Economist, Prof Lord Mensah, has lamented the lack of transparency in the country’s political financing.
According to him, political financing plays a pivotal role in the democratic process of any nation, as it enables political parties and candidates to campaign effectively, engage with voters, and promote their policies.
However, he revealed that in many countries, including Ghana, the way political campaigns are funded can become a serious problem, leading to economic instability, and undermining the very principles of democracy.
In a piece exploring the challenges of political financing in Ghana and its adverse impact on the nation’s economic stability, Prof Mensah indicated that the opacity raises questions about the influence of hidden interests on political decision-making, which can hinder economic development.
“The Current State of Political Financing in Ghana is riddled with lack of transparency, heavy reliance on private donations, and inadequate regulation. One of the primary problems in Ghana’s political financing system is the lack of transparency. Political parties often receive substantial financial contributions from undisclosed sources, making it difficult to trace the origin of funds.”Prof Lord Mensah
Prof Mensah noted that Ghana’s political parties heavily rely on private donations to fund their campaigns. While this is a common practice in democracies worldwide, he explained that it can lead to an undue influence of wealthy individuals and corporations on political decisions.
“This influence can result in policies that favor the interests of donors over the broader needs of the country. Regulation of political financing in Ghana is inadequate, allowing for loopholes and abuses. There is a lack of clear and enforceable rules governing campaign contributions, spending limits, and reporting requirements. As a result, political parties and candidates can skirt the rules with little fear of consequences.”Prof Lord Mensah
Moreover, Prof Mensah stated that economic consequences of the weak political financing mechanism in Ghana are corruption and rent-seeking, fiscal imbalance, and unequal economic development. By this, he stated that weak regulation and a lack of transparency in the Ghanaian political financing has fostered corruption and rent-seeking behavior among politicians.
“This has led to diversion of resources and public funds into private hands leading to economic inefficiency and misallocation of resources. Corruption in Ghana has eroded public trust and has undermine investor confidence, deterring foreign and domestic investment. Political campaigns in Ghana, especially during elections, is incredibly expensive. “Prof Lord Mensah
Furthermore, he underscored that when political parties rely on private donations, it can lead to fiscal imbalances as governments divert public resources to fund campaigns. This, he noted, can result in budget deficits, increased public debt, and reduced spending on essential services like healthcare and education.
“The influence of wealthy donors in political financing can lead to policies that prioritize the interests of the elite over the broader population. This can exacerbate income inequality and hinder inclusive economic development. When policies are driven by the financial interests of a few, most citizens may be left behind, leading to social unrest and instability.”Prof Lord Mensah
Addressing problems of political financing
Meanwhile, Prof Mensah disclosed that addressing the problem of political financing in Ghana is crucial to restoring transparency, accountability, and economic stability.
To this end, he proposed potential solutions to political financing problems, which included strengthened regulation, public funding, transparency measures and civic education.
The economist revealed that Ghana should enact and enforce comprehensive campaign finance laws that establish clear rules for contributions, spending limits, and reporting requirements.
Similarly, he expressed that strengthening the regulatory framework will help curb abuses and enhance transparency.
“Introduce a system of public funding for political campaigns to reduce reliance on private donations. This can level the playing field and ensure that candidates have access to sufficient resources without being beholden to wealthy donors. Implement measures to enhance transparency, such as disclosing the sources of political contributions, making campaign finance reports accessible to the public, and conducting independent audits of campaign finances.”Prof Lord Mensah
Promotion of civic education to raise awareness among citizens about the impact of political financing on the economy and democracy was heavily touted by Prof Mensah.
He highlighted that informed voters can make more responsible choices and demand greater accountability from their elected representatives by this.
Furthermore, he emphasized that addressing challenges opacity in political financing can also be achieved by strengthening regulation, promoting transparency, and considering public funding options is essential to restore faith in the democratic process and lay the foundation for a more stable and prosperous future.
By tackling this issue, Prof Mensah insisted that Ghana can work towards a healthier democracy and a more robust economy that benefits all its citizens.