The National Assembly has unanimously agreed to establish an ad hoc committee to look into the funding of political parties.
The committee would inquire into and make recommendations on funding of political parties, with a view of introducing or amending legislation if necessary and consider a model for adequate public funding for political parties represented in Parliament and the provincial legislatures. It would also look at the regulation of funding of parties by private institutions as well as investment entities owned by political parties.
The committee will consist of 11 members — six from the ANC, two from the DA, one from the EFF and two representing all other parties in the National Assembly.
South African parties represented in Parliament and in the provincial legislatures receive funding from taxpayers in line with the proportion of votes they receive in elections. This funding is regulated by the Public Funding of Represented Political Parties Act. The administration of the fund is placed in the hands of the chief electoral officer under the oversight of the Electoral Commission of SA (IEC). The fund is regarded as inadequate and, in most instances, is seen as consolidating the dominance of the ANC.
In May, ANC chief whip Jackson Mthembu said political parties were poorly funded by the state, which forced parties to rely heavily on private donors.
Mthembu said political parties’ reliance on private funding fuelled the perception that anonymous donations from business interests were a means to subvert democratic processes by influencing the awarding of contracts or "framing of policy in a manner that advantages private interests, dilutes the voice of citizens and undermines the Constitution".
Private political party funding has been a contentious issue in recent times, with civil society groups calling for the regulation of private financing of parties in line with AU, UN and other anticorruption codes the country has signed. The groups, including My Vote Counts, have in the past launched unsuccessful court bids to compel Parliament to enact legislation that will make it compulsory for parties to disclose private donors.
The now-defunct Institute for Democracy in SA was the first group to launch a court application on the matter, but in 2005, the High Court in Cape Town dismissed its application.
On Tuesday, Mthembu said: "The establishment of this ad hoc committee is a crucial step towards strengthening our democracy because political parties require adequate funding in order to perform their functions and the manner and transparency of such funding is paramount in building public confidence in our political system."
Mthembu said the ANC was confident that the work of the ad hoc committee would ensure that all political parties achieved financial sustainability in a manner that was transparent, ethical, lawful and predictable.
Freedom Front Plus (FF Plus) leader Pieter Groenewald said elections in SA would not be free and fair as long as the state’s party political funding model was "biased towards" the ruling ANC.
"As far as private donations are concerned, the FF Plus is in favour of parties disclosing the names of donors. This must apply to all parties, and especially to the ANC. If companies want to donate money for the sake of a healthy democracy and to ensure free and fair elections, the money can be placed in a fund and divided between the parties in a fair way," said Groenewald.
The FF Plus was in the process of initiating a court case in order to ensure a fairer distribution of funds, he said.
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