Ukraine

Key Takeaways: Cost of Politics

Population: 44.4 million
Head of Government: President Volodymyr Zelensky
Ruling party/coalition: Servant of the People
Last election: 2019
Next election: Unknown due to martial law
Registered voters: 35.5 million (2019)
Annual salary of member of legislature: ₴432,000 (US$16,800)
Year of study: 2014

A successful contender in a single-member district spends between US$1-5 million in an electoral race. The most expensive campaigns are those executed in highly contested large urban centres with the least expensive in peripheral rural districts.

US$1-5M

Electoral campaigning was most expensive during the 2012 election when it cost up to US$5 million to win a legislative race in a single member district.

US$5M

2012

The total amount of a contribution for the support of a party by a citizen of Ukraine in one year cannot exceed 400 minimum salaries.

400 salaries

One MP interviewed compared the cost of electoral campaign with an iceberg: only a small fraction of overall electoral expenses are visible, up to 90% of electoral campaign financing constitutes illegal expenditures.

90%

Political parties incur significant expenses when they take electoral campaigns to one of 25 regions of Ukraine. One electoral trip which includes a visit by party leaders, electoral show and press-conference with coverage in local media may cost up to US$100,000.

US$100,000

Membership fees that rank-and-file party members pay to support their political organisation do not cover even a small fraction of the cost of electoral campaign. Almost every major political party in Ukraine is backed by a major Ukrainian oligarch.

Ukrainian citizens without personal wealth or unique and extraordinary access to wealthy sponsors have practically no opportunities to seek and win office.

Key Findings

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Context

Since gaining independence Ukraine has employed all major existing electoral systems: an obsolete Soviet absolute majority run-off formula in single-member constituencies in 1994, a mixed plurality/proportional representation model in 1998 and 2002, a full proportional representation system in 2006 and 2007, and again a mixed plurality/proportional representation model in 2012 and 2014. Perhaps the only parliamentary value that remained constant throughout these years has been the number of MPs – 450.
The mechanism of electoral campaign financing and financing of political parties is established by numerous laws on elections to the Rada (the legislature) and the Law on Political Parties in Ukraine originally adopted on 5 April 2001. Since its adoption the Law on Political Parties has been amended over twenty times. The most recent amendments to the law were passed on 9 October 2015 and introduced a detailed mechanism of state financing of political parties. State financing of political parties become a reality when these amendments enter into force on 1 July 2016.
In general, the 2014 parliamentary elections were cleaner and less corrupt than many previous electoral cycles and the cost of electoral campaign decreased.

Drivers of the cost of politics

All interviewees stated that political advertising on the major central TV and radio channels with comprehensive nationwide coverage constitutes the most expensive expenditure of the electoral campaign. Overall, payments for political advertisement on TV, radio, printed media and billboards comprise up to 70% of all electoral expenses for a political party.
After political advertising, the second most expensive expenditure of electoral campaign is hiring staffers that perform various functions during the contest: propagandists, electoral observers, members of district electoral commissions, electoral headquarter workers and lawyers.
Members of district electoral commissions are nominated by political parties which may or may not participate in elections. In addition to the meagre salaries that they receive from the state budget for performing their duties, political parties pay them as well.
Payments for legal services represent a separate expenditure. Although all major parties have their own lawyers, they also hire additional skilled lawyers to work on the day of the election to ensure that electoral violations that affect the party are not left without proper legal action.

Conclusions & recommendations

Single-member districts that use the majoritarian electoral formula serve particularly as an almost impenetrable barrier that prevents Ukrainian citizens from entering politics due to the prohibitively high cost of an electoral campaign.
All interviewees consider the introduction of public funding of political parties as a step in the right direction. However, interviewees uniformly recognised that this was a first step which would need to be followed by further anti-corruption efforts.
Continued scrutiny from the media and investigative journalism; additional electoral reform, including getting rid of the majoritarian elections in single-member districts as these are the most corrupt form of elections; greater transparency of political party activities and financing; comprehensive and sweeping anticorruption reforms nationwide; and the creation and institutionalisation of a culture of intolerance for corruption in the minds of Ukrainian citizens are all reforms that can help.
The main challenge is to make all these reforms and institutions functional and effective.
Getting rid of the majoritarian vote would end many fraudulent schemes used in single-member districts and decrease the overall cost of electoral campaigns.

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