Sugar Daddy Update – Cormack and Kroger sense common ground

The ‘Nominated Entity’ clause of the Bill was meant to be balanced – the Labor Party would use the Trades Hall Council and the Liberal Party would use the Cormack Foundation (a trust created by the sale of 3XY in 1987).

The ‘Nominated Entity’ was allowed to donate unlimited amounts to their Party. The ‘Nominated Entity’ had to have a constitution stating that it would only support one Party, and sign a legal form to that effect for the Victorian Electoral Commission. OK for Trades Hall, not so good for Cormack Foundation.

BUT the Cormack Foundation did not have such a goal in its constitution. This was for two main reasons and one minor.

First the Foundation was created at a time when the Hawke Labor Government was contemplating severe restrictions to donations to Federal Partys (in 1987-8). The Liberals wanted to have an ability to fund third party groups (farmers, business etc) to push policy positions without government control.

Second, the Liberal leadership group was concerned that those in control of individual campaigns might not be able to see the ‘wood for the tress’ – spend big on an unwinnable campaign, leaving the Party without future funds.

The third minor point was that each of the senior group had lived through the 1930s & 40s. They knew that the Liberal Party was not likely to be eternal, that another reformation was possible – and that tying the Foundation to a specific incarnation of the centre-right might become an issue in 20 or 30 years.

With the legal tussles over the absolute right of the Liberal Party to Cormacks $70 million treasure chest being judiciated over the last year, and with both sides ‘triumphing’ last Thursday – the problems post 25th November (if the Bill passes in its current form) – are enormous.

The Cormack Foundation has stated it will donate to local campaigns for the 2018 campaign, but Justice Beech acknowledged that the Cormack Foundation isn’t a Liberal Party entity – therefore it will not be permitted to donate more than $4,000 in the 2018-2022 period to the entire Victorian campaign.

Cormack Press Release makes clear that even until November 25th no money will be donated to the Victorian Central office, due to ongoing issues with what Cormack views as poor governance arrangements.

Post 25th November Cormack can donate to six Party’s or ‘Third Party campaigning groups’ each to a maximum of $4,000 over the four years of a Victorian electoral cycle. But the great bulk of the Foundations money will have to go to federal campaigning – where for now larger donations are permitted.

Champagne corks are popping at RG Menzies House in Canberra, with the thought that most of the $70 million of Victorian money will have to be donated to the Federal Office of the Liberal Party.

There will be a great disparity in outcome if the Bill passes in the present form. Labor will get unlimited access to the war chests of the Union movement, Liberals will be running $50 bring a plate dinners.