25 June 2016
by Karen Middleton

Parties find campaign donors harder to come by

People are paranoid about their company name being on the front page of the paper

At Labor Party headquarters, the strategy used to be called “the blizzard of shit”.

The blizzard would hit late in the campaign and involved raining down television advertising on voters to deliver or reinforce a negative message.

As campaign 2016 enters its final week, the blizzard has struck. The big parties are reaching into their pockets for a negative advertising blitz up until the electronic media ad blackout hits late in the week.

But sources in the business sector and the Coalition have told The Saturday Paper that corporate donations to the Liberal Party are down and that donors’ reluctance to contribute is making money a potential problem just as the blizzard strikes.

“Does it mean that every time you tender for government business, that it’s perceived badly?”

Some in the Liberal Party fear they will not have the money to keep up the constant advertising coverage right through the crucial last week.

Former Liberal leader John Hewson suffered that problem during the 1993 election campaign, when Paul Keating’s Labor team ran scare messages on health late in the campaign.

“I lost an election with a massive scare campaign – not about the GST so much as health – in 13 key marginal seats in the last week or 10 days,” Hewson told Sky News this week. “Our party had no money for rebuttal ads, so it bit pretty hard.”

With just a week to go, the Liberal Party is still hoping to persuade uncertain corporate Australia to dig deep.

“The companies are really, really concerned about the impact of donating publicly – the impact on their businesses of donating to a political party of either ilk,” one corporate figure said. “People are paranoid about their company name being on the front page of the paper.”

Sources said the factors affecting corporate Australia’s willingness to donate included the fear of attracting bad publicity in the wake of the developer donations scandal involving the Free Enterprise Foundation, linked to the New South Wales Liberal Party.

Some worried that if their company names appeared on lists of political donors, it could have implications for future contracts.

“Does it mean that every time you tender for government business, that it’s perceived badly?” one asked.

Some companies also feared being targeted by union bans.

In response to individual companies’ concerns, the Liberals are urging peak industry and business bodies to kick in to spread the risk.

Master Builders Australia has stepped up, funding an advertising campaign on industrial relations. But traditionally the peak business and industry groups have been reluctant to make significant donations.

One Coalition source said some in business appeared to believe that because Malcolm Turnbull himself was wealthy, there was less need for other private donations.

Turnbull suffered that problem as head of the Australian Republican Movement. As George Williams and David Hume write in their book People Power: The History and Future of the Referendum in Australia, Turnbull ended up contributing almost $3 million of his own money to the ARM’s 1999 referendum campaign, “and was responsible for 80 per cent of its budget”.

Another source told The Saturday Paper that some individual business people who might have been expected to donate to the Liberal Party have held back out of unhappiness about the impact of the Coalition’s superannuation policy capping the amount able to be stored tax-free in super accounts.

In the absence of the cash to fund blanket broadcast advertising, Turnbull turned up his own volume at news conferences late this week.

Calling Labor’s allegation that the Coalition would privatise Medicare “a dishonest act of desperation”, Turnbull has begun focusing his attack on both Labor and Opposition Leader Bill Shorten personally, seeking to link the leader to aggressive union behaviour.

“If he became prime minister he would run Australia at the direction of militant trade unions,” Turnbull said on Thursday.

“They are totally wholly owned subsidiaries of militant unions.”

As week seven of the election campaign began, Turnbull succeeded in combating the saturation news coverage of Labor’s scare campaign over a privatised Medicare, swinging attention onto the issue of border protection. Turnbull is accusing Labor of planning to ease policies on offshore processing – something Labor denies.

“I’ve seen this film before,” Turnbull said. “And so have you. We’ve seen it before. Kevin Rudd did the same thing.”

Having long refused to provide details of turning back asylum boats, the government has temporarily lifted its information ban mid-campaign, long enough to reveal that a boat carrying people believed to be from Vietnam had been turned back – the 28th, Turnbull says, since the Coalition took office.

“He cannot be trusted on the border,” Turnbull said of Shorten.

Former speaker Bronwyn Bishop has endorsed the strategy of wrenching back the debate.

“We need to get back onto our territory – back onto the issue of boat people,” Bishop said. “We need again to be talking about jobs and growth, I think, even though people are sick of hearing the term. It needs to be prosecuted to cut through.”

But John Hewson said he’s not convinced scare campaigns are as effective as they used to be.

Campaign strategist Tony Mitchelmore, who has previously worked on Labor Party campaigns and now heads up Visibility, a qualitative research company, agrees.

“They just become less and less effective because of the general media-savvy of people, the general politics-savvy of people,” Mitchelmore says. Rather than commenting on the content of a message, he says members of focus groups will increasingly “tell me the strategy”, dissecting why a political party is saying this or that.

“And generally, they’re right,” he says.

Mitchelmore says negative advertising works best when it reinforces a sentiment already resonating in the community.

“If there’s a growing sentiment, it helps to continue to propel it – helps support a perception,” he says.

But a campaign advertising blitz is still a powerful tool. What also works well, he says, is direct-phoning voters in marginal seats – something the union movement has organised on behalf of the Labor Party.

While the Coalition is still favoured to win the election, strategists on both sides suggest it is an open race, with issues including the NSW state government’s forced merger of local councils angering voters in Sydney’s marginal seats. There are mixed results shaping up in seats across Australia.

“There are a lot of seats in play,” one strategist says.

Independent market analytics company Ebiquity is examining broadcast advertising spending throughout the 2016 campaign.

Ebiquity chief executive Richard Basil-Jones says voters should expect to be bombarded by broadcast advertisements in the final week.

“Based on the 2013 activity, we believe the two major parties have spent about a third of what they are likely to spend,” Basil-Jones told The Saturday Paper. “That is, the last two weeks will see a doubling of their activity monitored in the first six weeks. In 2013, 75 per cent of the spend was allocated to the last two weeks.”

Basil-Jones said Ebiquity is providing data to a media agency contracted to one of the two major parties, but declined to say which. He noted some differences between the previous election and this one, including that the previous time it was a standard five-week campaign rather than the eight-week marathon of 2016.

“Palmer United Party [also] played a big part in that,” he said, “spending some serious money in that time.”

The Liberal Party’s advertisements had been mostly positive in sentiment, while Labor’s ads had been mostly negative.

Despite the Liberals’ concerns about money, they were outspending Labor on broadcast advertising in the major capital-city markets as the campaign entered its last two weeks.

According to Ebiquity, as of June 20, the Liberal Party had spent $1.8 million on broadcast advertising across mainland capital-city markets; Labor had spent $1.3 million; the Greens had spent $117,000; and the Nick Xenophon Team had spent $22,000.

The government’s “Back the plan” advertisement was on heaviest rotation, with the Liberals having spent $1.4 million on that ad alone.

The major parties, the Greens and the Nick Xenophon Team all stepped up their broadcast advertising just before pre-poll voting opened on June 14.

Among the Labor and Liberal parties, the emphasis has swung heavily from positive to negative.

Sydney is bearing the brunt of it, representing 33 per cent of the broadcast audience but receiving an average of 43 per cent of the overall advertising.

Mitchelmore said that, even allowing for multiples of that expenditure in the final week, it’s still not much to spend on federal election advertising.

He believes the increasing importance of social media may have kept spending down because social media advertising is cheap and effective.

But he also said it would not surprise him if there was less money available through fundraising as corporates become more reluctant to donate.

On that score, the Liberal Party has become caught up in an in-house fundraising controversy after Greater Western Sydney Commission chairwoman Lucy Turnbull, wife of the prime minister, discovered the party was spruiking her professional status as a drawcard for a recent $3000-a-head fundraiser when she believed she was there accompanying her husband.

The party has apologised and donated the proceeds to charity.

Bill Shorten launched a salvo at the Liberal Party.

“I’ve got a great deal of respect for Lucy Turnbull and I wish the Liberal Party had not embroiled her in their fundraising,” Shorten said.

“The Liberal Party time and time again seem to sail pretty close to the wind when it comes to fundraising. I don’t know what it is about Liberals and money but it seems to get them into quite a bit of trouble. I think the Liberal Party would be well advised to back our sensible reforms to campaign finance.

“Why on earth does the Liberal Party fight tooth and nail to hide the identity of donors when we say if you’re willing to give $1000 you should put your name to it?”

Former federal Liberal Party treasurer Michael Yabsley has called for an overhaul of federal electoral funding in the wake of events in NSW related to the Free Enterprise Foundation.

“I believe this is now crunch time,” he told the ABC’s Four Corners last month. “You have the damage that has been done to the reputations of many, many individuals, to the reputations of many companies and the reputations of the major political parties.

“It all points to the absolute case to do away with the system of political fundraising that we currently have.”

As donations dry up, and spending is down, the system is making up its own mind anyway.