TRANSPARENCY INTERNATIONAL AND FREEDOM HOUSE TO SCRUTINIZE CAMPAIGN SPENDING

Volunteers and campaign experts help the civil groups monitor parties’ campaign finance

Transparency International Hungary (TI), Freedom House Europe (FH) and the Eötvös Károly Institute (EKI) joined forces to scrutinize and document Hungarian parties’ campaign spending, representatives of the three organizations announced at a press conference earlier today. The virtual campaign finance accounts can be accessed online at www.kepmutatas.hu, the project website. Both big parties have already spent more than HUF 100 million despite the fact that the campaign season has not yet officially started.

As the Parliament failed to pass the campaign finance reform bill that TI and FH prepared and distributed to parties last November, it is now beyond doubt that the 2010 parliamentary elections will still be held under the legal framework in effect since 1997. Through the most comprehensive and precise documentation of the parties’ election spending, the initiatiors aim to demonstrate the inevitable need for an extensive reform of party and campaign financing regulations.

Trade associations as well as the parties themselves articulated in previous years that the current regulatory framework is incapable of guaranteeing the transparency of election campaigns. That parties outspend the HUF 386 million spending limit—tenfold according to some estimates—and submit misguiding financial reports to the State Audit Office is an open secret.

“It is crucial to make parties realize they cannot carry on with their hypocritical campaign financing practices”, says Noémi Alexa, executive director of Transparency International Hungary. “The best way to confront them with this is to monitor their campaigns by mapping out their financial structure, estimating how much money is being spent on each item and to give the figures as much publicity as possible.”

Spending can be followed on the virtual campaign account

Once processed, all data received becomes available at www.kepmutatas.hu, where visitors can look up how much money each party is spending and find detailed reports on how much is being spent on television and radio ads, billboards, or rallies.

As Bálint Molnár, director of Freedom House Europe, explained, several sources are being used to measure campaign spending. “First of all, we use publicly available databases to estimate the quantity of parties’ paid political ads. Besides, we try to determine the price of the items about which not much information is at hand, such as events ranging from rallies with tens of thousands of supporters to town meetings with a few dozen, print campaign material, telephone or text message ads, opinion polls (frequently for internal use), and other items inevitably part of modern political campaigns and yet not included in the parties’ financial reports.”

“Not only does the lack of adequate campaign finance regulations encourage a system based on lies, living with which is unbearable, but just as importantly, it also greatly inhibits efficiency”, explains László Majtényi, director of the Eötvös Károly Institute. “I cannot think of any other system with a higher social cost. The current legal framework is a  hotbed of corruption, thus its rethinking would convey that the political elite starts mending the country by mending itself.”

Experts and volunteers help monitor

The work of the civil groups is helped by groups of college student volunteers who participate at campaign events, collect and document campaign material and communicate with the project coordinators to help monitor the parties’ activities.

Says Tímea Csikós of Pécs, one of the volunteer student coordinators, “I joined the project to help build the more transparent political and economic environment I would like to work in once I graduate. I encourage all students who want to stand up against corruption to join us.”

The goal is campaign finance reform

Such a comprehensive campaign monitoring project is unprecedented in Hungary according to the initiators, who added that they plan to keep the topic on the agenda after the elections. As Noémi Alexa explained, “with the newly elected Parliament we will have another chance to propagate our proposed bill that could do away with the vast majority of the illegal and corrupt practices currently employed in campaign finance. We believe that the documentation of the 2010 election campaigns will make people realize that the current situation is untenable, which will eventually help bring about the necessary political will.”

Campaign spending already exceeding HUF 100 million

According to the accumulated data, the two big parties, MSZP and FIDESZ, have spent a combined HUF 250 million before March. Calculating with market prices, MSZP has spent approximately 160 million on its campaign, with only its posters in public places totalling almost 70 million. FIDESZ has also exceeded 100 million.

What is the problem with party- and campaign financing in Hungary today?

Ultimately, it is only the parties themselves, sitting in parliament, who can improve on the current situation and make their campaigns transparent and fully conform to the law. It is up to them to enact new legislation that would close the loopholes and curb the opportunities for corruption. Above all, the following measures are essential for more transparency and accountability:

1. Introduce a designated “Campaign Account”!
There must be a single, designated bank account from which all campaign spending must be conducted. All credits and withdrawals from this account must be fully verified and made public. Every item related to the campaign must be paid directly from this account and this account only.

2. Increase the ceiling for campaign spending!
Parties should be able to spend ten times more on their campaigns than the current limit, but all spending must be transparent and verifiable and more severe sanctions should be applied to those who overspend.

3. Shorten the campaign period!
Campaign activities should only be allowed during a 60-day period before election day. Political advertising must be allowed only during this period.

4. Strengthen oversight of campaigns!
The State Audit Office must have full access to and oversight of the campaign accounts. The SAO must also have full authority to sanction overspending and campaign activities outside the designated 60-day campaign period. The SAO should use the full extent of its jurisdiction to uncover and sanction wrongdoing during the campaigns.

 What is www.kepmutatas.hu?

This site is the dedicated web-space of the joint initiative by Freedom House Europe and Transparency International Hungary to bring more transparency and accountability to party- and campaign financing in Hungary.

The word “képmutatás” means “hypocrisy” in Hungarian and, indeed, the current state of party- and campaign financing in Hungary and the position of all parliamentary parties on the issue today is nothing if not hypocritical. While parties profess their desire to clean up the current system and eliminate the corrupt practices surrounding it, they continue spend as much as ten times the legal limit on their campaigns, abuse state and municipal resources for their campaigns, raise funds through illegal channels and spend money in ways that are incompatible with the word, as well as the spirit of the law. Yet, to this day the parties could not find consensus in endorsing a series of amendments that would create a transparent and accountable framework for the funding of political parties and their campaigns. Without serious public pressure for change along the lines of clear policy recommendations, there is little chance for reform in this area.

This joint initiative seeks to incorporate both the high-quality work conducted by other organizations on the subject (most notably, the analysis and policy recommendations developed by the Eötvös Károly Institute) and the lessons learned from their own earlier attempts at exerting pressure on parliamentary parties to arrive at a consensus on the need for and contours of reform in party- and campaign financing.