The Government will introduce laws to overhaul how political donations work in Australia.
This includes legislation to limit how much a person or entity can donate to a political campaign. (There is currently no cap).
The reforms will also change the disclosure threshold at which donations must be made public from $16,900 to $1,000 from 1 July, 2026.
The Minister responsible for electoral matters, Senator Don Farrell, said the measures aim “to tackle big money in our electoral system”. Legislation is expected to be introduced next week.
Donations
Parties and candidates ask for donations to sustain their campaigns in the lead-up to an election.
These financial contributions are spent on things like ads on social media, TV, newspapers, billboards and radio.
Donations can also go towards staff, hiring venues for campaign events, and travel costs.
Current rules
Currently, there are no caps on political donations, meaning a person or entity can donate an unlimited amount to a political campaign.
The biggest political parties spent nearly $AU420 million worth of donations at the last federal election.
Queensland billionaire Clive Palmer, who has a (currently unregistered) political party – United Australia Party (UAP) – received more than $100 million in the federal campaign.
One UAP Senator was elected in 2022.
Donations above $16,900 for the 2024/25 financial year need to be disclosed, a threshold that increases every year based on inflation (rising prices).
It’s estimated the sources of about a third of political donations are unknown.
Disclosures occur in one of two instances: 24 weeks after an election is held, or annual reporting in February — showing the total donations of an individual or organisation for the previous financial year.
Shakeup
The Government will introduce reforms targeting donation caps, disclosure thresholds, and real-time publications.
Individual donation gifts will be capped at $20,000 for a candidate per year. Donors will be able to spend a maximum of $600,000 at an election.
Spending caps for political parties ($90 million) and registered organisations, such as unions ($11 million) will also come into effect. All political donation caps will be indexed after an election cycle — which is normally every three years, instead of every year.
Thresholds
The threshold at which the regulator, the Australian Electoral Commission (AEC), must publish donations will drop from $16,900 to $1000.
During a campaign, the AEC will publish donations in a weekly update.
Outside an election cycle, donations will be made public via monthly updates.
Daily disclosures will be required in the week leading up to polling day and the seven days after polls close.
Don Farrell
Farrell said the reforms would protect Australia’s democracy “into the future.”
He accused “billionaires” of repeated attempts to “sway our elections… not through policy or participation, but through money and misinformation.”
“The biggest weakness to our electoral system is big money influencing our political system,” Farrell said.
What now?
The Government plans to introduce legislation to the House of Representatives early next week.
It will need support from either the Opposition or a combination of the Greens and three crossbenchers to pass the Senate.
Previously, the Greens and some independents have expressed support for real-time donation disclosure reforms.
The Government hopes to pass the legislation by the end of the year, which would come into effect on 1 July, 2026.
Clive Palmer
In September, Farrell raised the possibility of legal pushback from United Australia Party leader Clive Palmer, due to questions over restricting money in politics and freedom of political communication.
Previously, the High Court has ruled NSW election donation caps were invalid because of a constitutional breach.
Palmer has flagged he would legally challenge the donation caps.
Truth in politics
The Government also plans to introduce “truth in political advertising” laws to Parliament.
The legislation would make it unlawful to publish and share misleading political ads.
It would be modelled on laws in South Australia in state campaigns, which ban political claims that would cause voters to be “led astray by deceit”.
However, the Government does not expect this legislation to pass before the end of the year.
