Liberals on the money

Well behind the Liberal Party when it comes to fund raising, state Labor needs to rethink its strategies.

The Western Australian Liberal Party not only swept all before it on the electoral front last year, it also confirmed its reputation as an extraordinarily successful fund-raising machine.

According to the WA Electoral Commission’s latest returns, the party raised $11.3 million in 2012-13; that’s almost double the Labor Party’s result, which came in at $5.8 million.

For political parties, fund raising is a fact of life. The more popular a party, the better its chances of raising big money – a case of winners are grinners and the rest can suit themselves.

Naturally, every party wants to outdo its rivals. But there can be problems when the donations get too one sided.

The current position is the exact reverse of what happened in the 1980s, when the fundraising maestro, Labor’s Brian Burke, swept all before him.

In addition to the usual union donations, Mr Burke made massive inroads into Liberal territory. Prominent businessmen including Alan Bond, John Roberts, Ric Stowe and Laurie Connell – the so-called ‘four on the floor’ types – all kicked in generously.

Mr Burke even diverted some of their money to the federal party and candidates in other states. In fact the donations became so skewed that a rebel group of state Liberals – against the wishes of party leader Bill Hassell – sought an audience with Mr Connell at the Allendale Square headquarters of his Rothwells finance operation for advice on what they could do to turn the tables.

Western Australians are still sending money across the continent to finance election campaigns, but this time it is the Liberal Party reaping the benefits. Labor’s sources, with the exception of the union movement, have pretty much dried up.

In fact if it hadn’t been for the introduction of public funding during the Gallop-Carpenter years, the financial situation in WA would be even more one-sided. On the basis of a payment of $1.73 for each vote polled in last March’s state election, Labor received $1.37 million from taxpayers, well short of the Liberals’ $1.97 million.

According to the electoral commission, the parties spent $8.8 million on their campaigns for that election. Of that, the Liberals invested an impressive $5.1 million (58.4 per cent of the total). Labor’s share was just $2.7 million (30 per cent), followed by the Greens $446,000 (5 per cent) and the Nationals $323,692 (3.6 per cent).

The Liberal performance is a great feather in the cap for the party’s former state president, Danielle Blain (who is being touted as the next federal president), and state director Ben Morton.

Before assessing the implications of the one-sided nature of the money flow, it’s worth looking at the trends over the past eight years. The Liberal dominance of fund raising in WA was already apparent in 2005-6, the first full year after Mr Gallop led Labor to a second term in power. The income for the Liberals was almost 52 per cent of the total for all parties, well ahead of Labor’s 37 per cent.

The Liberal share peaked in 2009-10 and the following year, coinciding with federal Labor’s failed attempt, under Kevin Rudd’s leadership, to introduce a mining super profits tax (later replaced by the Minerals Resource Rent Tax, masterminded by Julia Gillard).

In 2009-10, the Liberals accounted for a massive 64 per cent of all donations to political parties in WA. Labor’s share shrank to just 18.36 per cent.

It was much the same result in 2010-11, a period that included a federal election. The WA Liberals’ share was still strong at 60.96 per cent, compared with just 18.05 per cent for Labor. The trend was reflected in the result nationally, where the coalition won 12 of WA’s 15 federal lower house seats.

Federal Labor’s mining taxes were designed to appeal to voters in the heavily populated Sydney and Melbourne areas, regardless of the impact in the resources-rich states of WA and Queensland. The strategy was a spectacular failure.

So, does the system of political donations need to be reviewed? I recall the 2010 federal campaign when, at a news conference on a construction site at Curtin University, coalition treasury spokesman Joe Hockey promoted tighter controls on union donations to Labor.

His argument was that unions did not consult their members – many of whom did not vote Labor – about decisions to fund political campaigns. All was going well for Mr Hockey until it was pointed out that the same argument could be applied to corporate donations to the Liberals.

Perhaps the pendulum is starting to swing, albeit slowly. Last year, Labor’s share of donations in WA edged up to 28.2 per cent. But the Liberals were still well ahead on 55 per cent.

Labor could do worse than seek Mr Burke’s advice on how to encourage business to be a bit more generous. A review of the party’s resources and small business policies might also be a good move.