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WATCHDOG GROUP WANTS MPS TO RECONSIDER A BILL ON PARTY FINANCE REFORM

Party bill takes flak

THE WATCHDOG group Fair Play Alliance (AFP) has asked members of parliament to reconsider changes in the new, cabinet-prepared law governing the finances of political parties. For one, the group wants the bill to provide more control mechanisms to ensure transparency into party finances.
Although the AFP admits that the proposed legislation contains some positive changes, it warns that mechanisms supporting transparency into party finances remain "fatally non-functional".

THE WATCHDOG group Fair Play Alliance (AFP) has asked members of parliament to reconsider changes in the new, cabinet-prepared law governing the finances of political parties. For one, the group wants the bill to provide more control mechanisms to ensure transparency into party finances.

Although the AFP admits that the proposed legislation contains some positive changes, it warns that mechanisms supporting transparency into party finances remain "fatally non-functional".

The existing law has been criticized repeatedly for its failure to support mechanisms that would enable the public to scrutinize party finances. The new law, which would affect the 2006 to 2010 election term, is only marginally better, says the AFP.

Zuzana Wienk is the director of the AFP. She acknowledges an improvement in the area of transparency [into party finances] but points out that the public would demand more from other organizations.

"Shortcomings that would not be tolerated in other groups are tolerated in this [proposed] legislation governing political parties. We are very sorry to see that there is a lack of political will to fix these discrepancies," Wienk said.

Her colleague at the AFP was even sharper in his criticism.

"The new draft law gives political parties some Sk0.5 billion (€13 million) [in state funding] in addition to the current Sk600 million-plus (€15.5 million). However, there has been no public discussion as to why the funding has been increased or what citizens will receive in return for the increased party funding," said the AFP's Peter Kunder.

The AFP explained that, currently, party financing is controlled by parliament. "Thus, political parties control themselves," the AFP representatives noted.

The watchdog group says that for the current election term (2002 to 2006), Slovak political parties have so far received almost Sk620 million (€16 million) from the state budget in the form of contributions for operational costs and contributions made by mandate.

Should parliament pass the proposed law, state funding and contributions would represent Sk1.2 billion (€30 million) in the 2006 to 2010 election term.

Current state contributions to political parties consist of Sk60 (€1.55) per vote received in national elections and an annual contribution of Sk500,000 (€12,420) per MP mandate.

According to the new proposal, parties would receive 1 percent of the average national monthly wage in 2005 for every vote gained in the elections.

The white paper accompanying the proposed law, prepared by the Interior Ministry, indicates that the 1 percent sum would represent Sk165 (€4.27) in 2005, according to Finance Ministry estimates.

The proposed law also states that the contribution per each MP mandate would be calculated at 30 times the current national average monthly wage, provided a party has no more than 20 members of parliament.

Should a party have more than 20 MPs, the contribution for every additional MP over 20 would be calculated at 20 times the national average monthly wage.

The AFP has called on parliamentary political parties to consider whether increasing the funding is justified.

"This money could build a swimming pool for every tenth elementary school in the country. But apparently the parties think the money is better off in their cash drawers," said Kunder of the AFP.

Initial reactions from politicians suggested that the parties would not oppose the proposal's call for increased funding.

"I think it is justified that the contribution per vote [Sk60] was increased. It has been at that same level since 1994," said Roman Vavrík, a member of the ruling Slovak Democratic and Christian Union (SDKÚ).

Politicians from other parties, including the parliamentary opposition, shared his opinion.

Vavrík added that if parties did not receive adequate state contributions, they would have to look elsewhere for funding. "When political parties do not have enough money, a space for various speculations is created. NGOs start accusing parties of lobbyism and corruption," he said.

The SDKÚ itself was the recipient of such allegations when the AFP discovered that some of the party's donors, listed on the SDKÚ website, said they had never donated to the party.

According to the ministry's white paper, "an adequately introduction of new contributions from the state budget control mechanisms and sanctions have been incorporated" into the draft law.

Natália Hattalová from the Interior Ministry's press department told The Slovak Spectator: "The control of political parties by the public is enabled by the legal duty of political parties to make their financial details accessible.

"The new draft law introduces several changes aimed at preventing corruption and making the performance of political parties more transparent. If a party accepts gifts in conflict with the law, it will be fined. The fine will be twice the amount of the gift," she said.

Hattalová also said that parties would be obliged to publish the sum of their membership fees as well as information on their financial situation for at least two preceding accounting periods. An auditor will also be reviewing whether the annual report conforms with the party's accounting books - a departure from existing law that allows auditors to only review party accounting books.

"The control of political party financing can be improved through proposals made by members of the parliamentary financial committee, a move that the ministry supports. For example, MPs think that providers of loans [to parties] should not remain anonymous; therefore they proposed that parties reveal names and addresses of lenders in a separate loans registry," she said.

Parties would also have a special registry documenting accepted membership fees and providing names and addresses of members whose contributions exceed Sk25,000 (€646) in a given year.

However, Kunder of AFP insists that just as the "current control mechanisms are failing, the new proposed law ensures that they will continue to fail in the future as well".

Even the Interior Ministry admits that the previous controls were not enough to make many Slovak political parties conform to the requirements set by law.

As of August 2004, Slovakia had 119 registered political parties. According to the Interior Ministry, the Finance Ministry has "repeatedly found that parties do not act according to the law" in terms of party financial reports, for instance. In 2003, only 64 parties submitted their financial reports to authorities.

The failure to submit accounting records has been a repeat offence among parties for several years now. In 2002, just 72 parties of then-registered 117 submitted their reports. In 2001 it was just 67 of 107 parties.

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