Political parties need to be more transparent about private funding

When David Malatsi recently testified that he expedited approval for the Roodefontein golf estate after a series of secret, substantial donations to the New National Party, it was a graphic example of the price some private donors seek to extract from the recipient parties.

Shortly afterwards, in another even more sensational criminal case, a witness in the Schabir Shaik trial, Zweli Mkhize, gave evidence that Shaik made substantial donations to the African National Congress during the late 1980s and early 1990s *1.

In both instances, the public received this information too late for it to be able to evaluate the impact it may have had on policy - such as the golf estate development or the notorious arms deal - and only because of the criminal trials.

At present, there is no law requiring parties to disclose their private donations and, according to the recent high court ruling, the public has no right to know under the Promotion of Access to Information Act 2000.

When the Institute for Democracy in South Africa (Idasa) launched its court application against the five largest political parties in November 2003, we knew it was an important but also difficult test case of the Promotion of Access to Information Act.

But the parliamentary process was going nowhere, despite repeated promises from the ANC over a period of seven years, and a thorough consultation with civil society stakeholders and the public encouraged us that it was both necessary and appropriate to assert the constitutional right to access to information that underpins the Promotion of Access to Information Act.

In the February High Court hearing, we argued that when political parties collect private donor money, they perform a "public function" under the act. This was an important test of whether, and if, political parties are accountable to the public other than at election time.

After all, political parties spend public money that is provided to them by the taxpayer through the Public Funding of Represented Political Parties Act 1997 (around R70 million last year), they represent the electorate in parliament and they form a central role in the "multiparty democracy" that is central to many of the provisions of the constitution.

Yet, the court found that the act of collecting money through donations is distinct from these other functions. This then prompts the question: what exactly are the parties collecting the money for, if it is not to stand for elections, represent their electorate in parliament and so on?

In other words, the private donations are collected precisely so they can perform their "public function".

The distinction between exercising public or private power has important implications for democratic accountability and for the political process in particular. The nature of the political party determines its levels of accountability to those who are its potential or actual voters.

Despite the judge's finding that the definition of a public body is "a fluid one", "that the division between the categories of public and private is by no means impermeable" and that "entities may perform both private and public functions at various times... ", he found that political parties remained by their nature private entities.

That was not the end of the matter. Under the far-reaching provisions of the Promotion of Access to Information Act, even private bodies are obliged to grant access to their records if access is necessary to protect or exercise a right.

Here the case turned on the judge's interpretation of the right to free political choice contained within section 19 of the Bill of Rights, finding that "... disclosure of donor funding is not a prerequisite to free and fair elections - a proposition borne out by the experience of our first 11 years of democracy, which included no less than three general elections that have universally been accepted as free and fair".

Although the comparison must be handled with great care, there are shades of the recent Zimbabwean election in this approach.

There, many of the monitors fell into the trap of examining only the conditions at the time at which citizens placed their little pieces of paper into the ballot box.

But, as Jeremy Cronin put it so neatly at the time, Zimbabwe's was an "electoral event" and not an "electoral process".

In other words, when assessing the question of free political choice, a wider purview must be adopted. Another approach to the interpretation of section 19 would have seen that for the full realisation of the right, an informed choice requires that voters know the identity of the hidden hand of the secret funder, whose influence is apparently so often malignant.

The case has helped move the issue forward, by engendering debate and helping to forge a social consensus about the right to know, which is our primary purpose.

While dismissing our application, the high court also held that Idasa had presented a "compelling case that private donations ought to be regulated by way of specific legislation in the interest of greater openness and transparency" and that the judgment did not mean "that political parties should not, as a matter of principle, be compelled to disclose details of private donations made to their coffers".

In its response to the judgment, ANC spokesman Smuts Ngonyama stated that "... it has no legal or constitutional obligation to provide internal funding information to outside parties... this was not a matter to be decided by the courts. If it does need to be addressed, it should be through an act of parliament".

The equivocation of this contrasts with what ANC Secretary-General Khalema Motlanthe said in his sworn written evidence to the court: namely, that a parliamentary process is currently under way to pass appropriate legislation *2.

In fact, the only "process" is an old private member's bill drafted by Douglas Gibson of the opposition DA. No opposition-led private member's bill has ever been passed. So the question now is: Will the ANC honour what it told the court and present a bill itself?

Thus, whether we appeal the decision or not, the ball is now in the ruling party's court and all eyes will be on the ANC to see when and if it will begin the process of reform in parliament.

February is head of Idasa's Political Information & Monitoring Service; Calland heads Idasa's Right to Know campaign.

With acknowledgements to Judith February, Richard Calland and the Cape Times.

*1 The peak of Shaik's donations, including giving a motor car to Dr Mkhize himself, was not in the "late 1980s and early 1990s", but in the period 1997 to 1999 which was the precise period of the bidding and contract negotiation for the Arms Deal in general, and the Corvertte Combat Suite in particular.

Indeed, Minister Dr Mkize was given his motor car by Shaik on 17 November 1998. The very next day the Cabinet announced the winning bidders for the prime contracts, which included the German Frigate Consortium (GFC) for the corvettes (frigates). The GFC had nominated Thomson-CSF as the supplier of the Corvette Combat Suite (as per directive of the DoD, whose Chief of Acquisitions was Chippy Shaikh). However, on Sunday, 15 November 1998 the Business Times had published the article entitled SA Set to Award Defence Contracts (http://www.armsdeal-vpo.co.za/articles06/sa_set.html) where they report that :

"British and German bidders are likely to be the biggest winners in R15-billion deal, writes HENRY LUDSKI

"GOVERNMENT is this week expected to make the biggest decision on foreign spending in SA history when it names the successful bidders of defence procurement deals worth an estimated R15-billion. Mr Ludski was only half right when it came to the wonga.

And so it was a "done deal" by the time Minister Dr Mkhize got his windows tinted darkly for the car (another Merc we thinks) registered in the name of another son or the earth.

*2 The truth has never yet bothered.