Parties received R3.2 billion in funding, but watchdogs warn gaps in the law conceal sources, loans, and spending from public scrutiny.
The Political Party Funding Act (PPFA) is flawed, with many legislative gaps and implementation issues, says election watchdog My Vote Counts (MVC).
Much is still hidden from public scrutiny and that is a threat to transparency and accountability regarding political party funding in the country, it said.
The Act has many weaknesses regarding donations to political parties and their lending and spending activities, said MVC.
Political Party Funding Act is riddled with loopholes – MVC
In a submission by MVC’s Lauren Gildenhuys and Joel Bregman, MVC questioned the efficacy of the Electoral Commission of South Africa-administered (IEC) political party funding approach, or the way the legislation operates.
The MVC report provides detailed visualisations and analyses of the IEC data gleaned from the IEC annual Political Party Funding Report from 1 April, 2023 to 31 March, 2024.
The Act requires that the IEC publish an annual report presenting the previous financial year’s political funding data based on extracts from parties’ audited annual financial statements.
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MVC identified several legislative gaps and implementation issues. It saw these as threats to the efficient system that the law aims to achieve.
According to the MVC analysis, parties received a total of R3.2 billion in private and public funding combined in the recent reporting period of 2023-2024, a significant increase from the R2.03 billion received in the prior reporting period.
Of this amount, the ANC received R1.7 billion, the DA got R645 million and the EFF received R310 million.
ANC’s private funding not primarily derived from donations
The analysis revealed that despite receiving more private funding than any other party, the ANC’s private funding was not primarily derived from donations.
Instead, “an alarming proportion of the ANC’s private funding is categorised as ‘other income’, leaving the public largely in the dark about the sources of its private funds”.
The MVC report also said the significant loans which were granted to the EFF, Rise Mzansi, ActionSA and the ANC should not go unnoticed either.
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“We only know about the sources of approximately a third of parties’ private funding.
“We have almost no information about parties’ lending activities, ‘other income’ streams and spending habits [only expenditure of the IEC allocation is required to be disclosed].
“Not only does this limit our ability to monitor and mitigate the influence of private interests on our politics, but it also precludes us from critically evaluating our current model of political funding and its suitability for the South African context,” MVC said in its report statement.
Multiplying secrecy involved in party funding
Following President Cyril Ramaphosa’s recent proclamation to double the funding disclosure threshold to R200 000 and the upper donations cap to R30 million, MVC said it was concerned that this would multiply the secrecy involved in party funding.
The proclamation added to a myriad flaws in the legislation and its implementation process.
“The analysis demonstrates that, though we know much more today than four years ago about party funding, there are still many legislative gaps and implementation issues to be remedied before we have a transparent and accountable party funding system.
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