North Macedonia

Key Takeaways: Cost of Politics

Population: 2.08 million
Head of Government: President Stevo Pendarovski
Ruling party/coalition: We Can (Social Democratic Union of Macedonia coalition)
Last election: 2020
Next election: 2024
Year of study: 2016
Registered voters: 1.8 million (2020)
Annual salary of member of legislature: MKD 984,000 (US$19,200)

The nature of the Macedonian proportional electoral model secures that only large parties and coalitions can mobilise large number of voters and political “infrastructure” to be able to present themselves successfully at the elections.

Legally, political parties in Macedonia are financed from two types of sources, public and private donations. 30% of these funds are allocated equally to all political parties that won at least 1% of the votes during parliamentary elections, regardless of whether they won seats in the parliament. The remaining 70% is allocated to political parties whose candidates have been elected MPs and is proportional to the number of MPs.

The size of a donation is limited depending on whether it comes from an individual or legal entity. The total amount of an individual donation must not exceed 150 average salaries for the legal entities and 75 average salaries for an individual. This amount cannot be donated more than once in a year.

The Electoral Code stipulates compensation for election expenditures. Campaign organisers whose candidates are elected get a compensation of MKD 15 per vote (US$0.30).

US$0.30

Many media, especially commercial TV channels with national coverage, are beneficiaries of the state advertising funds that means they run content on behalf of the government, the ministries, public enterprises and agencies, as well as the local self-governments.

Around 40 regional and local broadcasters appeared as major contributors to the election campaign of the ruling party during the 2014 early parliamentary elections.

The current proportional six district no-threshold electoral model remains an obstacle for small political parties to enter the political scene efficiently and independently.

Key Findings

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Context

The newly introduced multiparty system has led to an inflation of new political parties with more than 70 registered and 33 operating in the current system. Although this number is volatile due to the difficulties of smaller political parties having to re-register themselves once every four years.
The main law regulating polls is the Electoral Code, adopted in 2006 and last amended in December 2015. According to the law, the organisers of the election campaign are obliged to submit three financial reports on their election campaigns to ensure that the principles of transparency and accountability are upheld. However, the law does not require that donors submit reports of their financial contributions to political parties.
For the purposes of the parliamentary elections, the territory of the country is divided into six electoral districts, from each of which 20 members of the Parliament are elected. The remaining three members of the Parliament represent Macedonian citizens living abroad and are elected by proportional representation; one from each of the three districts of Europe and Africa; North and South America; and Australia and Asia.

Cost of politics drivers

Since 2006, when the Internal Macedonian Revolutionary Organization – Democratic Party for Macedonian National Unity (VMRO-DPMNE) took power, the country has witnessed a nearly total encroachment of the government into the business sector. The government and the pro-government businessmen are the biggest employers in the country and the ones who control virtually every segment of the economy. Consequently, opposition parties struggle with finances and donation because most of the donors/businessmen are reluctant or are afraid to donate funds, fearful of government retaliation.
The boundaries between electoral and non-electoral campaigning have become blurred. It is a common saying in the country that the electoral campaign continues 365 days a year.
The largest bulk of finances and donations for election campaigns are transferred to the party’s headquarters, thus allowing the party elite to control the process of MP nomination. In an inverse logic, the party headquarters is in a way “buying” the loyalty of its MPs by financing the whole election campaign.

Conclusions and recommendations

Disclosure requirements are part of a broad set of regulations governing election law in general, but they have a particularly significant meaning when political finance is concerned. To be effective, disclosure needs enforcement agencies, administrative capabilities, sufficient budgets and educated manpower.
The current legal framework effectively restrains the illegal or semi-legal flow of finances to the political parties, but weak and corrupted auditing bodies prevent its implementation in practice.
Further media reforms and stronger regulations on media’s fair and balanced presentation are needed. Restraining the role of public money in private media is an immediate task, but further reforms, including autoregulation and development of journalist standards, should be a long-term objective for the country.
Political party financing is a taboo topic in North Macedonia. There exists a tacit consent between political parties, especially the big ones, for not exposing to the public the sources of parties’ revenues.

Read the brief (English)

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