Debate is continuing in NSW over an Act that bans unions from donating to political parties.

The passage of the bill in early 2012 was accompanied by grand talk of “taking the money out of politics”. The sentiment seems appealing. However, its impact is likely to be felt much more by the labour movement than by the traditional representatives of money in the Liberal Party.

Unions are prevented from paying affiliation fees to political parties or from contributing amounts over $2,000 to election campaigns – as are community organisations and campaign groups.

The bill, pushed by the O’Farrell Liberal government, was supported by the Greens. They justified siding with O’Farrell by pointing out that corporate money as well as union funds would be blocked from flowing to the coffers of any party.

“The ultimate goal is to drive money out of politics”, Greens MP John Kaye told the media. “Not just union affiliation fees, but tobacco, alcohol, gambling cash – all of which had a profoundly corrupting influence in NSW.”

However, defenders of this law miss a vital point: wealthy individuals are unaffected by the new laws, as long as they donate as individuals.

The posh fundraising dinners aimed at the top end of town will continue, and business leaders will continue to hand over money to the politicians who serve them.

Those without personal fortunes to spend and who rely on collective organisations like unions are the ones locked out by this law.

[Unions NSW, the state’s peak union body, in November launched a High Court challenge to the laws. At the time of writing, judgment has been reserved.]