Since 1978, elected representatives from the President to local councillors, have come to power only after wasting massive amounts of money as well as some serious IOUs to those who provided the funds for the campaign.
Any major candidate contesting the Presidential elections today has to spend anything between 500 million to one billion rupees. Almost 1/3 of it goes for advertising in electronic and print media. Depending on how frequently a presidential candidate uses electronic and print media to advertise himself, the cost of a campaign could be as high as 3-5 million rupees a day. If the candidate wishes to have an effective campaign, he will have to publish the advertisements in at least 4 newspapers in three languages, on 8 television channels and on 12 radio channels. Assuming the daily cost for these reach Rs. 3 million, in effect it would cost 180 million rupees for a 60 day campaign.
In addition, a presidential candidate has to dish out a certain amount of money for each electoral organiser. At the 2005 presidential election Mr. Ranil Wickremesinghe distributed a million rupees each to the electoral organisers of his party. With 168 electorates that amounted to 168 million rupees. The exact amount that was given by Mr. Mahinda Rajapaksa for this purpose is not known. Another substantial amount of money has to be spent on billboards, posters, leaflets, etc. Massive amounts are also spent on election rallies.
A candidate contesting parliamentary elections will have to spend between 25-40 million rupees, while the cost to a candidate for a provincial council election may be around 5-10 million rupees.
Sri Lanka may be among a few democracies that have no laws governing political party funding and election funding.
The accounting records of political parties are not published. The whole system of party financing is totally devoid of any checks and balances. An individual or a company is free to donate any amount of money, there are no restrictions, and no records. A candidate’s party is under no legal obligation to reveal either the amount of monies received by them or from where the money came.
Post-1948, there were laws to control and check the amount of money spent by candidates contesting elections. Although the system was not perfect, every candidate was legally obliged to furnish a report to the Commissioner of Elections giving details of income and expenditure for the campaign.
J.R. Jayawardena invalidated all these laws. By introducing the Executive Presidential system of government in 1978, J.R. Jayawardena copied from the Constitutions of the U.S.A. and France. Yet, not surprisingly he deliberately omitted campaign finance laws that were inherent in those countries.
When analysing the causes for corruption in the country, the dearth of laws governing political party funding and election funding can be seen as the main culprit.
United States of America
In the United States, if a presidential candidate asks for state finance, the maximum amount of money a Presidential candidate can spend is 200 million dollars. However, if they choose to get the funds from the government, they are not permitted to accept funds from the general public. The candidate can spend only 50,000 dollars out of his own personal money.
A candidate can opt not to take public financing and raise funds from the public. Here again there are restrictions. Candidates are prohibited from collecting money from foreigners, government contractors, commercial banks or trade unions. If any individual wishes to donate money to a candidate the highest amount he/she can donate is limited to 2300 dollars.
At the 2008 U.S. Presidential election, Barack Obama opted for the second option and was in fact the first Presidential candidate to conduct a successful election campaign with funds raised from the public since the option of $200 million worth of government funding was introduced after the Watergate scandal.
The election committee and the political organisations engaged in the election campaign for the candidates by law have to report on income and expenses regularly to the Federal Elections Commission. Those reports are available not only for the mass media, but also to the general public.
Raising funds and spending them in violation of the law is a criminal offence.
France
In France, the maximum amount of money that can be spent by a contender for the Presidential Election is16 million euros. If a second round of elections is necessary the maximum amount is raised to 21 million euros. In a Parliamentary election the maximum amount that could be spent by a candidate is limited to 40.000 euros or Euro cents 20 per voter.
Private companies are not prohibited from donating funds to political parties and candidates. However, the political parties and political aid groups can support candidates by way of donating cash. In addition, under the existing limitations, individuals too are free to support party funds and the candidate’s funds. An individual can annually donate only up to 7500 euros to a political party. If that donation is for a candidate it is limited to 4600 euros. The persons supporting a political party or a candidate is entitled to tax relief for such contributions.
During the election campaign, paid advertisements in the electronic or printed media are prohibited. However, the parties contesting the elections are given equal time on electronic media to address the voters.
In France, there is a system in place that enables a Presidential candidate to be reimbursed by the state, for a substantial amount of the money he/she has spent on the election campaign. A Presidential candidate can claim up to 180,000 euros or 8% of approved maximum expenses. In addition, in the event a candidate secures more than 5% of votes, he/she is eligible to claim a further 36% of the expenses.
The audited accounts reports of political party funds and candidates’ funds have to be presented to the Constitutional Council. The Constitutional Council is empowered to inspect the accounts submitted. Those reports are published in the government gazette for the information of the general public.
As in the United States, withholding or distorting the accounts is a criminal offence. During the past sixteen years, four ministers have been imprisoned for committing funding-related offences.
India
India too has a maximum limit for candidates to spend at an election. The maximum limit has been decided based on the population in that particular constituency. If it is a parliamentary election the amount allowed is between Rs. 10-25 lakhs and if it is a state election a candidate can spend between Rs. 5-10 lakhs for the campaign.
A person can donate any amount of money to a political party and to a candidate. However companies cannot donate to a political party or to a candidate over and above the amount stipulated by law. It cannot exceed 5% of the net profits of the company or Rs. 25,000.00.
Each and every candidate has to hand over a detailed income and expenditure report to the Elections Commissioner in the district within 30 days. They also have to submit an assets and liabilities statement along with their nomination papers. The Auditor General will audit the accounts reports of the political parties and then they will be presented to parliament with the Auditor General’s observation remarks. The candidates and the political parties have to include the sources of income in their income and expenses reports. Here again withholding or distorting information is a criminal offence.
The situation in Sri Lanka
In contrast, Sri Lanka has no laws at all governing political party finances or expenditure during an election. It is a free for all. A party or a candidate is free to spend any amount of money during an election and can accept any amount of money from anybody. The political parties or the candidates are not obliged to declare their income and expenses. In other words, we do not enjoy any kind of system to inspect the amount of money received by political parties, candidates and the money spent by the candidates.
Though the candidates are legally obliged to declare their assets and liabilities, even that solitary law is not properly practised in our country. Very few candidates forward their asset and liability reports to the Elections Commissioner. The Elections Commissioner does not take any action against those who fail to submit such reports. The position taken by the current Commissioner of Elections is that the Assets and Liability law does not explicitly state the procedure to be applied with regard to those who do not comply with the requirement of the said law, he is unable to initiate actions against such persons.
Why controlling political funds is necessary
Under the existing political system, the President and members of parliament are elected by the people. This political system has been developed in such a way that vast power is vested with a wealthy minority who pump money into the hands of the politicians. That gives them the power to control indirectly the people’s representatives including the President. However, the strict laws in other countries that have a democratic political system have been designed to minimise the possibility of a minority of people who finance politicians indirectly controlling the elected governments.
Restrictions on political financing are intended to ensure that politicians do not depend upon a few wealthy persons, but rely on the vast majority of general public. Conversely, the political system of our country has been designed to allow political parties and politicians to depend on a wealthy few instead of a majority of the people for political finances.
If a citizen donates Rs. 1000 to a political party he does not wish for a return for that money. Yet if anybody gives out Rs. 50 million to a politician it is quite natural for the person to expect a return on that investment with an appropriate amount of interest. Currently, Sri Lankan political parties charge only a nominal fee for party membership. Political parties depend not on the membership fees or the support of a large number of supporters, but on the monies streaming in from the few black money mongers.
There are certain businessmen in the country prepared to look after the party leaders and some others to look after other prominent leaders. Instead of collecting party funds from a large number of supporters it is easier for every political party to gather the funds from one or a few businessmen supporting that specific party. Those business people are more generous than the party members. Nevertheless, unlike the donations received from party members, the monies that are collected from the businessmen need to be paid back. The politicians pay them back not out of their personal money but from the public resources of the country.
Reimbursements
A prominent businessmen who had became a billionaire with the support he received from Mrs. Sirima Bandaranaike when she was the prime minister from 1970-77, “took care of and nurtured her and her son Anura as long as they lived.” On the eve of 1994 Parliamentary Election however this businessman and Mrs. Chandrika Kumaratunga did not have a cordial relationship. At the 1994 Parliamentary Election Chandrika Kumaratunga had received more money than she required for the campaign. Had those funds been managed properly, that would have been sufficient to cover the expenses not only of the 1994 Parliamentary Election, but also to cover the expenses in the Presidential Election that followed. But as there was no proper management of funds, when the Presidential Election approached, Chandrika Kumaratunga did not have adequate funds to spend and the businessman who had looked after her mother and brother grabbed the chance to develop a friendship with her and became her major sponsor for the Presidential Election. Later, the country had to pay dearly for that support.
The money she received from him Chandrika Kumaratunga paid back from the country’s public resources. She allowed him to buy the state institutions he was interested in acquiring at the lowest possible rates. Further, she as the President disregarded the laws of the country to safeguard this businessman. Ultimately, to settle her debt with this person, the former president used public resources worth perhaps a million times what he originally contributed to the campaign.
It is not only Chandrika Kumaratunga, but all the politicians active in the country are to varying degrees nurtured by this kind of businessmen or by a few businessmen. Even an independently wealthy and cultured man cannot escape from this rotten political system. Finally, as in the case of Chandrika Kumaratunga, all of them pay back their debt to the businessmen, with the country’s public resources. That alone may cost hundreds of billions of rupees and this situation may have contributed to weakening the country’s economy and the rule of law to a large extent. This should be considered as the main root of corruption in the country. Cutting that root alone may bring as much money as brought by foreign workers to the Treasury. With that step taken, it might even be possible to hope for the restoration of law.
Where to?
Unfortunately, even intellectuals who are interested in introducing good governance have not paid due attention to this factor. The inventors of the 17th Amendment did not realise the importance that should have been attached to this issue. Party funds and election funds are included in the subject matters of the Elections Commission. Yet this issue was not included in the Elections Commission created under the 17th Amendment. Further, this subject has not drawn the attention of the reformists who seek court orders to force changes. What do all these symptoms suggest? Doesn’t it imply that the struggle for a better tomorrow is still a shallow battle instead of a struggle that has any depth?