1. COSATU Submission to the IEC: Political Party Funding Act Regulations 1 August 2019

2. Objectives
Welcome Political Party Funding Act & Regulations’ progressive objectives;
Crisis of corruption and capture;
Crisis of public faith in parties and political system;
Many ruling parties today in South Africa at different levels;
Fears of intimidation; and
Important intervention by Bill.

3. COSATU Supported Clauses in Act & Regulations
Equitable and proportional representation based party funding;
Prohibitions of funding parties by:
Foreign government and state agencies;
South African state organs and state owned companies; and
Proceeds of crime.

4. COSATU Supported Clauses in Act & Regulations
Party funding statements to include all donations and be subject to auditors;
Powers of Commission:
Access to all party funding information;
Powers to subpoena and sanction;
Party responsibilities;
Commission reports to Parliament;
All donations.

5. COSATU Opposed Clauses in Act
Principle of expanding public funding of parties in climate of austerity, service delivery, and state and SOE job cuts and as a reward to parties not to be corrupt;
Section 9 Disclosure of donations to political party;
R threshold.

6. COSATU Proposed Amendment to Schedule 1 of the Regulations
Section 19 (2) (a) provides for a sentence of up
to 5 years for offenders violating Sub-Section (1)
(a) of the Act.
Yet this does not appear to have been captured in the Regulations’ Schedule 1.
Instead the sentencing provisions have been reduced and limited to 2 years in the Regulations.

7. COSATU Proposed Amendment to Schedule 1 of the Regulations
Amend Schedule 1’s penalty provisions to be in line with the penalty provisions of the Act:
Sentencing provisions for offences under Sub Section (1) (a) must amended to be in line with the Act’s provision of up to 5 years.

8. COSATU Proposed Amendment to Section 4 (3) (e) of the Regulations
Section 4 (3) provides for:
“The Commission shall make a final determination in respect of such request, after taking into consideration the following–
(a) The reason for the request;
(b) The amount Donated;
(c) Confirmation from a recognised financial institution of the Contributor’s bank account;
(d) The source of the monies for the Donation and all supporting documents;
(e) Assessment of political exposure of the Contributor, if applicable”

9. COSATU Proposed Amendment to Section 4 (3) (e) of the Regulations
There is no definition in the Act or Regulations as to what constitutes “political exposure”.
There is no cross-reference to another Act which may have such a definition e.g. the Financial Centre Intelligence Act etc.
Section 4(3) (e) is consequently extremely vague and open to interpretation and possible abuse.

10. COSATU Proposed Amendment to Section 4 (3) (e) of the Regulations
COSATU Proposal:
COSATU is therefore calling for a clear and concise definition as to what constitutes political exposure to be drafted and inserted into the Act and/ or Regulations.

11. Conclusion Support progressive objectives of Act and Regulations;
Support progressive transparency and accountability clauses; and
Support powers and reporting requirements of commission.
Remain opposed to expanding public funding of parties in light of corruption and austerity crises in state fiscus; and
Need to scrap the R disclosure threshold principle and amount.

12. Conclusion
Need to amend Schedule 1 of the Regulations to ensure the Act’s 5 year sentencing provision is provided for.
Need to provide clear legal definition as to what constitutes political exposure for persons applying for their donations not to be publicly disclosed by the Commission.