Victoria left without limits on political donations after high court rules laws unconstitutional

Lowe said that if the government had scrapped the nominated entity exception as they had requested in a letter sent in 2024, the case would never have made it to the high court.

“They clung to it for two years because they wanted to protect their own incumbency and we’ve deeply challenged that,” she said.

“Yes, there’s work that needs to be done but the state government probably should have done that work in the first place.”

Both the opposition and the Greens raised concerns the ruling effectively removes all safeguards ahead of the election.

The shadow attorney general, James Newbury, said: “This is a very big problem for the integrity of our electoral system. We now have effectively no donation system, no caps and no limits on foreign donations.”

“Clearly that would be a concern to Victorians and we in good faith would work with the government right now on helping to make sure that’s fixed.”

The Greens leader, Ellen Sandell, also urged the government to take immediate action to cap donations to prevent a US-style system “where billionaires and big corporations can buy politicians and elections”.

“If Labor doesn’t take immediate action to cap donations to political parties, they’re giving big corporate interests and billionaires free rein to influence this year’s state election,” she said.

A Victorian government spokesperson described the decision as disappointing.

“This is a win for billionaires and a loss for transparency,” they said. “We are considering our options.”

It’s understood the government is preparing to introduce new legislation to parliament but this will not occur prior to a by-election in Nepean on 2 May, leaving the final weeks of the campaign a funding free-for-all.

The federal government is facing a challenge to its campaign finance laws on similar grounds by former independent MPs Zoe Daniel and Rex Patrick.

The Centre for Public Integrity executive director, Catherine Williams, said the Victorian decision sent a clear warning to governments across Australia.

“Today’s judgment makes it clear: governments cannot rig electoral laws in favour of major parties and expect to get away with it,” she said, adding that Victoria must now pursue “genuine reform – not cosmetic change”.

This was echoed by Bill Browne from the Australia Institute, who said the decision gave the state government a “chance to go back to the drawing board” to design a fairer system.

He said it also put the federal and South Australian governments “on notice”.

“If these laws are not amended to make them fairer, they risk being struck down as well,” Browne said.