Tracking the cashflow of European political parties
Where do pan-European political parties get their money from, and how do they spend it? In the run-up to the European elections on May 23-26, the independent Dutch investigative platform Follow the Money finds out.
Over the past few months, FTM journalists Dieuwertje Kuijpers and Lise Witteman compiled two separate datasets. The first, containing the 2014-2018 annual budgets of the 10 Europarties and their respective thinktanks that currently receive funding from the European Parliament, was released on April 23. The second dataset, containing all 997 traceable donations and contributions made to all 15 existing EU parties and their respective thinktanks between 2014 and 2018, is available today (April 30).
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The European Parliament is under increasing pressure from (corporate) lobbying. After the Lisbon Treaty expanded legislative powers to parliament in 2009, Brussels experienced a lobbying boom. Since lobbyist operate behind closed doors and the media often focus on national parties or representatives when covering the election, this has garnered relatively little attention.
The EU itself has made several attempts to increase transparency. In 2008, the European Commission had created a voluntary transparency register; this was merged with that of the European Parliament in 2011. As of April 26, 2019, the website of this registry lists a total of 11,743 registrants.
The aforementioned website eloquently explains the need for transparency: ‘Citizens can, and indeed should, expect the EU decision-making process to be as transparent and open as possible,’ its front page reads. ‘The more open the process is, the easier it is to ensure balanced representation and avoid undue pressure and illegitimate or privileged access to information or to decision-makers. Transparency is also a key part of encouraging European citizens to participate more actively in the democratic life of the EU.’
Well-intentioned as these efforts may be, they are falling short. In September 2015, Transparency International EU found that over half of the entries on the lobby register were ‘inaccurate, incomplete or meaningless’. The NGO subsequently filed 4,253 official complaints with the Secretariat of the Transparency Register. Two years later, November 2017, the Brussels-based Corporate Europe Observatory also reported ‘dodgy data, under-reported spending, missing entries, and a lack of enforcement’.
In 2016, the European Commission proposed to make registration mandatory for all three European institutions — that is, for the Commission, the Parliament and the European Council. Although the European Parliament took a major step bty voting to end secret meertings between MEPs and lobbyists on January 31, 2019, the European institutions have yet to implement the mandatory lobby register. As of February 14, 2019, the three institutions intend to ‘continue their discussions on moving towards a joint mandatory Transparency Register.’
In order to gather from which outside sources Europarties acquire their funds, we thus decided to create our own database. We investigated all traceable third party contributions and donations made to these parties. Parties need to demonstrate they are capable of independently acquiring a certain percentage of equity before they are eligible for funding from the European Parliament. Even though the acquired sums are — in absolute terms — modest, the 8.7 million euros of third party income acquired by European parties does reveal the ideological networks willing to fund these representatives.
How we compiled the data
For the first database, we digitized the annual budgets of the 10 European parties that were eligible for funding from the European Parliament in 2010 (ACRE, ALDE, ECPM, EDP, EFA, EGP, EL, EPP, MENL, PES), as well as their respective think tanks (ND, ELF, SALLUX, IED, CMC, GEF, TE, WMCES, FENL, FEPS), for the 2014-2018 period. These budgets are available on the website of the European Parliament. Due to the inferior quality of the scanned documents, we had to make several request to provide readable documents. Even though we found some inconsistencies and minor errors, we have not corrected those, as the dataset is intended to visualize how European parties reported their budget.
For the second database, we looked at all donations and contributions made to European political parties and their affiliated think tanks between 2014 and 2018. We decided to include all third party income, since parties themselves use different definitions of (a) donations and (b) contributions, and sometimes even change these definitions per budgetary year. To make our data comparable across parties, we decided to define this income more broadly: any income that, as far as we can tell, was received from a third party, excluding subsidies from the European Parliament.
This (mostly) explains why parties reported having received 2.1 million euros in donations in their annual budget, while our dataset shows a third party money stream totalling 7.8 million euros (8.7 million, if we also count the 5 extra parties that are included in our second dataset). Since our second dataset included contributions made by affiliated national parties, we were able to identify instances in which (public) funds were being moved around in order to gain eligibility for European subsidies.
Altogether, we identified 997 donations and contributions, received by 15 Europarties and their affiliated think tanks. We tracked every individual donation by consulting available open sources such as trade registers, social media pages (e.g. LinkedIn, Twitter, Facebook), and Google (Maps). When this did not yield any results, we requested further details from the relevant European parties. Parties were not always willing to cooperate, however. For example, the Alliance of Conservatives and Reformists in Europe (ACRE) did not respond to any of our questions, and the European Christian Political Movement (ECPM) spokespeople claimed that they were ‘not allowed’ to provide additional information.
Our manual search allowed us to check whether the registered (company) names and addresses were correct, and find additional relevant details on donors. These details are listed in our dataset as well. In addition, relevant details (such as country of origin, or whether the donation was done by a company, NGO or individual) are coded in our dataset as well. This allows for cross-party comparison.
Since we were – to some extent – dependent on the cooperation of European parties and their willingness to answer questions, both datasets are as complete as the parties themselves allowed it to be. We did, however, attempt to compile as much data as possible, in order to avoid skewed results and being constrained to the degree of transparency exerted by parties themselves.
Our initial conclusions
Between 2014 and 2018, 8.7 million euros were donated and contributed to Europarties. Although this sum is relatively low compared to the approximate total of 230 million euros parties gathered in income during this period, the number (and height) of donations received by European parties has steadily been growing over time. Since 2008, the year in which parties were first allowed to receive third party contributions, the total sum of received donations increased almost twelvefold: from 200.000 euros in 2008, to an ample 2.3 million euros in 2018.
Note that the larger parties are not necessarily bigger receivers. For instance, the social democratic PES only received a grand total of 36.000 euros in donations, while much smaller parties, such as the conservative ACRE and the European Green Party (EGP), received approximately 1.1 and 1.6 million euros respectively.
There are several possible explanations for this. For one, smaller political organizations might have a more compact agenda, allowing them to bring in potential donors with a more unified political message. These smaller political groups also have a more urgent need for donations in order to conform to the EU subsidy requirements, so they might make a bigger effort to gather them.
Secondly, the high amounts of donations given to Eurosceptic parties may point to another explanation: such parties may be using these donations in order to politicize their agenda on a national level. In 2016, separate investigations by the Belgian website Apache and Dutch newspaper NRC Handelsblad found that ADDE, the Eurosceptic party headed by Nigel Farage, had used donations to fulfill European Parliament subsidy requirements. The resulting EU subsidy was then used to pay for Farage’s national election campaign.
How we are covering this story
After the news on company donations to ALDE broke in March, we made a cross-party comparison in order to identify which other parties have accepted money from (American) companies. On April 23, we published our first dataset, accompanied by an analysis of the income and expenses of Europarties and their affiliated think tanks. And on Thursday, April 25, we previewed some of the conclusions in today’s dataset, noting that almost half of all donations made to Europarties from outside of the EU originated from the US.
We have been able to identify these cases by checking for duplicate observations (e.g. donors donating several times or to several parties) or overrepresentation (e.g. German think tanks and American donations in general). In the weeks leading up to the European elections, we will publish a series of stories delving deeper into the material.
We are convinced, however, that journalist from other countries will be able to spot interesting cases and dig into stories that we have overlooked. Therefore, we are providing the datasets and codebooks in English and for free. The download link can be found in the banner at the top of the article. Enjoy!