Unpacking the issue of Party political funding

By Khaya Sithole

If last week is to be remembered in South African political history – it will be for 2 things in particular. Firstly, there was the extraordinary and grotesquely riveting testimony of Angelo Agrizzi in the Zondo Commission. Secondly – and not altogether unrelated to this testimony – the President of South Africa finally signed into law the Political Party Funding Bill. The bill itself has been idle in the President’s desk since last winter, and true to precedent – took an inexplicable length of time to become law. Its primary intention – to usher in a new era of transparency on how political parties are funded – has been long overdue in a country where the ANC’s electoral support has seen it claim the lion’s share of the current party funds allocation from the state.

But more crucially, due to its dual status as a political party and the incumbent governing party; the ANC has been accused of latent double-dipping in resources. Such a double-dipping occurs when the ANC can claim the legitimate share as allocated by the IEC every year, but also leverage government resources to amplify its message.

Whilst government resources should promote and fund projects and deliverables for the society at large; there is the obvious overlap where government ministers may be on a platform to address government matters, and also then remind the listening audience that their political party is the one that made it all happen. In this case, voters may then find the distinction between the party and the state difficult to untangle. This is as unavoidable as it is inevitable in any political system.

One could regard it as the latent dividend of winning electoral support – the ability to then run government agencies where you can find subtle ways of crediting your political party with the initiatives being conducted at a government level. This serves to provide indirect capital to the governing party as they can essentially stage an entire rally in their capacity as ‘government’, and simultaneously dedicate the entire programme to promoting their party ahead of a general election.

The secondary electoral dividend – and the more explicit one – is the fact that annual party funding allocations by the IEC have been allocated primarily on the basis of seats won in preceding elections. This means that a party that wins over 62% of the vote; attains a number of seats in the national and provincial assemblies that is commensurate with its electoral support.

As a result; big parties have more resources to dedicate to winning even more electoral support in succeeding elections. This has the capacity of driving the electoral system towards an oligopoly of the few as we have seen in South Africa where the ANC, the DA, and the EFF received 89% of the 2018 allocation alone. The remaining parties accounted for only 11% of the IEC allocations from the Represented Political Parties Fund. Whilst the correlation between electoral support and final allocation is not perfectly linear due to the fact that the fund is split 90:10 between the national and provincial legislatures; it is remarkably strong. As a consequence; the ANC’s 62% electoral support (as per national assembly representation); saw it receive 59% of the total allocation.

The new act provides for the creation of 2 separate funds – the public fund and the private fund. The public fund will essentially be a successor fund to the current Represented Political Parties Fund. Its mandate will be to house the funds disbursed by the state towards supporting political parties. The main difference is that this fund will no longer apply the 90:10 allocation rule. Rather, the fund will now apply a new formula to allocate funding to political parties. It is envisaged that such a formula will balance equity and proportionality. In spreading the pie across the multiple parties who qualify; the formula will assist smaller parties to gain access to more resources than they currently have.

The private fund will allow everyone else to donate to political parties. This is the fund where government agencies and foreign agents are not allowed to participate. The prohibition of government agencies from funding political parties is important as it prevents public resources from being redirected by to curry political favor. Besides; given the financial state of most public enterprises these days, their capacity to make political donations is marginal.

When one looks at the Bosasa saga, there is the burning question of whether most of the looting would have been prevented had the political party at the heart of it all, been forced to be more transparent about the source and use of all its funds. As it stands, we now hear that some of its functions and rallies were funded by Bosasa from resources that had to be replaced through inflated procurement contracts. The Agrizzi testimony carries on and all of this may yet be disputed. Until that happens, the ongoing disclosures simply highlight why transparency has been so long overdue.

Khaya Sithole @CoruscaKhaya  is a political analyst at Kaya 959. 

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