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The corruption potential created by absence of political party funding regulation is laid bare by Zondo

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Awonke Baba is a political party funding Intern at My Vote Counts (MVC). His job entails providing research support and co-producing opinion pieces. He holds an MA in Politics and International Relations from the University of the Western Cape. He has interests in funding dynamics between private donors and public institutions, both at intra-state and international level.

The Zondo Commission report shows clearly how the absence of the Political Party Funding Act provided a space for corruption and greed within our political party financing. Importantly, it demonstrated the dangers and the risks posed to our democracy by such actions.

The Judicial Commission of Inquiry into Allegations of State Capture, better known as the Zondo Commission, has after four years since its establishment finally released the first part of its long-awaited report.Its findings and recommendations come as no surprise to the public.

Equally unsurprisingly, parts of it are being highly criticised and rejected by implicated entities including Bain & Company and individuals such as the former CEO of the Government Communication and Information System, Mzwanele Manyi.

In addition to providing insight on State Capture, the report also delivered some analysis on enhancing transparency in political party funding. In this regard the report delivered clear albeit brief recommendations for party funding which offer some food for thought.

The report acknowledges and welcomes the newly established legislation, the Political Party Funding Act (PPFA), and further recognises corrupt activities that have a direct bearing on political party funding. The act is concerned with democratising our politics through creating a regulatory framework around party funding. The act aims to “provide for, and regulate, the public and private funding of political parties, in particular; the establishment and management of funds to fund represented political parties sufficiently”.

The act seeks to enhance transparency and accountability by compelling political parties to publicly disclose the source of their private funding. In his report, Judge Zondo makes a clear connection between party funding and its effect on political decision-making and governance.

While the debate on party funding is not new, the need for a strong party funding regulatory framework became clearer after 1994, especially under the presidency of Jacob Zuma. Under his presidency, multiple cases of corruption were reported, most notably the Gupta financing of the ANC and the case of Bosasa, although there are countless other examples.

Judge Zondo makes it clear in his report that political parties should not profit or use money gained from illicit or criminal activities. However, evidence presented to the commission clearly demonstrates that this took place. He is even more emphatic in his most searing criticism that because of this, we are facing an “existential threat to our democracy”.

Through the example of the Free State government and its dealings with Blackhead Consulting, Judge Zondo unpacks the issues that arose from the quid pro quo relationship attached to the tender process and party funding. The scandal involved the awarding of many multimillion-rand contracts to Blackhead (including the infamous R255-million asbestos tender deal). In return, the company gave millions of rands to the ANC.

Former Johannesburg mayor Geoff Makhubo too was found to be complicit in a similar offence through his dealings with tech giant EOH which used shell companies to funnel money to the ANC.

The Zondo Commission’s report has highlighted both these cases as they are severe and illustrate precisely the types of nefarious activities and corrupt relationships that were developed. The examples are clear in showing that the fair and equitable delivery of goods and services to the public was disregarded in favour of money being funnelled to the ANC. Donations to parties are not meant to be built upon the premise that the donor will receive business from the party.

The report welcomes the PPFA as an important building block in regulating political party funding and fighting these illicit activities. It notes that “the recent promulgation of the Political Party Funding Act No 6 of 2018 (PPFA) is at least a first step but most likely an ineffectual step in addressing this particular abuse”.

The report also acknowledges that this act alone is not sufficient and therefore cannot produce desired outcomes. It further notes that “the PPFA does not go as far as it should” and therefore recommends that “provision must be made to prohibit donations linked to the grant of tenders”.

Recommendation number nine suggests that “the act be amended to criminalise the making of donations to political parties in the expectation of or with a view to the grant of procurement tenders or contracts as a reward for or in the recognition of such grants having been made”.

A politics free of undue private influence needs robust legislation and a political culture that does not operate on self-enrichment.

We all eagerly await the remaining two volumes of the report, but whether its recommendations are implemented or not depends on how the President will respond to and interpret the report. We have a few months to go before we will know what that will be. Despite the uncertainty that awaits, the Zondo report in general should mark a turning point in addressing corruption.

While the report and its recommendations are crucial in deepening South African democracy and especially its two main pillars, transparency and accountability, which are prioritised by the PPFA, the act is also key in regulating public and private funding of political parties.

The report shows clearly how the absence of this act provided a space for corruption and greed within our political party financing. Importantly, it demonstrated the dangers and the risks posed to our democracy by such actions.

The PPFA will, of course, give birth to new challenges, and this is why there is a need for interest groups to keep an eye on the act and observe how it is implemented and complied with over time. The aim of this process will be to further strengthen the act and ensure its objectives are met. MC/DM

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