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Funding Political Parties in Ghana

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Funding Political Parties in Ghana Working paper Funding political parties in Ghana Nature, challenges and implications E.K. Sakyi K.S. Agomor Daniel Appiah November 2015 INTERNATIONAL GROWTH CENTRE (IGC) FINAL REPORT FUNDING POLITICAL PARTIES IN GHANA: NATURE, CHALLENGES AND IMPLICATIONS By E.K. Sakyi, K.S. Agomor & Daniel Appiah November 5, 2015 Contents List of Tables ...................................................................................................................................... 3 Abbreviations ...................................................................................................................................... 3 Abstract ............................................................................................. Error! Bookmark not defined. Conclusions ......................................................................................................................................... 4 Policy recommendations ................................................................... Error! Bookmark not defined. Acknowledgements ............................................................................................................................. 5 1.0 Introduction ................................................................................................................................... 6 1.1 Literature review on political party financing ............................................................................... 6 1.2 Methodology ............................................................................................................................... 12 2.0 The legal and institutional architecture of party financing in Ghana .......................................... 12 2.1 Overview of rules governing the formation and funding of political parties .............................. 16 2.2 The laws governing the financing of political parties ................................................................. 17 2.3 The EC and enforcement of the rules governing party funding .................................................. 19 3.0 The study findings ....................................................................................................................... 20 3.1 The nature of funding political parties in Ghana ........................................................................ 20 3.2 State funding of political parties ................................................................................................. 22 4.0 Major obstacles to mobilizing fundsand resources for political activities .................................. 23 4.1 Weak economy ........................................................................................................................ 23 4.2 Absence of accurate data......................................................................................................... 24 4.3 Lack of credibility in the political system ............................................................................... 24 4.4.Apathy and bad-mannered politicians ..................................................................................... 25 4.5 Why no policy on political party financing? ............................................................................... 25 5.0 Quantitative results: nature, challenges and state funding of Political parties ............................ 26 5.1 Characteristics of respondents ................................................ Error! Bookmark not defined. 5.2 The nature of funding political parties .................................................................................... 27 5.3 Challenges faced by the political parties in mobilising funds ................................................. 28 5.4 Respondent perceptions on party financing ............................................................................ 28 6.0 Conclusions ................................................................................................................................. 31 6.1 Policy recommendations ............................................................. Error! Bookmark not defined. 1 7.0 References ................................................................................................................................... 34 Appendix: 1 ....................................................................................................................................... 34 Appendix: 2 ....................................................................................................................................... 38 Appendix 3 ........................................................................................................................................ 42 Appendix 5 ........................................................................................................................................ 44 Appendix 6 ........................................................................................................................................ 44 2 List of Tables Table 1: Political party and region of affiliation cross tabulation Table 2: Demographic characteristics of respondents Table 3: Sources of funding for political parties Table 4: pairwise differences for post hoc tests Table 5: Factor analysis of challenges of mobilising funds Table 6: General perceptions of party funding Table 7: Political party funding and political party affiliation cross tabulation Table 8: Political party funding and portfolio cross tabulation Table 9: State funding support and political party preference cross tabulation Table 10: State funding support and party portfolio cross tabulation List of Abbreviations ADB - Agricultural Development Bank CDD – Centre for Democratic Development CPP – Convention People Party EC – Electoral Commission IDEG – Institute for Democratic Governance IEA – Institute of Economic Affairs LECIAD – Legon Centre for International Affairs and Diplomacy NDC – National Democratic Congress NIP – National Independence Party NLCD – National Liberation Council Decree NPP- New Patriotic Party PNC – People National Convention PNDC – People National Defense Council SMCD – Supreme Military Council Decree 3 Abstract This study examines the nature and challenges of funding political parties in Ghana. Data were collected through semi-structured elite interviews and survey of 1600 self-declared card-holding members and 200 self-declared non-card holder members of the seven political parties that contested the 2012 general elections. The findings of the study indicate that all Ghanaian political parties obtain their major funding from rich individuals, special contributions and donations rather than membership dues. And, some rich individuals fund more than one political party; also, funding from foreigners especially Chinese, Lebanese and Indian businesses is common within the two bigger political parties. The study conclusions are that, Ghanaians are divided on the question of state funding for political parties. But then, support for state funding is stronger among the elite political class and party executives than ordinary party members. Institutional weakness emerged as one of the severest challenge to political parties in mobilising financial resources for their activities. And, this institutional weakness manifest in the lack of transparency and accountability frameworks and weak internal organisational mechanisms required to mobilise funds from ordinary members. The following recommendations have been proposed during the study to address the funding problem. The need to provide support for political parties to build organisational capacity to enable them mobilise funds and improve internal transparency and accountability regimes. The Electoral Commission would have to be strengthened to enforce the rules governing funding of political party activities. Unwavering support from the political elites is required so as to intensify public discourse on the vexed question of state funding of political parties. Also, a more vibrant civil society to continuously demand accountability and compliance with the laws on party funding is needed. An overwhelming majority of interviewees recommended that, Ghanaian political parties themselves would have to start showing unimpeachable signs of being very transparent and accountable internally to their own membership. 4 Acknowledgements This research report was funded by the International Growth Centre (ICG) and is part of a larger effort to understand the factors shaping social, political and economic development in developing countries including Ghana. It was written by E. Kojo Sakyi with support from Kingsley Agomor and Daniel Appiah. The research report also benefited from Charles Gyamfi-Ofori, Ernest Apau and Eric Yobo who assisted with data collection. 5 1.0 Introduction This report presents the findings of a research on the nature and challenges of funding political parties in Ghana. The aim of this research is to further expand our understanding of: (a) the current institutional frameworks governing the funding of political parties; (b) the nature of funding political parties; (c) the challenges of funding political parties; (d) the effectiveness in enforcing regulations governing the funding of political parties; (e) why policy recommendations made by advocacy groups have not produced legislation and implementation of policies on political party financing; and, (f) implications for nurturing democratic politics and good governance in Ghana. The research
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