ts and MEDIA >press clipping - panel discussion

ts and MEDIA >press clipping - panel discussion

Press clipping ABOUT panel discussinon called "Political Party Financing: Norms and Practice in Serbia"

Party Politics Is Still a Lawless Affair

Serbia urgently needs new legislation governing the financing of political parties to eliminate misappropriation of political donations, according to participants of a panel discussion called "Political Party Financing: Norms and Practice in Serbia."

Keeping a modern political party up and running and organizing costly election campaigns is an expensive enterprise, but rarely does the public known exactly how political parties come by and spend money. In most cases the only time these matters get any attention is when party officials are discovered with their hands in the cookie jar.

Many Are Content with the Status Quo

The Political Party Financing Act of 1997 ensures government funding for parties and bans foreign donations. The law also restricts donations from companies, groups of companies, and other organizations to 50 average salaries, but doesn`t regulate donations from individuals. Anonymous donations are allowed but can`t amount to more than three percent of what a party earned the previous year. If a party does break the law, the punishment is little more than a slap on the wrist.

Many public debates have come to the conclusion that these provisions are precisely the reason why new legislation has yet to be passed. No party, the ruling parties included, wants to have to publicize information on its income, let alone reveal its benefactors.

At the discussion mentioned in the first paragraph, Zoran Andjelkovic of the Socialist Party of Serbia, the ruling party until 2000, wittily remarked that while a party is in power "everybody gives, but when you`re opposition, they just send bills."

Parties not represented in the Legislature want the government to provide them with funding, which would give them enough money to pursue various ACTIVITIES and get ready for elections.

Germany`s Approach

According to Bernard Lamers, director of the Konrad Adenauer Foundation, political parties play an important role in keeping a society on its toes and developing democracy. Germany, therefore, does give money to smaller parties, but only after elections and only parties that received more than 0.5 percent of the vote are eligible for the assistance.

For example, this year`s German budget includes EUR133 million earmarked for party funding. Citizens give EUR0.5 every month for this purpose, which Lamers says is a small price to pay for democracy. He added that someone should explain to Serbia`s citizens what they stand to gain from a stable, democratic system of government, and that their money will be well spent.

However, private donations are subject to strict checks. Every donation from a private individual has to be announced in public as well as the name of the donor. Party members get tax breaks for donating, and companies can give as much as they want but without any similar benefits. Lamers added that on average, German political parties get ABOUT one-sixth of their total income from donations.

Zoran Sami, a vice president of the Democratic Party of Serbia, wants the first stage of democracy to include more government funding for political parties to make it easier to keep track of the money and how it is spent.

"A threshold for receiving money has to exist and should be slightly less than the percentage of the vote required to enter the Legislature. The fair thing would be to give parties money based on how many votes they get since their strength doesn`t necessarily correspond the number of seats they hold in the Legislature," said Sami, adding that the government should encourage private companies to contribute by offering tax breaks.

Dusica Andjelkovic, a senior official of the Democratic Party, believes that only parties represented in the Legislature should get government financial assistance, based on how many seats they hold. In addition, she would like to see additional funding provided to each caucus through special legislation.

"The Democratic Party gets its income from the state budget and from membership dues, which are 300 dinars per year. Our rule is that each of the 3,000 or so party officials has to give the party five percent of what he earns. Whoever fails to comply can`t expect to be nominated for an election," said Andjelkovic.

Restrictions Are Needed

Bernard Lamers, Jan Kes de Jager, a financial expert with the Christian Democratic Party of the Netherlands, and Jure Toplak, a University teaching assistant from Slovenia, said that in modern, democratic states the law imposes limits on the sources political parties can tap for funding and how much money they can accept.

Most states treat political parties the same as corporations, which means they have to keep books and report their earnings on an annual basis. Generally, parties aren`t allowed to receive foreign donations, they can`t take money from any company that the government has a stake in, and they`re prohibited from using money derived from gambling and lotteries. Some countries also require a certain ratio of government and private income.

Combating Money Laundering

Predrag Markovic, a vice president of G17 Plus, put special stress on the need to pass new laws, adding however that laws will have little effect until something is done ABOUT the grey economy. Markovic added that campaigning for elections is generally a good opportunity to launder money, and that parties spend much more than needed.

Vladimir Goati of Transparency Serbia said the financing of political parties is an especially sensitive issue which usually comes up only when something illegal is discovered.

Most affairs, said Goati, are very much alike: senior party officials use their political power and influence to ensure that certain legislation does or doesn`t pass in return for some kind of financial gain, which is the essence of corruption.

"Passing legislation dealing with party financing is usually motivated by the desire to curb corruption. Corruption is defined as the unauthorized use of public office for personal gain. This includes candidates for public office who accept payment for a service to be rendered in the event of victory," said Goati, adding that this is known as "influence trading."

Corruption in party financing usually takes two forms: parties taking money in return for a promised or rendered service and party officials taking a piece of the pie.

According to Goati, parties should get government funding but not to the point that would make party leaders lose interest in donations from members and even members themselves because of an overabundance of money.

A Proposal from the Cabinet

Over the past several years several different versions of party financing legislation have seen the light of day. One of them, put forth by the Center for Election Monitoring, includes a conflict of interest clause which states that no individual who does business with the state can either run for office or make donations to any party. Furthermore, four years would have to pass until this prohibition loses force.

The Center for Free Elections and Democracy, also know as CeSID, also called attention to its own draft on several occasions. The document is based on financing by both government and public sources.

According to Aleksandra Drecun, secretary of the Serbian Finance Ministry, the cabinet soon will release a version that is a blend of these two models.

She expects Serbia`s Legislature to pass the bill within months, adding that this will put the issue to rest while compelling parties to go public with financial figures.

The funding bill will probably pass simultaneously with another bill dealing with political parties. The latter specifies that 3,000 signatures are necessary to start a party. Consequently, each of the 249 parties currently on the books will have to go through the registration process all over again. Drecun also points out that such an abundance of parties hardly encourages political stability.

Drecun said the bill guaranteed government money only to parties with seats in the Legislature, adding that the amount will depend on just how many seats they have.

All parties will be obliged to send spending reports not to the Tax Department, but to the Serbian Electoral Commission, which is staffed by people from every party represented in the Legislature.

The panel discussion, hosted by the Konrad Adenauer Foundation, Transparency Serbia, and the Eduardo Frei Foundation, concluded that what Serbia needs are new laws and their effective implementation.

Belgrade, June 27^th 2003. (Beta) - By Zlata Djordjevic