Donations to political parties. What are the boundaries?

May 12, 2022

The Federal election is days away and the Victorian state election is also approaching.

You may have made, or be considering, a financial donation to a political candidate or political party.

Political donations are regulated in both the Federal and Victorian jurisdictions and their rules differ considerably.

Victoria

In July 2018, the Victoria Government passed the Electoral Legislation Amendment Act 2018 (Vic), which amended the state Electoral Act 2002 (Vic).

At the time, this implemented the strictest laws on political donations in Australia.

The Government’s aim was to enhance the transparency and integrity of our democratic system.

Currently, the Electoral Act sets out the following limitations on political donations:

  • A donor, whether an individual or entity, cannot donate more than $4,210 in total to a registered political party in a four year election period. This is referred to as the ‘General Cap’.
  • Any donations during a financial year over $1,050 must be disclosed within 21 days of the donation being made. This also applies to smaller amounts when the aggregated total is $1,050 or more.
  • Donations from foreign persons or entities are prohibited.
  • Anonymous donations of more than $1,050 are prohibited.

Australia

The rules on donating to a Federal political party are starkly different to the State laws.

Under the Commonwealth Electoral Act 1918 (Cth):

  • There is no cap or limit on the amount a person or entity can donate to a political party.
  • Any donation above the Disclosure Threshold during a financial year must be disclosed by a Donor Annual Disclosure Return lodged with the Electoral Commission, within 20 weeks of the end of the financial year. The Disclosure Threshold for the 2021/2022 financial year is $14,500.
  • Donations from foreign persons or entities over $1,000 are prohibited.

Many workplaces set out a Political Donations Policy to regulate how employees can make a political donation on behalf of the Company.

Any such workplace policies must be in line with the Federal and/or Victorian laws.