Funding and disclosure

New laws governing political funding and disclosure are now in place in Victoria.

The laws incorporate a number of changes, including caps on political donations and a requirement for donations of $1,000 or more to be disclosed online.

Obligations under these laws will come into effect in stages.

These new laws are contained in amendments to the Electoral Act 2002 (external link)

Changes from 1 August

Political donations

From 1 August 2018, there will be a ban on:

  • foreign donations (donors will need to be an Australian citizen or resident, or a business with an Australian Business Number)
  • anonymous donations of $1,000 or more.

Registered political parties may also appoint a 'nominated entity'. For more details, see Information for recipients below.

Administrative funding

From 1 August 2018, the VEC will be required to pay administrative funding to registered political parties with Parliamentary representation and independent elected members.

Independent elected members are eligible to receive up to $200,000 per year.

Registered political parties are eligible to receive an amount that is tiered based on their number of elected members, capped at 45 members. Payments start at $200,000 per year for the first member, scale down to $70,000 for the second member and $35,000 for the third to forty-fifth members.

There are certain restrictions on the use that registered political parties or independent elected members can make in relation to this funding. This includes not using the funds on an election campaign.

Changes from 25 November 2018

From 25 November 2018:

  • prospective recipients of political donations must establish and maintain an account with a bank or financial institution for the purpose of State elections
  • certain recipients may appoint agents to manage their funding and disclosure obligations
  • eligible registered political parties will receive annual policy development funding at a rate of $1 per first preference vote or $25,000 (whichever is greater)
  • donors and recipients will be required to disclose all political donations totalling $1,000 or more via the VEC website within 21 days
  • there will be a $4,000 cap on political donations from any one donor to any one recipient in an election period, for more details see Information for donors below
  • recipients will need to provide a report, known as an ‘annual return’, to the VEC on their political donations, expenditure and debt – the first return will cover 25 November 2018 – 30 June 2019 and will be published on the VEC website no later than 31 December 2019
  • eligible registered political parties and independent candidates may receive advance payments of public funding - the rates for advance payments will be $6 per first preference vote for Legislative Assembly candidates and $3 per first preference vote for Legislative Council candidates.

Am I a donor?

You are a donor if you make a political donation to a person or organisation participating in a State election (registered political parties, candidates, groups of candidates, elected members, associated entities, third party campaigners and associated entities).

What is a political donation?

A political donation is:

  • any gift made to a registered political party, a candidate, a group of candidates, an elected member, or a nominated entity
  • a gift to a third party campaigner or associated entity for the purpose of helping them make a political donation or incur political expenditure.

For more information about the types of recipients see Information for recipients.

What is and isn’t a gift?

Gifts for the purposes of a political donation include:

  • money
  • services (including paid labour)
  • loans
  • guarantees
  • property (including loan of assets).

Gifts do not include:

  • gifts made in a private capacity for personal use
  • annual subscriptions to political parties
  • annual affiliation fees to political parties
  • annual levies to political parties
  • gifts between a registered political party and its nominated entity
  • gifts made for Commonwealth electoral purposes
  • volunteer labour
  • labour shared between branches
  • property used by a shared labour resource between branches (e.g. a telephone used by a worker).

When do I have to disclose political donations I make?

From 25 November 2018, anyone who makes a political donation totalling $1,000 or more must register and disclose it via this website within 21 days of giving the donation.

Are there any limits on how many donations I can give?

From 25 November 2018, there will be limits on some political donations, including:

  • a cap of $4,000 to any one recipient by any one donor within an election period
  • a cap of six third-party campaigners a donor can donate to within an election period.

What is an election period?

An election period is the period between one State election and the next – this is usually four years.

Multiple donations

Donors must disclose multiple donations when the total of those donations adds up to $1,000 or more to a single recipient within a financial year.

A registered political party, its endorsed candidates, groups of Upper House candidates, elected members and its nominated entity are considered one recipient.

Members of a group of independent candidates are also considered one recipient.

This means donors cannot give $4,000 each to several candidates endorsed by the same party, nor to each member of a group of independent candidates.

Are there penalties for giving a donation not allowed by the laws?

If a donor gives a political donation not allowed by the laws and the recipient accepts the donation, it must be forfeited to the State. This includes donations above the $4,000 cap, foreign donations, anonymous donations of $1,000 or more, and donations from a donor to more than six third-party campaigners.

If a donor knowingly gives a foreign donation, an anonymous donation of $1,000 or more, or a donation above the $4,000 cap, they may be fined or imprisoned, or both.

The fine for this offence is 300 penalty units (more than $48,000). The imprisonment term is two years.

It is also an offence to enter into or carry out a scheme with the aim of avoiding a ban or requirement under the funding and disclosure provisions of the Electoral Act 2002. For example, if a donor sets up a direct debit of $49 weekly payments to a recipient with the aim of trying to characterise that payment as a small contribution, when in total it would add up to more than the $1,000 disclosure threshold, this may be considered entering into or carrying out a scheme.

From 25 November 2018, the fine for this offence is 10 years’ imprisonment.

Who is a recipient?

The laws apply to a person or an organisation that receives a political donation, being:

  • a registered political party
  • a candidate at an election
  • a group of Legislative Council candidates
  • an elected member
  • an associated entity
  • a third party campaigner
  • a nominated entity of a registered political party.

Donations to an associated entity or a third party campaigner are only considered political donations when they will be used to help make a political donation, or promote or oppose a candidate or registered political party at an election.

What is an associated entity?

Associated entities are organisations that fit at least one of the following criteria:

  • they are controlled by one or more registered political parties
  • they operate wholly, or to a significant extent, for the benefit of one or more registered political parties
  • they are a financial member of a registered political party
  • they are a financial member of a registered political party via another person
  • they have voting rights in a registered political party
  • they have voting rights in a registered political party via another person.

What are third party campaigners?

Third party campaigners are people or organisations that receive political donations or incur political expenditure of more than $4,000 each financial year.

What is a nominated entity?

A nominated entity is an incorporated body that operates for the benefit of the party, but does not have voting rights in it.

A nominated entity must be appointed by the party, which also must provide the VEC with written confirmation of the appointment.

A registered political party can only have one nominated entity.

See a full list of Registered nominated entities.

What is political expenditure?

Political expenditure is any expenditure for the main purpose of directing how a person should vote at an election by promoting or opposing a candidate, elected member or registered political party.

For associated entities and third party campaigners, this expenditure occurs:

  • during the election campaigning period (for a general State election from 1 October to 6 pm on election day, for any other election from the day the writ is issued to 6 pm on election day), or
  • outside the election campaigning period when material published, aired or issued refers to both a candidate or registered political party and how a person should vote.

Are there penalties for receiving a donation not allowed by the laws?

If a recipient accepts a political donation not allowed by the laws, it must be forfeited to the State. This includes donations above the $4,000 cap, foreign donations, anonymous donations of $1,000 or more, and donations from a donor to more than six third-party campaigners.

If a recipient knowingly receives a foreign donation, an anonymous donation of $1,000 or more, or a donation above the $4,000 cap, they may be fined or imprisoned, or both.

The fine for this offence is 300 penalty units (more than $48,000). The imprisonment term is two years.

It is also an offence to enter into or carry out a scheme with the aim of avoiding a ban or requirement under the funding and disclosure provisions of the Electoral Act 2002. For example, if a donor sets up a direct debit of $49 weekly payments to a recipient with the aim of trying to characterise that payment as a small contribution, when in total it would add up to more than the $1,000 disclosure threshold, this may be considered entering into or carrying out a scheme.

From 25 November 2018, the fine for this offence is 10 years’ imprisonment.

When do I have to disclose donations I receive?

From 25 November 2018, you must disclose any political donations totalling $1,000 or more via the VEC website within 21 days of receiving the donation. The VEC will make an online disclosure portal available closer to this date.

Recipients will also be required to disclose the aggregate of donations received during the financial year in a report known as an 'annual return'.

Is a ticket to attend a fundraising event organised by a political party or candidate, considered a political donation?

The portion of the ticket that is profit after covering the cost of the function is considered a donation. For example, if a table of 10 to a fundraising event costs $2,000, but the cost of the function (e.g. catering, staff, venue hire) was $1,000 per table, only $1,000 of that ticket is considered a political donation.

It is the responsibility of the organiser of the fundraiser to inform attendees of the donation versus cost split. Donors and recipients may need to disclose the donation via our website.

Resources

The VEC has produced the following resources and forms for donors and recipients:

More information

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