WATCH: This is where political parties get their funding

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Published Mar 1, 2023


Have you ever wanted to know how political parties are funded? Here you go …

This week the Electoral Commission (IEC) issued party funding details for the third quarter of the 2022/23 financial year. The 2021–2022 Party Funding Annual Report was tabled in the National Assembly at the end of January 2023.

This is in line with the requirements of Political Party Funding Act. The IEC will, in due course, issue a comprehensive statement on the state of party funding in the country as at the end of the last financial year.

Naturally, this will include information on the audited annual financial statements of registered political parties and the extent of compliance with the act during its first year of implementation.

Only ActionSA and DA declared foreign donations and all of them were compliant with the legislation in that they were below the R5 million limit per donor per party per year. Foreign donations were also used for prescribed purposes, namely, skills development, research and policy development.

The EFF’s declared donation of R 202 600 was an in-kind donation received from a donor called Car Junction. The donation was in the form of party branded T-shirts and caps.

A total of five political parties have declared donations amounting to R40 050 925.54 during the third quarter of the 2022/23 financial year.

The five parties and the donations received are as follows:

• ANC – R32 000 000

• DA – R 2 921 325.54

• EFF – R 202 600

• ActionSA – R 4 680 000

• Patriotic Alliance – R 247 000

The IEC explained that ActionSA’s donations were received from three donors, two of whom are regular donors to the party, namely: Martin Moshal (R3.5 million) and Konrad Adenauer Stiftung (KAS) NPC (R180 000). The third donor was an entity known as African Equity Corporation (Pty) Ltd, with a donation of R1m.

"The ANC also received donations from three entities, namely: Batho Batho Trust (R15m), Naspers Limited (R2m) and United Manganese of Kalahari (UMK) (R15m). Both Batho Batho Trust and UMK have in the previous financial year made significant donations to the party,“ the IEC said.

The DA received donations from four entities: Fynbos Trust (R271 000), Ms Karen Cramer (R250 000), Naspers Limited (R2m) and Friedrich Naumann Foundation (FNF) (R400 325.54).

“Save for Karen Cramer, the three other entities have also made significant donations to the party previously,” the commission said.

The EFF and the Patriotic Alliance each received donations from a single donor. The EFF’s donation (R202 600) was received from an entity known as Car Junction, while the PA’s donation (R247 000) was received from one of the national party leaders, Kenny Kunene.

ActionSA and the Patriotic Alliance are unrepresented political parties, that is, they currently do not have representation in either one of the nine provincial legislatures or Parliament. These two parties have from time to time declared significant donations received.

Among the five political parties that have declared donations, four declared donations‑in‑kind to the value of R30 782 925.54. The largest of these in-kind donations was declared by the ANC at R30 000 000. The balance was made up of donations to ActionSA (R180 000), the DA (R400 325.54) and EFF (R202 600).

ActionSA’s in-kind donation was received from KAS, a foreign entity and political foundation that is closely associated with the Christian Democratic Union of Germany (CDU). The in-kind donation was in the form of training and skills development for party members.

The ANC’s in-kind donations were from Batho Batho Trust and UMK, valued at R15m each.

The donation from Batho Batho Trust was a payment made to the SA Revenue Service (Sars) on behalf of the party, whereas the donation from UMK was a payment made on behalf of the party to the Johannesburg Expo Centre for the ANC elective conference of December 2022. These types of payments to third parties are classified as in-kind donations in terms of the act. Both the donations do not exceed the prescribed annual threshold.

DA’s total in-kind donation is from FNF, a foreign entity, which has up to now donated to the party every quarter. The in-kind donation, valued at R 400 325.54, was in the form of training and skills development for party members. This covered seminars on communication: strategy and skills; promoting entrepreneurship and open markets; and coalition building and strategic partnership, among others.

No contributions were made to the Multi-Party Democracy Fund (MPDF) during the third quarter. In an effort to obtain more contributions to the fund, the IEC said it had begun a process of engaging with a number of high net worth citizens to introduce the MPDF. The increasing activity in the preparations for the 2024 elections could also provide additional impetus to contribute to the MPDF by these citizens, the IEC said.

The IEC said represented parties continued to be the beneficiaries of bigger donations.

“However, there are also indications that unrepresented parties themselves are actively raising funds and do receive some significant donations. Case in point is ActionSA, which has during this particular quarter received donations that are bigger than donations received by some of the represented parties,” the IEC noted.

On the MPDF front, the commission wished for more contributions to sustain multi-party democracy. The performance of the fund was the clearest indication yet that funders appeared to still have a preference for direct donations to political parties, the IEC said.