Political Donations and Gifts
Amendments to NSW legislation requiring developers to disclose political donations or gifts of more than $1,000.00 when lodging a development application came into effect on 1 October 2008.The Local Government & Planning Legislation Amendment (Political Donations) Act 2008 (“Political Donations Act”) amends the Environmental Planning and Assessment Act 1979 and the Local Government Act 1993.
The Political Donations Act aims to “deliver increased confidence in the transparency of the development process in NSW” according to the NSW Minister for Planning, Kristina Keneally. The Political Donations Act requires any person who has a “financial interest” in a “relevant planning application” made to the Director General, the Minister or a Council to disclose all “reportable political donations” or gifts made within a 2 year period prior to the lodgement of the planning application at the time of lodging the planning application.
Reportable Political Donations and Gifts
In accordance with the Election Funding and Disclosures Act 1981 a “reportable political donation” is a donation of $1000.00 or more made to or for the benefit of a political party, elected member, group or candidate or made by a major political donor to a group or candidate, or made to a major political donor. A gift includes a disposition of property or a gift of money or other valuable service for inadequate or no consideration at all.
Relevant Planning Applications
- a “relevant planning application” is made under the Political Donations Act where:a formal request is made to the Minister or the Director-General for development on a particular site to be made State significant development or declared a project to which Part 3A applies; or
- an application for approval of (or modification of) a concept plan or project under Part 3A; or
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an application for development consent under Part 4 (or for the modification of a development consent); or
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any other application or request under or for the purposes of the Political Donations Act that is prescribed by the regulations as a relevant planning application. (no other applications or requests are prescribed at this stage).
Financial Interest
A person has a “financial interest” in a “relevant planning application” where:
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the person is the applicant or the person on whose behalf the application is made;
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the person is an owner or the owner of the site to which the application relates or have entered into an agreement to acquire the site or any part of it; or
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the person is “associated with” a person referred to above and is likely to obtain a financial gain if development that would be authorised by the application is authorised or carried out. Persons will be “associated with” each other if they carry on a business together in connection with the planning application or they carry on a business together that may be affected by the granting of the application. They will also be associated with each other if they are related bodies corporate.
Disclosure Requirements
Disclosure must be made in a statement or declaration accompanying the planning application. Where the gift or donation is made after the lodgement of the planning application, disclosure must be made within 7 days the donation or gift is made, until such time as the application is determined by the relevant consent authority. Curiously, if the planning application is made to a Council, the applicant or associated person need only disclose political donations made to any Councillors or Council employees – not to state government politicians.
Disclosure Publication
Pursuant to the Act, disclosures are to be made available to the public on, or in accordance with arrangements notified on:
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a website maintained by the Department (in the case of planning applications or submissions made to the Minister or Director-General), or
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a website maintained by the council (in the case of planning applications or submissions made to that council.
The disclosures are to be made available to the public within 14 days after the disclosures are made.
Consequences of non-compliance
Failure to comply with the disclosure obligations outlined above will constitute an offence pursuant to section 125 of the Environmental Planning and Assessment Act where the person “knows, or ought reasonably to know [that the donation] was made and is required to be disclosed”, rendering the person liable for a fine of up to $22,000.00 or 12 months imprisonment (200 penalty units)..
Practical Implications of Political Donations Act
Whilst the Political Donations Act does not prohibit the making of political donations or gifts, it is important for political donors to ensure that proper disclosure is made where required. It is arguable that the definition of “financial interest” is sufficiently wide enough to require disclosure by any individual relevantly associated with, for example, the owner of the relevant site. For example, this could require planning consultants and architects working on the project to declare any relevant political donations or gifts.
It is also important to note that the use of the phrase “ought reasonably to know” in section 125 of the Environmental Planning and Assessment Act increases the disclosure obligation imposed upon applicants by effectively creating an obligation to make reasonable enquiries of their “associates” as to whether reportable political donations or gifts have been made.
Leases
Given that the Political Donations Act requires applicants to make reasonable enquiries of their “associates” when reporting political donations or gifts, it is arguable that a tenant may be an “associate” of a landlord applicant where the planning application in question would benefit, or has the potential to benefit or impact upon the business carried on between the landlord and the tenant. Landlords considering developing or re-developing premises or land may, for this reason, wish to consider imposing disclosure requirements upon tenants when granting new leases. We note, however, that there has not been any judicial consideration of the disclosure requirements to date.
