Roundtable ‘Problems and perspectives in implementation of political party funding’ on 9 October, 2017

The political party funding reform in Ukraine was launched back in 2015, and is currently undergoing the implementation stage. There are more than enough problems with its implementation: starting from attempts by certain Parliament members to revise it and ending with unwillingness on behalf of the government to finance political parties at the level required by the law. For example, in 2016-2017, these parties received less than 10% of amounts allocated for their financing, while the draft 2018 State Budget envisions that political parties represented in Parliament will receive funding at twice below the amount required by law for their financing.

   

Yulia Kyrychenko, member of the Board of the Centre of Policy and legal Reform (CPLR), and Yulia Shypilova, IFES program manager, have noted that only 29% of Ukrainians know that, beginning in 2016, parliamentary parties started receiving government financing, and at most 10% of the population support the idea of introducing such financing. The absolute majority of Ukrainians are convinced that parties must receive funding from their leadership and ranking members. Only 13% of the Ukrainians are prepared to contribute funds to benefit a political party which they trust (according to opinion poll by the Il’ko Kucheriv Democratic Initiatives Foundation).

Speaking of the regulatory-making functions of the NAPC, the CPLR’s expert Dmytro Kalmykov noted that this agency has developed and promulgated all the regulations that it was required to by the Law “On Political Parties in Ukraine”. “Several of the regulations contain significant deficiencies, which are not conducive to the proper and effective implementation of the political finance reform. For example, one the NAPC’s regulations has established a duty for political parties to submit not just quarterly financial reports, but also a consolidated annual financial report, which contradicts the Law’s provisions”, he emphasized.

Representatives of parties noted that the submission of quarterly financial reports in paper format is an excessively burdensome requirement for many parties. Such reports could get as long as several thousand printed pages in length, which causes both significant inconveniences in submitting them and significant financial expenses. That is why there is an urgent need to introduce an electronic system for submission and publication of such reports.

Members of the event emphasized that the law permits making huge donations to benefit the parties, and the limits established for the amounts of contributions in no way incentivizes the parties themselves to seek new – that is, genuine and lawful – sources of funding”. Effectively, an individual could contribute such donations for up to a total amount of UAH 1,280,000, and a legal entity – up to UAH 2,560,000, in 2017. These limits will increase significantly in 2018.

    

In general, the roundtable participants agreed that, in addition to numerous significant obstacles in the implementation of political finance reform, there is also a problem related to permissible use of state funds. Parties have never received an answer from the NAPC regarding which expenses for chartered activity are lawful (i.e., permissible) and which are not. In other words, they do not have a clear understanding as to which of their activities, exactly, they could spend the money on. On the other hand, a party’s leader and accountant are subject to criminal responsibility for non-permissible use of state budget funds, including imprisonment for up to 6 years.

Livestream (ukr)

 

The round table was organized by the Centre of Policy and Legal Reform (CPLR) with the support of the United States Agency for International Development (USAID) and the European Union (EU).

The opinions expressed by the CPLR experts do not reflect the official position of the USAID, the National Democratic Institute or the EU.