Slovenia’s Patchy Transparency

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Slovenia’s Patchy Transparency

Though legislation governing party and
election-campaign financing was revised two years ago, Slovenia’s
system is still filled with holes.

The law on party financing was revised following
a Constitutional Court ruling that found that one of the law’s
provisions–which awarded state budget funds to parties with
representatives in parliament–was unconstitutional. The new law
stipulates that all political parties are eligible for state funds
if they receive at least 1 percent of the votes cast and if their
candidates competed in at least 66 voting districts. The law has so
far resulted in four parties without representatives in parliament
becoming eligible for state funds, and in 11 parties that failed to
earn 1 percent of the vote in the 2000 elections being denied
eligibility.

Ten percent of the state funding is to be split
equally among eligible parties, while the remaining 90 percent will
be distributed according to voting results. For each vote received
in the last parliamentary elections, parties will receive 30 tolars
(about $0.08)–an amount that is continually revised based on
inflation rates.

The law further limits the annual amount of
state budget funds that can be used for party financing to 0.017
percent of GDP. The eight parties with parliamentary
representatives will receive approximately $2.5 million this year
and $2.6 million next year. The ruling Liberal Democracy of
Slovenia (LDS) will be awarded the largest share, approximately
$72,000 per month for 2002. The party that gained the fewest votes
in last year’s elections–the Party of Slovene Youth (SMS)–will
receive less than $11,000 per month from the state budget.

All parties are required by law to file a yearly
financial report detailing all funds received and expended. Fines
for failure to file before the end-of-February deadline range from
$4,500 to $22,500.

THE BLACK HOLE

Despite those strict provisions, one big
remaining hole ensures that party financing is not completely
transparent: Parties are not required to inform the state of the
source of all their donations and sponsorships. The parties are
only obligated to detail the sources of donations that come from
individuals or private companies, and then only if the amount
exceeds three times the average monthly salary.

According to a financial statement filed in
2001, the governing LDS–the party most successful in generating
donations–received approximately $220,000 in donations from
companies and individuals. Two telecommunications companies and one
bank were listed among the donors, but the rest of the (unlisted)
donations came from an array of small companies, including some
that had won pubic tenders from the government the year before. The
amount of their donations to the LDS ranged from $3,000 to
$75,000.

Despite the lack of transparency, all political
parties claim that their finances are handled in strict accordance
with the existing legislation. But the reality is quite different.
When the Slovenian Court of Audit scrutinized the financing of the
2000 parliamentary election campaign of all the parties that
managed to win seats in the assembly, not one received a positive
assessment. According to the court, all were given an “opinion with
reservations, mostly for not listing all funds received for their
campaign.”

From time to time, Slovenian media report on
shady quid pro quo transactions between parties and their financial
contributors. When the Hudournik construction and transport company
contributed $11,600 to the 2000 election campaign of the Slovene
People’s Party (SLS+SKD), the media jumped on the story. Prior to
that donation, the media reported, the Health Ministry had granted
the same company a tender to operate an emergency helicopter
transport system, sparking accusations of vot e-buying. At the time
that deal was closed, the Health Ministry was headed by an SLS+SKD
politician.

The media put its watchdog pen to paper when it
was discovered that private banks were financing the LDS 2000
election campaign. SKB Bank, Slovenia’s leading private bank,
donated some $7,600 to the party. The president of the bank’s
board, Cvetka Selsek, was then elected as a municipal councilor in
the capital on the LDS ticket.

Presidential candidates are also required by law
to file a financial statement detailing the donations and
expenditures for their election campaign. The same rules apply,
with the donation limit set at three times the average monthly
salary. In the run-up to this year’s November presidential
elections, it remains a mystery who financed the majority of
incumbent President Milan Kucan’s campaign five years ago.

In 1997, Kucan received some $66,200 in
donations from individuals and private companies. Sources were
listed for only $6,300 of that amount. Eight candidates ran against
Kucan in that election, receiving a total of $630,000 in donations
among them. Today, the public is still in the dark as to where the
bulk of that money came from. And transparency for the upcoming
November elections doesn’t look much less holey.


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