Financing Democracy

Funding of Political Parties and Election Campaigns and the Risk of Policy Capture

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The recent debate on the role of money in politics has shed the light on the challenges of political finance regulations. What are the risks associated with the funding of political parties and election campaigns? Why are existing regulatory models still insufficient to tackle those risks? What are the links between money in politics and broader frameworks for integrity in the public sector? This report addresses these three questions and provides a Framework on Financing Democracy, designed to shape the global debate and provide policy options as well as a mapping of risks. It also features country case studies of Canada, Chile, Estonia, France, Korea, Mexico, United Kingdom, Brazil and India, providing in-depth analysis of their political finance mechanisms and challenges in different institutional settings.

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Foreword and Acknowledgements

Understanding and addressing the role of money and its influence in politics can no longer be a taboo subject. When public policy making is captured by private interests, the “rules of the game” for markets and opportunities may be bent to favour the few and violate the interest of the many. The consequences include the erosion of democratic governance, social cohesion, and equal opportunities for all, as well as the decline of trust in democracy itself. The laborious recovery from the financial crisis, together with the widening income gaps between rich and poor, heighten the risk of policy capture while testing the ability of governments to develop and deliver policies and programmes that benefit all citizens.

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