Committee Draft Bill on Funding of Political Parties: briefing & call for comment

Ad Hoc Committee on the Funding of Political Parties

14 September 2017
Chairperson: Mr V Smith (ANC)
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Meeting Summary

The Committee met to check that the Committee Draft Bill on the Funding of Political Parties had captured all the proposals agreed to and to ensure that the Bill was ready for gazetting and for public comment. Minor amendments were made and the Committee made a note to address the matter of political party funding at local government level when the Committee next met on 17 October. It was hoped that more detailed information about political party funding at municipal level would be available to the Committee by that time. The Committee agreed to the Memorandum of Objects to accompany the Bill. A Committee Progress Report was approved for submission to the Speaker to bring her up to date with progress on the Bill.

The Chairperson informed the Committee that, as agreed, the secretariat would, extraordinarily, ask organised business and businesses in general to engage with the draft legislation as it had implications for any business that wished to donate to the Multi-Party Democracy Fund or to political parties.  The South African public would be given 21 days to submit inputs with a 16 October deadline. Thereafter, there would be public hearings, which would include Black First Land First as previously agreed. The Committee would next meet on 17 October 2017.  Worthy input would be included, and the Bill would be submitted to the National Assembly by 28 November 2017.

Meeting report

The Chairperson explained that the Committee would check the Draft Committee Bill to ensure that it covered everything decided upon and to give it its blessing so that the secretariat could send it out to South Africans for public comment.  The Committee would look at a draft progress report for the Speaker to bring her up to date with the progress on the Bill and the Chairperson welcomed input. Thirdly, the Committee would look at the Memorandum that needed to accompany the Bill.

Discussion ensued about the process for the meeting. Mr B Bongo (ANC) suggested that the Committee look only at the clauses where there had been changes. The Chairperson said he would have allowed the legal advisors to run through the document.  Dr P Mulder (FF+) would feel more comfortable if the legal advisor ran through the document briefly. The decision was to allow the legal team to take 15 minutes to present an overview of the Bill.

Legal Advisor review of the Bill
Mr Michael Prince, Parliamentary Legal Advisor, reviewed the content of the Bill, clause by clause.  He explained that the Draft Committee Bill began with the Long Title which captured all the salient matters contained in the Bill and ended with a catch-all.  The Preamble was a statement of Parliament’s legislative authority.

Clause (1) the new definition of “funds” has a reference to a combination of the two funds –the new Multi-Party Democracy Fund (MPDF) and the existing Represented Political Party Fund (RPPF).
Clause (2) established the Represented Political Parties Fund and made it clear that such parties had to have a representative either in Parliament or in a provincial legislature.
Clause (3) established the new Multi-Party Democracy Fund to provide for private sources of funding.
Clause (4) related to bank accounts and investments for the funds.
Clause (5) dealt with the management of the funds by the Chief Electoral Officer of the IEC.
Clause (6) regulated how the funds would be allocated to political parties.
Clause (7) set out what the money could and could not be used for.
Clause (8) regulated political parties.
Clause (9) sought to prohibit donations made by certain persons and parties. 
Clause (10) provided for disclosure of donations to political party funds.
Clause (11) prohibited direct funding to individuals in political parties.
Clause (12) explained how a political party had to account for funding.
Clause (13) regulated how political parties had to account for funds made available to them.
Clause (14) dealt with unspent monies.
Clause (15) dealt with the monitoring and inspection powers of the IEC.
Clause (16) granted the Commission power to issue a direction to a political party.

Clause (17) granted the Commission the power to suspend payment of monies.
Clause (18) granted the Commission power to retrieve money irregularly received or spent by political party.
Clause (19) granted the Commission the right to impose sanctions.
Clause (20) allowed for an appeal of a decision by the Commissioner and established the Electoral Court as the body to hear any appeals. 
Clause (22) limited the source of funding for political parties. 
Clause (23) allowed the Commission to devise rules. 
Clause (24) provided for the repeal of the previous Act.  Certain sections of the Bill could be brought into operation at different times or simultaneously.

The Chairperson asked if there were any errors or a need for clarity. He reminded Committee Members that the regulations would only be written after the Bill had been cleaned up following public input.

Mr A Lees (DA) noted that funding by foreign foundations had been approved but he could not find it in the Bill.

Prof Halton Cheadle, UCT legal drafter, replied that it was partly covered under the definition of in-kind but did not include multi-party training or skills development. 

The Chairperson explained that the Committee had agreed to allow donations in-kind in respect of political training etc.

Prof Cheadle said that it was allowed if it was multiparty or leadership training.

The Chairperson explained that it was not about multiparty but political party policy or other training. 

Mr J Steenhuisen (DA) stated that the problem would come in clause 9(1)(b) where it was prohibited because it was a foreign donation.

Mr N Singh (IFP) determined that the definition was inadequate and there needed to be a sentence that clearly stated that training provided by a foreign foundation was not prohibited. 

Dr P Mulder (FF+) noted that some of the definitions in the current Act had been omitted.  The new Long Title did not refer to the reason for the Bill.  There had to be a clear articulation of the purpose of the Bill. The proposal in clause 6(3) on the payment of monies to representative political parties incorrectly referred to a fixed threshold.  He was under the impression that a weighted scale was to be used. Clause 23 proposed a new way of regulating. The Draft Committee Bill stated that the Electoral Commission would make Regulations and the Committee would have the opportunity to approve or reject the Regulations.  He was of the view that the Regulations on the principles of the Act had to be done by the Committee. The Commission had to take responsibility for all administrative regulations but not for those with a political context.  

Mr Prince pointed out that clause 23(3) indicated that Regulations, apart from specified clauses relating to political decisions, were to be formulated by the Commission. 

Dr Mulder felt that it was not sufficiently clear.

Prof Cheadle explained that the word “equitable” was used because that was the term used in the Constitution. 

Dr Mulder pointed out that he wanted the equitable part done on a weighted basis in respect of the formula.

Mr Singh referred to Clause 6(2) which needed to be tidied up. Where was the prescribed formula going to be explained?

Mr Prince explained that “prescribed” would cover that.

Mr Singh asked whether investment in the Public Investment Corporation (PIC) was the choice of the drafters.

 Mr Prince explained that it was a carry-over from the original Act.

Mr Singh asked about municipalities and whether the way in which the clause was written forbade municipalities to fund parties or candidates.

Prof Cheadle explained that local government had no rights through policy or bylaws to fund political parties. 

Mr Steenhuisen pointed out that municipalities provided administrative support to political parties and that if municipalities were prevented from making donations in cash or kind, political parties at that level would be unable to function effectively.  

Mr Bongo thought that the Committee could omit the reference to local government until after the public submissions.

The Chairperson said he did not want to allow a loophole at local government level.

Mr Bongo suggested that it be omitted as the Committee Members could come back to it when they had more information.

The Chairperson indicated that Mr Steenhuisen and Mr Bongo were saying that it should be left out of clause 22(2). 

Mr Singh suggested that the clause should be left in so as to get public input. 

Dr Mulder warned that they did not want representation by 220 municipal councils at the next set of hearings.  He asked if it was not possible to state that municipalities had to provide administrative support to local politicians.

The Chairperson determined that clause 22(2) would be removed.

The Chairperson reminded the Committee that Members would have a second bite when the Bill came back after public input.  The secretariat would attempt to secure submissions from organised business.

Mr Singh asked whether it was Section 75 or Section 76 legislation.

The Legal Advisor replied that it was a Section 75 Bill as it did not affect provinces. 

Mr Bongo commended the work done by the support team.

The Chairperson said that once the Draft Committee Bill was tidied up, the secretariat would gazette the Bill for 21 days for public comment. He reminded the support team of the work to be done on the Bill. 

The Chairperson put the Draft Committee Bill to the Committee. 

Mr Steenhuisen replied he was happy for it to go to the public.  He had a problem with page 11 which suggested that one could not provide any donation to an individual politician even on election day but the Chairperson explained that it prevented donations to individuals but not to a party. He was quite sure that support on election day would be support for the party.  He asked the legal advisor to make sure it was clear.

Mr M Dlamini (EFF) asked if the Committee had agreed to increase the public funding for political parties. 

The Chairperson explained that the Committee was not a funding committee and had not discussed rands and cents. The Committee could discuss a formula for funding but not the actual amount of funding.

Mr Singh asked that consideration be given to independent candidates who would ask for donations for themselves on election day.

The Chairperson agreed that the Committee should look at that matter after the hearings. 

Mr Steenhuisen agreed that the Bill could go out for public comment but noted that the DA reserved its right to disagree with the Bill at a later stage.

The Chairperson pointed out that the same would apply to all political parties.

Memorandum on the Objects of the Bill
Mr Singh suggested that the briefing made by the legal team, once amended according to the morning’s discussion, could, in fact, become the Memorandum required to accompany the Bill for gazetting. The Chairperson agreed and the legal advisor was instructed to amend the briefing document so that it could serve as the Memorandum.

The Committee agreed that the Chairperson could check and approve changes made to the Draft Bill and the Memorandum.

Committee Progress Report to Speaker
According Rule 253, the Committee had to advise Parliament before gazetting a Committee Bill.

The Committee was asked to comment on the Report.

Dr Mulder requested that the Report be amended to state that the Committee comprised eleven full-time and seven alternate members, although everyone was permitted to participate.

Mr Singh pointed out a technical amendment..

The Chairperson asked if the Report sufficed for what was required for a Progress Report.

The Committee approved the Report.

The support staff would ensure that the amendments were effected.  The Report would then go to the Speaker. 

Way forward
The Chairperson reminded the Committee that the secretariat would, extraordinarily, ask business to engage with the draft legislation.  There would be 21 days for public comment, with a 16 October deadline. Public hearings would follow, which would include, at least, Black First, Land First. The Committee would meet again on 17 October 2017. Worthy inputs would be included and the Bill would be submitted to the House by 28 November 2017.

Committee Minutes
The Committee approved the minutes of 15, 16, 17, 18, 22, 23 August and 1 September 2017.

Meeting adjourned.

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