Editorial: Come clean on political funding

Two important events this week served to peg back the absolute freedom South Africa’s political parties enjoy to raise funds without being required to reveal their sources of funding.

In the first, the United States’s Securities and Exchange Commission found that Japanese corporation Hitachi violated the country’s Foreign Corrupt Practices Act by paying dividends and “success fees” to ANC funding vehicle Chancellor House in order to win Eskom contracts worth close to R40-billion at the Medupi and Kusile power stations.

The Mail & Guardian revealed in 2007 that Chancellor House was Hitachi Power Africa’s empowerment partner and 25% shareholder. Although the parent company did not admit guilt, it has agreed to pay $19-million in settlement of the exchange commission’s charges.

The message to future foreign investors is blindingly clear: if you get into bed with Chancellor House or any other party front as a way of landing state business and, like Hitachi, you are listed on the US stock exchange or are otherwise subject to increasingly tough anti-bribery laws in the US, the United Kingdom or parts of Europe, you run the gauntlet of corruption charges.

The second case looks like a victory for the ANC, the Democratic Alliance and other elements opposed to a transparent regime on the funding of political parties: a majority of judges in the Constitutional Court this week rejected an application by My Vote Counts that was intended to force Parliament to legislate disclosure. But what is almost as significant is that a sizeable minority of judges, including the court’s deputy president, Justice Dikgang Moseneke, dissented from this narrow and technical ruling.

Essentially, the minority argued that transparency on the sources of party revenue is intrinsic to exercising the right to vote – arguably the most important democratic right of all. The hope is that the minority opinion will foster a moral and legal climate that rejects secrecy and acknowledges openness as intrinsic to democracy and good governance.

Even in the majority view of the court, nothing rules out the possibility of new legislation. The hope is that the judgment will prove a first step towards a dispensation, common to so much of the democratic world, where parties are required by law to put their funding cards on the table.


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