Tony Abbott has joined Malcolm Turnbull and a growing chorus of Liberals calling for only individuals to be allowed to donate to political parties, in effect banning union, foreign and corporate donations.
Labor backs a ban on foreign donations but opposes a ban on union and corporate donations which shadow attorney general, Mark Dreyfus, has warned the high court has already found is unconstitutional.
The Coalition is now seeking to widen the reform conversation to include spending on political campaigns by third-party entities, including unions and GetUp.
According to a Fairfax media report, Abbott has said: “We need to look long and hard at restricting donations to real people on the electoral roll.”
“To that end, there should be no union donations, company donations or foreign donations.”
Abbott also suggested that real-time or “near-to-real-time” disclosure was the best way to ensure full transparency and prevent “influence buying”.
He stopped short of calling for caps on donations, saying it was “a good thing” for individuals to donate to their party of choice – even “substantially ... as long as there is that transparency”.
On Thursday, Turnbull backed the same position on donations, which is shared by a number of ministers including Christopher Pyne.
“Ideally, donations to political parties should be limited to people who are on the electoral roll – voters,” Turnbull said.
But he noted the reform faced “big legal issues and some constitutional issues”.
In 2013 the high court found that a New South Wales law limiting donations to individuals breached the implied freedom of political communication.
On ABC’s 7:30 program on Thursday, Dreyfus said the high court “has said absolutely clearly that you can’t, within our constitution, ban corporations from making donations or ban unions from making donations”.
He called Turnbull “an absolute hypocrite” for opposing union and corporate donations, after reports he made a large personal donation to the Liberal party ahead of the 2016 election, which Turnbull has never denied.
“Apparently in his ideal world, only very wealthy individuals like himself would be able to give $1 or 2m dollars to their own political party to buy an election result,” Dreyfus said.
The shadow attorney general said under current laws donations do not need to be disclosed for 18 months. He said Turnbull was “all talk and no action” and called on him to sit down with Labor so “we can get somewhere on donations reform”.
Dreyfus said Labor wants a ban on foreign donations, lowering the limit for disclosure of donations to $1,000 from $13,200 and real-time disclosure. He said there should be “no donation splitting”, which allows individuals to give donations to separate branches of the same party to avoid disclosure.
Asked whether dual citizens would be excluded by a foreign donations ban, Dreyfus said it was a detail that needs to be “ironed out” and they might not be excluded, particularly if they are Australian residents.
On Friday Pyne told Nine’s Today program he was also in favour of banning union and corporate donations, so that only individuals could donate to political parties.
“You would have to do something about third party campaigning otherwise the unions will get their money together and use it to campaign against the Liberal party,” he added.
“It is not as simple as everyone thinks it is and that’s why it has to be done sensibly and calmly and put through a proper process.
“You can’t just ban donations from one group and then not expect there could be a flow-on effect elsewhere.”
Donations reform will now be considered by the joint standing committee on electoral matters.
There is some talk in Coalition circles about a Canadian provision that restricts campaigns by third-party groups during election seasons.
Under electoral law in Canada, third-party activist groups are permitted to spend what they like on advertising before the start of an election campaign but, once the writs are issued, spending is capped, which works to limit the influence of these groups.
New South Wales electoral law still contains a similar provision restricting spending on electoral communication during state election campaigns to $1.05m for registered third-party campaigns. Parties are allowed to spend $100,000 multiplied by the number of electoral districts they are contesting.
