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Hazards of political overlap

Corruption can flourish when the lines between power broker and a political lobbyist become blurred.

Political lobbying - that is, private interests seeking to influence government - continues to grow as a profession and industry. The targets are mostly federal and state Coalition governments now, so the growth spurts within the industry are taking place among those firms that can present themselves as Liberal confidantes. Those with Labor associations are in decline.

The most dangerous and potentially corrupt - in the non-financial sense of that term - parts of the lobbying industry are those where party politics overlaps with lobbying. This aspect of the industry is where internal party advancement and sometimes factional politics become mixed up as party-aligned lobbyists seek influence over government policies. This means lobbyists not just possessing party connections but manipulating their influence within the party for self-interested ends.

This overlap generated the disreputable aspects of former West Australian Labor premier Brian Burke's lobbying business in Western Australia. It was investigated by that state's Crime and Corruption Commission and ultimately revitalised the interest in the stricter regulation of lobbying which has spread from WA around the states and to Canberra over the past seven years. Burke was not just a skilled lobbyist but a Labor Party powerbroker who used that internal party power to link his clients with the Labor government.

This link between powerbrokers and lobbying was recently highlighted by Prime Minister Tony Abbott when he ruled out Liberal Party office-holders concurrently operating as political lobbyists. In his own words he said he was ''determined to ensure you can either be a powerbroker or a lobbyist but you can't be both''.

This intervention by Abbott was a necessary step, on which he should be congratulated. NSW Premier Barry O'Farrell belatedly followed Abbott's lead.

The two individuals especially

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concerned, Michael Photios and Joe Tannous, have now resigned from their positions on the NSW state executive of the Liberal Party, choosing their lobbying businesses over their party roles. Photios owns a firm called PremierState and Tannous's firm is called 1st State Government and Corporate Relations. Photios, who has been reported as ''kick-starting the careers of many current NSW MPs'', admitted no substantive conflict of interest but reluctantly agreed with Abbott's reading of community expectations.

It all shows how brazen about their activities these party insiders had become. It is remarkable they saw no conflict of interest and that they had to be pushed out by Abbott. O'Farrell was either blind or powerless in the face of powerbrokers within his own party. Abbott, fresh from a big election victory and with his own factional party wars to prosecute in NSW, was able to exercise his power.

Lobbying merges easily into party election fund-raising and pre-selection contests in these circumstances. Within a comfortable circle of party friends the boundaries between government and party become blurred. Support in return for concessions may become the order of the day. Liberal aspirants wanting to climb the greasy pole are especially vulnerable as Labor aspirants were in Burke's days in Western Australia.

Abbott took a necessary but insufficient step. While it is more than cosmetic in its impact, it still leaves a lot undone in the world of lobbying and party politics.

Abbott acted on very narrow definitions of both powerbrokers and lobbyists. These definitions are accepted by both sides of politics. In particular, the affiliated union-Labor connection means there are many individuals within Labor who wear two hats. They are union lobbyists by virtue of their union positions and internal party powerbrokers as well.

Power can be brokered within a political party by office-bearers, but also by individuals who can influence office-bearers. They can choose to be office-bearers if they wish but have no real need to personally occupy party positions. Photios will not cease to be a NSW Liberal powerbroker merely by losing his official position. His power might be dented a little but among the office-bearers there will still be some who will dance to his tune because of factional and business connections. This sort of informal power is not easily regulated.

But the narrow definition in regulation schemes of political lobbyists as so-called third-party intermediaries only is something governments can and should address. Political lobbying narrowly defined is an enormous industry. Darren Halpin , of the Australian National University, calculated that, in late 2012, there were 240 lobbying firms and more than 550 individual lobbyists registered to lobby nationally. The companies included the rising star, Coalition-aligned Barton Deakin, whose federal director Grahame Morris, once chief of staff to John Howard, has reported a 230 per cent growth in business since the election. Morris speculates that Barton Deakin might have 70 clients by Christmas. If so, as it grows, it will pass Labor-aligned Hawker Britton, which had 107 registered clients last year, on its way down.

But third-party political lobbying, the world of Photios and Morris, is only one slice of the big political lobbying cake. The second slice is composed of corporate in-house government relations specialists. The biggest companies, such as Telstra and Qantas, lobby directly and employ hundreds of their own lobbyists. The third slice is composed of thousands of special-interest pressure groups.

Lobbying regulations don't include these other two big battalions because they reckon they are already transparent. As a consequence Abbott hasn't come to grips with these types of powerbrokers holding party office.

Before we can confidently say that on both sides of politics it is impossible to be both a power broker and a political lobbyist, the working definitions of both have to be broadened considerably.

John Warhurst is an emeritus professor of political science at the Australian National University.

john.warhurst@anu.edu.au