Smith Funding of Rep Political Parties Bill; Schmidt Admission of Advocates & Joubert Mag Courts Amd Bills

Meeting report

PRIVATE MEMBERS’ LEGISLATIVE PROPOSALS AND SPECIAL PETITIONS STANDING COMMITTEE
24 August 2005
ADV SCHMIDT'S ADMISSION OF ADVOCATES BILL; MR SMITH'S PUBLIC ELECTION FUNDING OF REPRESENTED POLITICAL PARTIES BILL; MR JOUBERT'S MAGISTRATRES’ COURTS AMENDMENT BILL

Acting Chairperson: Mr S Mshudulu (ANC)

Documents handed out:
Schmidt’s Paper on his Admission of Advocates Amendment Bill
Smith’s Public Election Funding of Represented Political Parties Bill
Response from the Department of Justice on Joubert’s Magistrates Courts Amendment Bill
Response from the Department of Provincial and Local Government on Joubert’s Magistrates’ Courts Amendment Bill

SUMMARY
The Committee was briefed by Mr P Smith MP on his proposed Public Election Funding of Represented Political Parties Bill. The object of the Bill was to provide for the State to contribute towards election funding of political parties by way of a Represented Political Parties’ Election Fund. It was only concerned with the establishment of a vehicle through which the State could appropriate monies for election purposes. The Bill did not make any provision for the appropriation of monies to be given to parties for election purposes. It would be entirely in the discretion of the National Treasury to put anything into the empty vehicle. The Bill had no financial implications as far as the setting up of the Fund was concerned. The financial implications would arise if National Treasury decided to put some money into the Fund. No decisions were taken in respect of the Bill and it would be discussed further in upcoming meetings.

Members raised the following questions:
- whether it would not be better to amend the Public Funding of Represented Political Parties Act instead of having another Act;
- whether other jurisdictions offered financial assistance for election purposes, and
- whether government did not give parties some money for election purposes?

There was general agreement that political parties needed more money. Fund-raising had become increasingly difficult.

The Committee agreed not to discuss the merits or demerits of the proposed Admission of Advocates Amendment Bill pending a response from the Department of Justice. The Department of Justice had sent a letter indicating that it was considering the initiation of legislation to amend the Magistrates’ Courts Act of 1944. It was of the view that the proposal relating to the amendment of the Magistrates’ Courts Act should not be promoted separately because it intended to bring Section 66 of the Act in line with the Constitutional Court’s judgement in Jaftha v Schoeman and Others.

MINUTES
The Acting Chairperson said that the Committee had committed itself to finalising all proposals before it. The Committee had received a response from the Department of Justice in relation to the proposal by Mr L Joubert, MP.

Mr P Smith’s proposed Public Election Funding of Represented Political Parties Bill
Mr P Smith MP had sent a letter to the Speaker of the National Assembly indicating the intent to introduce a Bill. There was also a copy of the Bill attached to the letter even though the submission of the Bill was not a requirement. He had decided to attach the Bill hoping that his proposal would find favour and also help speed up the drafting process. Another reason was that there were some controversial provisions in the Bill. It was therefore helpful for Members to have a copy of the Bill. A memorandum on the Bill was also circulated. It summarised the Bill clause by clause.

He said that the object of the Bill was essentially to provide for the State to contribute towards election funding of political parties by way of a Represented Political Parties’ Election Fund. The Bill did not make any provision for the appropriation of monies. It was only concerned with the establishment of a vehicle through which the State could appropriate monies for election purposes. It would be entirely in the discretion of the National Treasury to put anything into the empty vehicle. He reminded Members of the existence of the Represented Political Parties Fund that was not a Represented Parties’ "Election Fund". The Public Funding of Represented Political Parties Act (No. 103 of 1997) was passed entirely for the purposes of contributing towards represented political parties’ operational expenses. Although there were some discussions on whether the Act should cover election funding, it was at the time the Act was passed decided that it should be restricted to operational expenses. The Bill would create a vehicle for funding of parties for election purposes.

Mr Smith said that Section 236 of the Constitution provided for mandatory funding of parties represented at national and provincial spheres of government. The Bill envisaged election funding even for parties represented only at local government level. The Constitution required that funds from the Represented Political Parties’ Fund should be distributed on the basis of proportionality and equity. All represented parties shared 10% of the gross amount available in the Fund. The balance was divided proportionally. The Bill would use the same formula for election purposes. Funding for local government was a bit complicated. The Constitution did not require the application of the proportionality/equity formula principles at all for local government. The legislature was free to determine any formula it deemed fit. Mr Smith said that after he had applied his mind to what would be an appropriate formula, he came to the conclusion that one could not come up with a workable formula.

The way forward could have been the use of the same formula that was used for national and provincial government elections. However, this would be unworkable because some of the political parties that would contest local government elections might not be represented in the National Assembly or provincial legislatures. Such parties would be excluded in terms of the existing formula. The Bill proposed a formula based on proportionality. One would simply have to take the number of councillors that parties had in all municipalities in the country and express the number as a percentage of all councillors in the country. If a party had 100 councillors, the formula would be 100/9000x100. A formula that would include the equity component would create problems because every independent candidate would register as a party in order to receive a portion of the equity component of the Fund. Such a possibility was to be avoided.

He said that the bulk of the Bill dealt with the regulatory aspects, administration and accountability. The Bill replicated the provisions of the Public Funding of Represented Political Parties’ Act. The Independent Electoral Commission was the nominated accounting authority. There were procedures for reporting to Parliament and auditing. The difference was that unspent funds had to be returned to the Commission on its request. The possibility of unspent funds was very remote.

Mr Smith reiterated that the purpose of the Bill was to create an empty shell. There was a requirement that the memorandum of Bill should indicate if the Bill had any financial implications for the State. The Bill had no financial implications so far as the setting up of the Fund was concerned. The financial implications would arise should National Treasury decide to put some money into the Fund. Foreign donors might not want to make donations directly to political parties. They might choose to make donations into the Fund. There were all sorts of controversies to the private funding of political parties and the donations process. Putting the donations into the Fund would have benefits for both donors and parties. IDASA had estimated that the cost of the 1999 elections ranged between R300 million and R500 million. The real motivation behind the Bill was essentially that all parties were finding it very difficult to raise funds.

Discussion
The Chairperson said questions would allow the sponsor to say more on the Bill. The objective was to give him the opportunity to sell his proposal and to assist Members with a better understanding of the issues.

Mr A Ainslie (ANC) could not understand the difference between the Public Funding of Represented Political Parties Act and the Bill. The Act provided the purposes for which the monies allocated to the parties could be used and they did not exclude the use of the monies for election purposes. Political parties were in the business of elections. He asked if it was not preferable to amend the Act if the differences between the Act and the Bill were minor.

Mr Smith replied that the intention was not to say that the Funding Act provided that the monies could not be used for election purposes. A party could choose not to use the money for operational expenses and use it for electioneering. The proposed Fund in terms of the Bill was intended solely for funding of elections. Most parties used the money allocated in terms of the provisions of the Act for operational expenses. The Funding Act provided for an annual appropriation of monies and the need for funding in terms of the Bill would only arise in the year of elections. There were similarities between the Bill and the Act especially with regard to the accounting provisions.

Advocate Schmidt said that the presentation created an impression that there were two different issues: election funding and operational funding. It appeared that the issues had been discussed in another forum before and the Committee, when discussing the Bill that resulted in the Funding Act, had decided against election funding. He asked about the thinking behind such a decision.

Mr Smith replied that the issue that the Committee had dealt with then was funding towards operational expenses. The issue of election funding had been raised in the course of the deliberations. There was no principled objection to election funding.

Advocate Schmidt asked if the government had not allocated monies for the last national elections. Into which Fund was such money paid? Private funding of political parties was facilitated through the payment of the money into the party’s bank account.

Mr Smith replied that he was not aware of any donations that had been made into the existing Fund. It was true that parties were recipients of donor funds. The grounds on which parties received donations were in the donor’s discretion. Some donors had gone public with their formula. There was no government funding towards the last elections. There was a popular myth that government funded elections. People generally believed that the monies paid to parties were for election purposes.

Mr Ainslie said that the basic point was that all political parties needed more money. He could not distinguish between operational and election expenses.

Mr Smith agreed that there was no distinction. It was just a question of a strategic/tactical approach to the issue. The slight difference, which made it worthwhile to consider the proposal, was that the existing Act did not deal with local government at all. The Bill would deal with local government. The Act was concerned with annual appropriations whereas the Bill was specifically aimed at the years in which elections would be declared. One could amend the existing legislation to accommodate the provisions of the Bill but at the same time there would be no harm in having parallel legislation. The truth was that parties were struggling to raise funds and some sort of assistance, whether in the form of the existing funding being increased or through a different vehicle, was necessary.

Mr B Magwanishe (ANC) asked if other jurisdictions had a Fund similar to the one proposed in the Bill.

Mr Smith replied that there was an article that had shown that in 104 countries that had been examined, 59% of the political parties were recipients of direct public subsidies. He did not have the figures for election versus non-election subsidies. There were examples of Zimbabwe and Mozambique.

A Member said that the Committee should not let the Bill drop because it was important. All political parties needed more money.

Mr Smith said that he had submitted the Bill in February 2005. He asked if there was any possibility of finalising it before the end of the calendar year.

Mr Mshudulu could only respond that the Committee had committed itself to finalising all proposals before it before the end of the year.

The Committee would further discuss the proposal in its next meeting.

Adv Schmidt's Admission of Advocates Amendment Bill
The Chairperson said that the Committee was still awaiting a presentation by the Department of Justice on any legislation related to the Bill.

Advocate Schmidt read through a document he had prepared. (See document attached). The proposal was motivated by and on behalf of Advocate Adrian de Bourbon from Zimbabwe who had practised as an advocate in Zimbabwe for over 30 years and had been a senior counsel in that country for over 20 years. The current law created an anomaly in that a person not resident in South Africa and who did not have a South African law degree could practice as an advocate so long as s/he remained resident in any country designated by the Minister of Justice. However, such a person would not be entitled to practice as an advocate should he or she have received permanent residence in this country. He proposed that the existing concept of designation by the Minister of Justice should be retained. However, a person who had practised as an advocate in a country designated by the Minister of Justice and who had obtained permanent residence in South Africa, should be able to practice as an advocate in South Africa provided s/he satisfied certain requirements:
- that he or she had practised as an advocate in a country designated by the Minister of Justice;
- that he or she remained in good standing with whatever organization was responsible for the practice of advocates in that designated country;
- that he or she had practised in that designated country for a minimum of a specified period; and
- that he or she had lawfully obtained permanent residence in South Africa.

He urged the Committee to support the proposed amendment.

Discussion
Mr Smith asked if a person did not require a permit before he or she could come and work in South Africa. The intention of the current Act was to allow advocates to come and work for a short period and go back to their countries. For instance, a company might decide to bring in a lawyer from Nigeria or Zimbabwe for a specific case.

Mr Ainslie felt that the Committee could not make a decision on the merits or demerits of the proposal until it had heard the views of the Department of Justice. The Committee should also consult the Portfolio Committee on Justice on the issue.

A Member supported Mr Ainslie’s views. The role of the Committee was to receive petitions and process them before referring them to the relevant Departments for consideration. It was imperative for the Committee to wait for some input from the Department. The Department might initiate legislation should it share the view that there was a loophole.

The Committee agreed that it would await the response from the Department before taking the matter any further.

Response by Department on Mr Joubert’s proposed Magistrates’ Courts Amendment Bill
The Chairperson said that the Committee had endorsed the motion of desirability of the Magistrates’ Courts Amendment Bill as proposed by Mr L Joubert MP. He said that the Department of Justice had indicated that it was considering the initiation of legislation to amend the Magistrates’ Courts Act, 1944. The Department was of the view that the proposal should not be promoted separately because it intended to bring Section 66 of the Act into line with the Constitutional Court’s judgement in Jaftha v Schoeman and Others.

The Chairperson said that the Department of Provincial and Local Government had acknowledged receipt of documents from the Committee. It had referred it to its officials for attention.

The meeting was adjourned.