Relationship between money and politics a threat to SA’s democracy

This month, parliament dismantled political party funding transparency laws by passing the Electoral Matters Amendment Bill. The bill was introduced at the end of 2023 to amend several laws to allow independent candidates to contest elections. In a show of political expediency, the bill was also used to undermine the Political Party Funding Act (PPFA). 

The introduction of the bill brought life to the ANC’s two-year campaign to weaken political party transparency laws, launched out of sheer desperation, amid the party’s financial crisis. In February 2023, the party’s leadership instructed its parliamentarians to initiate the process to expand the thresholds for party funding stipulated in the PPFA. The campaign was yet another show of the ANC’s increasing disregard for democracy.

The PPFA is one of the most important pieces of legislation since 1996. It allows the public access to crucial funding information, limits the ability of private entities to influence our politics for narrow interests and protects South Africa’s sovereignty. It forces political parties and their donors to disclose donations above R100 000, places an annual cap of R15 million per donor per party and places heavy limitations on foreign funding. 

When signing the PPFA into law in 2021, President Cyril Ramaphosa celebrated it as having “far-reaching consequences for good governance and ethical political activity”. He added that the Act will “strengthen the confidence of citizens in the democratic political process and enable them to assert their right to information.“ 

Three years later, he nullified the Act.

Although the governing party has led this assault on our democracy, almost all its political opponents have shown an equal disdain for transparency regarding their funding.

Before the PPFA came into effect, the Democratic Alliance (DA) had vociferously argued against transparency laws, claiming that political party donors were entitled to privacy. When it became law, ActionSA made the absurd argument that it would undermine South Africa’s multi-party democracy. Economic Freedom Fighters (EFF) president Julius Malema publicly encouraged his donors to donate amounts just under the R100 000 reporting threshold to evade scrutiny.

Since its launch, the well-funded Rise Mzansi has consistently withheld information about its funding sources. In February and March, it ignored two letters from the civil society organisation My Vote Counts, which outlined the party’s legal obligations to disclose its funding details from the end of 2022. To date, the party has not disclosed all of its funding information.

Money and politics

The political parties rejecting the need for meaningful funding regulations ignore its most important purpose: to give the public some control over the toxic relationship between money and politics. This is especially important because money’s hold on politics has weakened our democracy — beginning even before 1994.

In the early 1990s, as the apartheid state began to collapse and ANC leaders were getting ready to govern, wealthy business people like Southern Sun owner Sol Kerzner hosted ANC leaders in luxury apartments and threw extravagant birthday parties for some. Certain business people used their financial resources to secure tender contracts, while others bought undue influence over decision-makers elected or appointed to act on behalf of everyone.

After the 1994 election, huge amounts of money were used to secure lucrative arms contracts and capture parts of the state. And, more subtly, to influence policy decisions and shape our political landscape to serve narrow interests.

The past three years of the Political Party Funding Act have given us some insight into how money shapes politics. It’s no coincidence that the Oppenheimer family’s R135 million in political donations has funded only parties whose economic programmes aim to entrench a neoliberal politico-economic project, which has devastated economies, deepened inequality, and eroded democracy globally in the interests of capital accumulation. It’s also easy to understand why Israel-linked billionaire Martin Moshal’s R76.5 million in party donations have benefited only parties that have outrightly supported Israel’s Gaza genocide or, at best, have remained neutral on the matter.

These big donors have no interest in investing their money in political parties whose political programme centres the poor, call for a radical redistribution of the economy or oppose Western hegemony.

Political fluidity 

Understanding the role of money in politics is especially crucial as we approach our most contested election since the start of our democracy. Polls suggest the ANC may lose its majority nationally and in some provinces. This shift will create a more fluid political landscape, with opposition parties keen to capitalise on ANC failures.

Funders who have historically used money to influence our politics are acutely aware of these shifts and are eager to influence whatever replaces the status quo. In the lead-up to the May elections, wealthy business people and the right-wing think tanks they fund, such as the Brenthurst Foundation and the Centre for Development and Enterprise, held several strategy meetings focused on the elections. Replacing the ANC was high on the agenda.

Funders understood that they could create political projects beyond the shrinking DA to represent their interests. Last year, former Firstrand chairperson Roger Jardine parachuted onto the political scene with a well-funded and sophisticated election campaign using a political vehicle called Change Starts Now (CSN). Reports, which Jardine denies, suggest that his funders had made available R1 billion to him to win political influence. The CSN leaders have openly admitted that funders had influenced its decisions and even convened meetings with the DA to plan to remove the ANC from power. The party collapsed after it was unable to garner the required number of signatures to be able to contest the elections. 

As the CSN tried to establish itself, the DA launched its moonshot pact — a coalition of right-wing parties set up to remove the ANC from the Union Buildings. Numerous reports suggest that the campaign was the brainchild of Martin Moshal, who donated part of the R200 million to kickstart the coalition. 

We have little insight into who the actual funders are of the neoliberal Rise Mzansi’s big-budget campaign and Jacob Zuma’s authoritarian and kleptocratic uMkhonto weSizwe Party. 

Towards public funding

There is no doubt that the relationship between money and politics has allowed the wealthy undue control over public life — more than the rest of us have. But for multi-party democracy to work in South Africa, we do need adequately funded political parties. 

Ironically, the ANC has already proposed a solution to this conundrum. In 2022, its highest decision-making body, the national conference recognised that the party’s heavy reliance on private donor funding was a threat to its overall sustainability, that private entities fund political parties only to serve their own interests, that wealthy individuals do not fund parties with pro-poor policies; and that political parties are public entities that should be accountable to the public. 

The ANC then resolved that private political funding must be done away with and replaced only by public funding for political parties. 

University of Johannesburg professor, Steven Friedman, goes further, suggesting that, in a democratic political funding system, funding reflects the extent of a party’s support. Such a system, he argues, will reward parties that can attract many small citizen donors, not just a few donors with massive donations. This requires a radically reduced donor cap of only a few thousand rands. The amount of public funding that parties receive from the Electoral Commission of South Africa will be determined by the number of individual donors they attract. This, Friedman argues, removes the power of wealthy donors and forces parties to deepen links with voters. 

The ability of a political party to influence government decisions should be based on the number of people it can convince of its ideas, not on its ability to convince two or three extremely wealthy individuals that it will protect their interests. 

The influence of private money on our politics presents a grave threat to our democracy. To guard against this threat, we must reject political parties’ assault on party funding laws.

Minhaj Jeenah is the executive director of My Vote Counts.