By Jan Gerber
- My Vote Counts will ask the Western Cape High Court to declare the Political Party Funding Act invalid.
- The lobby group is concerned that the act does not provide adequate transparency for party funding as a guardrail against corruption.
- The ANC government, however, indicated that it wants to amend the act to do the opposite and get more money for political parties from the public purse.
Private funding “poses a threat to democracy itself”, and as such, lobby group My Vote Counts want the Western Cape High Court to declare the Political Party Funding Act (PPFA) unconstitutional, as it does not provide suitable transparency and control.
This sets up a showdown with the ANC government, which, through Home Affairs Minister Aaron Motsoaledi, recently proposed legislative amendments that would make private party funding more opaque and easier for big parties to fill their coffers.
In his application to the Western Cape High Court, filed on Tuesday, My Vote Counts executive director Minhaj Jeenah states it’s “indisputable that private funding poses a threat to democracy itself”.
“It has the potential to place the governance and policymaking in the hands of private interests. This must be mitigated against and a comprehensive regulatory scheme which limits the influence of private funding must be adopted. The PPFA purports to achieve this constitutional imperative, but fails to do so.”
READ | ANC bid to increase funding threshold disclosures an attempt to evade transparency – My Vote Counts
My Vote Counts is not alone in observing the dangers of untrammelled private funding.
As noted in Jeenah’s affidavit, the Zondo Commission stated in its report: “It is a matter of extreme concern that the evidence given at the commission establishes a link between the corrupt grant of tenders and political party financing. Such a link can represent an existential threat to our democracy. It is inconceivable that political parties should finance themselves from the proceeds of crime, and yet there is alarming evidence to that effect.”
Jeenah states in his founding affidavit: “At its core, this application is concerned with strengthening democracy by giving meaningful effect to the constitutional imperatives of transparency, openness and accountability.”
Subsequently, My Vote Counts asks the court to declare several sections of the PPFA invalid.
The act requires registered political parties to declare all donations over R100 000 and limits the amount a party can receive from a single donor to R15 million.
The lobby group’s concern with the PPFA is fivefold:
- There ought not to be any threshold limiting the disclosure of private donations;
- Even if the threshold is constitutional, R100 000 is unlawful and unconstitutional;
- The current limit of R15 million is excessively and unjustifiably high, “which fails to mitigate the risk of rendering political parties bondaged to the dictates of private interests”;
- The PPFA leaves the decision on the upper limit and disclosure threshold to a political actor, namely the president, and MPs; and
- The act doesn’t obligate parties to account on how they spend the funds received from private donors, which is part of the information voters need to make an informed choice at the ballot box.
Jeenah says it appears that the R100 000 threshold has been motivated by “concerns over privacy and administrative burden”.
“Quite apart from the irrelevance of those considerations in the constitutional context, it is unclear how the specific limit of R100 000 was arrived at and on what basis any limit was justified,” he states.
A donor’s right to privacy or secrecy cannot trump the “proper exercise of the right to vote, which is facilitated through disclosure”.
READ | ANC wants more money from the public purse to fund political party activities
Jeenah points out that parties must already account for all income received. Therefore it wouldn’t increase the administrative burden if all donations were disclosed.
“Should the disclosure threshold be set aside, this would simply mean that political parties would need to disclose all donations which they are already required to record and subject to an audit.”
Jeenah states that “a greater restriction on the ability of private actors to exert influence” would safeguard the constitutional mandate of public representatives and political parties.
“In the context of the PPFA, this would entail imposing greater restriction on the amount that private donors and related persons can contribute to political parties.”
Jeenah describes the R15 million cap as “plainly excessive” and falls short of “addressing the fundamental issues of corruption and undue influence, perception by the public thereof”.
“To be clear, the applicant is not suggesting that direct private funding ought to be scrapped in its totality or that it is innately problematic. The applicant simply submits that there is no constitutional justification for an upper limit of R15 million in private donations, and such an excessive limit falls short of the constitutional imperatives concerning the obligations on elected representatives to fulfil their constitutional mandate unencumbered by the dictates of private interests.”
Jeenah adds that the necessity of “excessive private funding” is also questionable given how much public funds are dispersed to represented political parties – in the 2020-21 financial year, this was R1.5 billion.
My Vote Counts is also concerned that the R15 million limit is imposed on a donor per year.
“There is no restriction on or upper limits to donations by related persons or entities. There is not even full disclosure in this regard. Thus, political parties can receive a multitude of donations from entities related to the same persons, as long as any one natural person or legal entity, in its own right, does not donate in excess of R15 million.”
For instance, three companies with links to Patrice Motsepe have made donations to the ANC.
“Thus, the upper limit for entities and individuals with great wealth and influence, such as Mr Motsepe, is limited only by the number of entities or companies they are in control of.”
READ | How Motsoaledi wants to use Electoral Amendment Act to benefit coffers of political parties
The president, justice minister, home affairs minister, IEC and all parties represented in Parliament have been listed as respondents by My Vote Counts.
While My Vote Counts continues with its quest, which started with a court application in 2015, to achieve greater transparency in party finances, the government is preparing to do the opposite.
Last week, Motsoaledi proposed increasing the R100 000 cap on donations that don’t have to be declared, exempting donors from declaring, and, tellingly, excluding parties’ earnings from investments, shareholdings and commercial activities from being declared. Motsoaledi also wants more public funding for political parties.
Motsoaledi addressed the Portfolio Committee on Home Affairs on legislative amendment to the PPFA necessitated by the recent enactment of the controversial Electoral Amendment Act, and thought it opportune to also propose further amendments, which happens to be in line with the ANC’s previously stated position.
The Political Party Funding Act was passed in March 2018, with the support of all the parties in the National Assembly except the EFF, and came into effect on 1 April 2021.
The ANC’s national conference, which it couldn’t complete on time in December, resolved that the PPFA should be reviewed.
“Donors do not want to fund the party because of the act. The state should increase its allocations to political parties. Parliament itself should be able to fund political parties,” ANC national executive committee member Joe Maswanganyi said.
As it turns out, one of the ANC’s donors paid in part for the very same conference where it took this resolution.
The ANC declared R15 million paid to the Johannesburg Expo Centre by United Manganese of Kalahari (UMK), a company in which the ANC’s investment arm – Chancellor House – is a shareholder and with links to sanctioned Russian oligarch Viktor Vekselberg.
Originally published on News24
