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Prime Minister Tony Abbott has defended his Treasurer's fund-raising techniques, arguing that raising money through granting access to senior party members is preferable to taxpayers footing the bill for party funding.
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Labor MP Andrew Leigh says it's an idea "worth exploring", while government MP Andrew Laming calls for "forensic tracking" of all donations.
His comments come after Fairfax Media reported that Joe Hockey is offering privileged access to a select group of business people and industry lobbyists in return for tens of thousands of dollars in donations to the Liberal Party via a secretive fund-raising body.
This comes as the Independent Commission Against Corruption probes Liberal fund-raising bodies such as the Millenium Fund and questioning their influence on political favours in NSW.
The donors are members of the North Sydney Forum, a campaign fundraising body run by Mr Hockey's North Sydney Federal Electoral Conference (FEC). In return for annual fees of up to $22,000, members are rewarded with "VIP" meetings with Mr Hockey, often in private boardrooms.
The North Sydney FEC officials who run the forum – which is an incorporated entity of the Liberal Party – say its membership lists and therefore the identities of its donors are "confidential". Mr Hockey also says details of who he is meeting and what is discussed are confidential.
On Monday, Mr Abbott was asked if he was comfortable with Mr Hockey's fund-raising activities during an interview with Channel Nine.
Mr Abbott responded by saying that he had not read the Fairfax Media report but that "all political parties have to raise money".
"Typically, you raise money by having events where senior members of the party go and obviously they meet people at these events," he said.
"The alternative to fund-raising in this time-honoured way, is taxpayer funding."
Mr Abbott said that in the context of a "very tough" budget, the idea that taxpayers should fund political parties was "very, very odd".
When asked if there should be a federal ICAC, Mr Abbott said that he thought that Canberra had a "pretty clean polity".
"The thing is that we’re going to keep the lobbyists out [of politics]. And the problem that ICAC is exposing is a problem of lobbying, essentially its influence peddling . . . and we’re going to make sure that that has no place whatsoever federally."
In a statement released on Monday morning, Mr Hockey described the accusations made in the Fairfax Media story as "both offensive and repugnant".
"The Treasurer will not let this distract him from the important task of putting the budget together," he said.
"As the matter is now in the hands of lawyers no further comment can be made."
Parliamentary Secretary to the Prime Minister Josh Frydenberg also jumped to Mr Hockey's defence.
"Joe Hockey, in having this forum, is doing nothing unusual or untoward," he told Sky News.
"Many MPs on both sides of the House, had similar arrangements, because we don't have a fully tax-payer funded political system."
There was less support from former Liberal prime minister - and former Liberal Party member - Malcolm Fraser.
Mr Fraser tweeted "using ministerial office for fund raising corrupt".
In another tweet, he said, "used not to happen".
The Greens used the news of Mr Hockey's fundraising to again call for a national ICAC.
Senator Milne said that the Greens had introduced the idea several times to parliament, but it had not secured the backing of Labor or the Coalition.
"And the question I put to them is: why? Why if you've got nothing to hide, would you not want a national integrity commission?" Senator Milne said on Monday.
Shadow assistant treasurer Andrew Leigh said that while Mr Hockey's fundraising was "within the rules", he did not think it was appropriate that people could make such large donations that were not disclosed.
"I think ultimately cash of that scale does cause challenges for the effective operation of our democracy," he told Sky News.
ACTU president Ged Kearney labelled the Fairfax Media report “extraordinary”.
“What we’re hearing is that people are buying policies that really only benefit the people who can actually pay the Treasurer for such a privilege [to do so],” she told reporters in Melbourne.
Ms Kearney said that she hoped the Mr Hockey would stand up “very soon and explain himself”.
But ACTU secretary Dave Oliver said on Monday that Mr Abbott should extend the terms of reference for his royal commission into the unions to include an investigation of Liberal Party slush funds.
Mr Oliver said he would write to the Prime Minister asking him to broaden the Heydon royal commission’s terms of reference, which includes an investigation into union slush funds.
When the commission was announced Mr Abbott said it would shine ‘‘a great big spotlight’’ into the ‘‘dark corners of our national life’’.
Mr Oliver has now used revelations about secret Liberal Party donations aired at the NSW Independent Commission Against Corruption (ICAC) to demand ‘‘this murky underworld of non-disclosed fundraising’’ also be put under the microscope.
‘‘If he’s serious about shining a light on this, he can easily extend the terms of reference into the royal commission to start looking into this area that we’re reading about in the newspapers now on a daily basis,’’ Mr Oliver told ABC radio.
The ICAC has exposed a web of slush funds involving NSW Liberal party MPs and staffers and its inquiry last week lead to the resignation of NSW police minister Mike Gallacher.
Former energy minister Chris Hartcher and fellow Liberal MPs Chris Spence, Darren Webber and Marie Ficarra have all withdrawn from the Liberal party as a result of the ICAC investigation.
Two weeks ago, Barry O’Farrell quit as premier over an undeclared gift of a $3000 bottle of wine.