The Upper House is also known as the Legislative Council.

The purpose of an electoral system is to translate the will of the electorate, as expressed through the ballot box, into members of a legislative body. The ways this can be achieved are many and varied.

An electoral system should:

• result in a legislature that reflects the electorate's wishes.
• result in a government that reflects the majority opinion of the electorate.
• allow for stable government.
• be easily understood by the electorate.
• ensure a quick result.
• allow effective constituent representation.
• allow voters a choice of candidates.

A significant feature of the electoral systems used in Australia is the use of one system for the lower house of the Parliament and the use of an alternative system for the upper house.

The basic concept of proportional representation systems is to allocate seats in the legislature in a proportional relationship with the votes cast at the election. To achieve this requirement in New South Wales, a quota system is used. The simplest method of a quota is to divide the number of valid votes by the number of seats allocated.

The principal advantage of proportional representation is to provide representation to those parties in proportion to their electoral support.

The arguments against proportional representation are based on the consequences of the system in providing representation to smaller parties. The proliferation of minor parties in legislatures as a result of proportional representation systems can result in unstable government, and in minorparties being in a balance of power situation. The election of a number of parties with no one party having a majority in the legislature may result in unstable government and uncertainty as parties trade with each other to form coalitions and alliances. The behind-the-scenes manoeuvring and bargaining can lead to situations where the resultant government follows policies that bear only a slight resemblance to the policies placed before the electorate by the parties concerned. A minor party may be able to take advantage of this situation and hold major parties to ransom by imposing its wishes on the other parties in recompense for its support. In this political environment governments are more susceptible to the whims of party officials rather than the wishes of the electorate.

4. How does the quota system work in the Upper House or Legislative Council?

Elections for the Legislative Council take place every 4 years, at which time half (21) of the 42 Members retire or stand for re-election. The whole of NSW acts as a single electorate electing 21 Members on a proportional basis. To be elected a party or candidate must get a certain proportion of the total NSW vote - the formula is 100% divided by 21 +1, or around 4.55% of the total vote - this is called a "quota'. The effect is that parties or candidates that get at least a quota of votes, should get about the same proportion of seats as they do votes - i.e. 10% of the total vote should gain about 10% of the seats. The general effect of this can be seen in the 1999 elections when the three major political parties between them gained about 67% of the primary vote and won 14 out of the 21 seats. Minor parties, with 1/3 of the votes also won 7 (or 1/3) of the seats. Thus the membership of the Legislative Council is able to accurately reflect minority political opinion in NSW as well as majority opinion.

However, the voting system is also preferential - i.e. voters vote for a number of candidates or parties in order of choice, and this makes it quite complex. Usually in an election, the first 16-18 Legislative Council seats are decided easily because parties or candidates obviously have gained sufficient quotas. The last few seats, though, have to be decided by preferences.

Some apparently mysterious and complex formulas and processes are used in the distribution or transfer of preferences. These are all designed to represent what the people said in the election as fairly and accurately as possible. If you want to know more about this, read on.

There are about 4 million voters in NSW. Divide that by 22 and you get around 182,000 votes needed to elect one Member. Typically in an election, a major political party might get enough primary (first preference) votes for several quotas - i.e., if they get 25% of the vote (or around 1 million votes) they will have at least 5 quotas = 5 Members elected. However, they will also have a surplus of votes - in this case about 90,000 votes more than they need for five but 92,000 short of getting a sixth seat.

On the other hand a minor candidate or party might only get a few hundred or a few thousand first preference votes, clearly no-where near enough for a quota. As in any preferential system, the candidates with the least votes get eliminated first and their preference votes are transferred to the second or subsequent choices indicated by each voter on each ballot paper. In the 1999 Legislative Council election there were 264 candidates. Most candidates get relatively few votes and were quickly eliminated. Their votes were added to the totals of others and thus some more quotas were reached.

But remember, each party or candidate that gets a quota usually has more votes than they need (in the case of our big party above, it was about 90,000 votes). At a certain point in the counting, if the big party has not picked up enough transferred votes to gain another quota, their surplus votes are transferred. The actual votes that are transferred are chosen at random from the party's total votes and distributed according to the voter's preferences.

However, there is one more thing. A transferred surplus vote is not regarded as having the same value as a first preference vote. They are given a "transfer value" which has been worked out by a formula and is usually less than 1. Thus, if each of the big party's 90,000 extra votes were transferred and added to candidates, their value to those candidates would probably not be one full vote.

Through this process a candidate with insufficient primary votes for a quota may still get one after the distribution of preferences. In 1999, six parties which originally got less than a full quota, gained seats after distribution of preferences and one candidate with only 7,264 first preference votes (or 0.2% of the total vote), was able to reach a quota because of the large numbers of later preferences he received.