How political parties spend money

2013-09-29 14:00

Bringing Parliament to the people comes at costly price

Political parties are having a tough time bringing Parliament to the people.

The Independent Democrats (ID) last year blew 105% of its constituency allowance on its staff, the Congress of the People (Cope) made a R5?million profit two years in a row, while the African Christian Democratic Party (ACDP) made a loss three years in a row.

These are among the revelations from a Media24 Investigations analysis of how political parties spend the annual state allowance Parliament pays them to run offices where MPs and their staff can help ordinary citizens in their dealings with government.

Media24 Investigations obtained five years worth of audited financial statements under information law.

The ID’s employee costs for the past financial year were almost R2.7?million, even though Parliament only gave it a R2.5?million allowance.

The party’s constituency fund was in the red by more than R900?000 at the end of the previous financial year.

ID secretary general Haniff Hoosen said staff costs usually increased dramatically in the run-up to elections when the party temporarily employed community liaison officers that it could not afford on a permanent basis.

These costs would then be recouped in the following years, according to Hoosen.

“As the accounting officer, I’m held personally responsible for any irregular expenditure on the party’s books.”

He said this measure should be more widely implemented in the public sector “because you work far more carefully with an institution’s money if you know your house could be attached if there is significant irregular expenditure”.

Cope’s latest set of accounts still bear the blight from 2010, when R5?million in parliamentary funds were unlawfully paid into the party’s coffers.

The auditors say they were unable to verify all transactions on the books in 2011, so there can be no certainty over the opening balances at the beginning of the last financial year, which was April 1 2012.

The party’s chief whip, Thozamile Botha, told City Press this disclaimer had to stay on the books for three years.

Both Cope and the ID have restructured their constituency offices to cut back on rent.

Cope has consolidated constituency offices and now has bigger, better staffed offices in fewer locations.

The ID also rents fewer offices and has roving community liaison officers who are not office-based.

Vince Smith, the head of the ANC caucus’ finance committee, said the party had to run a tight ship because its constituency allowances did not always rise in line with inflation, even though other fixed costs like office rental did.

The ruling party spent 63% of its allowance on staff last year, and 15% on office rental.

The party has been able to cut its telephone bill from 13.6% of the allowance in 2009 to 5.5% in the past financial year.

He said: “It’s difficult to control landline costs, so we gave our staff cellphones instead.

“Every staff member has a R500 per month telephone limit, and if you give them R500 worth of airtime on a cellphone, it’s easy to control that spending,” he said.

The ANC received R151.6?million in constituency funding last year, and had a R13.3?million surplus by the end of the year.

The DA, which has the second largest representation in Parliament, received R15.7?million and recorded a ­R656?000 surplus.

The year before, it overspent its budget by R162?000.

The ACDP made a R273?000 loss on its R1.4?million allowance in 2011, a R159?000 loss in 2012 and R92?600 in the past financial year.

Most party representatives who spoke to City Press admitted it was difficult to make ends meet with the allowance available and said they had to introduce cost-cutting measures.

Constituency fund spending

How parties spend their constituency allowances

Parliament’s policy on constituency allowances

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