Electoral laws reinstate donation caps

The Electoral Further Amendment Bill 2026 passed parliament this week following debate, with the government arguing it is an urgent measure to plug what it described as a “dangerous” gap in the law, while the opposition expressed concerns the government was using the situation to entrench its own advantage. 

The legislation re‑establishes caps on political donations, reinstates disclosure requirements and public funding, and introduces a ban on foreign contributions. It also enforces rules retrospectively, requiring political parties to repay any donations received above the cap since the High Court invalidated the previous scheme in April. 

In his second reading speech in the Legislative Assembly the Leader of the House, Anthony Carbines said the intervention was needed after the High Court struck down the state’s existing donation laws in full, creating a risk of undue influence on politics.  

‘Victoria’s political finance environment remains entirely unregulated, leaving this state without laws to govern how political money is raised and disclosed,’ he said.  

‘This regulatory vacuum jeopardises the core principles of our democracy by opening the door to hidden influences and leaving our system vulnerable to unchecked political spending.'

He told the Legislative Assembly the absence of regulation threatened public confidence in elections by allowing hidden influence and unrestrained political spending.  

The bill introduces a $7,500 cap on donations, alongside bans on foreign donations and stricter disclosure rules. Public funding tied to electoral performance has also been restored, with enforcement powers and penalties aimed at ensuring compliance. 

New parties and independent candidates will have a higher cap of $15,000, to help level the playing field with incumbents.

“ ‘This regulatory vacuum jeopardises the core principles of our democracy by opening the door to hidden influences and leaving our system vulnerable to unchecked political spending.' ”

Anthony Carbines, Leader of the House

Member for Brighton, James Newbury criticised the haste in passing the legislation. 
 
'The government will say to you that there are no constitutional problems. What I would say, respectfully, is they got it wrong last time. All you can do is look at what occurred when they tried to pass bills through on the electoral donations system in 2018. The High Court struck them down,’ he said.

Member for Point Cook Mathew Hilakari said constitutional validity was not raised in the debate when laws governing electoral donations were put through put through Parliament in 2018. 

‘We were all quite shocked by the decision of the High Court, including the Liberal–National parties who supported these bills in previous governments, so we need to turn back to this chamber and respond to those decisions of the High Court,’ he said.

“ 'Foreign donations must be absolutely and utterly banned in terms of political donations in this state.’ ”

Brad Rowswell, Member for Sandringham

Brad Rowswell, Member for Sandringham said the legislation would effectively channel taxpayer money into political parties while doing little to address existing concerns about donations. 

He criticised the rushed timeframe for passing the legislation, but agreed with some of its principles.

‘Of course there should be transparency around all of this, of course there must. Foreign donations must be absolutely and utterly banned in terms of political donations in this state,’ he said. 

“ ‘Fundamentally, the Greens believe that money should not decide the outcome of elections; voters should.' ”

Ellen Sandell, Member for Melbourne

Member for Melbourne Ellen Sandell said the new laws were a necessary temporary fix to a political funding crisis in Victoria caused by flawed 2018 laws, which allowed major parties to funnel money through “nominated entities” later found to be unconstitutional. 

She backed the reinstatement of donation caps and transparency rules as essential but also called for a full rewrite of electoral laws, including campaign spending caps, fairer rules for new candidates, stronger transparency and integrity measures and limits on donations from harmful industries.

‘Fundamentally, the Greens believe that money should not decide the outcome of elections; voters should,’ she said. 

The full lower house debate is published in Hansard where the Legislative Council debate on the same bill is also available to read.

A statutory review will be held after the election.