Cap on political donations by property developers upheld by High Court

In a case brought by former Newcastle Lord Mayor, Mr Jeff McCloy, the High Court has found that the restrictions imposed on both individuals and ‘prohibited donors’ in the Election Funding, Expenditure and Disclosures Act are legitimate. This is because they prevent both the perception and risk of corruption and undue influence in New South Wales politics.

Mr McCloy brought the case to the High Court in an attempt to challenge the provisions of the Election Funding, Expenditure and Disclosures Act which prohibit property developers from making donations to political parties, elected members of NSW Parliament and local councils, impose caps on political donations made by individuals, and restrict indirect campaign contributions.

Mr McCloy argued that prohibiting certain individuals and placing limits on the amount permissibly donated conflicts with the implied freedom of communication found in the Constitution. The High Court did not accept this argument, holding that whilst the limits and prohibitions may indirectly burden political communication, this burden is necessary in order to enhance our system of representative government.


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