a Nationals senator keen to interject on this issue—is that we are starting to have a really serious breakdown in MPs who come into this place with the commitment to work for the public good. And it has been set out so clearly by the High Court. The High Court also said: 

 

Unlike straight cash-for-votes transactions, such corruption is neither easily detected nor practical to criminalise. The best means of prevention is to identify and to remove the temptation. 

 

That is precisely why the Greens have brought forward a series of private member's bills on this issue, and we will take it up in the JSCEM in great detail and do everything we can to advance the need for reform here.  

 

I also want to acknowledge the words of the former Leader of the Opposition, when the Liberals and Nationals were in opposition, John Hewson. He wrote yesterday that 'the major parties know exactly what needs to be done' but they do not act because they 'each believe that they can better exploit' the current system, where political donations can be taken, 'to their electoral advantage'. It is really disturbing that you can have a former opposition leader identifying that the self-interest of the major parties in this parliament is absolutely undermining democracy because they are so hooked on taking political donations. Effectively, I would argue that Mr Hewson endorses the Greens position to cap donations and to have them declared in real time and online. Today, TheSydney Morning Herald editorial echoes these calls. It concludes: 

 

Money should not buy access to, or influence with, public officials. The intention to evade the law relating to donations is unacceptable, even if the ICAC cannot legally call it corruption any more. 

 

So there is momentum for change here. 

 

As I said in my opening remarks, it is incredibly disappointing that the word 'democracy' did not figure in this major speech that supposedly is to outline the priorities of the current Turnbull government. That is why I have given over my whole speech to this issue of democracy and to the need for reform around political donations. It really goes to the heart of how we work as senators. Are we able to represent the public good or are we going to be compromised by the corporate interests who continue to attempt to—and so often do—dominate this place?