Political financing in Indonesia lacks regulation

Political financing in Indonesia lacks regulation
Despite being one of the most open electoral systems in Asia, the high cost of politics in Indonesia has taken a toll on the country.

When Indonesia embarked on its journey towards democracy after the fall of Suharto in May 1998, there was euphoria all round as political reforms were put in place for the rejuvenated country.

Within a decade, Indonesia became one of the most open electoral systems in Asia with features of multiple political parties compared to the miserable three during the three decades of the Suharto era, and a direct election as opposed to hand-picked appointments for government officials, regional heads and the highest office in the land: the presidency.

But for all the positive signs of a thriving democracy, the downside is that politics is becoming costly not only for political parties, but also for individual politicians and other aspirants.

The underlying issue is political financing which has not been addressed even as the country's election laws are regularly updated through Parliament about two years before the next elections.

With no control over political financing, politics has become so expensive that the cost of contesting under a party ticket is staggering.

Last month, Golkar legislator Bambang Soesatyo lamented that candidates for the national and regional parliaments have to fork out at least one billion rupiah (S$130,000) to contest the election.

Aspirants who want to be regional governors must each have at least 25 billion rupiah, a figure that is extremely expensive and may be out of reach for many aspirants.

Contestants in elections have to pay political parties to get themselves nominated. Then they have to meet other expenditures for logistics - from organising rallies, and putting up posters, banners and advertisements to engaging pollsters and consultants and providing food for the events they hold.

The high cost of politics has taken a toll on the country.

First, an unintended effect is the corruption scandals involving top leaders of political parties, legislators and regional heads seeking funds to finance their political activities through illegal means.

The most recent scandal involves the Islamist Prosperous Justice Party (PKS), the fourth largest party in Parliament and a member of the ruling coalition.

Former PKS chairman Luthfi Hassan Ishaaq is being tried for taking bribes from a meat import firm in return for his influence on the Agriculture Minister for an increase in the beef import quota.

At the start of the trial late last month, it was alleged that the politician conspired with a businessman last year to help the PKS raise two trillion rupiah for the next general election.

Earlier, a corruption suspect in the case told investigators that the party planned to make use of its control of several government departments to amass a campaign war chest. PKS officials have vehemently denied the allegations.

Resorting to shady deals has been a standard practice for party leaders to raise funds, especially if they do not have wealthy patrons who can provide the financial backing, according to analysts.

For many political parties, their main sources of funds are their membership dues, donations from supporters and also subsidies from the government based on the number of seats they have in Parliament.

These are grossly insufficient to cover the huge cost of running a political party and its branches in 33 provinces while also financing its activities.

For candidates who had spent millions to get elected, they might start thinking about recouping their investments once elected. They might use whatever means at their disposal, including engaging in shady deals and graft.

Second, while free and fair elections have characterised Indonesia's democracy in the reformasi era, the high cost of politics has resulted in political competition that is neither free nor fair.

Political parties and candidates with a huge war chest tend to have the upper hand in the battle for votes because they can use their money to buy support from the electorate.

Hence the likelihood is that wealthy candidates, who are not necessarily the best, are poised to win in the contests. Good candidates with ideas and who are committed to doing constituency work could be forced to withdraw if they are unable to raise enough money to enter the fray.

This brings us to the issue of political financing. While the election law has been regularly updated and amended to bring it in line with the changing landscape, political funding has been somewhat neglected by political reformers.

There should be a regulation on such funds to bring down the high cost of politics and prevent illicit funds from being used by political parties and candidates in election campaigns.

With concerns raised over political financing, it is only natural that the General Elections Commission (KPU), an independent body that conducts elections, is under pressure to introduce some form of regulation in time for the legislative elections in April next year and the presidential election three months later.

The regulation should require political parties to be more transparent in their fund management and in declaring their sources. More importantly, there should be a cap on the volume of donations by individuals and companies.

Political financing is an important element for a democracy to work. Regulating it is essential to create a more healthy political competition, in accordance with the ideals of democracy.

Besides, the intention is also to create transparency and accountability and to minimise money politics. This is especially so as political funding is one of the determinants of victory in elections.

- Salim Osman

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