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A new funding legislation is active since April 2021. Political parties must declare funding above ZAR 100,000. For more information, check:
Description of Political Party Funding in South Africa Before April 2021
The funding legislation, in South Africa, adopted in 1997, gives a 10% of the public fund to be shared in equal proportions among the parties represented in the National Assembly (NA) and provincial legislatures (PLs). The remaining 90% is shared proportionally among the parties according to their representation in NA and PLs (Taljaard, 2014: 228-229). The parties without representation in the government do not have access to public funding, but they have the option of sourcing private funding. The private funding is uncapped and can be donated by any individual, corporation or foreign governments, and there are no requirements for disclosure (Friedman, 2010:157). The mechanisms to access the private funding brings concerns about its consequences for democracy in South Africa, and Friedman (2010:165-167) supports its regulation to avoid corruption and other problems. It is argued. though, by some, that free competition for resources and seats in government, could strength democracy, however, what is happening is different: The dispute for funding diminishes the competition for serving the society (Friedman,2010:163). On the other hand, Taljaard (2014:229) foresees that any future reform to the funding policies will focus on the equitably-proportionally balance of the public funding and the exclusion of non-represented parties. The public and private funding strategies, in the current political environment, shows a negative impact on the democratic elections, as it induces to an unfair competition among parties for representing their voice in government. Thus, this essay will discuss how an even competition among political parties is hindered by the current strategies and how this may threaten the political stability of the country. It will also address if the reform of the current regulation will enhance the current dynamic around funding politics in South Africa.
Registering a political party is an inexpensive and relatively simple process but competing to enter to the NA or PLs is complicated, even more for parties without funding. Africa (2014:105-106) observes that the number of smaller parties participating in the contestation have increased from 16 in 1994 to 29 in 2014, however, the majority of them, have not been successful to access seats in the government. This situation is one of the salient consequences of lack of funding because it is observed that when “parties become financially stressed, they lose their capability to organize, to campaign and to think” (Butler, 2014:240). The statistics reveal that the political parties in South Africa without enough or not seats in the NA or PLs, and therefore without public funding, need a significant major effort to compete and consolidate, which might frustrate sectors of the South African minorities. The alternative for the smaller parties to institutionalize is to attract private funds into their campaigns.
However, the unwanted consequences of the lack of regulation of the private funding such as corruption, unfair competition and subversion of the meaning of democracy, highlights the negative impact of the current funding strategies on the political stability of the country. A problem with private donations to political parties is seen in that the parties might be unduly predisposed by the donors. Friedman (2010:160) refers for example, to the decision of not admitting the Dalai-Lama in the country, which might have been influenced by the compromise with the Chinese government, a donor of the ANC. On the other hand, scandals around private funding and corruption abound, for example, Taljaard (2014:219) mentions several cases, such as the case of oilgate, the Harksen drama, and the arms deal. The influence of money in politics, in the above context, diminishes the confidence on the democratic system to govern the country and opens the door for private entities to access the political power of the government. Thus, the non-disclosure and uncapping of private funding, induces parties to act in an open and aggressive manner to obtain and retain funds, usually forgetting democracy ethics and their responsibilities with the political stability of the country.
The potential power of corruption that money has on politics is often diluted in the discussion of freedom of choice proclaimed in democracies, making redundant the actions to control fair competition among parties and fight corruption. Friedman (2010:155-156) mentions that there are democracies that have such libertarian approach to private funding, for example, the United States and Germany, where democracy functions mostly well. These examples seem possible that a democracy can be run successfully, without heavy regulation on private funding. Perhaps, the problem with regulating the private funding is not a simple matter of limiting the freedom of donors to give money to the preferred party or the right of using donations as per needed by the parties. Moreover, it seems that for countries with younger democracies, such as South Africa, such a libertarian approach regarding private funding is more damaging than in older democracies. It is also observed that “without strong institutions capable of checking the power of the state, democracies often slip back into authoritarianism or ‘illiberal democracy’” (Gibson and Gouws, 2003:3). The disclosure and regulation of the private funding by strong institutions serve as preventive measures to ensure that democratic values are learned by the society, where money is not the objective but the enabler to have access to a multi-party participation. Only exposing the consequences that private funding exerts on politics, will allow the relevant organizations to intervene and challenge anti-democratic behavior, such as corruption.
The reform of public and private funding would help to utilize the funds with focus and responsibility, it would create mechanisms for transparency and would ensure the participation of smaller parties, even with educational programs of how to exert their rights and responsibilities as political parties. For Taljaard (2014:225), the main objective should be the reform of the public funding, not just in the inclusion of unrepresented parties but also in the search for a more balanced formula to share it, it also should be expanded to diminish the need for private funding. On the other hand, recognizing that it will be not possible to relinquish the private funding totally, Friedman (2014:165-167) emphasizes the importance of disclosure and capping as two chief mechanisms to control, both corruption and political overpower based on large donations from private sources.
As concluding thoughts, it would be worth to review the current legislation, regarding public and private funding. The 10/90 formula for equitable and proportional distribution of the public fund could be modified to decrease the need for private funding, mostly to those parties that do not yet appeal individuals or corporations financing. A mechanism should also be implemented to warranty a portion of public funding for new entries or parties without seats in government. The private funding should be regulated at some extend to create mechanisms for transparency and fairness, preventing unknown large amounts of money to overpower other parties and the corruption of politicians who forget their mission towards society and change it for self-serving activities. Although this could be seen as contradictory to the freedom proper of democracies, the reality is that in regimes in transition, the pace towards libertarism should be cautious and social responsibility should be seen as a better approach for governance. Cases of corruption, unduly influence in the decisions of the state by third parties, the dissatisfaction of minorities as not able to participate in the government, in a young democracy, could threaten the political stability of the country. As mentioned above, several proposals are already available in the literature, as for example creating an independent entity to administer and organize the private funding, or extending the influence of public funding to decrease the impact of private funding. Such actions would help to strength the democracy in South Africa.
Africa, C (2014). The Smaller Parties: Between A Rock and a Hard Place. In: Schulz-Herzenberg C & Southall, R ed. Election 2014 South Africa. The campaigns, results and future prospects. Johannesburg: Jacana and Konrad Adenauser Stiftung. PP 104-117.
Butler, A (2010). Conclusion: The Opportunity and Challenge of Party Finance Reform in South Africa. In: Butler, A ed. Paying for Politics. Party Funding and Political Change in South Africa and the Global South. Johannesburg: Jacana and Konrad Adenauser Stiftung. PP 237-250.
Electoral Commission of South Africa (2016). How to register a political party. Available at http://www.elections.org.za/content/Parties/How-to-register-a-party/ (Accessed on the 20th of October, 2016)
Friedman, S (2010). Government buy the people? Democracy and the Private Funding of Politics in South Africa. In: Butler, A ed. Paying for Politics. Party Funding and Political Change in South Africa and the Global South. Johannesburg: Jacana and Konrad Adenauser Stiftung. PP 155-169.
Gibson, J.L & Gouws A (2003). Overcoming Intolerance in South Africa. Cambridge: Cambridge University Press.
Robinson, J (2014). The Economic Freedom Fighters: Birth of a giant?, In: Schulz-Herzenberg C & Southall, R ed. Election 2014 South Africa. The campaigns, results and future prospects. Johannesburg: Jacana and Konrad Adenauser Stiftung. PP 72-88.
Sokomani, A (2010). Party Financing in Democratic South Africa: Harbinger of Doom?. In: Butler, A ed. Paying for Politics. Party Funding and Political Change in South Africa and the Global South. Johannesburg: Jacana and Konrad Adenauser Stiftung. PP 170-186.
Taljaard, R (2010) Paying for Our Democracy. In: Butler, A ed. Paying for Politics. Party Funding and Political Change in South Africa and the Global South. Johannesburg: Jacana and Konrad Adenauser Stiftung. PP 218-233.
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