Party Funding: a Defective System?

There is no law or rule that requires any political party to disclose the source of any funds provided to it for any electoral or pre-electoral expenses. In my last but one blog I raised the issue of how timing electoral propaganda expenditure could

"... very adeptly sidesteps the rather archaic rule that any expenditure incurred prior to 30 days before the election does not fall to be calculated within the limits imposed on candidates by the Parliament Act. A reading of section 14(2) is also indicative that, if any expenditure is incurred on materials and services before the prescribed period, then it is not to be taken into account, even if used within the prescribed period (although this depends on the interpretation of the word "expenditure" and "incurred")."

It is also true that the only further control that exists on electoral expenditure is an absolute limit (section 14(1) Parliament Act) of £3,000 per candidate. This limit only applies during the prescribed period stated in my quote above. 

What these rules do not deal with at all is, first disclosure of who is making donations to any political party in Gibraltar. Secondly, the perception that arises that any individual or business that makes a substantial donation to a party does so in anticipation that he/she or it will receive an appropriate favour in return. In the UK there is a requirement for disclosure of any donation made to a party in the sum of £7,500 or more. Making rules to oblige disclosures in Gibraltar needs to be looked at urgently. Obviously the minimum amount that would need to be disclosed needs to be appropriately scaled down from the UK amount, in line with the limit on expenditure per candidate.

Expenditure by the GSD in an effort to get iteslf re-elected has already begun. It seems to be very lavish. Who is providing these funds to the GSD? Soon other parties, the GSLP/Liberal Alliance and the PDP, will be incurring expenditure. The public is entitled to know who is making donations to each political party to enable it to fund its election and pre-election campaign. For example, it would be very telling if the same individual or company were to be funding both major parties. It would be evidence of large favours being expected in return for the donation. There would be no other explanation for a desire to fund both main parties.

The issue of political donations to parties has been debated for years in the UK. The Committee on Standards in Public Life is now looking into it, once again. It is recognised, now, that the current system of allowing donations has to be discontinued. The only alternative is public funding. The debate is how the level of such funding can be determined? The favoured option seems to be to base funding on a per vote levy. The levy may or may not be what is introduced. Any system adopted will have its detractors but that is no reason for not finding a solution to such a palpably obvious defect in the electoral process. The same issue of finding an alternative method of party funding exists in Gibraltar. It is time that it be carefully looked at and debated with a view to resolution. Perhaps, waiting for the solution given to the problem in the UK may be wise. Waiting for the UK to resolve the election funding issue in order to follow it's example does not mean that making compulsory disclosure of donations public in Gibraltar should be delayed.

There is no doubting that putting a cap on expenditure has some small effect. A cap has always existed in Gibraltar. It does not exist in the UK at present, although one may be introduced. However, the cap does not resolve the issue of how funding affects politics nor unfair expenditure for the period immediately preceding the announcement of an election by the Chief Minister. However, what can or could influence policies and decisions is the source and level of largesse shown to a political party (especially if, as in Gibraltar, both factors remain secret), a cap on expenditure does little or nothing to prevent this but funding parties from public funds would.