Sponsored by Revesby Workers Club STRICTLY EMBARGOED

1 The inaugural address of The Light on the Hill Society - sponsored by Revesby Workers Club STRICTLY EMBARGOED UNTIL DELIVERY (7pm) Senator John Faulkner: Public Pessimism, Political Complacency: Restoring Trust, Reforming Labor. I have always believed that politics is worthwhile. This is not, nowadays, a popular view. Important issues are, we are told, ‘above politics’— because politics, by implication and expectation, are the province of the low road. No more damaging charge can be made than to say someone is ‘playing politics’ with an issue — because, by implication and expectation, politics is a game played for personal gain and for entertainment. But politics is one of the ways – the chief way – any democracy works out solutions to its problems. Politics is a way to manage substantial disagreements within a society or a community, and to bring about real change for the better. Our politics is the expression of our values, our beliefs, and our policy priorities. Politics is about the public good - not private interest. Widespread contempt for the practice of politics is not because Australians have lost faith in what politics really is. It is because too many Australians have come to see our parliaments, our governments, our political parties, and our politicians, as practising not politics but its opposite: a values-free competition for office and the spoils it can deliver. 2 Individuals who transgress – recent examples being Peter Slipper and Craig Thomson – are seen by many as representatives of the rest. There is no doubt that the seemingly unending parade of current and former politicians from both major parties through NSW’s ICAC has been the icing on the cake as far as that view is concerned. But these individual symptoms would not have as much impact if there were not a deeper disease in our democracy – a deficit of that trust on which democracies depend. That trust is not – or is not necessarily – trust of any particular individual involved in the political process, but trust in the political process itself. Trust that elections are conducted fairly and that they produce legitimate governments, even if they are not the government of our preference; trust that in the balance between the executive government, the parliament and the courts, each fulfils a specific and necessary role; trust that even where we disagree with policy, it is shaped and delivered by our representatives, and that those representatives make informed judgments based on sound advice. On that consensus of trust rests the operation of our government: the ability to make decisions, even where they may not be popular; the ability to pass laws, even where they constrain or disadvantage some members of the community; the ability to assign what may be scarce resources to priorities, and therefore not to other areas or interests. On that consensus of trust has been built some of humanity's most courageous efforts to transform the world in which we live. Without that trust politics is a contest of personalities, not ideas — a contest with no more relevance than an episode of Masterchef, for without trust in the political process how can any of us believe that the votes we cast influence the future direction of our country? 3 Our trust in our democratic institutions – such as parliament and our political parties—has been undermined by how they’re portrayed and perceived, but also by the very real flaws in our democracy. Spiralling costs of electioneering have created a campaigning ‘arms race’ – heightening the danger that fundraising pressures on political parties and candidates will open the door to donations that might attempt to buy access and influence. In Australia, as in other democracies around the world, the potential for large and undisclosed sums of money in election and campaign financing has become more and more a matter of concern to the public. These perceptions of possible influence need not be only concerns about potential undue influence in the narrow sense of how government decisions are made, but in a broader sense: concerns that parties and politicians dependent on large donors will be if not compliant, then at least receptive, or that large donors and fundraisers may get access that others do not. The perception of undue influence can be as damaging to democracy as undue influence itself. It undermines confidence in our processes of government, making it difficult to untangle the motivation behind policy decisions. Electors are left wondering if decisions have been made on their merits. I have argued long and hard about the need for reform of our electoral funding laws at the federal level. Unfortunately, I was not persuasive enough, particularly when I was the Special Minister of State, to convince the Senate in 2008 and 2009 that reform was desperately needed. My attempts to make our system more transparent and freer from corruption and improper influence failed. Political parties have a privileged position in our electoral system. Any Australian can run for public office, but a registered political party can be formally recognised on the ballot paper, nominate multiple candidates, and receive public funding for its election costs if its endorsed candidates receive at least 4 percent of the vote. 4 In the past four Federal elections, over $180m of public funding has been dispersed, with over 80 percent of that funding going to the two major parties. Political parties also have privileged access to the Electoral Roll, and are exempted from most of the provisions of the Privacy Act in their use of the Roll, as long as that use is for ‘electoral purposes’. I believe these privileges bestowed by legislation should entail strict conditions and obligations for those political parties which qualify for them. Party members and the public at large are entitled to know that standards exist, that these standards are open to public discussion and public assessment, and that they must be met. Principles of integrity, transparency, and accountability are crucially important to Labor’s reforming agenda, because they enable that faith in the political process which is critically important to the consensus building that makes reform possible. And those principles are equally important to Labor’s historic values of fairness and equality, because they safeguard our movement against vested interests, self-interest and unfair advantage. The stench of corruption which has come to characterise the NSW Labor Party must be eliminated. Failing to act is not an option. The Party which gave you Eddie Obeid, Ian Macdonald and Craig Thomson, and promoted Michael Williamson as its National President must now be open to scrutiny and its processes subject to the rule of law. In fact, I believe that the rules and decisions of all political parties should be justiciable, and that State and Federal Governments should consider making a party’s eligibility for public funding contingent upon it. All party tribunals must be impartial, independent and conducted fairly. The party must insist on a binding code of conduct for its candidates, parliamentarians and officials. The recent NSW Annual Conference adopted my proposed rule change to include this in the NSW Rules. All state and territory Conferences, and National Conference, should do so as well. 5 The practice of factions, affiliates or interest groups binding parliamentarians in Caucus votes or ballots must be banned. Factional binding is inherently undemocratic. It allows a group with 51% of a subfaction, which then makes up 51% of a faction, which in turn has 51% of the Caucus numbers, to force the entire Caucus to their position. This Russian doll of nested factions is profoundly undemocratic and, as we have seen in NSW, wide open to manipulation. The reforms I proposed as Special Minister of State included significant measures: to reduce the donations disclosure threshold from its current level of $12,800 to $1,000 and remove indexation; prohibit foreign and anonymous donations; limit the potential for 'donation splitting' across branches, divisions or different units of parties; require faster and more regular disclosure of donations; and introduce new offences and significantly increase penalties for the breach of electoral law. These reforms would have enhanced the transparency and accountability of political donations, and I would like to think they would have had at least some dampening effect on the behaviour that is being exposed at ICAC. It is quite clear that much more needs to be done in this area. The recent events in New South Wales should motivate all Australian political parties to work together for far-reaching and long-overdue reform of our electoral donations, funding and expenditure laws. This is a real and urgent challenge for all political leaders. Elections must be a contest of ideas, not a battle of bank-balances. And in that contest of ideas, our political parties are paramount. In our two- Party system the selection of candidates and the setting of policies within the major political parties have perhaps as great an influence on Australia’s governance as do general elections. It is therefore essential that Australia’s political parties are open, transparent and democratic – no code-words, no cabals, no secret handshakes. 6 Labor at its best would take the lead in fixing this problem. The best way for Labor to demonstrate that we are genuine in pursuing reform is to reform ourselves. Labor is dedicated to the basic principle that any community or country is stronger when all of us are involved in our democracy. That no government can find the best solutions to the challenges facing us, without drawing on the abilities of all of us – the experience, the knowledge, the skills, the judgement of the whole community, and not just a section of it.

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