Understanding new campaign finance law in Nigeria

 

THERE is no gainsaying that election is a money-guzzler. The popular lingo by Nigeria’s ace hip-hop artiste, Davido, that “if you don’t have money, hide, your face” depicts the situation in Nigeria’s political climate. To say the least, it is capital intensive. Just last week, the Peoples Democratic Party on Wednesday, March 16, 2022, announced the cost of the Expression of Interest and Nomination Forms as follows: “State House of Assembly – Expression of Interest – N100,000; Nomination Form – N500,000; House of Representatives – Expression of Interest – N500,000; Nomination Form N2m; Senate – Expression of Interest – N500,000; Nomination Form N3m;  Governorship – Expression of Interest – N1m; Nomination Form – N20m; President – Expression of Interest – N5m; Nomination Form – N35m.”

PDP National Publicity Secretary, Debo Ologunagba, announced the development after the joint meeting of the Board of Trustees and the National Executive Committee of the party. The PDP spokesperson further said the NEC of the party approved a 50% reduction in nomination fees for youths aged 25 to 30 years for various elective positions.

Nomination form is about the least of all the expenditure items of serious political contestants. Huge resources are spent on consultations with key stakeholders such as traditional rulers, religious leaders, youth leaders, women leaders and party leaders. Campaigns before party primaries and after becoming party nominees also gulp a lot of money. Imagine the cost of political adverts in print and electronic media, running a well-resourced campaign office, paying for security, organising rallies and paying for polling agents on the day of the election. These are aside from the large sum used for vote-buying as well as expenses for possible pre-election and post-election litigation.

In order to rein in campaign finance abuses and ensure a level playing field for all contestants, the new Electoral Act 2022 has spelt out campaign finance ceilings and penalties for violations. The campaign finance thresholds are in two folds: One for the candidates and another for the political parties.

Section 88 of the new Act places limitation of election expenses on candidates.   Sub (2) says the maximum election expenses to be incurred by a candidate at a presidential election shall not exceed N5bn (Used to be N1bn); (3) The maximum amount of election expenses to be incurred by a candidate in respect of governorship election shall not exceed N1bn. (Used to be N200m); (4) The maximum amount of election expenses to be incurred by a candidate in respect of senatorial and House of Representatives seats shall not exceed N100m and N70m respectively (It used to be N40m and N20m respectively); (5) In the case of State Assembly election, the maximum amount of election expenses to be incurred by a candidate shall not exceed N30m (Used to be N10m).

Furthermore, subsection (6) says “In the case of a chairmanship election to an Area Council, the maximum amount of election expenses to be incurred by a candidate shall not exceed N30m (Used to be N10m) sub. (7) says in the case of Councillorship election to an Area Council, the maximum amount of election expenses to be incurred by a candidate shall not exceed N5m. (Used to be N1m) and subsection (8) says no individual or other entity shall donate to a candidate more than N50m. (Formerly N1m).

This upward review has generated a lot of furore in political circles and among the Nigerian public with many saying the amount is humongous and has priced elections beyond the reach of average Nigerians. While this may be true, we, however, must understand that the previous ceilings in the Electoral Act 2010 have become grossly unrealistic given the fact that it was done 12 years ago. Inflationary trends and devaluation of the naira have seriously weakened the purchasing power of the nation’s currency. Aside from that, the campaign period has also been extended from the initial 90 days to 150 days to election (Section 94(1).

It then means candidates will spend more than they used to do. It should also be noted that it is not mandatory that all the contestants must spend up to the ceiling. For popular candidates, who may find it difficult to raise money for their electioneering project, the law permits them to engage in crowdfunding. That was what former US President, Barack Obama, did to raise funds for his presidential campaigns. If a contestant has high-net-worth friends, the fact that individuals can now donate N50m in support of their preferred candidates has also made fundraising for political campaigns easier.

It is instructive for the president, governors and local government chairpersons to know that according to section 95 (2) of the new Act, state apparatus (money, vehicles, personnel, aircraft, public buildings) including the media shall not be employed to the advantage or disadvantage of any political party or candidate at any election.

As the saying goes, a community that has no law will not also have punishment for offences. In the case of Nigeria’s elections, there are laws and there are also punishments for violations. Take for instance, s. 88 (9) of the Act says, “A candidate who knowingly acts in contravention of this section, commits an offence and is liable on conviction to a fine of 1% of the amount permitted as the limit of campaign expenditure under this Act or imprisonment for a term not more than 12 months or both.”

Subsection (10) says “Any individual who knowingly acts in contravention of subsection (9) is liable on conviction to a maximum fine of N500,000 or imprisonment for a term of nine months or both.”  While sub. (11) says “An accountant who falsifies, or conspires or aids a candidate to forge or falsify a document relating to his expenditure at an election or receipt or donation for the election or in any way aids and abets the contravention of the provisions of this section commits an offence and is liable on conviction to a fine of N3,000,000 or imprisonment for a term of three years or both.”

As per political parties, the Act says in s.89 (2) that election expenses incurred by a political party for the management or the conduct of an election shall be determined by the Commission (i.e. INEC) in consultation with the political parties. To the best of my knowledge, the Commission has not been doing this though it is an old provision.

Section 90(3) says “A political party shall not accept any monetary or other contribution which is more than N50,000,000 unless it can identify the source of the money or other contribution to the Commission.” This is from N100,000 prescribed in s. 93(3) of EA 2010. The implication of this is that a lot of monies from anonymous sources could be mobilised to fund political parties in Nigeria.

In order to promote accountability and transparency in political finance in Nigeria, the political parties are expected to file three reports to the election management bodies, i.e. INEC. The first is the annual report. S. 86. (1) of the Act says “Every political party shall submit to the Commission a detailed annual statement of assets and liabilities and analysis of its sources of funds and other assets, together with statement of its expenditure including hard and soft copy of its list of members or in such a form as the Commission may require”

The second is election contribution report, S.90 (4) of the Act says “A political party sponsoring the election of a candidate shall, within three months after the announcement of the results of the election, file a report of the contributions made by individuals and entities to the Commission.” The third is the election expenses report.  S.89 (3) of the Act says “Election expenses of a political party shall be submitted to the Commission in a separate audited return within six months after the election….”