Landmark ruling on party funding

The Cape High Court has ruled that political parties in South Africa should not, as a matter of principle, be compelled to disclose details of private donations made to their coffers.

In a landmark ruling by Judge BM Griesel on Wednesday, he dismissed the application by the Institute for Democracy in South Africa (Idasa), and its officials Judith February and Brett Davidson, against the ruling African National Congress, the Democratic Alliance, the Inkatha Freedom Party and the New National Party.

No order was made for costs.

Griesel said the applicants made “a compelling case” with reference both to principle and to comparative law that private donations to political parties ought to be regulated. He said it should be done “by way of specific legislation in the interest of great openness and transparency”.

The judge noted that the issues are complex and this highlights the need for them to be dealt with by legislation.

“It is precisely because of these complexities that the court is, in my view, ill equipped—compared with the legislature—to perform the task that the applicants are seeking to impose upon it.”

Idasa ‘glad for opportunity’

Idasa’s February, the second applicant, said in a statement on Wednesday that although Idasa is disappointed by the judgement, “we are very glad to have had the opportunity to present arguments to the court and welcome the public debate engendered by the case”.

“After a careful review of the judgement, a decision will be taken about whether to appeal. There are very important issues of public and private accountability, which deserve consideration at the highest possible level.

“We welcome the judge’s comments that we raised matters of great public interest and concern.

“What is important, however, is that even though the court has rejected the assertion of the public’s right to know the identity of private donors to political parties, reform must still follow.

“In particular, we note the commitment that was made by the ANC, to the court and in its affidavits, to present legislation that will regulate party funding in the future. We presume that this legislation will be in line with the African Union Anti-Corruption convention, of which South Africa is a signatory, which recommends regulation based on transparent public disclosure.

“We look forward to the legislation and express the hope that having offered this explicit argument to the court, the ANC will not now delay in presenting legislation to Parliament. As recent revelations in the [Schabir] Shaik trial illustrate, secrecy in donations invariably prompts corruption and corrodes public confidence in party politics.

“At that point, we look forward to contributing to the debate about the detail of the regulation, applying the principle of the right to access to information,” February said.

DA welcomes ruling

The DA was the first political party to react to the judgement. DA federal council chairperson James Selfe said the party welcomes the court’s ruling.

“Many of our donors have expressed their wish to remain anonymous because they feared that if their donations became known, the ANC government may react by, for example, not awarding them contracts in the future.

“This is certainly the perception of many donors. In light of this, the DA undertook to respect its donors’ wishes to remain anonymous.”

The party agrees with the view that the court is ill equipped—compared with the legislature (Parliament)—to determine the circumstances in which political parties must be obliged to disclose donations.

The party’s chief whip, Douglas Gibson, had submitted a private member’s Bill in 2002, calling for the prohibition of donations to political parties from foreign governments, the prohibition of anonymous donations from any source if the amount in one financial year exceeds R50 000 rand and the declaration of the name and address of any donor whose donation in one financial year exceeds 50 000.

“It is also important to note that in the context of a political system characterised by patronage, there is every possibility that a more stringent disclosure requirement could be a disincentive for companies to fund opposition parties,” said Selfe.

Threshold amount

Idasa said in its heads of argument that the question is not whether the threshold amount is arbitrary but that it is a substantial amount.

“It stands to reason that a donation of more than R50 000 can influence decision-making.”

Responding to the question whether the threshold adequately protects any privacy interest, it argued that given South Africa’s socio-economic context, “the vast majority of South Africans would be unable to make donations of an amount greater than this as a means of participating or supporting a political party”.

In November 2003, when Idasa launched its “groundbreaking” litigation—as it described its own initiative—it said that recent corruption cases involving the senior figures in the NNP and Count Riccardo Agusta, as well as serious allegations relating to inducements paid to the ANC in relation to the arms deal, “highlight the dangers of the current absence of any regulation in private funding of political parties”.

“The gap amounts to a charter for influence-peddlers and mischief-makers,” said Idasa Right to Know programme manager Richard Calland at the time.

Idasa was seeking to compel the four parties to disclose their private donors, the amount involved and the conditions under which the donation was made—in order to allow the public to consider what influence was brought to bear on political parties by large donors, including big business.—I-Net Bridge

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