The Open Society Georgia Foundation (OSGF) and Transparency International Georgia published a study on funding of political parties on June 28. The study examines the transparency and accountability of political parties in terms of funding. It is based on 2007-2010 data and provides analysis of incomes and spending by the political parties that overcame the election barrier and obtain mandates as a result of the May 30, 2010 elections. The presentation of the report was attended by representatives of civil society, international organizations, the media, politicians and experts. Based on report findings, meeting participants considered opportunities for the improvement of the election environment.
The report reviews the sources of political party funding, their specifics and spending trends. The report also deals with the state funding allocated to political parties before the 2010 local elections for voter list verification. The final
part of the report provides recommendations, which will help improve the election environment.
“The report makes interesting findings and offers respective recommendations on improving funding practices and legislation. The key aim is to achieve transparency and create equal competition opportunities for parties”, said Keti Khutsishvili, the OSGF Executive Director.
The study shows that it is quite difficult to analyze the annual financial reports of the parties in Georgia because there is no uniform template for financial reporting. Some parties only provide four or five categories of expenses in their annual report, while others offer a far more detail account of expenses. Some parties place most of their expenses in the “Other Expenses” field, which often accounts for 70 per center of the total expenses and sometimes exceeds 1m GEL. Things like that make it far more difficult to analyze party expenses. Moreover, in accordance with Georgian law, the CEC is only responsible for the collection of the information regarding party financing, which means that there is no agency responsible for monitoring the annual financial reports of political parties.
Nina Khatiskatsi, a representative of Transparency International Georgia, said: “There is no standing body in Georgia that will verify party funding practices and the way they manage funds. Therefore, we come across with a number of shortcomings and inconsistencies during the analysis of the financial reports. However, respective response measures have not been made”.
Further the study shows that it is often difficult and even impossible to identify the sources of the campaign funding that the political parties received. Parties transfer money from their party funds to their campaign funds.
The analysis of campaign financing in 2008-2010 showed that funds are not distributed equally among parties. With a few exceptions, opposition parties have only received donations from individuals, while business companies have only been providing funding for the campaign of the ruling party and its candidates. This was the case during the 5 January 2008 presidential elections and all the subsequent elections.
“One of the problems that has been exposed and that has created a noncompetitive environment among political parties is the different and disproportional distribution of resources. For example, ruling party’s campaign funding was seven times larger during the 2010 local elections and 26 times larger during the presidential elections in 2008 than the total financing of all other election contestants. This poses a problem to political competition”, said Khatiskatsi.
Please, see the full version of the report.
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