Page 2434 - Week 06 - Thursday, 10 May 2012
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accounted for on the way out. It is still a flawed system. It will be a less flawed system. The Maginot line will not be quite as obvious, but there will still be a Maginot line.
It was quite simple. What did they do during the First World War? They said, “We’ll build a wall so the Germans can’t come in.” It was a really big, strong wall. And what did they do? They went into Belgium and came in around the edge. This is what will happen with this system. This is the financial Maginot line of the ACT electoral system. It has been operating in New South Wales and it has been problematic. The New South Wales system is better than this system.
In New South Wales not only do you have to bank cash money but also you have to notionally bank in a chart of accounts, which obviates the need for having a bank account, any gift in kind. When a gift in kind is valued and put on the chart of accounts at its market value, it is automatically deemed to have been expended under the expenditure cap at the same time. But the government’s amendments do not do that. We have got a system whereby people can donate gifts in kind to political parties all they like and they do not have to account for them. We have to account for them coming in, but somebody could print $10,000 worth of pamphlets and they could be distributed. We would account for the gift on the way in but we would not count it as expenditure against the expenditure cap on the way out. This is because the government has not actually caught up with modern accounting systems.
When my staff and I were first briefed on this just after Christmas, this was the first issue that was raised: had anyone talked to an accountant about this? Was there a better way of doing this? If you had asked an accountant or a set of auditors if there was a better way of doing this, would you have come up with this? They did not ask. Well, I did, because I have someone who works for me who is an accountant and an auditor and is qualified. He can tell you till you are blue in the face—and he has done it—just how flawed this system is. This system will fail. It could be solved because we already have the accounting principles. All you have to do is require that we have a chart of accounts kept to the appropriate accounting standard that registers the cash money that comes in, the gifts in kind that come in and when they are expended. That can be audited.
The Electoral Commission already audit our books. When they audit our books, they will be able to see through the chart of accounts, kept to the appropriate Australian standard, exactly what came in and what went out. There would be no Maginot line. You would have to account for it. But, as the bill is drafted, there is a huge risk. The government amendments will make it slightly better but they will not fix the system.
My proposal is to do away with the whole notion of election accounts. Then we would have a system whereby donations would be recorded in a chart of accounts. It is the sensible way to go. I know that I am not going to have any success here because the government is locked into its position. The Greens have said, “Well, it sort of works in New South Wales.” I have spent some time talking to people who have been involved with setting up the system in New South Wales and they wish they had done it differently. It has created problems. Superficially it looks simple, but in time it will not be simple. Auditors will tell you that when you have multiple accounts people will
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