Young politicians preparing to compete as legislative candidates for the 2024 General Election complained about the high-cost political system, which dragged them to a difficult situation of being held hostage to financiers.
“It’s because politics is full of promises. We are held hostage by capital owners and financiers because the political costs in the candidacy process are very high,” said Setyawati Molyna, a young politician from the central board of the National Mandate Party (PAN) in a Youtube broadcast by Cak Nur Society entitled “Politics of Ideas, Examples from the Nation’s Teachers,” on Saturday, January 28, 2023, in Jakarta. This talk show is the result of a collaboration between Sumbu Kebangsaan with the Nurcholish Madjid Society, the Gusdurian Network, and the Maarif Institute.
Besides Setyawati, Zebi Magnolia from the Indonesian Solidarity Party (PSI), Bona Simanjuntak from the Nusantara Awakening Party (PKN), Abe Tanditasik from the Indonesian Democratic Party of Struggle (PDI-P), and Pitria Nopa Asriani from the Democratic Party, also participated in the talk show.
In a separate interview session, the Deputy Chairman of the Ummat Party (Partai Ummat), Nazaruddin, did not deny the facts. “The political costs in Indonesia are very high,” he told Jaring.id, on Monday, February 6, 2023.
The former PAN politician said the legislative election to elect members of the House of Representatives (DPR) required a cost of at least Rp5 billion to 10 billion per candidate. “For the district and city level of the legislative body (DPRD), the costs are much smaller, only around hundreds of million rupiah. As for the provincial level, the cost ranges from hundreds of millions approaching or exceeding 1 billion rupiahs,” he continued.
Ummat Party is one of 18 parties that qualify as participants in the 2024 elections. Previously, this party had not passed factual verification by the General Elections Commission (KPU) in December 2022. The Ummat Party then filed a dispute with the Election Supervisory Agency (Bawaslu) to request a re-verification process. Based on this change in verification results, the 2024 elections will be contested by nine parliamentary parties and nine non-parliamentary parties.
As a non-parliamentary party, according to Nazaruddin, the Ummat Party must work twice as hard as other parties. Without this effort, it will be difficult to participate to the full extent in the next election. “We are a new party, we have to work extra hard,” he said.
Some of the ways that the Ummat Party is doing is by looking for candidates who are able to finance themselves, collecting membership fees, looking for donors, and crowdfunding. “We can invite candidates. We fight for the values we believe in, so we target groups that agree with our thoughts. This becomes our capital,” said Nazaruddin.
The Ummat Party’s crowdfunding platform is listed on the website partaiummat.id. Not only collecting public funds, but they also sell a number of items for sale, ranging from cloth masks for Rp15,000, children’s t-shirts for Rp85,000, a number of books written by Amien Rais priced at Rp75,000 at most, to merchandise such as hoodies sold at Rp250,000. “Previously, when the party had a dispute [about participation in the 2024 elections] in Bawaslu, we opened donations distributed to administrators, cadres, and sympathizers of the party. We managed to collect more than Rp500 million,” he said.
Another new party using a digital platform to raise public funds is the Labor Party. Claiming to represent the working class, the Labor Party has created its own donation platform, where sympathizers can donate from Rp15,000 to 100,000. The party chose to fund its operations through this system to avoid interference from oligarchic interests. Unlike the Ummat Party, the Labor Party does not sell goods on its website.
Before crowdfunding was utilized by new parties in Indonesia, the Indonesian Solidarity Party (PSI) had already conducted public fundraising in the 2019 elections. However, this non-parliamentary party did not build its own crowdfunding platform, but through a popular feature already provided by the kitabisa.com portal.
The high cost of politics also pushed Gerindra Party to do collective funding. The idea of crowdfunding for Gerindra’s political costs was proposed by its chairman, Prabowo Subianto, through his Facebook account. “I ask for your donation. Adjust the amount to your ability. If you, let’s say, donate Rp5,000, we will thank you. If you can donate Rp10,000, Rp20,000, and so on, it will be very meaningful,” Prabowo said at the time, Thursday, June 21, 2018.
The crowdfunding mechanism is actually not something new to be done in general elections. Former United States (US) President Barack Obama and Donald Trump have already implemented it. Obama successfully raised public funds when he was running for the 2008 presidential election. As reported by the New York Times, Obama successfully raised nearly US$750 million, surpassing all similar gains of all-time presidential candidates. He spent US$136 million in the period from October 16 to November 24, 2016. Not surprisingly, this method was then adopted by a number of other countries, including Indonesia.
However, Law Number 7/2017 on General Elections limits the amount of funds that can be given to parties. Individual funds cannot exceed Rp2.5 billion and non-individual funds (from groups, companies, and/or non-government business entities) cannot exceed Rp25 billion. Violating this regulation brings a maximum imprisonment of 2 years as stated in Article 525 (1). This regulation has not been able to accommodate the use of virtual accounts as a collective funding platform. So far, the KPU only recognizes registered bank accounts of the political parties to see the parties’ cash flow.
Recently, the Financial Transaction Reports and Analysis Center (PPATK) discovered the alleged use of money laundering proceeds during the 2014 and 2019 elections. Money from corruption and other illegal sources is estimated to reach trillions of rupiah. PPATK Chairman Ivan Yustiavandana revealed this during a working meeting of Commission III of the House of Representatives, at Nusantara II Building, Jakarta on Tuesday, February 14, 2023.
Meanwhile, research results issued by the Indonesian Election Governance Education Consortium together with the General Election Commission (KPU) in May 2020 noted that the source of campaign fund revenue in the 2019 elections was dominated by donations from legislative candidates amounting to Rp1.99 trillion, followed by donations from political parties (Rp315.6 billion), individuals (Rp19.7 billion), non-governmental business entities (Rp15 billion), group donations (Rp9.5 billion), and others amounting to Rp16.5 billion.
The funds were used to finance campaign services for legislative candidates, distribution of campaign materials, production of advertisements, making campaign props, and donations to legislative candidates. “Expenditures for campaign services have the largest portion for the majority of parties worth Rp1.9 trillion,” the research stated.
The research also mentioned campaign material expenditure of Rp77 billion, overall advertising production reaching Rp74 billion, props making (Rp60.5 billion), and fulfilling various campaign needs (Rp6.1 billion). “Only two old political parties are still doing it, Golkar (Rp4.2 billion) and PDIP (Rp1.9 billion),” the report read.
Former Secretary General of the National Democratic Party (Nasdem), Patrice Rio Capella, revealed that one of the high-cost components was the printing of campaign props, such as billboards whose value ranged from Rp 10,000-Rp15,000 per meter, making T-shirts, and stickers. Political service advertisements, transportation, and campaign costs are also expensive. “That dominates the high-cost component,” Rio told Jaring.id on Wednesday, February 10, 2023.
In addition, the need for high costs can also be estimated from the electoral district. Rio gave an example, for the North Jakarta and Thousand Islands electoral districts, political costs reached Rp60 billion to US$30 million or equivalent to Rp450 billion. In contrast, the Bengkulu electoral district only spent Rp5 billion. “Because the population is not large and the level of competition for candidates is not harsh. So, high-cost politics between regions may vary, although it remains high,” he said.
This political cost, according to Rio, will increase if the Constitutional Court (MK) changes the electoral system. Currently, the Constitutional Court is examining the material of articles regulating the open-list proportional system in the Election Law. In a judicial review petition filed by a number of politicians, the court was demanded to change the legislative election system from an open proportional system to a closed proportional system. They asked to cancel Article 168 Paragraph 2 because they considered the article to be contrary to the 1945 Constitution.
Rio said that an open proportional election system would make candidates compete to promote their own image by ignoring the electability of the party. “This will open up opportunities within the party, one of which is competing to meet the public, opening up opportunities for money politics for candidate competitions. This will make the politics cost higher,” he said.
Nazaruddin also shared similar views, saying that an open proportional system creates a free market for an internal competition of candidates within a party. Meanwhile, a closed proportional system prioritizes an election system that only lists the names of candidates whose sequence numbers are determined by political parties. “The open proportional system applies a very barbarian economic law. Candidates will need quite a lot of money,” he said.
Nazaruddin is not surprised that cadres who try to advance in the election seek funding from businessmen. Without strong funding support from the financiers, it is difficult to collect such a huge amount of money for the political competition. “There are only two groups who can spend that much money for a contest. One is those who want to spend money on hobbies and the other is investors who are able to invest billions,” he said.
Similarly, Rio said that financiers would determine legislative and presidential candidates in the competition. “So those who advance and win are not because they are great candidates but because of the game of oligarchs who play big capital to defeat their opponents,” said Rio.
Rio suggested that the KPU make minimum and maximum limits on campaign funds for candidates and political parties, as well as ensuring financial transparency and audits. “So far, the KPU has not conducted audits,” said Rio.
Titi Anggraini, a member of the Advisory Board of the Election Association for Democracy (Perludem), agrees with Rio. According to her, political parties need to first improve their party’s financial management before stepping into other fundraising systems, such as crowdfunding. So far, she said, the campaign funding reports submitted by political parties to the KPU were not comprehensive. “The parties are not serious in regulating and enforcing open, transparent, accountable campaign governance. So far, the ‘formality’ campaign funds do not reflect the truth. Campaign funds should cover all funds they received and spent for election purposes,” said Titi on Thursday, February 11, 2023.
In fact, referring to the Law on Elections, political parties need to report the receipt and expenditure of campaign funds to a public accountant (KAP) appointed by the KPU no later than 15 days after the elections. After that, KAP will submit the audit results to the national KPU, provincial KPU, and KPU office at the regency/municipality level no later than 30 days after receiving the report. “The condition is exacerbated by weak supervision and law enforcement without tracing and examining the validity of the report. The enforcement is merely about compliance to report, but not checking the truth of the entire use of campaign funds,” she said.
Jaring.id had tried to trace the 2019 Election campaign fund reports for both the presidential and legislative elections, but did not find the reports on the KPU website. The Final Campaign Fund Report (LADK), Campaign Fund Contribution Receipt Report (LPSDK), and Campaign Fund Receipt and Expenditure Report (LPPDK) for the 2019 Election are not available. On the datapemilu.KPU.go.id page, it only says “empty table.”
Until this article was published, KPU Commissioner Betty Epsilon Idroos did not respond to Jaring.id’s interview request. She did not reply when contacted via WhatsApp message and telephone.
In Timor Leste, new political parties have a slim chance of winning parliamentary seats in the legislative elections to be held on May 21, 2023. The request for an increase in the parliamentary threshold by major parties will be one of the obstacles for new political parties to qualify for parliament. A higher parliamentary threshold also means a threat to small political parties that have had parliamentary seats in previous elections.
This conclusion was stated separately by the Executive Director of Centro Nacional Chega! Hugo Fernandes and Chairman of the Timor Leste Human Rights and Justice Ombudsman (PDHJ) Virgilio da Silva Guterres. “The big parties proposed a parliamentary threshold of up to 25,000 for one seat in parliament,” Fernandes said in a remote interview to Jaring.id on Friday, February 17, 2023.
This proposal, according to Fernandes, will make it difficult for new parties such as Partido Democratika Republica de Timor (PDRT) or Partido os Verdes de Timor, or the Timor Green Party to qualify for parliament.
Dozens of political parties will participate in the legislative elections in Timor Leste in May. Some of them are new political parties that have passed the administrative selection. However, the large amount of campaign funds needed to gain votes will hinder the steps of small political parties to the parliament.
Fernandes, who was on the campaign team of presidential candidate Lere Anan Timur, said that a political party will spend US$10-15 million or around Rp150 billion to Rp227 billion in campaign funds. At least two major parties, Fretilin and CNRT, are predicted to spend that much.
A campaign fund of Rp150 billion is certainly not a small amount for parties like Partidu Unidade Dezenvolvimentu Demokratiku (PUDD), Frente de Reconstrução Nacional de Timor Leste-Mudanca (FM), Uniao Democratica Timorense (UDT), let alone for parties like PDRT and the Green Party. According to Fernandes, PUDD, FM, and UDT – the three old parties that have sat in parliament in previous elections – plan to build a coalition if the parliamentary threshold is eventually raised.
Out of 65 parliamentary seats, no single party has been able to obtain 33 seats—the requirement needed to lead a cabinet—in previous elections, including the 2018 election.
In the 2018 election, there was a coalition between CNRT, Fretilin, KHUNTO Party, and the People’s Liberation Party (PLP), with Fretilin (23 seats) and CNRT (21 seats) dominating. Halfway through, this coalition broke up. Even so, Fretilin and CNRT will still be dominant in the 2023 elections. “Timor Leste’s political stage will still be filled with old faces. The political narrative will also be the same,” said Guterres in an online interview with Jaring.id on Thursday, February 16, 2022.
According to Guterres, the enthusiasm to establish a new party in Timor Leste does not match the enthusiasm of the voters. “The intention to establish a new party exists in big cities, such as Dili. While in the villages, people still choose parties with old figures,” said the former Chairman of the Timor Leste Press Council. Apart from Fretilin and CNRT, the PLP and the Democratic Party also have a great opportunity to gain votes with the presence of struggle figures there.
Guterres added that the voters in Timor Leste are too small to be contested by many parties. The majority of voters are also quite loyal to the party they have chosen. If new political parties want to get votes from young people, then in each election, political parties will only compete for 100,000-200,000 votes.
The battle for these votes is compounded by the party’s ability to campaign. Both Guterres and Fernandes acknowledge that election campaigns in Timor Leste require significant funds. Compared to Indonesia, Timor Leste even spends bigger costs.
Timor Leste’s 2018 Political Party Law allows several sources of political party funding, including membership fees, personal/individual donations (no business groups), fundraising, and allocations from the state in accordance with vote/seat acquisition. Individual donations are only allowed from Timor Leste, not from outside or foreign nationals.
Under the law, these funding sources must be audited by the Comissao Nacional De Eleicoes (CNE), Timor Leste’s electoral oversight body. But of course, this audit, according to Fernandes and Guterres, is not a guarantee that political parties are being transparent about the acquisition of their campaign funds.
The same rules, more or less, apply in the Philippines. The country’s tax authority, the Bureau of Internal Revenue (BIR), often asks political parties and politicians to report their campaign funds. The Philippines has just held elections on May 9, 2022. Ferdinand Marcos Jr or Bongbong won the presidency.
Campaign fund reports used by politicians, political parties, and political party coalitions in the Philippines must be submitted to the local general election commission (Comelec) and the tax service office within 30 days after the election. This does not only apply to election winners, losers will also be required to submit campaign contribution and expenditure statements. Thus, according to the BIR circular, contestants need to record all contributions from election participants, political parties, and even campaign financiers.
Meanwhile, the regulation of political funds in Malaysia as stipulated in the Election Offenses Act 1954 does not limit the sources of political party funds. This law does not require disclosure of donor identities and reporting the amount of revenue, and expenditure of election-winning funds, both outside the stages and up to polling day. Parties are also not required to return excess campaign funds they received.
In Southeast Asia, Malaysia is the only country that does not prohibit donations from foreign parties, whether companies, countries, individuals or foreign institutions. According to the Institute for Democracy and Electoral Assistance (IDEA), Malaysia allows donations from unknown or undisclosed identities by political parties or candidates. Therefore, former Prime Minister Mahatir Muhamad formed the Electoral Reform Committee (KRP) to encourage independent auditing of political funds, build the capacity of the electoral commission regarding campaign finance reporting, and set campaign spending limits based on the geographical area of the constituency and the number of voters.