State Capture: Coalition assault on GetUp backfires, catches a rash of fossil fuel donors

by | Mar 31, 2021 | Government

It was a magnificent shot-in-the-foot, a political “own goal” directed at its ideological foes, and driven by a relentless campaign by Rupert Murdoch’s News Corp, but an own-goal which backfired and caught all the Coalition friendly lobby groups in a red-tape nightmare. Stephanie Tran and Elizabeth Minter report on political donations.

Egged on by The Australian, and other Murdoch media, the government pursued left-wing activist group GetUp to force it to disclose its political party links to the Australian Electoral Commission (AEC). The aim was to bust them for being Labor supporters. Ironically, the upshot was that the Coalition’s own financiers and influencers, lobby groups such as the Minerals Council of Australia and Business Council of Australia, were caught in the sting. They all donate to Labor too, although often in lesser amounts. 

Now all “political campaigners” have to disclose their donations. We list the major ones below.

For more than 10 years, the Coalition has repeatedly lobbied the Australian Electoral Commission to classify GetUp as a Labor Party affiliate. 

The Coalition tried in 2005 and then again in 2010 to persuade the AEC to classify GetUp as an “associated entity” and was in the process of doing so again in May 2017, according to Freedom of Information documents obtained by Michael West Media. 

However, the Coalition ended up circumventing that process by passing an amendment to the electoral laws which regulated foreign political donations and increased the regulation of political campaigners, called the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017.

This legislation ensnared major supporters of the Liberal Party, including the leading resources lobby group MCA and the nation’s peak big business lobby group, BCA, because their activities now fell under the banner of political campaigning. As a result, some major organisations had to come clean about just how much they were receiving from corporate donors.

The donations system is cynically abused by the major parties. Its flaws are many. And as revealed here last month, dozens of Australia’s largest companies pay exactly the same fees to be Platinum, Gold and Silver members of both parties.

State Capture: top corporations identified as members of both Liberal and Labor parties

But, in the process of declaring their party donations, the political parties faced a conundrum. While they are typically shy about declaring where their money is coming from, their campaign funding, some of the funders are not nearly so reticent. 

The Mineral Councils of Australia for example. Their donor returns are commendably detailed, declaring contributions as small as $75. On the other hand, the major political parties are more obscure, often declaring contributions as “other receipts” leaving a gaping hole in political funding disclosures. However, it has to be said that the MCA is an outlier. Most donors are not nearly so transparent. 

The assault of GetUp had unintended consequences. Not only did it ensnare the likes of the Business Council, the Minerals Council and “clean coal” lobby LET Australia, instead of addressing the lagging and shoddy disclosure regime, the move to compel “Political Campaigners” to disclose added little to the public interest. 

Political campaigners

The political campaigners category was established in 2017 when Parliament passed an amendment to the electoral legislation which both regulated foreign political donations and increased the regulation of political campaigners. 

Prior to the amendment, the Coalition had lobbied to classify GetUp as an associated entity in 2005 and again in 2010. Both attempts were unsuccessful, with the Commission concluding that GetUp was not an associated entity of the Labor Party. Indeed it was well known that GetUp often disagrees with Labor policy and supports Greens policy.

A political campaigner is defined as an entity that engages in electoral expenditure exceeding $500,000 during the financial year in which the disclosure is lodged or any of the three previous financial years. There are currently 24 entities which are required to register as political campaigners. Key organisations include the Minerals Council of Australia, the BCA and LET Australia.  

Political campaigners/associated entities in Australia play a similar role to the extraordinarily powerful Super PACs (Political Action Committees) in the US. While they raise money for and lobby political parties/candidates, the donors and the amount of donations are opaque. Huge amounts of money are raised. In the US, for example, as of “January 25, 2021, 2,276 super PACs received $3.4 billion and spent $2.1 billion during the 2019-2020 cycle. 

In Australia, political campaigners received more than $1.5 billion in the 2018-19 and 2019-20 financial years. As the political campaigner category was established in 2017, we only have data for 2018-19 and 2019-20 however, the receipts collected by associated entities of political parties have blown out massively over the past two decades. For example, in 2000-2001, associated entities received just $52.4 million. By 2010-11, the amount had blown out to $795.3 million; and $922.2 million in 2018-19. The clear question is what these associated entities do with all this money. 

 

The Minerals Council

As Michael West Media has reported, the MCA is a member of the Liberal Party, the Labor Party and as we have also just revealed, a member of the National Party. The MCA bought a $55,000 gold membership to Labor and silver memberships to each of the Liberal and the National parties during 2019-2020.

During the 2019-20 financial year, the MCA donated $145,709. Some $56,235 went to Labor, which included the $55,000 membership fee of the Federal Labor Business forum. 

The Coalition received $89,474, which included the $27,500 membership fee to the Liberal Party’s Australian Business Network and the $22,000 membership fee to the National Party’s National Policy Forum. The MCA also spent $25,675 on “dinners” with various Liberal Party branches.

Remarkably, the major parties declared all of these contributions as “other receipts”.

Since the 2015-16 financial year, the MCA has donated $469,934 to the major parties. Labor received $192,581 and the Coalition $277,353. 

While the donor returns of the Minerals Council of Australia show that these contributions were for membership fees, event attendance and dinners, the major parties simply called them “other receipts”. 

Revolving doors

The MCA has strong ties to the Coalition. John Kunkel, a former MCA deputy chief executive is now Scott Morrison’s chief of staff. Brendan Pearson, a former chief executive of the MCA, is now an advisor for international trade and investment. In May 2019, former Liberal Communications Minister Helen Coonan was appointed chair of MCA. As the newly appointed chair of the MCA, former Liberal senator Helen Coonan, said one of her key priorities would be to speed up approvals of mining projects.

Mineral Council backers

Thanks to the donations dump we can see which companies are the Top 10 contributors to the MCA. The top three contributors – mining giants BHP Group, Rio Tinto and Glencore – stumped up more than $17.6 million for the MCA, each contributing more than $3 million.

Minerals Council demands “reform” while its members pay little or no tax

Top 10 contributors to the Minerals Council

Entity Amount
BHP Group Limited $3,215,565
Rio Tinto Services Ltd $3,140,890
Glencore Australia Holdings Pty Limited $3,126,810 
Anglo American Metallurgical Coal Pty Ltd $1,868,203 
Yancoal Australia Limited $1,513,288 
Newmont Australia Pty Ltd $1,370,047 
Newcrest Mining Limited $1,227,585 
LET Australia Ltd $914,531
Whitehaven Coal Limited $762,329 
Idemitsu Australia Resources Pty Ltd $530,956 

 

Political benefits

Due to its power to stymie action on climate change, the MCA has been named one of the Top 10 climate policy wreckers in the world. 

As Renew Economy noted, BHP, Santos, Rio Tinto and Glencore were some of the Australian companies with the strongest linkages with fossil fuel industry lobby groups that are working to undermine efforts to meet the goals of the Paris Agreement, despite facing pressure from shareholders to end their involvement in the groups.

It campaigned vociferously against Julia Gillard’s 2011 Clean Energy package, which pundits had said was quite generous, with compensation for many trade-exposed industries, including steel and aluminium, with up to 94.5% of their permits granted for free. Meanwhile, the MCA claimed the resources sector would face costs of $25 billion by 2020, with about 20,000 job losses. 

As 350.Org notes, it was the incredibly successful advertising campaign against Labor’s Resource Super Profits Tax that entrenched the Minerals Council as the most powerful lobby group in Australia. With the “mining tax” expected to raise about $22.5 billion over its first four years of operation, the campaign’s $22 million cost was an incredible return on investment.

While the Turnbull government’s National Energy Guarantee didn’t get off the ground, the MCA was out there campaigning to ensure it was as weak as possible, arguing for unlimited carbon offsets and the removal of state renewable energy targets.

Last but not least is the MCA lobbying to reduce the corporate tax rate even while many of its members pay very little corporate tax. Major funders BHP, Rio Tinto and Glencore have all been the subject of tax avoidance investigations by the Australian Tax Office.

Meanwhile ads placed by the coal lobby spruiking the benefits of coal and mining were the biggest political expenditure by third-party groups in Australia last year. 

Since Rio Tinto threatened to leave the Minerals Council of Australia two years ago for its overtly pro-coal advocacy, the MCA has been careful not to undermine the role of renewable energy.

Despite shareholder pressure on BHP to leave the Minerals Council due to conflicting views on carbon pricing, BHP remains a member of the MCA.

More recently the MCA was given a $3.6 million contract with the Department of Education, Skills and Employment (DESE). The contract was for the “Mining Skills Pilot”.

The Business Council

The BCA has been named as the fourth biggest drag on action to tackle climate change, which is perhaps surprising given the BCA states publicly: “We support the need for a market-based carbon price to drive the transition and incentivise investment in low and no-emissions technology.”

The BCA’s “Plan for a Stronger Australia” demands that “existing energy sources be improved and upgraded”.  BCA chief executive officer Jennifer Westacott clarified this innocuous-sounding ask in an interview with Sky News in March, saying “we’ll make sure that the existing coal-fired power stations, which represent 60 per cent of all energy use, stay open. And that there are incentives for people to invest in those, and that we’ve got supply of coal coming into those power stations”.  

The BCA’s “Plan for a Stronger Australia” includes a demand to “scrap unnecessary subsidies” for what it calls “taxpayer-funded green schemes”. To the BCA, “green schemes” include renewable energy targets and rebates for household solar panels.

https://www.thefifthestate.com.au/business/what-the-carbon-lobby-wants-from-morrison/

Among the BCA’s 132 members include the big 4 banks, big 4 accounting firms, law firms, investment firms, property developers and large mining companies … basically almost every large corporation operating in Australia is a member.

During the 2019-20 financial year, the 132 companies contributed $12.2 million in subscription fees to the Business Council of Australia. Most of the companies paid a standard subscription fee of $93,500 ($85,000 before tax)

In the previous financial year, 2018-19, the BCA received  $12.9 million in “other receipts”

BCA lobbying

According to Influencemap.org, since 2015 the BCA appears to have continued to lobby against meaningful climate policy that aligns with the Paris agreement. While the BCA supports Australia’s 2030 emission target of 26-28%, it does not support any increase. 

In 2018, when Labor proposed raising this target to 45%, the BCA labelled the idea “economy-wrecking”. In 2019, BCA advocated in favour of using Kyoto carryover credits to reach Australia’s 26-28% target, in effect reducing the amount of emissions reductions required even further.

Last year the BCA nominally shifted position, endorsing a net-zero federal emission target by 2050, which is has supported in its submission to the Technology Investment Roadmap and in its submission to the COVID-19 Recovery budget. The group argues that this should be reached without carryover credits if possible but has not fully ruled out supporting their use in the future. In January 2021, BCA stated support for Zali Steggall’s independent Climate Change Bill, which legislates for net zero target.

BCA has, however, opposed state-level emissions reduction targets and schemes. In March 2019, BCA lobbied the WA government to reject the greenhouse gas emissions guidelines to be used in development assessments released by WA’s Environment Protection Authority, which were developed because of what the agency felt to be a lack of action and leadership from the federal government on emissions reductions. 

BCA opposed the Australian carbon tax, supporting its repeal in 2014, but has since stated support for a carbon price in its 2020 submission to the Technology Investment Roadmap, as long as it avoids a fixed pricing mechanism and begins at a price well below the original 2014 Carbon Tax.

LET Australia

Low Emission Technology Australia, formerly known as COAL21, was established in 2004 to research “clean coal technologies” and  prolong the inevitable demise of coal.

Under a 2006 agreement, mining companies in NSW and Queensland contribute 8 cents to LET Australia for every tonne of coal they export. 

Some critics have accused LET Australia of being the Minerals Council’s “advertising department”

Despite claiming that it was severing ties with the Minerals Council, LET Australia contributed $914,531 in “other receipt” to the MCA.

MCA’ s Infamous marketing campaign “Coal. It’s an amazing thing” was slammed as desperate

According to the International Energy Agency’s “Coal 2020” report released in December last year, “Global coal consumption is estimated to have fallen by 7%, or over 500 million tonnes, between 2018 in 2020. A decline of this size over a two-year period is unprecedented in IEA records, which go back as far as 1971.”  “By 2025, global coal demand is forecast to flatten out at around 7.4 billion tonnes.”

According to a report from the Climate Council, “To have just a 50:50 chance of preventing a 2°C rise in global temperature: 88% of global coal reserves, 52% of gas reserves and 35% of oil reserves are unburnable and must be left in the ground”.

Globally, demand for coal is falling. In August last year, Japan announced plans to close 100 of its 140 coal stations by 2030

Top 10 contributors to the LET Australia

Entity Amount
BM Alliance Coal Operations Pty Ltd $3,809,028
Peabody Energy $1,847,065
Anglo American Metallurgical Coal Pty Ltd $1,775,130
Hunter Valley Energy Coal Pty Ltd $1,132,788
Whitehaven Coal Mining Ltd $1,097,057
Centennial Coal Company Ltd $897,466
Hunter Valley Operations Pty Ltd $869,567
Rolleston Coal Pty Ltd $855,517
Moolarben Coal Pty Ltd $839,935
Warkworth Mining Ltd $763,519

 

Effect of lobbying on democracy (Why does this matter?)

The Senate Committee into the Political Influence of Donations noted “The NSW Independent Commission Against Corruption (ICAC) expressed the firm view that ‘using political donations to procure favourable government decision, or even favourable access to decision makers, causes serious damage to representative democracy’. ICAC reiterated its opinion from its December 2014 report into the influence of political donations on the integrity of government decision-making:

A situation in which citizens believe elections can be bought or that there is some quid pro quo for helping a candidate win must be seen as seriously damaging to the proper functioning of a democratic government. A corrupt member of parliament can be voted out of office if elections are free and fair. But if there is a loss of trust in the election process, then the whole system of representative government is weakened.” (NSW ICAC submission 28)

Investigation: how political donations protect a cosy loophole for Australia’s plutocrats

ABOUT THE AUTHOR

Stephanie Tran

Stephanie Tran

Stephanie is studying a Bachelor of Communication (Journalism)/Bachelor of Laws at the University of Technology Sydney. She has a keen interest in public interest investigative journalism and is president of the UTS Journalism Society. As cadet reporter at MWM, she has built our database of grandfathered companies and their political donations.

1 Comment

  1. Avatar

    Interesting article Stephanie.

    Just one question, do these people understand the meaning of ‘double dealing’ otherwise known as duplicity?

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