Political Parties’ Campaign Financing in Ghana’s Fourth Republic: A Contribution to the Discourse

Introduction

The 1990s saw the rise in Africa of varying efforts to promote liberal democracy. As Fombad (2007) notes, as the ‘third wave’ of democratization swept through the African continent in the 1990s, it generated expectations of a new dawn and the end of an era of corrupt, authoritarian and incompetent dictatorships that had earned the continent notoriety for political instability, civil wars, famine, disease and similar ills. One such country which, under pressure from both within and without, embarked on its democratic transition process was Ghana. The first free elections in Ghana’s Fourth Republic occurred in 1992 following eleven years of military regime under Jerry J. Rawlings and after the decision of his Provisional National Defence Council to allow a new constitution that subsequently sanctioned political parties. Rawlings and his new civilian National Democratic Congress (NDC) comfortably won the presidential election. The strongest opposition party – the New Patriotic Party (NPP) – refused to accept the outcome of the presidential contest after making allegations of irregularity, and it boycotted the subsequent parliamentary elections. The NPP fielded candidates in the 1996 presidential and parliamentary elections, which were however again both won by Rawlings and his NDC, but this time in a widely accepted contest. In 2000, a peaceful turnover of power took place following the victory of John A. Kufuor in the presidential elections and his NPP in the parliamentary elections. The victory of the NDC’s John Atta Mills in the 2008 presidential elections – yet another peaceful turnover in power – enhanced Ghana’s growing international prestige and reinforced the image of the country as a consolidated democracy (Kopecky, 2011: 718; Arthur, 2010). Indeed, of the six elections held in Ghana since 1992, two have produced power alternation in 2000 and 2008, helping the country to meet the criteria and conceptual definition of democratic consolidation outlined bySamuel Huntington (Debrah, 2015). Despite the strides, Ghana has been battling with the unregulated nature of political party financing, ¹ described as the process by which political parties and individual candidates who seek elected political office gather funds for electoral campaigns and, in the case of political parties, seek to maintain themselves as organizations (Ayee, Anebo and Debrah, 2008). Although there has been some scholarly work on political party financing in Ghana, the issue of has not yet been exhausted and solutions to problems of party financing have not fully emerged (Bryan and Baer, 2005: 7). This paper therefore adds to the growing literature by examining the best possible course of action for addressing the challenges of political party financing in Ghana.

The following research problems will guide the study: What is the nature of the existing political party financing system in Ghana and how is it impacting on the country’s democratic process in the Fourth Republic? What are the prevailing challenges to the existing political party financing system? What needs to be done to overcome these challenges and problems with the political party financing system in order to achieve the goals and objectives of ensuring a competitive electoral system in Ghana? Secondary data were used to address the aforementioned questions. These data sources involved library research (books, journal articles) on the nature of political parties in Ghana, and how they are currently financed. These books and journal articles were reviewed and analysed for the purposes of drawing conclusions using the interpretative research approach. The interpretative research method was employed because it afforded the author the opportunity of extensively examining the ongoing debate on the political party financing system in Ghana, and contributed to understanding and appreciation of the strengths and weaknesses of the current system. As Neuman and Robson (2009: 40–41) note, underlying the interpretative approach is that the social world can be understood by acquiring knowledge from stated perspectives, interpreting them and using inductive reasoning to arrive at conclusions.

The paper begins with a discussion and overview of the role of political parties, and reviews the theories underpinning political party financing. It continues by examining the development of political party systems in Ghana, in particular the legal framework for political party activities in Ghana’s Fourth Republic. The paper then analyses the party financing system in Ghana and demonstrates how it benefits incumbent governments. It concludes by analysing the benefits and disadvantages of public party financing, and offers suggestions on how to address the weaknesses in the existing party financing system in Ghana. In doing so, the paper takes the position that given that it is political resources that drive party vibrancy and competitiveness (Centre for Democratic Development – Ghana, 2005), as well as the institutionalization of the party system, the need for political party financing outweighs the concerns. However, to ensure success, the need for transparency and accountability in the use of public funds is crucial.

Political parties and party financing: theoretical discussions

The ‘scholarly literature that examines political parties is enormous’ (Strøm and Müller, 1999: 5). This is because political parties are major institutions of democracy. When in the majority, parties provide an organizational base for forming government, and when in the minority, a viable opposition, or alternative to government (Kelly and Ashiagbor, 2011). Thus, one of the main functions of political parties is to maintain themselves as organizations capable of contesting elections, maintaining their membership, supporting their members of parliament, and, if they become the government party, ensuring that their political programmes and election promises are acted upon and implemented. Maintaining contacts with an increasing number of party-to-party national, regional and global networks, working with special-interest groups such as young people, women, the private sector, trade unions and civil society organizations are also common activities in which political parties are constantly involved (Salih and Nordlund, 2007: 84–85). For Van Biezen (2003), political parties are essential for the organization of the modern democratic polity and are crucial for the expression and manifestation of political pluralism. Parties perform an important function as a channel for integrating individuals and groups in society into the political system; they mobilize and socialize the general public, particularly at elections; and they constitute the core vehicles for the articulation and aggregation of social interests.

While the role of political parties in helping to organize choices for voters as well as choosing elected representatives is not in dispute, their success in performing these roles is very much dependent on having the necessary resources and funds to operate. Mietzner (2007: 240) points out that in the scholarly discussion of party financing, the funding mechanism used by mass political parties was typically considered the ideal form of financial party management. Mass political parties are mostly funded through membership fees and small contributions made by their supporters, who work voluntarily in party offices and are actively engaged in running electoral campaigns. The supply of funds by a motivated and ideologically cohesive support base reduces the dependence of the party on state subsidies on the one hand and donations by politically interested sponsors on the other. Indeed, for Katz (1997), funding of political parties through membership fees and small contributions made by their supporters, who work voluntarily in party offices and are actively engaged in running electoral campaigns is typically considered as the ideal form of financial party management. Private funds are desirable in that they encourage citizen participation in the activities of political parties and maintain a linkage between parties and their grassroots supporters (Van Biezen, 2003: 20). Hopkin (2004: 7) argues that the mass party model was particularly successful in overcoming the logistical difficulties involved in connecting with such large numbers of people: mass parties had both a broad financial base and large numbers of activists ready to work for the party without material compensation. Also, mass party finance has the advantage of diluting the individual influence of contributors.

However, in recent times, not only has party membership declined consistently, but also in contemporary democracies, parties must seek votes from among the entire adult population, raising the potential problem of some individuals benefiting from the activities of political parties without necessarily paying or contributing anything (Hopkin, 2004: 7). According to Mietzner (2007), in order to overcome this problem and the general decline of membership of political parties, there has been an increase around the globe of public financing of political parties. The result is that currently, the majority of political parties cover only small parts of their expenses through membership fees and internal donations, while most of their income is provided by state subsidies and other forms of public financing of political parties (Mietzner 2007: 24). However, critics hold the view that public funding may lead to state interference in the internal affairs of political parties or lead to ossification of the party system. In other words, the party system will not change and encourage new competition because parties that might have otherwise faded away continue to exist as a result of state funding (Eme and Anyadike, 2014: 29). Critics add that in many developing countries fighting the quagmire of poverty and underdevelopment, it is politically unwise for government to spend taxpayers’ money on political parties when there are more pressing bread and butter challenges confronting the ordinary person (Van Gyampo, 2015).

In spite of what critics contend, with funding being one of the most crucial issues for political parties, public financing of political parties has become part of the landscape of many countries. As Fobih (2008: 218) has observed, given that the rising expenditure needed to successfully run a political party and fund political parties’ election campaigns continues to be one of the main issues facing new democracies, the provision of public subsidies and other forms of public financing of political parties is seen as an acceptable means of helping emerging democracies to promote that process. Finally, Sakyi, Agomor and Appiah (2015: 6) point out that, while perspectives on political party funding are largely shaped by one’s orientation, appreciation and persuasion about the roles parties play in a democracy, public financing of political parties is not only accepted as essential but also seen as a critical requirement for the survival of democratic government.

Political party development in Ghana

The development of the party system in Ghana mainly emerged from the growth of nationalism and the struggle to end colonialism, first under the Aboriginal Rights Protection Society in 1898, and later, the United Gold Coast Convention (UGCC) and the Convention People’s Party (CPP), which led the country’s struggle for independence in the 1940s and 1950s (Fobih, 2010). Political parties became important instruments in Ghana’s democratic practice as early as the 1950s when the country was in transition from colonial rule to an independent sovereign nation-state. Political parties in Ghana succeeded in cultivating nationalist sentiments and amassing the necessary human, financial and logistic resources to organize an aggressive pursuit of independence movements and propaganda campaigns in the process of competing for power (Fobih, 2008). Between 1954 and 1957, there were eight parties participating in earlypre-independent elections and fighting against colonial rule. The most vibrant political parties in the political landscape were the CPP, National Liberation Movement, Northern Peoples Party and the UGCC. These early political parties had different identities and philosophies of existence. While some of the parties were formed to express sub-national or ethnic and regional identities, others held onto religious or supra-national identities (Nam-Katoti et al., 2011). Since independence in 1957, Ghana’s party system has undergone several transformations through military interventions and bans on party activities, leading to overall political instability (Fobih 2010). As the Centre for Democratic Development – Ghana (CDD – Ghana) (2005) notes, the extended periods of military dictatorships stunted political party development in Ghana. Not only were the parties proscribed during these periods, but also other sectors of society that nurture political development were equally suppressed.

However, the formation of political parties witnessed yet another turning point in 1992 when multiparty democracy was restored, paving the way for the formation and registration of new political parties to contest the December polls. When the Fourth Republic began in 1992, the enthusiasm to rule characterized by the restoration of freedom saw an overwhelming 13 political parties being formed. While some of these parties have since collapsed and others have merged, aligned and changed their names, a number of them, notably NPP, NDC, CPP, and People’s National Convention (PNC) have remained part of the presidential electoral landscape since 1992 (Nam-Katoti et al., 2011). In terms of ideology, the NPP emerged from the old political tradition of the UGCC, which dates back to the 1950s and subscribes to conservative liberalism. It has dogmatically implemented the neo-liberal economic policy framework fashioned by the international financial institutions (IFIs) and the donor community generally. For this party, the overriding economic policy objective is to achieve macro-economic stability through fiscal prudence, low inflation, low bank interest rates, and so on. In general, it believes that creating the enabling environment for the private sector to flourish is the only way to encourage the growth of a dynamic private sector and create wealth, because it is only the private sector that can create wealth and engineer national progress and prosperity. On the other hand, the NDC claims to be a social democratic party (Ninsin, 2006). Similarly, the CPP is also committed to social justice and believes that the state must ensure that all people are given equal opportunity to develop themselves. It also holds the view that the state must be committed to solidarity with the poor. Finally, the PNC espouses socialist principles and sees the party as seeking to work for the betterment of the wellbeing of all the citizens of Ghana. Despite these supposed ideological differences, the differences in terms of practical policies are minimal. Indeed, Ninsin (2006) notes that during election campaigns, for example, neither of the two leading political parties – the NPP and NDC – espouse economic policies or strategies that reject the neo-liberal policy framework dictated by the IFIs and the development partners. In fact, they hardly campaign around policy issues. The only economic issue that distinguishes one from the other is the success or failure of the neo-liberal economic policies in ameliorating the harsh economic conditions of the masses of the people when one party or the other is in power.

Political party financing laws in Ghana

As noted in the preceding discussions, one of the fundamental aims of political parties is to seek to control or influence the conduct of government, essentially by getting a majority of its candidates elected to public office. Parties provide a more effective means of articulating people’s views and have more influence in the political process than people who enter politics as independent candidates. The process of winning people’s support for a party’s platform involves a great deal of energy and expense including communicating with the electorate, formulating and disseminating the party’s platform as well as engaging in programs and activities for securing public support (Fobih, 2008). However, these activities requiremoney and funding. As Ayee et al. (2008: 4) note, managing political parties is capital intensive and requires an extended programme of fund mobilization. As a result, political parties raise money in order to maintain themselves as organizations, recruit personnel, win support, hold conventions, manage election campaigns, handle the media, and establish political offices to canvass support and get their message through to the electorates (Salih and Nordlund 2007: 89).

Since Ghana gained its independence, political parties have been relying on private funding ranging from members’ contributions to big donations from businesses (Magolowondo et al., 2012). Under the Fourth Republic, Ghana’s legal framework for political parties is embodied in Article 55 of the 1992 Constitution, the Political Parties Act 1992, and the revised Political Parties Act 2000 (Debrah, 2015; Fobih, 2010). Article 55(3) of the Ghanaian Constitution states that a political party (in Ghana) is free to participate in shaping the political will of the people, to disseminate information on political ideas, social and economic programmes of a national character, and sponsor candidates for elections to any public office other than to district assemblies or lower local government units. On the other hand, Article 21(1) of the Political Parties Act 2000 (Act 574), also outlines the rules for financing of political parties (Ayee et al., 2008). The Act has disclosure laws concerning the raising and expenditure of funds by political parties. Part II of the Act focuses on the operation of political parties and specifies what needs to be disclosed. Subsection 1 states that within three months of being issued with a final certificate of registration, or longer periods as the Electoral Commission (EC) may allow, a political party is required by law to submit to the EC a written declaration giving details of all its assets and expenditure, including contributions or donations in cash or kind, made to the initial assets of the party by its founding members (Debrah, 2015; Fobih, 2008). Subsection 2 also states that the declaration submitted to the EC under subsection 1 ‘shall state the sources of funding and other assets of the political party’. Subsection 3 states that within 21 days before a general election, a political party shall submit to the EC a statement of its assets and liabilities and other particulars in such a form as the EC may demand in writing. Section 13 of the same law discusses matters relating to political parties’ initial assets and further contributions and donations made to the party. Subsections 3 and 4 also require the statement to be supported by a statutory declaration made by the General Secretary and the National Treasurer of the party. The Act also stipulates that ‘any person may, on payment of a fee determined by the Commission, inspect or obtain copies of the returns and audited accounts of a political party filed with the Commission under this section’ (Fobih, 2008: 214).

In addition to the foregoing, the EC can also request a political party to furnish it with any information or records that may be reasonably required to enable the EC to ensure that the provisions of the Act are complied with (Ayee et al., 2008). Article 23 also stipulates that only Ghanaian citizens or firms, partnerships or enterprises in which a Ghanaian owns at least 75% and is registered under the laws of Ghana, can contribute or make donations in cash or kind to a political party (Ayee et al., 2008). This suggests that it is illegal for non-citizens to contribute or make donations in cash or kind to a political party. The essence of these regulations is to ensure transparency and accountability in the operation of political parties (Nam-Katoti et al., 2011: 95). The law also allows funds from party supporters and national businesses (Magolowondo et al., 2012). Non-citizens, foreign governments or non-governmental organizations are only allowed to provide assistance to the EC if that assistance is applied for the collective benefit of registered political parties. There are no limits and no disclosure requirements for the identities of donors. Furthermore, the law establishes no limits as to how much a party or candidate can spend and no disclosure obligation for what they spend their funds on. Therefore, although huge amounts of money are spent by political parties and candidates in election time, neither the electoral management body nor any other relevant authority knows the details regarding the amount of resources that are spent and/or their sources (Magolowondo et al., 2012: 11). However, to ensure that the disclosure and expenditure requirements are met, Fobih (2008: 215) points out that the EC publishes the information submitted by the political parties in the Gazette to make it a public document within thirty days of receiving the declaration. He adds that Subsection 6 of the Political Parties Act states that ‘where a political party (a) refuses or neglects to comply with this section; or (b) submits a false declaration, the Commission may cancel the registration of that political party’. Also, the EC may at any time, upon reasonable grounds, order the accounts of a political party to be audited by an auditor appointed and paid for by the EC (Fobih 2008: 215; Ayee et al., 2008).

Finally, to help create a level playing field in party fundraising, the 2000 Political Parties Amendment Act amended one of the inconsistencies in the 1992 Political Parties Law by removing the limits on the financial contributions that members could pay to a party, and placed outright restrictions on corporate and foreign contributions to parties (Fobih, 2008). Furthermore, although parties are not supported with direct financial payments, through the EC the state supports political parties indirectly with some basic necessities for campaigning during elections, such as making available to parties a limited number of vehicles during election years for campaign activities. Political parties are also supported indirectly by the state through tax exemptions. Some foreign donor agencies, together with the EC, also indirectly support the political parties through organizing of seminars, capacity building and training programs for party leaders. In addition, the law provides two forms of indirect public funding to contesting political parties and presidential candidates in election periods: free airtime in the state-owned media to present their programmes and campaign messages; and access to vehicles according to the number of candidates each political party fields in the election (Fobih, 2008). In sum, we see that the legal framework for political party financing in Ghana leaves the political parties substantially free to raise private funds for their operations and electioneering campaigns. In fact, Ayee et al. (2008) contend that the implications of the provisions in the Political Parties Act are that, with the exception of the ban on foreign donations and non-citizens contributing to political parties, the party financing system is completely unregulated.

Legal framework for political party financing in Ghana: problems and challenges

Operating a political party is not an easy enterprise. Although political parties in Ghana have continued to develop and assert themselves as relatively strong democratic institutions without state subsidies (Magolowondo et al., 2012), they still face numerous challenges when it comes to financing their activities. First, as Fobih (2008: 213) states, the sources of funding available to the parties, as discussed in detail below, are woefully inadequate for running the day-to-day activities and effective organization of the parties. The money raised by parties is often spent on salaries to party staff and volunteers’ allowances, payment of office rent and utilities, administrative and stationery expenses, election campaigns, rallies and other political activities, bicycles, billboards, transportation and other logistics. Unsurprisingly, political parties in Ghana, especially the opposition ones, often lack the necessary funds, putting them at a disadvantage when it comes to competing with the incumbent government. As is the case in many African countries, most political parties lack membership lists, let alone the expectation that membership fees are regularly paid. CDD – Ghana (2005: 2) has indicated that

the financial weakness of the parties accounts for the lack of political party dynamism and encourages the abuse of incumbency, political patronage and corruption that, in turn, undermine political party competitiveness, thereby undermining the entire system of alternating governments through democratic elections.

Despite the important role that political parties play in democracy, some parties have not been ideal arenas for promoting free and fair elections. It is common knowledge that one of the challenges of opposition parties in emerging democracies is the situation where the ruling party makes use of governmental resources for party purposes, while opposition parties are cut off from access to public funds. Incumbent political parties in Ghana have always been accused of stifling opposition competitors of the oxygen of funds while they use state resources to secure re-election, thereby undermining the competitiveness of the elections (Debrah, 2015). Indeed, opposition political parties in Ghana, as is the case in many African countries, have problems such as scarcity of resources, uneven access to resources, and limited outreach and geographical coverage (Ashiagbor, 2005).

Hence, a major problem hindering Ghana’s elections and democratic development, which the political parties have not addressed effectively, is systemic abuse of incumbency through arbitrary use of state resources for party or personal gains at the expense of the opposition parties by a ruling party, public officials and party members standing for elected public office (Fobih, 2008). Incumbent political parties use the national coffers, the media, logistics and, above all, the advantage of incumbency to access resources in order to attain their political ambitions (Salih and Nordlund, 2007: 88). The absence of state subsidies for parties potentiallycontributes to a huge increase in the use of illicit efforts and attempts to raise campaign funds. It can also contribute to an increase on the part of political parties, especially incumbent parties, in making use of and exploiting their positions to secure incomes and raise other funds for political party activity. While ruling parties take advantage of the power of incumbency in the absence of laws or regulations that distinguish between the party and the state, the opposition parties suffer the consequent uneven political playing field (CDD – Ghana, 2005; Teshome, 2009). For Ashiagbor (2005), where state resources are abused for partisan purposes, scarce public funds are diverted to finance partisan political activity and bore holes, clinics or other public goods are reallocated from the most destitute localities to the most politically expedient areas.

Similarly, as Fobih (2008) points out, abuse of incumbency takes many forms, including development project delivery, direct bribery through the distribution of gifts, politicizing access to public facilities and funds, using government vehicles and facilities for political rallies/campaigns, turning official events into campaign rallies and privatizing public amenities for partisan purposes. Abuse of incumbency also occurs in the form of the use of institutional resources, such as employing logistical and financial resources for electoral campaigns rather than official duties; budgetary allocation abuse, where public funds are used for politically motivated projects during elections rather than the purposes for which the money was intended; and state media resource abuse, through biased information and advertising for the purpose of influencing the electorate to support a party. For example, according to Fobih (2008), during Ghana’s 2004 elections, the incumbent NDC government supplied free fuel to transport owners through the Ghana Private Road Transport Union, an umbrella group that unites private commercial vehicle owners and their drivers. This was in exchange for members of the body using their vehicles to convey NDC supporters free of charge to party rallies and polling stations and helping the party in its campaign during elections.

Consequently, the survival and competitiveness of any party largely depends on its effective organization. Parties that have a large following often meet these needs more easily than independent candidates, especially in countries like Ghana where the technology for communication is not well advanced (Fobih, 2008). It is therefore reasonable to argue that one of the bottlenecks of the development of the party system and democracy in Ghana is the problem of political party financing. The establishment and operation of a political party is a very expensive undertaking and is becoming increasingly expensive in all democracies. The desire of parties to generate more income is evidently driven by the increasingly high cost of contesting electoral campaigns. Although democracy is perceived to be the best system of government in the world, the huge sums of money involved for its effective organization do not make it an easy form of government to practice anywhere around the globe. However, as noted by Fobih (2008), inadequate funding of political parties and limited fundraising strategies undermine party competitiveness and the possibility of rotating only the well-resourced parties in government periodically through elections. In Ghana, despite the huge expenditure incurred by parties, such as expenditure on campaigns; transportation of people to party meetings, rallies and conventions; communication equipment and other logistical and administrative necessities needed for the effective functioning of a party, there is no financial support from the state. It also involves the maintenance of offices and staff at the national and ten regional levels, the constituencies or district levels, and at the unit or grassroots level, some of whom are paid. Since funding plays a significant role in the day-to-day functioning of parties, much of the energy of the party leaders and volunteers is directed toward mobilizing financial and logistic resources from local and international sources to support the party (Fobih, 2008).

Despite the good intentions of Article 55, Section 16 of the Ghanaian Constitution to restrict funding of political parties to Ghanaian citizens, the Constitution failed to specify how political parties should be funded. According to Fobih (2008), the Political Parties Act 2000 (Act 574) also does not regulate funding of political parties, aside from prohibiting funding by non-citizens. One ambiguity about this law is that, despite its ban on donations by foreigners, it also states that a corporate citizen, defined by the Act as a company registered in Ghana and whose capital is at least 75%Ghanaian-owned, can contribute in cash or kind without any limits or any other regulations. This gives some foreigners and businesses some leeway to exploit the law for favours from public officials and a ruling party. Furthermore, the law fails to regulate the private funding of election campaigns by citizens since individuals and interest groups often pay huge sums of money to parties and their candidates to finance election campaigns (Saffu, 2003a: 1–2; Saffu, 2003b). This has made the parties find their own ways and means of funding their activities, and made it extremely difficult for some parties to raise funds (Fobih, 2008). Also, despite their existence, party financing laws are frequently violated. Either reports are not submitted at all or do not reflect the full expenditure. In addition to Article 55(14) of the Constitution, Article 14 of the Political Parties Act requires parties to submit assets and liabilities to the EC 21 days before a general election, and also to submit reports on expenditure six months after a general or by-election. Moreover, although Article 55 (14) obliges political parties to publicly disclose their audited statements, the political parties have, thus far, failed to comply with the provision (Asare, 2013). Also, the law does not specify sources, although it says the EC will determine the format in which the information is to be submitted (Bryan and Baer, 2005: 62). Thus, in spite of the existence of various provisions in the Political Parties Act, Ayee et al. (2008: 10) note that the EC often turns a blind eye to obviously inaccurate returns from the political parties, thereby undermining the checks on the disclosure and spending limits. Not only has the EC not sanctioned any of the political parties for breaching the rules, but also it has failed to prescribe a standard format to be used by the political parties in the preparation of their annual financial statements (Sakyi et al., 2015: 19). In sum, Fobih (2008: 218) argues that even in a situation whereby workable and satisfactory regulations are enacted, enforcing limits on private funding of political parties and elections in Ghana remains a formidable challenge due to the lack of strict monitoring systems to apply the rule.

Despite the good intentions of Article 55, Section 16 of the Ghanaian Constitution to restrict funding of political parties to Ghanaian citizens, the Constitution failed to specify how political parties should be funded. According to Fobih (2008), the Political Parties Act 2000 (Act 574) also does not regulate funding of political parties, aside from prohibiting funding by non-citizens. One ambiguity about this law is that, despite its ban on donations by foreigners, it also states that a corporate citizen, defined by the Act as a company registered in Ghana and whose capital is at least 75%Ghanaian-owned, can contribute in cash or kind without any limits or any other regulations. This gives some foreigners and businesses some leeway to exploit the law for favours from public officials and a ruling party. Furthermore, the law fails to regulate the private funding of election campaigns by citizens since individuals and interest groups often pay huge sums of money to parties and their candidates to finance election campaigns (Saffu, 2003a: 1–2; Saffu, 2003b). This has made the parties find their own ways and means of funding their activities, and made it extremely difficult for some parties to raise funds (Fobih, 2008). Also, despite their existence, party financing laws are frequently violated. Either reports are not submitted at all or do not reflect the full expenditure. In addition to Article 55(14) of the Constitution, Article 14 of the Political Parties Act requires parties to submit assets and liabilities to the EC 21 days before a general election, and also to submit reports on expenditure six months after a general or by-election. Moreover, although Article 55 (14) obliges political parties to publicly disclose their audited statements, the political parties have, thus far, failed to comply with the provision (Asare, 2013). Also, the law does not specify sources, although it says the EC will determine the format in which the information is to be submitted (Bryan and Baer, 2005: 62). Thus, in spite of the existence of various provisions in the Political Parties Act, Ayee et al. (2008: 10) note that the EC often turns a blind eye to obviously inaccurate returns from the political parties, thereby undermining the checks on the disclosure and spending limits. Not only has the EC not sanctioned any of the political parties for breaching the rules, but also it has failed to prescribe a standard format to be used by the political parties in the preparation of their annual financial statements (Sakyi et al., 2015: 19). In sum, Fobih (2008: 218) argues that even in a situation whereby workable and satisfactory regulations are enacted, enforcing limits on private funding of political parties and elections in Ghana remains a formidable challenge due to the lack of strict monitoring systems to apply the rule.

One other problem with the law on disclosure of sources of funds is that the requirement that opposition parties must reveal the names of their individual and organizational contributors could lead to backlash and reprisals from the ruling party, especially in the award of government contracts and restricted access to business opportunities and public sector jobs. This is an indication that there is a need to regulate corporate funding of parties to reduce the risk of big corporations and wealthy interests influencing elections in Ghana (Fobih, 2008). Another problem is that parties can no longer rely on their members to perform unpaid secretarial work, electoral campaigning or constituency mobilization. Instead, party boards have to hire office staff, consultants and media specialists, who charge professional fees and have only loose emotional ties to their employers (Farrell and Webb, 2000). These challenges are exacerbated by the fact that party financing laws go unenforced deliberately because ruling parties who control government do not want to hamstring their own fundraising efforts, or worse yet, they are enforced selectively as a way of preventing opposition parties from garnering financial support (Bryan and Baer, 2005: 21). In many western democracies, problems related to party financing and corruption have been addressed through a series of efforts to curb the excesses of money in politics by enacting internal party reforms, legislative measures requiring spending limits and reporting of campaign funds, and public funding (Bryan and Baer, 2005: 20).

Despite the difficulties, a number of funding sources are available to political parties in Ghana. While Ghana’s Political Parties Act does not list sources for political party financing, there are a number of private funding sources available to them (Ayee et al., 2008). These include private sources such as small financial contributions from salaried and professional sectors of civil society; members’ contributions in the form of registration fees and annual membership dues; donations and grants or gifts from philanthropist, members and sympathizers; sale of party paraphernalia; income from party fundraising activities; seed money provided by founding members; and support from citizens living abroad (Saffu, 2003b; Bryan and Baer, 2005; Ninsin, 2006; Ayee et al., 2008; Fobih, 2008; Nam-Katoti et al., 2011; Sakyi et al., 2015). Also, political parties solicit financial support by organizing special dinners, breakfast meetings and special meetings with wealthy people who are interested in getting their names in the good books of the party (Sakyi et al., 2015: 8). Thus, Ninsin (2006) contends that ‘the Ghanaian political financing regime virtually bequeaths party funding to market forces’. For example, Jonah (1998) states that in Ghana, it was a ‘group of young upwardly mobile, cellular-phone clutching business executives and professionals who provided substantial financial backing for Professor Albert Adu Boahen’s 1992 presidential bid’. Similarly, in the 1996 election, Ghanaians living in the USA contributed an estimated US$ 100,000 to the main opposition party, the NPP (Teshome, 2009).

However, as Ninsin (2006) argues, realizing effective party organization in the domain of the private sector in Ghana is problematic. The problem with private donations to political parties is that the lack of predictability makes it a liability for parties as it does not provide them with a stable source of income to rely on. In addition, the unequal access to and the unequal distribution of private donations have an effect on the equality of political participation and competition (Van Biezen, 2003: 20). Also, Kumado (1996: 13) is of the view that apart from being irregular in nature, individual and private donations to finance political parties can result in a situation where individuals become ‘dictatorial and undermine the multiparty democratic system of governance with narrow agenda not necessarily in consonance with the public good’. Moreover, while a good option for political parties, party membership contribution is generally insignificant in Ghana. Pervasive poverty limits the amount ordinary citizens can contribute or pay as dues to their parties (Ninsin, 2006). According to Sakyi et al. (2015: 23), income inconsistency of citizens and party members, which stems from the weak nature of Ghana’s economy, has resulted in the lower capacity of parties to raise membership dues which should ideally form the bulk of funds for political parties. Moreover, given that all political parties are not equally resourceful and those who are unable to benefit from private funding should not be allowed to suffer unduly or be disadvantaged, public financing of political parties becomes imperative (Sakyi et al., 2015: 9). Furthermore, while democratic institutions such as the judiciary, parliament and civil society organizations are all important in emerging democracies, the prevailing assumption is that effective political party organization through the availability of financial resources plays a key role in the democratic process. In cases where political parties are weak because of the lack of operational funds, the prospects of promoting the democratic process in developing countries like Ghana could be undermined. Thus, the growing appreciation of the positive contribution that parties make to democratic development justifies public financing of political parties (Sakyi et al., 2015: 10).

The importance of political parties in promoting democracy and concerns about funding of political parties in Ghana led to the Public Funding of Political Parties Bill, a copy of which was submitted to the late President John E.A. Mills in 2010 (Van Gyampo, 2015: 5). The late President John E.A. Mills directed the then Vice President John Mahama (now sitting President), to study the draft bill for action. The expectation was that after the cabinet considered and approved the bill, it would be forwarded to parliament for deliberations and ultimately passed into law. According to Van Gyampo (2015: 15–16), although ‘regrettably the draft bill has not moved past the executive and thus not been deliberated in Ghana’s parliament years after its submission’, he notes that the main elements of the draft bill are as follows: the establishment of a Political Parties Fund; the principal source of money for the fund is two and half percent of total revenue of Ghana; a fund to be administered by the EC; a formula for the disbursement of the fund comprising the reimbursement of electoral expenses and general administration; and promotion of an annual audit of the fund and annual report to parliament.

Financing political parties in Ghana: charting the way forward

Party financing, which is a complex concept that encompasses numerous aspects (Booth and Robbins, 2010), is crucial for the meaningful participation of political parties in the electoral process. Candidates of various political parties would be expected to contribute funds toward the campaign and electoral effort by being very active in fundraising in order to improve their prospects of getting their messages across to the electorate. Given the challenges associated with political party financing and political corruption, the issue has gained increased international attention, and a variety of officials and activists around the world have begun to address the problem through public awareness campaigns, legislative initiatives, reporting requirements, and spending limits (Bryan and Baer, 2005: 7). One common legislative response to the apparent constraints facing political parties in their urge to secure funding for elections is to introduce or to boost public subsidies for political parties.

However, according to CDD – Ghana (2005), sceptics in Ghana contend that it is inappropriate for the government to spend large sums of money on political parties when there are pressing social needs that remain unmet, such as poverty, health care, nutrition, basic education and so on. Also, after they receive public funding, political parties will cease to actively seek new members and funds from the voting public. The parties will no longer feel a need to perform their activities, since funding will be comfortably provided by the state. This complacency will cause the parties to atrophy and lose their efficacy and influence. Finally, there is also the argument that the political parties have access to enough money already; they need to learn how to manage what they have better and use it more wisely. They have a fiduciary responsibility to be more frugal with the public’s money. The best way to reduce corruption in politics would be to minimize the influence of money by restricting the amount of money flowing into the political system generally and the electoral system in particular (CDD – Ghana, 2005). Indeed, Ninsin (2006: 18) notes that various opinion polls that have been conducted to assess the views of the Ghanaian public regarding state funding of political parties show a lack of support. Similarly, Van Gyampo (2015) found in a research study that although Ghanaians are politically active, they are not keen on contributing to keep their respective political parties running. Given their weak financial base, the general public in Ghana is not supportive of any proposal for public funding of political parties.

Be that as it may, there is an increasing call for the provision of public financing and subsidies to political parties in Ghana. In order to stabilize opposition, many states, especially those transitioning and seeking to consolidate their democracies, are looking at state subsidies as a way to prop up legitimate opposition (Booth and Robbins, 2010: 632). Proponents note subsidies create a level playing field for political parties, especially those less likely to attract the support of rich donors (Nam-Katoti et al., 2011: 94). Moreover, without party funding, the democratic process not only turns into a money-raising machine, but also deprives poor but well-deserving and qualified citizens from standing for a public office, and over-represents the interests of the rich. Also, since mass membership dues are inadequate, or non-existent in the case of some minority parties, without political party financing, some parties, especially opposition ones, would phase out and citizens’ right to free speech in the shaping of public opinion would be limited (Fobih, 2008).

Although the state in Ghana provides some political party financing in the form of allowing a certain amount of free airtime on state media during campaigns (Bryan and Baer, 2005: 62–63), this is simply not enough. As Van Gyampo (2015) points out, established democracies such as Germany, Ireland, United Kingdom, Australia, Canada and countries in post-communist Eastern Europe practice some form of public funding for political parties. Similarly, all Latin American states, with the exception of Venezuela, provide public funding of political parties, following the re-emergence of the multiparty system in the region after a long suspension under military rule (Ssemogerere, 2011). In Africa as a whole, public funding of political parties is not available in 56% of countries, with Botswana, often referred to as one of the few shining examples of democracy in Africa, being one of the most notable, which gives the ruling party a huge advantage. While public funding of political parties is still relatively low continent-wide, it is high on the political agenda in the countries of sub-Saharan Africa, including southern Africa, for example, where 8 out of 15 countries in the region have introduced it under law (Ssemogerere, 2011: 17). According to Magolowondo et al. (2012: 8), in some countries, funds are provided for all political parties with legal existence. In Mozambique, for example, public funds are provided for both day-to-day functioning as well as for electoral campaigning. Also, campaign financing is distributed before the elections, based on the number of candidates fielded. On the other hand, in Burundi funds are made available only after elections based on electoral results. Finally, countries like Tanzania and Malawi use a threshold for political parties to access funds.

For Van Biezen (2004: 702), the increasing willingness of governments to subsidize parties in electoral races suggests that states themselves are aware of parties’ importance and view parties as an ‘essential public good for democracy’. Without funds, parties are unable to compete effectively, which can spell disaster for the stability of party systems; so, in systems where parties lack sufficient funding, higher turnover among parties is not uncommon (Booth and Robbins, 2010: 632). Thus, the call for the introduction of public funding is based on two arguments. First, it is believed that unless the public invest in the financing of political parties through public funding there will be no basis for the introduction of stringent laws for public control of political party financing. Second, it is understood that public funding can be used as a tool to fight corruption in the financing of political parties (Magolowondo et al., 2012: 12). As argued by Van Biezen (2003), the traditional type of party financing, primarily or almost exclusively through membership fees, is no longer viable for most parties in modern democracies. Private means of financing other than through membership fees, either from within or outside the party, are not without problems. Contributions by parliamentarians to their party deducted from their allowances may constitute a concealed form of public funding and are difficult to reconcile with their independence and constitutional free mandate, in particular when the payment constitutes a de facto obligation. Other private sources such as donations run the risk of establishing inappropriate links between donating money and specific political decisions. In this context, the mere impression of misuse may in itself be sufficient to erode public confidence in the political system and its political actors and may thereby undermine the legitimacy of democracy.

In this vein, it is to enhance multiparty politics and the development of democracy in Ghana that the need for public financing of political parties has been emphasized (Ayee et al 2008: 8). For Sakyi et al. (2015: 8), public financing of political parties helps control the influence of individual and private money, limits their potential effect on the democratic political process, and also protects the public good and ensures that the public interest rather than individual interest and money shapes the conduct of political parties and elected political actors. More direct citizen involvement in the political process, as well as the promotion of public trust in political institutions, can be realized from political party financing in Ghana. Introducing a system of public assistance to political parties has the potential of encouraging and ensuring a party-centred as opposed to a candidate-centred approach to electoral campaigning. As CDD – Ghana (2005) notes, public funding in Ghana would promote some measure of equality and provide a more even ‘playing field’ for the parties. The advantages of incumbency and greater financial resources for the ruling party would be reduced; all the candidates and parties would therefore have the political space to concentrate and offer their views on how to solve the problems facing the country. Moreover, public funding reduces the temptation for political parties to accept illegal contributions, to accept donations in exchange for favours, to use money for activities like vote-buying, to use state resources in conducting election campaigns, or any number of corrupt political practices. In addition, it reduces the temptation for political parties to accept ‘interested money’, by which a party becomes disproportionately influenced by a small minority of people (CDD – Ghana, 2005).

The conventional wisdom in political economy is that most donors have clearly defined political and economic interests, and they expect the party and its politicians to take those interests into consideration if elected to public office (Katz, 1997). Arguing from a pluralist political perspective, Alexander (1989), for example, contends that since policy preferences are in competition with conflicting claims for political action, individuals or groups use wealth to achieve policy goals by promoting nominations or elections of candidates and parties with views congenial to theirs. Similarly, for Welch (1974), contributors are investors that give in order to gain political influence. Thus, individuals and corporations that provide contributions to elected officials are likely to experience higher returns in the form of policy influence and decisions than those that do not. By making contributions to elected officials, not only would donors have access to the policy making process, but also they are likely to exert some kind of influence that benefits them on regulatory activities in the country. In the most extreme cases, sponsors provide donations in exchange for support of a particular policy or piece of legislation that benefits them (Mietzner, 2007). In this regard, not only do elected officials become more accountable to those who finance their campaigns than to their constituents, but also large corporate or single donor funding for parties and candidates dominates political decisions and political corruption becomes a problem (Eme and Anyadike, 2014). By reducing the influence of special interests in a political system, the interests of the majority are better represented (CDD – Ghana, 2005).

In sum, as Van Biezen and Kopecky (2007) argue, public subsidies paid to non-governing as well as governing parties may help boost democratic competition when the alternative model is that governing parties alone benefit highly from state resources paid in the form of patronage opportunities and corruption. The introduction of subsidies has the potential to make funds available not only to national political party organizations but also to the individual politicians seeking the support and vote of the electorate. It needs to be added that the provision of public financial support must be complemented by internal party reforms in Ghana. As the CDD – Ghana (2005) states, the current situation in Ghana, where high levels of popular party identification but low card-carrying membership exists, is a worrisome one. It connotes weak actual commitment of Ghanaians to political parties. Apparently, the political parties have a lot to do in terms of self-help before they can expect to translate the vast latent support into actual and active support. Successful cultivation of genuinely active support for political parties will obviously facilitate the mobilization of resources through membership dues and other contributions. At the moment, such a task is made more daunting by the fact that public perceptions of the parties’ internal organization and conduct are less than favourable. Quite clearly, future public support will hinge on serious internal party reforms.

However, as Van Biezen (2003: 13) points out, any system of party financing and the limitations it imposes on political parties and their financial sources will only be effective with transparency as well as strong mechanisms of control and sanctions for eventual violations. To meet transparency and accountability requirements, the provision of financial support to political parties in Ghana should thus be supported not only by independent external audit systems, clear rules and regulations as well as administrative procedures, but should also be accompanied by easily identified proportionate sanctions for any breaches. Moreover, control bodies composed of independent members and provided with sufficient means (including investigative powers, and financial and technical equipment) for effectively exercising their monitoring function should be established (Van Biezen, 2003: 13). Also, because of the perception of corruption, frequent auditing and publication of party accounts in the media is highly recommended. Van Gyampo (2015) argues that not only is there the need for some consensus about the most neutral institution in Ghana to handle the disbursement of state resources to political parties, but also the formula for sharing must first consider equity in which party infrastructure building will receive proper attention. At a time when public cynicism about politics is high, a significant reduction in perceptions of political corruption through successful dissemination of campaign finance regulation would be a boost to the legitimacy of democracies (Avkiran et al., 2016).

Furthermore, the criteria for determining how much and which political parties could benefit from government funding in Ghana could be based on a formula or combination of factors and variables such as votes obtained at the last general election, parliamentary seats obtained and the number of party members, among others. Finally, placing limits on party and campaign expenditure are a device that can be used to avoid excessive increases in the cost of party politics, control inequalities between political parties and restrict the scope of improper influence and corruption. In the absence of an upper threshold on expenditure, there are no limits to the escalation of campaign costs. This can be prevented by setting legal limits on election expenditure. Expenditure limits should also be seen as a means to prevent candidates or parties from buying votes (Van Biezen, 2003: 29). It needs to be stated that the role of civil society organizations in this process cannot be underestimated. Since nascent political party systems are often characterized by poor internal decision-making and management systems (Bryan and Baer, 2005: 11), not only should civil society organizations monitor the electoral process and its results, but also monitoring the flow to political parties and reporting them in them media could be crucial to the transparency and accountability aspect of political party financing in Ghana. As suggested by Bryan and Baer, leading elements in civil society – media, watchdog groups – should enhance their efforts to raise awareness of and educate citizens about party financing. Civic organizations, think tanks, independent journalists, and media outlets have proven to be catalysts for change and reform in many other countries, revealing corruption and abuse of state power and informing citizens about the nature of political corruption to shine the spotlight on abuse in developing democracies by monitoring expenditures, tracking sources of funding, and bringing abuses to the public’s attention (Bryan and Baer, 2005: 25-26).

Concluding remarks

The focus of this paper was to examine Ghana’s political party financing laws and find out the extent to which they could be reformed to ensure that there is a level playing field for all political parties to compete in the electoral process. The paper noted that Ghana has made great strides and enhanced its status as one of the countries in Africa to promote liberal democracy. While successive peaceful elections have taken place, and structures of governance such as the EC, parliament, judiciary, media and civil society organizations have played their roles, there are potential bottlenecks in the democratic process in Ghana. Nowhere is this more evident than in challenges faced by political parties to secure adequate funds to offer alternatives to incumbent governments. It is in this vein that political party financing has recently received attention in Ghana. The argument goes that in the absence of some form of equity through the provision of public funding and other subsidies for political parties, incumbents would outspend opposition parties, thereby undermining the fairness of not only the electoral process but also its outcome. Critics, as noted earlier, contend that money to support political parties could be used to provide infrastructure and other essential social services to the general public, given the highs levels of poverty in the country. Moreover, it is also possible that the introduction of public funding to political parties could result in a situation where parties become dependent on government support to operate their activities, thereby reducing their reliance on their members.

While these are genuine concerns, the paper recommends public financing of political parties in Ghana. It is the case that in the absence of a level playing field in the electoral process, which can be realized through public financing of political parties, efforts to promote the liberal democratic process in Ghana would come to nothing. Having said that, transparency and accountability by political parties receiving public funding for their activities is crucial to the success of the process. The paper argues that this could be attained through the media and civil society organizations performing their watchdog functions as well as insisting and ensuring that political parties and parliamentarians who receive public funding disclose it, publish their expenditure and annual reports, as well as have their accounts audited by an independent agency. Also, since political party financing scandals illustrate that enforcement is one of the greatest challenges to reform (Bryan and Baer, 2005: 22), a legal framework that ensures monitoring, denouncing, sanctioning and punishing abuse would be equally critical. Finally, the paper agrees with the recommendation of Sakyi et al. (2015) of providing support to political parties to build organizational capacity to enable them to mobilize funds.

Although the paper has added to the existing literature, there are still some limitations that are worth noting. The main limitation is the absence of primary data through fieldwork research and personal interviewing of the actors involved in the debate on political party financing in Ghana. As a result, the paper has the challenges and limitations that are generally found when making use of pre-existing and secondary sources of data. These include the lack of control over the quality of the data, and the incomplete nature of the information, which may stem from the information not meeting the specific needs of the researcher or being inappropriate for the particular research question (Neuman and Robson, 2009: 232–233). Despite these limitations, the analysis in the paper helped identify gaps in the existing literature and what kind of additional information needs to be collected. Indeed, information from the secondary sources for this paper demonstrated that incumbency is often abused by the Ghanaian government, which in turn threatens the electoral competitiveness of the opposition parties and the democratic process. It also contributed to our knowledge of how a level playing field in terms of public financing of political parties can help in electoral competition and promote the democratic process in Ghana.