Labor’s plans to reform Victoria’s political donations system are on the brink of collapse after the Coalition controversially pulled support for the legislation at the 11th hour.
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The government is now scrambling to cobble together support for its plan, which it says would take corporate money out of politics.
Labor will now be forced to turn to upper house crossbench MPs for the required votes in a last-ditch effort to secure the passage of the legislation.
Under the changes, donations to political parties would be capped at $4000 per person or entity over a four-year term but about $45 million in taxpayer funds would go towards political campaigns.
The major parties were set to reap tens of millions of dollars in taxpayer money in each electoral cycle in return for relinquishing much of their fundraising activities.
Candidates would need to achieve a minimum of 4 per cent of votes to receive $6 for each lower house vote and $3 for every upper house vote. What's more, MPs were to receive $40,000 a year for administrative costs under the proposed shake-up.
But on Tuesday morning the Liberals and Nationals shattered confidence in government ranks that the long-awaited bill would have the required support to pass through Parliament before the winter recess.
The Coalition argued the government’s proposed reforms would allow Labor to retain its funding through unions’ affiliation fees while starving other parties of other income streams.
On the same day the Coalition also revealed it would oppose a bill to set up an independent tribunal for MPs' salaries that would also deliver them a pay rise.
Opposition Leader Matthew Guy accused Labor of trying to “game the system” with its donations bill.
He said the Coalition had allowed the bill to proceed to the upper house so discussions could continue but Labor had ruled out changes on base funding and the union movement.
“If Victorians want to see what a Labor Greens government is like, here it is,” he said. “They’re prepared to pay $45 million to themselves and other political parties.”
Mr Guy said the changes would tip the balance in Labor’s favour by up to $6 million.
However, Special Minister of State Gavin Jennings said the Liberal Party was walking away from months of productive negotiations.
Unions would be subject to the same restrictions as other entities for their donations to the Labor Party, Mr Jennings argued.
“We created a level playing field. The unions’ desire to donate to the Labor Party is stripped away through this legislation,” he said.
With less than six sitting weeks to go before the November election, Labor is now racing against the clock to secure crossbench votes for the legislation in the upper house.
The donations bill is now opposed by at least 19 members of the upper house with the position of the Shooters, Fishers and Farmers Party set to prove vital.
The government, which holds 14 seats in the upper house, needs another seven votes to pass legislation.
The Greens, who have five upper house seats, will support the donation reform bill. However, the government must gain two votes from the remaining five crossbenchers.
Shooters, Fishers and Farmers MP Jeff Bourman said that he and his colleague Daniel Young were yet to decide on how they would vote.
But Vote 1 Local Jobs MP James Purcell said he was strongly opposed to the bill.
“It’s one of the greediest pieces of legislation I’ve seen in my time here,” he said.
Australian Conservatives MP Rachel Carling-Jenkins also remained steadfast in her opposition.
