Summary of Submissions; Committee Bill drafting; Programme

Ad Hoc Committee on the Funding of Political Parties

03 August 2017
Chairperson: Mr V Smith (ANC)
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Meeting Summary

The Ad Hoc Committee received 16 written submissions and it decided that all those who had made submissions would be invited to the public hearings from 15 to 18 August 2017. The Committee decided that the Chairperson would be flexible about the time available to each presenter to ensure that there was full and meaningful engagement with all submissions.

Submissions from two political parties, the ANC and Azapo, raised some concern but it was agreed that all South Africans, even political parties, had been encouraged to engage with the process. The Chairperson assured everyone that the ANC submission would not become the overriding position of the Committee. The public, including all political parties, would receive further opportunity to give input when the draft Committee Bill was made public.

An offer of research and legal advice assistance from the Democratic Governance and Rights Unit at the University of Cape Town's Department of Public Law was approved.

The Chairperson agreed to a political debate within the Committee about what "party support" meant before they began to construct the document.

In response to whether he was targeting the Bill to be ready for the 2019 elections as this had budget implications, the Chairperson said that he was not worried about the budget as the Committee would submit the Bill to the powers-that-be and it would be their baby to decide what needed to be done.

Meeting report

The meeting observed a moment of silence in honour of the late Timothy Khoza (ANC) (MP).

The Chairperson noted that the deliberations of the Ad Hoc Committee were important because whatever came out of them would have a bearing on South Africans for a very, very long time and would impact on the lives of many South Africans. He was therefore hoping that, in the spirit of putting South Africa first, the deliberations of the Committee would be constructive.

Recapping, the Chairperson reminded the Committee that the previous meeting had taken a decision to call for public submissions. In response, 17 submissions had been received. However, one submission from Judith February would not be considered because Ms February had indicated that she needed to do more work on it and that she would resubmit when the Committee called for the next round of input. The purpose of this meeting was to go through all the submissions and decide who Committee members would like to invite to a public hearing, if anyone. Public hearings were scheduled for 15 to 18 August 2017. The first decision was therefore to decide who to invite to the public hearings.

Secondly, the Chairperson had been approached by the University of Cape Town (UCT) Department of Public Law, Democratic Governance and Rights Unit. They had generously offered the Committee the support of people from the University to assist with research as they were close to the subject and would be able to assist, particularly from a legal perspective, before the matter was submitted to the parliamentary legal team. They would provide services gratis as part of their mandate. The team consisted of Prof Halton Cheadle and his team, Prof Hugh Corder and Ms Vanja Karth, although the Chairperson was unsure as to exactly who would be involved in the actual work. He put it to the Committee that they should decide whether they would like to accept the offer of assistance and pointed out that the team from UCT would not be assisting the Chairperson himself but the Committee as a whole. The Chairperson assumed that if the Committee accepted the help from UCT, it would probably also accept assistance from similar bodies.

The Chairperson suggested that submitters should be allocated 30 minutes, or in the best-case scenario 15 minutes. An equal amount of time would be allowed for engagement with the presenters. The proposed programme had been submitted to Committee members. He proposed that all the submitters be called, unless they themselves decided not to appear at the hearing. 

Dr P Mulder (FF+) requested clarity on the cut-off date for submissions. The date for submissions had been 21 July. However, he had noticed in the media that it had been extended to 24 July. He requested feedback.  He also noted that the ANC had made a submission and he needed clarity on the matter as, in the past, political parties had not made submissions because they had representatives in the Committee.

Ms N Mafu (ANC) wanted to accept the offer of assistance from UCT. As there was a great deal of interest in the deliberations of the Committee, she believed that they would need all the support that they could get. She agreed with the Chairperson that all submitters be invited to make submissions at the public hearings from 15 to 18 August 2017.

Mr N Khubisa (NFP) agreed that the support offered by UCT would be very welcome but he required clarity as to exactly how they were going to give technical assistance. He also noted the ANC submission which had been widely publicised in all of the media. He asked if all political parties were supposed to have made submissions. He agreed it would be prudent to invite all those who had made submissions as it would give Committee members an overview of what it was that the submitters had had in mind.

Mr N Singh (IFP) was pleased to see that some of the organisations that had made submissions were at the meeting. Their attendance was a good sign of their interest in the matter. He supported the view that all who had made submissions should be invited to make an oral submission. He also supported the proposal of 30 minutes per submission. He agreed with the acceptance of the offer of assistance from UCT. Mr Singh asked if the technical team would be able to give Committee members advice on the meaning of “equitable and proportional basis” as indicated in the Constitution, or whether the Committee would need legal or technical advice from elsewhere. He did not object to an ANC submission, provided that that submission did not influence the ANC members of the Committee or have undue influence on decisions taken.

Mr J Selfe (DA) supported inviting, although not summonsing, those who had submitted input, but he was concerned about the amount of time available for the Committee to interrogate the submissions. He noted that generally many questions arose from oral submissions. He suggested that the Committee be more flexible on timeframes. In the Ad Hoc Committee on the SABC Board Inquiry, every member of that Committee was given time to question presenters. Some of the submissions traversed very complicated pieces of information and presenters had gone to a lot of time and trouble. It would be unfair if there was insufficient time to engage with the submissions.

M B Bongo (ANC) agreed that everyone be invited to present their submissions but he thought that the time of 30 minutes per presenter should be accepted as the Chairperson could manage the time, where necessary. For example, some submissions could be one-line submissions and would not need 30 minutes. The Committee had not stipulated who could submit input and so, not having been prescriptive, the Committee should accept the ANC submission. There was nothing fundamentally wrong with the submission and the Committee would interact with that input in the same way as with all other submissions.

Ms L Mathys (EFF) supported the universal invitation to those who had submitted. She agreed that there should not be time constraints because of the effort that presenters had put into the submissions. She suggested that other “less ivy league” universities be invited to take part as it was usually the University of Cape Town and the University of the Witwatersrand that seemed to trend in those matters.

Mr R Lees (DA) accepted the offer by UCT as the Committee needed all the help that it could get but he suggested that the Committee needed to determine how that resource could be utilised. Would the Committee be calling upon them as a resource or would they be sitting in meetings making contributions throughout the process? Or would they be part of the public hearing? It could not be a loose arrangement, particularly if the Committee was going to be inviting other universities. He also wanted to know whether UCT had made a submission and, if not, why not. He wanted clarification of the exact role to be played by any institution that provided support to the Committee.

The Chairperson was of the opinion that the UCT researchers would do research and would not participate or make submissions.  They would not be running commentators. They would be backroom staff and operate in the same way as the parliamentary researchers. For example, they could research the query that Mr Singh had presented. He agreed with Mr Selfe that the Chairperson should use his discretion and be flexible about the length of input and time available for engagement. Real engagement meant discussing matters with the presenters until there was complete clarity. He alerted the committee that this would mean that the hearings might extend beyond the arranged times and that Committee members would need to be prepared to stay later, if necessary. Nobody would come to the hearings and feel that they were rushed. Presenters would get as long as they deserved, be it an hour or a couple of days. The Committee researchers and the legal advisers would ensure that proceedings did not run afoul of the Constitution or other parliamentary processes. The Chairperson noted that another political party, Azapo, had also handed in a submission.  He believed that there was no reason why a political party should be denied the opportunity.  The ANC submission would not be the line followed by the Committee and there was no risk of that because there were public representatives from all political parties who would defend or argue the point, as would stakeholders. Should the ANC contingent move along the ANC line, they would be brought to order. He suggested that other political parties also make submissions when a second bite was made available.  He informed Dr Mulder that his office had received requests for an extension of the deadline from 10:00 on Friday to Monday at 17:00 from Judith February, Right2Know, Azapo, the Cape Flats Civics, Cosatu, Democracy Development Program and Keith Gottschalk. He had used his position to make a discretionary change.  He informed the meeting that there would, anyway, be a second opportunity for everyone to contribute when the first draft of the committee bill was published. The last deadline should be somewhere in September. He believed that the Committee should allow as many people as possible to participate in the second round, whether they had or had not submitted in the first round. He apologised for not getting back to Committee members on the deadline extension but he trusted that Dr Mulder was satisfied with his decision.  The Chairperson stated that he would inform UCT that their support would be welcome and added that support from other institutions would also be welcomed. The committee support staff would make  arrangements to invite everyone who had submitted input to make an oral submission at the hearing.

Mr Singh proposed that the Committee give ex post facto approval to the extension to the submission deadline, just for the record.

Ms Mafu stated that the clarity seeking questions were not meant to undermine the Chairperson but were intended to clarify the process. She supported the proposal that the Committee give approval to the extension of the deadline.

Mr Mulder had no problem with the extension.  It made sense. He felt strongly that there should be absolute clarity about the role of the University of Cape Town. He requested that the letter from UCT be made available to members.

The Chairperson agreed to circulate the letter. He believed that the Committee would guide UCT in respect of their role as the process continued but he insisted that at no point could they engage in a running commentary.

Mr Khubisa welcomed the fact that other academic institutions would be encouraged to offer support. He strongly supported the notion that they would not be permitted to give a running commentary but would take their place alongside the parliamentary researchers.

The Chairperson noted that the committee support staff had attempted to make a summary of the submissions. The summary consisted of the recommendations made by the submitters. He requested that the content advisor present the summary.  The presentation of the summary was simply to empower Committee members and was not intended as a completely accurate summary as it was the support team’s own impression of the input. The summary had no status per se. He would also ask the legal advisor to advise on processes so that the Committee could craft their proceedings correctly and the Constitutional Court would have no grounds to challenge it.

Summary of submissions
The Committee Content Advisor, Mr Xolisile Mgxaji, stated that 17 submissions had been received from the public: individuals, civil society, organisations, political parties, religious groups, trade unions and so on. One had since been held back. The submissions made unique and crucial comments on political party funding. Those comments tackled public and private funding and how that could be best managed in terms of institutional arrangements.

On public funding, all submissions agreed that there should be allocations of public funding to political parties as one of the key elements to support and promote democracy in South Africa. However, public funding had to be accompanied by strictly regulated private funding. Regulations should cover disclosure of private funding and the use of public funding. There was also a litany of comments noting that the public funding should be used to fund and promote activities which enhance participation such as ongoing voter education, election campaigns, funding of operational costs to political parties and also positive development. They indicated a need to streamline and extend the scope of the current system to specifically include those activities. Submissions highlighted the need to review the formula currently used to fund political parties. Ten of the submissions argued that the current formula was not in line with the principles of section 26 of the Constitution which promote multiparty democracy in South Africa. They proposed a 50-50 basis between proportionality and equity. The submission also stated that ever since the creation of public funding, not a single cent had been donated by the public. All monies came from the fiscus and submissions suggested that public funding be encouraged by offering tax concessions.  The public funding should be used to enable the evolution of democracy in South Africa by ensuring that it was not biased against new entrants and smaller parties.  A balance had to be struck between funding parliamentary activities and non-parliamentary activities. Proposals included funding the constituency allowance and the caucus in Parliament. There had to be strict monitoring and oversight of the public funds as monitoring and oversight was lacking in the current system. 

100% of the submissions agreed that private funding should be used as one of the instruments to fund political parties. However, such funds should be subject to legislation and strict regulations and not be laissez-faire as was currently the case in South Africa. But, undue influence on politicians had to be avoided as it could undermine constitutionality and democracy, and dilute the influence of the citizens.

There were differing opinions on whether foreign funding should be accepted. Those who supported foreign funding recommended that restrictions and limits be put on such funding. Funding should be channelled to a central fund. There was a proposal to ban funding from companies that do business with government. All of the submitters agreed that the recipients, i.e. the political parties, should disclose the amount that they received. There were differing opinions as to whether the donors should disclose such funding in their annual reports. Incentives could be given to encourage local companies to disclose their funding to political parties. Disclosure of amounts above a particular threshold should be compulsory, according to some submissions. However, there was currently no data on political funding and it would be difficult to find a suitable threshold. There were also submissions on the frequency of the disclosure, especially during elections. Disclosures should be incumbent not only on political parties, but also on political leaders.

Submissions addressed the use of public funding and included suggestions that the funds should be earmarked to include activities that enhance participation. Private funding should be used for capacity building. There was a proposal that political party funding should not be used for administration and organising of a political party but the money could be used for election campaigning.

There were three different views on managing the funds. The majority of submissions proposed that a central fund be developed to monitor, oversee and regulate private funding and that that fund could be independently managed. Three submissions proposed that the status quo remain but that the Electoral Commission (IEC) be strengthened. It was suggested that either all excess money, or foreign funds, be channelled into the central fund. In conclusion, the submissions proposed that there should be regulations for managing private and public funding and that a credible and capable institution should be created to manage the funds.

Mr Singh said that the Content Advisor had done a good job and that he had encapsulated his understanding.  The document should be accepted as a support document. However, Committee members should take it as the understanding of the compilers.

Mr Khubisa stated that the submissions would add value to the mandate of the Committee. The submissions should be taken in that light.

Ms Mafu expressed her appreciation for the work done by the content advisor and team as the document provided a broad overview of what had to be done.

Committee Bill drafting: Parliamentary Legal Advisor briefing
The Parliamentary Legal Advisor, Mr Michael Prince, provided a summary of the parliamentary rules applicable to Committee Bill drafting and processing. Once the Committee had finalised the review of the principal Act, the Public Funding of Represented Political Parties Act, the Committee should then be in a position to develop a draft bill which was where Parliament's Legal Services would assist the Committee, and he was a member of its drafting unit. Once drafted, the Committee would have to consult the Joint Tagging Mechanism (JMT) in Parliament to get advice on the classification of the Bill. Thereafter, the Committee would publish a notice in the Government Gazette together with a copy of the Bill or the Explanatory Memo. If the Committee decided to publish the Bill, that notice would have to be accompanied by an invitation calling on the public to comment on the Bill. The Rule stated that the Committee would have to give the public or interested persons three weeks to comment on the Bill.

Once the Committee had decided to publish the Bill, Rule 274(3) required the Committee to report to the House. The Committee would give the House a progress report on what had happened regarding the draft Bill up to that stage. Section 59(1)(a) of the Constitution stated that comments received by the Committee had to be fully considered. The Constitutional Court had coined the phrase “meaningful participation in the process”. Once the Committee had received the comments and had decided how to process them, the Committee could decide to make further amendments to the draft Bill, in which case Legal Services would assist with the amendments. If amendments were made, the Bill would have to go back to the JTM to confirm the classification. Legal Services would then certify that the final Bill was in line with the Constitution and was correct in style and form. To introduce the Bill, the Committee would send the final Bill, and a supporting memorandum, to the Speaker, together with the JTM classification. There was no first reading on a Committee Bill but it would be placed on the Order Paper for a second reading. The Bill would then be submitted to the National Council of Provinces (NCOP).

The Chairperson stated that he had not previously been involved in preparing a Committee Bill so he welcomed the advice and support of Legal Services.  However, he was unaware that the Bill had to go to the NCOP. The original Act had been a Home Affairs Act and therefore he understood it to be a national competence and not a national and provincial competence. He asked the support team to ensure that that part of the process was correct. He would then draw up a programme to ensure that all activities were included.

Mr Selfe assumed that the Bill would have to go to the NCOP because it was an Act of Parliament. He noted that a number of institutions, and even provincial councils, provided money to political parties and in that sense the NCOP would be integral to the legislation. The fact that the NCOP had to be involved raised the question of whether the Committee needed to be a Joint Committee.

Mr Singh stated that their point of departure was the current Public Funding of Represented Political Parties Act, No 103 of 1997.  He asked that the legal team explain how the Committee went back to that point. That was where the Home Affairs Portfolio Committee came into the picture. He also wondered whether there would be any need for constitutional amendments as the Act derived from the Constitution.

Mr Khubisa was also puzzled by the fact that the Bill had to go to the NCOP. He wondered whether it was necessary for the Committee to factor in the NCOP into the process.

Dr Mulder suggested that the Committee not attempt to change the Constitution. The NCOP would be involved from the legislative perspective but he advised that they stay away from a Joint Ad Hoc Committee as it would complicate things. He was not sure whether there would be a need for legislative changes to the Act.

The Chairperson explained to Dr Mulder that the Committee was moving from the worst-case scenario and that if no legislative changes were necessary, he would be very happy. He noted that after the meeting, the Committee Secretary would invite the submitters, as well as National Treasury and Home Affairs/IEC as they were integral stakeholders. Thereafter, the Committee would have to put together the written and oral submissions.  The support staff hoped to present the document to the Committee the day after the final submissions.  The legal advisors would interrogate the document and return it to the Committee for approval before it went out for three weeks of public comment.  Further hearings would be held and a second draft would be drawn up. Thereafter, the legal team would be requested to formulate it as a Bill. It would then be returned to the Committee for final deliberations before it was sent to the Speaker.  The 30 November deadline was the 30th and that was the deal. He did not want to extend the date set for completion of the process. Unfortunately, many people did not like to work on Fridays but everyone would have to work on Fridays, and over weekends.

Gen B Holomisa (UDM) asked when the Chairperson would like to see the Bill legislated. Was he targeting 2019 or 2024? If it were before 2019, how was he going to escalate it to be included in the budget?

Mr Selfe asked if there would be a day between the last submission and the production of the first draft. The Chairperson had explained that he and his team would collate the document within 24 hours after the last submission. The document would then be presented to the Committee to finalise. Mr Selfe assumed that it meant that the Chairperson was using the original Act or the submissions as a basis for the document. He suggested that there needed to be an existential discussion about what "party support" meant in all its ramifications before the draft was put together.

The Chairperson agreed to a political debate within the Committee about what party support meant before they began to construct the document.

The Chairperson assured Gen Holomisa that he was not worried about the budget as the Committee would submit the Bill to the powers-that-be and it would be their baby to decide what needed to be done.

Dr Mulder stated that there were many forms that the document could take and so he supported the proposal for political discussion.

The 21 June 2017 minutes were adopted and the meeting adjourned.


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