United Democratic Movement: legal opinion on funding

31 July 1998

The Chairperson
Mr Desmond Lockey, MP

In addition to our submission already made to you in connection with matters pertaining to the Electoral Bill attached please find a submission specifically addressing the issue of funding of political parties as prepared by Advocates Jan Heunis, SC and Andrew Breytenbach at our request.

Please submit this document to your Committee for consideration.

We request written confirmation upon receiving this submission by the UDM.



31 JULY 1998

1. We are briefed by the United Democratic Movement ("UDM") to make submissions to the Portfolio Committee on Home Affairs (National Assembly) on the constitutionality of the absence of provision for state finance of registered political parties' campaigns in the Electoral Bill, B96-98 (hereinafter "the Bill"). We understand that the UDM will be making separate submissions regarding other aspects of the Bill.

The Constitution
2. The Constitution of the Republic of South Africa, 1996 ("the Constitution") requires that national, provincial and municipal elections be fair. Section 19(2) provides that every citizen has the right to free, fair and regular elections for any legislative body established in terms of the Constitution. Section 190 provides that the Electoral Commission must manage the elections of national, provincial and municipal legislative bodies in accordance with national legislation and must ensure that those elections are free and fair.

3. The Constitution requires that national legislation regulate national, provincial and municipal elections. See sections 46, 105 and 157 which deal respectively with the composition and election of the National Assembly, provincial legislatures and municipal councils.

4. It is necessarily implicit in the Constitution, and in the provisions cited above in particular, that the national legislation regulating the elections must conduce to their being fair.

5. Accordingly, if Parliament were to enact electoral legislation which is inimical to the holding of fair elections, it would be failing to fulfil a constitutional obligation.

The 1993 Electoral Act
6. Section 74 of the Electoral Act, 1993 ("the 1993 Electoral Act") set up a State Electoral Fund in order to provide registered political parties with financial assistance for the purpose of conducting their election campaigns.

7. The Fund was administered by the Independent Electoral Commission (set up by the Independent Electoral Commission Act, 1993, and now governed by the Electoral Commission Act, 1996).

8. Section 74(4) of the 1993 Electoral Act made provision for two forms of financial assistance to registered political parties: an initial grant payable before the elections on an equal basis and without discrimination to all registered parties which could show on the basis of a representative and scientific poll that they enjoyed the support of at least 2% of voters (or on the strength of a list of 10 000 signatures, in which event 50% of the initial grant was payable), and a final grant payable to all successful parties after the results of the election had been determined. Part of the final grant was divided proportionally between the successful parties on the basis of the number of votes they attracted.

9. The 1993 Electoral Act is due to be repealed and replaced by the Electoral Bill, which makes no provision whatsoever for financial assistance to registered political parties for the purpose of conducting their election campaigns.

The Public Funding Act
10. The Public Funding of Represented Political Parties Act, 1997 ("the Public Funding Act"), however, which was enacted pursuant to section 236 of the Constitution, establishes a Represented Political Parties' Fund which is to be credited with money appropriated by Parliament (R53 million has been budgeted for the Fund) and from which money will be allocated to political parties represented in the National Assembly and/or any provincial legislature in accordance with a formula based on the principles of "proportionality" and "equity".

11. Section 5(1)(b) of the Public Funding Act provides that money allocated to a political party from the Fund "may be used for any purposes compatible with its functioning as a political party in a modern democracy", and then goes on to specify a number of distinct purposes. Although the primary focus of the specified purposes seems to be political parties' operational funding, as opposed to their electoral funding, neither the general purposes described in section nor any of the specified purposes, preclude the use of money received from the Fund for election campaigns, whether directly or indirectly (i.e. to free-up funds which would normally be required for operational purposes so that they can be diverted to electoral activities).

12. Money from the Represented Political Parties' Fund will shortly be allocated and paid to the represented political parties. The practical effect of these payments will be to afford the recipient represented political parties substantial State financial assistance for their forthcoming election campaigns.

13. The UDM was founded by prominent members of Parliament who were representatives of the two political parties which currently enjoy the largest representation in the National Assembly and most of the provincial legislatures, namely the African National Congress ("ANC") and the National Party ("NP"). Upon their leaving the ANC and NP the persons concerned lost their seats in the National Assembly due to the "anti-defection" clause in the Constitution (item 13 of Annexure A to Schedule 6), and no by-elections were held as the Constitution makes no provision for by-elections in such circumstances (or any other). As a result, the UDM is not represented in the National Assembly nor any provincial legislature and does not qualify for money from the Represented Political Parties' Fund.

14. We are instructed that the UDM is currently regarded as the third largest political party in South Africa and enjoys national support across a broad spectrum of the electorate. At the end of June 1998 the UDM had more than 650 registered branches and more than 50 000 paid up members. The results of an independent Markinor survey conducted between March and May 1998 showed that the UDM is a significant political party, and this has been confirmed by prominent political analysts such as Prof. Susan Booysen and Prof. Hennie Kotze'. The UDM has received funding from a number of international foundations, including the New South African Foundation (Netherlands) which funds political parties represented in Parliament but extended funding to the UDM after assessing the significant role played by the UDM in South Africa. The UDM also enjoys recognition by all foreign missions to South Africa. It has held formal meetings with a wide range of Ambassadors, High Commissioners and foreign delegations and a number of foreign missions sent representatives to the UDM's first national conference.

The State cannot fairly limit funding to represented political parties
15. In view of the substantial political realignments resulting from inter alia the establishment of the UDM, it would be patently unfair at this juncture for the State to make substantial payments to represented political parties (only) which can, and in all probability will, be used for their forthcoming election campaigns.

16. The resulting state of affairs would amount to unfair discrimination in breach of section 9(3) of the Constitution and a violation of the right of every citizen to fair elections in terms of section 19(2) of the Constitution. Moreover, the lack of any State funding for the UDM and the consequent disparity in campaign finance, would preclude the Electoral Commission from ensuring a fair election in 1999 (as required by section 190 of the Constitution).

17. As the Markinor poll makes clear, there is no question of the UDM having marginal public support or of its candidacy being frivolous. Moreover, as section 1 of the Constitution makes plain, one of the founding values of South Africa is a multi-party system of democratic government.

18. In short, the state of affairs brought about by Parliament's limiting state funding to represented political parties less than a year before South Africa's second democratic general election, would be inimical to fair elections and anti-discrimination provisions in the Constitution.

19. In all the circumstances, therefore, we have advised the UDM that if Parliament does not make any provision in the new Electoral Act for State campaign funding of the UDM, or does not amend the Public Funding Act conformably, it will be failing in its constitutional obligation to ensure that the forthcoming general election is fair.

20. The UDM will then be compelled to launch urgent proceedings in the Constitutional Court for an order to that effect in terms of section 167(4)(e) of the Constitution.