High Court Strikes Down NSW Government's Election Funding Laws

The High Court of Australia

The High Court of Australia has overturned NSW Government laws banning unions from funding election campaigns.

In a unanimous decision by the six-member bench, released today, the High Court ruled the laws — challenged by Unions NSW — contravene “the implied freedom of communication on governmental and political matters” in the Commonwealth Constitution and were invalid.

The laws passed in February 2012 limited donations given to political parties to individuals enrolled to vote.

They also capped the amount, and banned unions, corporations and others such as not-for-profit lobby groups from donating.

The NSW Government argued that the laws were anti-corruption measures.

The High Court ruled that the state laws have federal implications on free speech grounds, placing an “impermissible burden” on them and in doing so, concluded it was unnecessary to answer a series questions put about the validity of the laws to freedom of association and the NSW Constitution.

“The reality is that there is significant interaction between the different levels of government in Australia and this is reflected in communication between the people about them,” the Judgement said.

“The complex interrelationship between levels of government, issues common to State and federal government and the levels at which political parties operate necessitate that a wide view be taken of the operation of the freedom of political communication.”

The decision has implications for other Coalition-controlled states, who backed Barry O’Farrell’s Liberal government in its defence.

It allows unions to once again donate to the Labor Party. NSW goes to the polls again in March 2015.

In a surprise alignment, the Conservative think tank the Institute of Public Affairs welcomed the decision.

“The Institute of Public Affairs may disagree with trade unions and environmental groups on many issues, but we are in complete agreement with them on the importance of freedom of speech,” said Chris Berg, the IPA’s policy director.

“Campaign finance restrictions are both a restriction on free speech and suppress democratic political participation.”

The NSW Government was ordered to pay costs.

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