Disclosure of party funding is the way to go, say experts

Against the backdrop of a vociferous 10-day row between Democratic Alliance (DA) leader Helen Zille and the New Age, South African political experts are calling for the private funding of political parties to be regulated by law.

The spat between Zille and the newspaper came to a head on Wednesday when the DA's leader, following allegations of hypocrisy regarding party funding from the New Age, revealed the name of a party donor whose identity she had previously undertaken to protect.

Addressing journalists in Parliament on Wednesday, Zille revealed that Stefan Nel, an executive director from the Gupta-owned Sahara Computers, had donated a total of R300 000 to the party. She said the money came from his personal bank account.

Just the day before, Zille wrote in a newsletter on the DA website that the party "makes a commitment of confidentiality to our donors".

"Ideally," wrote Zille, "the DA would prefer full transparency. But if we were the only party to apply it, most of our donations would dry up – together with any prospect of sustaining democracy in South Africa."

Political analysts say that the DA's move to protect – and then reveal – Nel's identity has highlighted the need to enforce the disclosure of private donations made to political parties.

"What has happened in the past few days has indicated that the problem is not only with the governing party, it's with the system," Steven Friedman, director for the Centre of the Study of Democracy told the Mail & Guardian on Wednesday.

"If you don't have regulations and forced disclosure, you have problems."

'Disadvantageous catch-22'
Fabian Scherer, political analyst at Political Analysts South Africa, said that as long as parties were not obliged to disclose the origin of their private donations, they were operating in a "disadvantageous catch-22 situation".

"The party is faced with a difficult choice," said Scherer. "Either it keeps the donor's name secret, and therefore promotes doubt about the moral integrity of its financing, or it discloses the name and frightens off future donors."

Juli Kilian, spokesperson for the Congress of the People (Cope) underscored this difficulty. 

"Donors to opposition parties fear reprisal and loss of business from government," she said. "They will only support when they are assured of confidentiality."

But in Friedman's opinion, opposition party donors should see disclosure as a safety net against mistreatment, rather than as a risk.

He said that if a company made a public donation to an opposition party and was then unexpectedly rejected from a government tender soon afterwards, it would be "very obvious" that the company was falling prey to political mistreatment. At the moment, when companies befall such treatment, the offending parties are not held accountable.

"I think that disclosure is actually the best thing for opposition party donors," he said.

'Encourages corruption'
According to Scherer, the current lack of legislation makes it difficult to examine if private donations are being accompanied by a shady kickback for the donor.

Friedman agreed. "I certainly think our current system encourages corruption," he said. "The DA said 'we didn't give any favours in return [for the donations from the Gupta companies]'. But if we don't know who made the donation and how much they donated, then how do we know that is true? The public is entitled to more than the say-so of the senior politician."

In an interview with Polity.org.za, political analyst Ebrahim Fakir said that the non-disclosure of party funding not only affected the health of the South African democracy but subverted "our entire system of public values".

According to Fakir, the public cannot know the level of influence that is being exercised over a party by a private donor if they do not know the extent of its donations.

'Reduction of confidence'
Anonymous party funding "contributes to the reduction of confidence in the democracy," said Scherer, and Kilian said it directly undermined the democratic process.

"Buying off government politicians by cash or kind in government has become a way of life. The more bribes [the politicians] get, the more money they can spend on patronage and expensive election campaigns to stay in power," she said. In her opinion, "an entire new regime of party political funding is needed. There is just too much chicanery going on and transparency must become institutionalised."

Mametlwe Sebei, founding member of the newly-formed Workers and Socialist Party (WASP), said his party undertook to fully disclose its funding details.

"We are going to be absolutely transparent [about who donates to our party] and we are going to fight for all parties to be transparent," he said.

Whilst WASP did not intend on taking a "morally purist" point of view and would not reject endowments from small businesses, it would not canvas any big businesses for money, he said. Rather, it would rely on the donations of its working-class members.

"It is the only way we can keep ourselves pure from corruption," said Sebei.

When queried about the ANC's policy on party funding disclosure, ANC spokesperson Jackson Mthembu said that he could not comment on queries of a "financial nature". ANC treasurer general Zweli Mkhize was not available for comment.

We make it make sense

If this story helped you navigate your world, subscribe to the M&G today for just R30 for the first three months

Subscribers get access to all our best journalism, subscriber-only newsletters, events and a weekly cryptic crossword.”

Thalia Holmes
Thalia Holmes

Thalia is a freelance business reporter for the Mail & Guardian. She grew up in Swaziland and lived in the US before returning to South Africa.

She got a cum laude degree in marketing and followed it with another in English literature and psychology before further confusing things by becoming a black economic empowerment (B-BBEE) consultant.

After spending five years hearing the surprised exclamation, "But you're white!", she decided to pursue her latent passion for journalism, and joined the M&G in 2012. 

The next year, she won the Brandhouse Journalist of the Year Award, the Brandhouse Best Online Award and was chosen as one of five finalists from Africa for the German Media Development Award. In 2014, she and a colleague won the Standard Bank Sivukile Multimedia Award. 

She now writes and edits for various publications, but her heart still belongs to the M&G.     

Related stories


Already a subscriber? Sign in here


Latest stories

Fintech firms ramp up investments in Kenya’s microfinance space

Kenya’s microfinance banks are the target of fintech firms from abroad seeking to sidestep stringent regulatory perimeters for digital lenders

Harbour views at 9th Avenue Waterside

The award-winning eatery, which offers fine wines and food, is on stilts at Durban’s harbour

Zimbabwe hospital workers plot stillbirth burials

The policy is to cremate deceased infants but Bulawayo Hospital’s incinerators are not working

Salman Rushdie on ventilator, likely to lose an eye after...

The British author of "The Satanic Verses" had to be airlifted to hospital for emergency surgery following the attack

press releases

Loading latest Press Releases…