Is end nigh for secret party donors?

On Tuesday 20 October, almost exactly two years after the October 2013 parliamentary elections, the Chamber of Deputies passed in first reading government amendments to the law on political parties and the election law.

Nobody can say he knows who exactly finances Czech political parties today. The adoption of these key laws has long been pressed not only by the nation’s civil society, led by Reconstruction of the State, but also by the Council of Europe, represented by GRECO (Group of States against Corruption).

What should the amendment change? The supervision of party and candidate funding in the election process should not be carried out by the elected deputies themselves anymore. Until now, the oversight has been performed by the Chamber of Deputies Control Committee, which has only checked if the parties present their annual financial statements. They never asked where the money came from and how it is managed. Therefore, time has come to set up an office to supervise the economic management of the parties; such office should employ approx. 10 officials and have an annual budget of about 20 million crowns.

This is no small outlay at first glance, but it dims in comparison with 2.6 billion crowns parties receive in subsidies from the state within a single election period. The office employees must not be members of any party and would be appointed by the President of the Republic from among the candidates put forward by parliament and the president of the Supreme Audit Office. Parties’ influence on the nominations would thus be restricted by dividing the process among several constitutional institutions.

In addition to the new system of control, the reform also outlines new duties for the parties. First of them is the institute of transparent bank accounts (separately for daily routine and election campaigns), publishing balance statements and campaign budgets online, and cashless transactions for all expenditures of CZK 20,000 and more. In addition, parties must change their auditors every five years, report also non-monetary donations, and mark with their logos or other identification all advertisements filed in the course of election campaign.

The bill in this form meets seven of the nine recommendations presented by Reconstruction of the State. If passed and put into effect, it will be an efficient tool to curb the influence of illicit funding on Czech politics. But it is still miles away from ideal. The lack of regulation of entities (legal or natural persons) that are not political parties but engage in election campaigns anyway remains the core problem. Suffice it to recall the Friends of Miloš Zeman civic association, which organized and financed the incumbent president’s campaign even before his candidacy was officially announced. Fines for violations of the rules are also inadequately small, capped by CZK 100,000.

Problematically, the bill further introduces so-called political institutes. They would primarily engage in research activities—a concept that could, however, surreptitiously encompass a meeting with a campaign leader or the publication of campaign press and documents. In addition, one should not leave unnoticed the party firms, through which the party might easily obtain contributions to the printing of leaflets, billboards etc.
However, in spite of these problems and questions, the bill is good news; provided, that is, that parliament can pass it by the end of the year so it can apply to the next parliamentary elections.