Victorian politics still exposed to ‘dark money’ and foreign donations as MPs struggle to agree on urgent reforms

“Unlimited dark money” will keep flooding into Victorian politics after Labor failed to reach agreement with the Liberals or the Greens about donation reforms the Allan government vowed to fast-track through parliament.

Victoria is now without caps on political donations or disclosure requirements, months out from the November election after the high court struck down the state’s donation laws last month.

Under the previous laws, individuals and organisations could donate a maximum of $4,970 to a candidate, though there was an exemption for money transferred to registered political parties via their “nominated entities”.

While the high court challenge centred on that exemption, it ultimately found the entire section of the electoral act governing political donations was unconstitutional.

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The ruling has left the Victorian Electoral Commission unable to distribute the latest round of public funding and opened the door to large donations, including from foreign sources.

The day of the ruling, the premier, Jacinta Allan, said the government would “immediately move to restore Victoria’s electoral integrity regime”, warning the state had been left “exposed to dark money in politics.”

She said the reforms would also be fast-tracked through parliament and backdated to the date of the decision.

Since then, Labor, the Liberals and the Greens have been in negotiations and broadly agree on the need to reintroduce a cap on donations, disclosure requirements and public funding arrangements.

But they remain divided on key details, including where the donation cap should be set, how to treat the nominated entities and whether the laws should be retrospective. It means the bill won’t be introduced to parliament before June.

The Greens leader, Ellen Sandell, said the party wanted to “reinstate strict caps or bans on political donations, and close any loopholes that allow Labor and the Liberals to rig the rules for themselves”.

“Right now, because of Labor’s stuff-up, we have a situation where unlimited dark money from overseas, billionaires and corporations can flow to political parties to influence our state election,” Sandell said. “We need to get big money out of politics and level the playing field.”