There were 47 words in last Friday’s interview between Ryan MHR Michael Johnson and ABC Radio’s Steve Austin that have the potential to do the Howard Government much more damage than the Trish Draper affair.
They could mean that the Liberal Party organization will be forced to look at disciplining Mr Johnson. That the Australian Electoral Commission now have prima facie evidence that Mr Johnson has acted to subvert the public disclosure laws to complement their current inquiry into his affairs. He may also be forced to change his statement of pecuniary interest. And it is possible that he may be in a position where it appears that funds for his re-election have not been accounted for properly in what could be, at least technically, a breach of a constructive trust.
What were those 47 words? They are at the end of this paragraph and I have italicized them.
“Well, you know, all these people know who I am. They’re in the position where they can decline it. People like Ricky Ponting’s manager, it was made very, very plain to him that he was coming to a community forum and we had to recover the costs of that forum. We asked for it to be, for the appearance fee to be reduced, unfortunately they declined that, so we had to recover the funds and we were able to do that through companies very generously sponsoring it. Companies don’t make political donations or certain companies don’t feel comfortable making political donations and so certain companies made those directly to the schools, directly to the venue, directly to the caterers, and certain companies made it payable to me because I had to pay Ricky Ponting.“
Up until this point Johnson had spent the interview denying that his Ryan Community Forum had been a political fundraiser. The first half of this paragraph continues that line until the last sentence. Then Johnson coughs. Money was apparently paid directly to the venue, to the caterers and to him because certain companies are not “comfortable” making “political donations”.
So Johnson admits that he used Ricky Ponting to front a political fundraiser, despite having denied it now for weeks. Problem number one for the Prime Minister. This also means that he took money from schools in his area for a political function. While he denies in this interview that the schools paid anything, www.crikey.com.au has a copy of an email asking for money from a state school on their website. I understand this email to be genuine.
And why are companies not “comfortable”? Is it because they don’t want to support one side of politics or another? That can’t be it. They could avoid feeling uncomfortable by not donating at all. The only answer that makes any sense is that they are uncomfortable if others know they have donated.
That is why the AEC should be interested. The electoral act doesn’t allow you to pay third parties without disclosing the payment, unless it is less than $1,500, in which case it doesn’t have to be disclosed, but then, why would a company pay Johnson directly in that case. Of course, Johnson has time to fix this transgression, because the Ryan Community Forum falls into this financial year so isn’t due to be declared until August or September 2004. However, earlier in the interview he admitted that money was paid directly to caterers for earlier functions which do fall into the period which should have been disclosed by now.
The AEC now has a duty to look at all Johnson’s functions, whether they purport to be fundraisers or not.
But it gets worse. Johnson also admits that money was paid directly to him. This is where the Liberal Party needs to take some action. The Liberal Party’s fundraising code, which candidates agree to abide by, forbids a candidate from taking a donation from anyone. This is so that there can be no suggestion that a candidate has been bribed.
This is where it gets really tricky for Johnson. It would most likely be argued that any money paid to Johnson was paid to him on trust for the campaign, but he would need to make sure that he paid the money across very promptly either to the campaign or one of the suppliers, and that his accounting was completely accurate. Any delay or shortfall would lead to suggestions that the money was never going across.
The AEC investigation is partly because of allegations that he effectively defrauded his campaign fund by withdrawing money from it without proper authorization which he had made as a donation. Johnson is on the record in parliament as saying that this was not a donation but a loan, while at other times declaring that it was a donation. There is also the matter of his mother presenting a catering bill for lunches for volunteers in the office and on election day of $4,800 when a normal campaign budget would be around $500 for the same item.
Lastly Johnson could have problems with his register of pecuniary interests. This register is another check against members being bribed. If companies have made payments to him and they have not been disclosed as electoral donations, they are still a benefit that he has received, and they ought to be on the public record.
Ryan is a seat that the ALP recently held and is not the blue ribbon Liberal seat it once was. It is one that the ALP would hold on state election figures. With Trish Draper registering a swing against her in her South Australian seat of Makin of 14% – 5% of it since revelations about her travel – the Liberal Party might want to peek under the lid of Ryan. Michael Johnson would appear to be prepared to commit offences against the electoral act, even if he comes out clean on some of the other matters. That ought to be enough for the Labor Party to have a really good go at winning Ryan back again this election.