Juni 21, 2024

Political Party Finance and the Push for Regulatory Reform

The campaign finance report is one of the many problems in elections in Indonesia, which after every election is considered as one of the less honest. Troubled campaign finance regulations, oversight of campaign funds is not enough to guarantee that any dishonest candidate deserves to be disqualified. These problems prompted the Association for Elections and Democracy (Perludem) to organize a special regional conference on the theme of political party finance, including campaign finance. In a series of conferences, one of the discussions (9/24) highlighted the issue of campaign finance in Indonesia.

Portrait of campaign funds in Indonesian elections

In his presentation, Perludem researcher Heroik Pratama explained that there are three sources of campaign funding in the Indonesian election, namely candidates, political parties, and the private sector. The private sector includes individuals and legal entities that make donations. The maximum amount of donations that can be given by the private sector is different in the Election Law and the Political Party Law.

In 2014 and 2019 Elections, the majority of candidate campaigns are funded by the size of each candidate’s account. If in the 2014 election the percentage was 85.10 percent, in the 2019 election it fell slightly to 84.71 percent. Funds from political parties became the second largest source for candidates’ campaigns, namely 11 percent in the 2014 elections and 13.4 percent in the 2019 elections. Respectively, 2.67 percent (2014) and 0.64 percent (2019) of campaign funds came from private companies, 0.67 percent (2014) and 0.4 percent (2019) from groups, and 0.56 percent (2014) and 0.84 percent (2019) from individuals.

Heroik also conveyed that there was a relationship between the candidate list proportional electoral system and the amount of campaign funds spent. The serial number variable greatly affects the amount of the candidates’ campaign funds.

Candidate’s Serial Number Total of Candidate’s Campaign Fund Average of Candidate’s Campaign Fund
1 549,024,901,722 758,321,687
2 293,200,116,643 405,532,665
3 166,104,400,504 230,380,583
4 183,071,359,918 257,295,278
5 150,467,229,788 243,081,147
6 70,610,476,981 117,488,314
7 65,579,136,779 141,639,604
8 46,820,713,040 139,347,360
9 25,302,417,692 143,763,737
10 18,135,909,941 185,060,306


“So, candidates in serial number 1 tend to spend more campaign funds than candidates in other serial numbers. And, if we look at the electability of candidates based on serial numbers, indeed candidate number 1 is far more elected than candidates with other serial numbers,” explained Heroik.

In the 2009 election, 62.1 percent of candidate number 1 was elected. 2014 election, 64.96 percent. Election 2019, 63.48 percent.

Redefine campaign donation limit

Based on data from the International Institute for Democracy and Electoral Assistance (IDEA), there are three types of formulas for calculating the limit for campaign finance donations, namely a fixed amount, as applied in Italy and France, the applicable minimum wage, and campaign finance expenditures in the previous election. Perludem has simulated the formula for calculating the limit for campaign finance contributions, in conclusion, the limit for the ideal campaign fund donations if it is based on the regional minimum wage.

“The recommended limitation of campaign fund donations for Indonesia is based on the regional minimum wage,” said Heroik.

Many problems in campaign funds reports

Member of the Elections Supervisory Body (Bawaslu) RI, Fritz Edward Siregar revealed a number of problems in political party campaign funds. Bawaslu, which was given the authority to supervise campaign funds and check the validity of campaign funds reports, found that there were repeated donation transfers, divided transactions so as not to exceed the limits stipulated by the Election Law and the Regional Election Law, there were still campaign transactions carried out outside the special campaign fund account, and very low campaign spending. In fact, Articles 496 and 497 of the Election Law have imposed sanctions on election participants and candidates who report campaign funds incorrectly. For election participants, the sanction is in the form of a maximum imprisonment of one year and a maximum fine of 12 million rupiah. As for candidates, the maximum imprisonment is two years and a maximum fine of 24 million rupiah. “Bawaslu found that there were candidates who were nominated, but the nominal campaign fund reported was very low. Now, this certainly raises questions regarding the accountability of campaign finance reports,” said Fritz.

Fritz also highlighted that there is still flexibility in deadlines for submitting campaign finance reports. The audit process by auditors also opens a gap because the auditors employed by the General Elections Commission (KPU) are auditors who handle many areas. Moreover, Bawaslu has not been given access to the Campaign Fund Information System (Sidakam).

“Auditors deal with many areas so the auditor’s workload must be considered. It must be ensured that the auditors who have been blacklisted are not appointed,” said Fritz.

Political Party Dilemma

Politics requires money, both for party operations, regeneration, and management of the mass base in the electoral district (dapil). Organizing political parties in Indonesia is not cheap. The large territory of Indonesia with a population of more than 200 million requires a large amount of money. This condition creates a dilemma for political parties, because on the other hand, the need for large money forces parties to depend on donations from third parties. These donations often interfere with the independence of the party in fighting for the interests of the people.

Referring to this issue, a member of the Advisory Council of Perludem, Titi Anggraini, emphasized the importance of regulatory intervention to force parties to be transparent, accountable, and still be able to maintain party independence as the most important democratic institution. One of the rules that need to be emphasized is the limit on donations to political parties, and state funding for parties.

“When we encourage transparency and accountability, political party finance becomes the internal domain of the party. Well, transparency and accountability are not a culture that is internalized in political parties. Therefore, it is necessary to limit the amount of donations that can be received by political parties, and financial assistance from the government. Increasing state funds for political parties is also an effort to avoid the domination of the influence of capital owners in controlling the structure of political parties,” explained Titi.

In addition, Titi also highlighted the absence of an institution that oversees the political parties finance. Bawaslu is only given the authority to oversee campaign funds. As a result, reporting on political funds is only a formality to comply with the rule of law. Finance reports and campaign funds are also absent from the attention of voters, not being a reference in making choices.

Party funding assistance to increase women’s representation

One of the things that election activists and women activists in Indonesia are pushing for is party financial assistance to increase women’s representation in parliament. Financial affirmations are considered important for women candidates, because many women do not have the capital resources to fight in elections or regional head elections.

“Lack of access to finance is the biggest challenge for women to enter the political arena,” concluded senior Partai Persatuan Pembangunan [United Development Party] (PPP) politician, Lena Maryana Mukti.

There are three models of affirmation offered by Lena. First, state funds for parties are allocated to improve gender equality and women’s empowerment activities in parties. Second, the party’s financial reporting obligations that are allocated for gender equality, before state funds are sent to the party’s account. Third, there is a percentage of party funding that is required to form and run the party’s women’s wing organization.

“I support the proposal to regulate party spending, as well as the legal framework governing party finances. When we can arrange for parties to comply with the regulations, democratization in Indonesia will go on the right track,” said Lena.