As part of Penplusbytes’ issue-based coverage of Ghana’s 2016 Elections, this explainer article provides insight and an in-depth explanation on the issue of Political Party Funding, a recurring issue in Ghana’s political discourse.
Background
Political parties remain the most important institutions in every democracy. They are the vehicles through which the ideals of multi-party democracy are achieved. Since Ghana reintroduced multi-party democracy in 1992, political parties have played critical a role, particularly, in the mobilization of citizens for political participation as well as education of electorates on the electoral process and policy choices. The State has reciprocated this in the past with some level of support for the nation’s political parties in the form of campaign vehicles, though this has been described as paltry. Some stakeholders have therefore called for state funding for political parties in order to strengthen existing political parties, promote good governance and transparency in the internal management of political parties.
All over the world, political party financing scandals have hit countries, leading to increased public disillusionment with political parties and politicians. In Ghana, the recent media reports alleging that the ruling National Democratic Congress (NDC) spent Gh¢28 million on its activities during their campaign launch for the 2016 Ghana elections has rekindled the debate on sources of funds for political party campaigns. The pertinent questions are, which corporate organizations and individuals fund political parties? Are these corporate organizations “rewarded” when the political parties they fund win the presidential elections? What are the implications of political party funding on the nation’s fight against corruption?
The Key Issues in the Debate:
· State funding of political parties will enable them function effectively
· Political parties appropriate public resources to fund their political activities since their sources of funding are unknown and undisclosed
· State support for political parties would reduce political incumbency advantage
Why funding of Political Parties
Ex-President John Agyekum Kufuor, soon after his election in 2001, pushed for a bi-partisan debate on a law to fund political parties. His support for this call was informed by the inability of political parties in opposition to raise the requisite finances to reach out to electorates and mount a campaign to win elections. According to President Kufour, state funding of political parties “will be the best guarantee to sustain multi-party democracy prescribed in the national Constitution to anchor democratic governance of the state,” Fifteen years after Ex-President Kufuor’s proposal, Dr Ransford Gyampo, a Fellow at the Institute for Economic Affairs (IEA) and Senior Lecturer at the Department of Political Science, University of Ghana agrees that “political parties in Ghana need the support of the state and calls for the passage of Political Parties funding Bill.
Increasing Bi-Partisan Position on State Funding for Political Parties
In recent times, the two major political parties in the country, the ruling National Democratic Congress (NDC) and the Opposition New Patriotic Party (NPP) have presented a common position on the matter ahead of Ghana’s 2016 Elections based on the argument that state funding of political parties will reduce corruption in government and foster multi-party democracy.
Hon. Osei Kyei-Mensah Bonsu, minority leader in parliament expressed his view on the subject and said “I think as a nation we need to be looking at state funding of political parties”. He was concerned with the manner in which the Electoral Commission (EC) was certifying political parties without proper regulation which he believed led to the formation of many “non-serious” political parties. He therefore called for streamlining of political parties before a law is enacted to that effect. He however proposed the establishment of a benchmark of 3% to 5% of the votes to qualify for state funding.
Similarly, Hon. Alban Bagbin, the Majority Leader in Parliament stated that state funding of political parties is necessary in order to avoid a situation where friends and businesses that fund political parties, demand payback in the event that the political party they supported gain the levers of political power. In his view, “Wherever the party got that resources from, they have to pay back.” His position reinforces the long held view that political parties raise resources through all means for their electioneering campaign and do all they can to recoup such resources after elections, thereby depleting the nation’s coffers.
Position of Civil society
The common position of many Civil Society Organizations (CSOs) is that, state support for political parties would reduce corruption and create a level playing field. In their view, the nation’s political parties have been violating the Political Parties’ Act which states in Section 24 (1) that “a non-citizen shall not directly or indirectly make a contribution or donation or loan whether in cash or in kind to the funds held by or for the benefit of a political party …”, by secretly receiving campaign funds from non-citizens, creating fertile grounds for corruption to flourish. As a result, their call for support for political parties is informed by the need to root out the canker of corruption.
CSOs in Ghana however, favor the promulgation of a law that places a ceiling on the amount of funds or level of support a political party can receive during their electioneering campaign. This, they (CSOs) explain will minimize the risk of seeking illicit funds or incurring huge debts that are allegedly recouped after elections. In addition, public funding of political parties, they believe, will create a level playing field for political parties and keep the parties active in the inter-election period. They also support the need for a threshold for who qualifies to receive state funding to discourage mushrooming of political parties just to get state funding.
What is the best Practice?
In many democracies, public and private funding remain the most important source of funds which are either made directly or indirectly to political parties. Indirect public funding include free media time, special taxation status and free venue for campaign activities. A common feature of the regulatory framework for political party funding relates to prohibitions to anonymous, corporate and foreign donations as well as donations from government contractors, and trade unions.
In Africa, political party financing is relatively under-regulated. Even where there are strict regulations, these are often not enforced. The biggest challenge in this regard, is that political party candidates tend to control parties as their business entities. There is therefore no difference for support for these parties and the individual.
The Western European democracies have emphasized cash subsidies to political parties and fund-raising from individuals by tax incentives. In Sweden for instance, public funds are provided almost without any obligations. Essentially, monitoring and control of political party financing have been introduced in some of these countries.
Recommendations
While there has not been any thorough debate on political party funding in Ghana, the lack of internal party accountability, the threat of corruption in national life as a result of party capture by anonymous funders and the incumbency advantage by ruling parties are enough reasons for a frank discussion on the subject. On the other hand, since Ghana has many competing developmental needs, it would not be a prudent decision to support the over twenty political parties that currently exist.
In this regard, adopting the Central European model, an arrangement that would allow political parties in Ghana to continue to access private funds but with a ceiling in addition to some kind of state support, be it material or cash transfer in order to cushion opposition parties, and provide a level playing field for all is the best option. These would form the basis for demanding accountability from political parties within a strong regulatory framework for fundraising. In addition, the qualification for any kind of support must be based on some criteria such as a strong following across the country, and representation in Parliament in order to prevent the mushrooming of “non-serious” political parties.
This Explainer Article was made possible with funding from NED]
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