2015-10-24 18:30:29
Price of a mandate: what political parties conceal
Tetyana Haydabas, Olena Nefedova, Center for Investigative Journalism
On the eve of the elections, political parties started the real contest. Each one, in their slogans, promised transparency, honesty and openness. However, when it came to financing, most political forces were very closed. The real funds spent by candidates in order to get mandates turned out to be many times more than what they officially declared.
False start
Long before the official beginning of the election campaign, various posters with logos of parties and smiling faces of political party leaders started appearing in Mykolaiv. Candidates who looked straight into our eyes from posters and party leaders and their inner circles who looked honest, correct and successful called on us to vote for them.
Monitoring company Doors consulting, Ltd. calculated that there were 596 political-related advertising structures in Mykolaiv in August of this year and already 840 in September. That indicated that the election campaigns had started much earlier than the outlined term: quietly, behind-the-scenes and contrary to the law.
“Basically, we are seeing political advertising much sooner than the beginning of the election process,” said Lyudmila Oprishko, media lawyer. “Essentially, we understand that this is already campaigning, but from a legal point of view we cannot qualify it as political advertising or as materials for pre-election campaigns only because the participant in the election process is not registered.”
Those who are more tricky use gaps in the Law of Ukraine “On Local Elections.” According to this law, all pre-election campaigning must be paid only from special election funds. However, without official status as a participant in the election process, future election participants can advertise their political activity from any source they want. That is why the majority of political forces start manifesting themselves as soon as possible, and in doing so deny, by any means, any connection to open campaigning and humbly call this activity “information about ourselves.”
September. Billboards with party logos
“In September, the election process was not going on, which was why parties spent money on advertising, but not on campaigning,” said Vitaliy Hunko, lawyer from the party Renaissance. “It was an informational billboard and political advertising, but it was not subject to the law ‘On Local Elections.’ All informational campaigns that were conducted regarding the political activity of our party were financed either at the cost of the regional branch of the party or by the Kyiv branch of the party Renaissance.”
In this way, in August in Mykolaiv, 166 outdoor advertising objects were covered with such “informational” advertising by the party Renaissance, 133 by Opposition Bloc, 79 by Petro Poroshenko Bloc Solidarity, 78 by Our Land, 73 by Ukrainian Union Motherland, 30 by Ukrop Party, and 28 by Self-Reliance Union.
In September, the leaders by number of advertisements did not change, but the amount of billboards increased even more. For example, 173 billboards had the logo of Renaissance, 163 of Petro Poroshenko Bloc Solidarity, 99 of Our Land, 91 of Opposition Bloc, 80 of Motherland, 78 of Ukrop, 57 of Svoboda and 38 of Self-Reliance.
September. Advertisement for Democratic Alliance on Chihrina Street
September. In Mykolaiv, there were billboards with the picture of Artem Ilyuk, head of the regional branch of the party Renaissance
Closer to the elections – more advertising
In the first half of October alone, Ukrainian advertising operators earned UAH 28 million on political advertising. According to information from monitoring company Doors consulting Ltd., in just that time, by the middle of October, of the about 2,600 advertising surfaces in our city about half were covered with political advertising.
The leaders by the amount of rented advertising surfaces in October were parties and candidates from Our Land, Petro Poroshenko Bloc Solidarity, Renaissance and Opposition Bloc.
Journalists from the MykolaivCenter for Investigative Journalism requested information from the parties on how much funds they spent on their election campaigns. However, it was not easy to receive detailed information about it. Only four political forces of 17 participating in the election were not afraid to show their financial flows. That included Democratic Alliance, Self-Reliance, Renaissance and Ukrop; the rest either did not want contact with us at all or considered it unnecessary to respond to journalists. This leads to the idea that all of those parties that so carefully hid their information, which should be public, were forming their budgets in a non-transparent way and financing them from unknown sources. As it is known, whoever pays orders the music. Lyudmila Oprishko emphasized that according to the law “all election campaigning should be paid from election funds.”
Having received refusals from most of the parties to provide information, journalists started their own investigations into the money parties and candidates really spent on outdoor advertising in the city.
Title - Party money: How much money political forces spent in Mykolaiv (figures on top of boxes are in UAH). Inside the inner box - In October alone, on 1,004 outdoor ads, UAH 2,126,100 was spent.
Data on filled advertising space was provided by the same company as before, Doors consulting, Ltd. Monitoring of the advertising market in Mykolaiv was done twice a month. According to the results of this monitoring, we managed to find out the volume of political advertising in the city and calculated how many advertising objects were used by each party. At the same time, journalists found out the preferences of various political forces in terms of advertising operators.
We managed to find out information about the cost of advertising from representatives from advertising agencies where election participants rented outdoor advertising space from August to October. The average cost for placing a political ad on a billboard was UAH 2,300 per month, on a prizmatron – UAH 2,700, and on city lights and light boxes – UAH 950. Knowing the cost of rent and the amount of objects, it was easy to calculate the amount of money political forces spent on advertising. We presented all numbers in one table. This allows for seeing trends in the placement of political advertisements for August, September and October. As it turned out, in October, when the elections took place, the amount of spaces with political advertising exceeded 1,000.
At the same time, we sent a request to the Mykolaiv city election commission, where according to the law “On Local Elections,” until October 19 inclusive all parties and candidates for mayor had to submit an interim financial report. In its response, it indicated the amounts officially declared by the parties or those that decided to state it openly. As expected, the real cost of political advertising and figures that were officially declared differed significantly.
Advertising “land”
The Our Land party, headed by current mayor Yuriy Hranaturov, basically flooded the city with political campaigning on advertising boards. It looked like Yuriy Isayevych wanted very badly to not be deprived of his mayor’s office, which was why, having forgotten about his promises to demolish illegal billboards, now he was supporting them by every means.
According to monitoring company Doors consulting Ltd., in October Hranaturov’s photographs, where was mysteriously smiling at us, were placed on 213 advertising objects. Judging from the interim financial report, expenses on the mayoral election campaign, including the placement of outdoor advertising, was only UAH 8,109.
Expenses in the financial report of Yuriy Hranaturov
However, having conducted simple calculations, outdoor advertising cost Yuriy Isayevych almost UAH 400,000, which as we can see, was 50 times more than the amount declared in the report.
As far as the party itself, Our Land rented space on 61 advertising structures. It actively used the advertising boards of the agency Marmelad, which as it is known belonged to relatives of Vladyslav Entyn, a candidate from Our Land. As noted by Oleksandr Ukhmanovskiy, head of the Committee of Voters of Ukraine in Mykolaiv region, because of that, the party could get certain discounts for placing advertisements. “The use of their own assets is a normal practice and the law allows for that. Moreover, if candidates or parties’ capacity allowed, they could set the price for themselves to only cover costs or to even lower than cost.”
We conducted simple arithmetic operations and this is what we got: placement on 61 advertising structures should cost no less than UAH 126,000. However, in the interim report of Our Land given to the city election commission, expenses for election campaigning, including the placement of advertising on outdoor advertising objects were only UAH 38,062. See the difference!
Where does the money come from?
In terms of the amount of outdoor advertising, pro-presidential party Solidarity was not lagging behind. According to data from the monitoring company, in October it ordered placements on 173 advertising structures. The total cost should have been approximately UAH 320,000.
The city’s branch of the Petro Poroshenko Bloc Solidarity, when responding to a journalist request on its official expenses for outdoor advertising preferred to be modest and did not send any response. Maybe they have something to hide?
We did receive the interim financial report from Solidarity from the city election commission. However, that report did not indicate expenses for placing outdoor advertising specifically; it only stated the overall amount for all expenses on the production of pre-election campaign materials – UAH 160,338 and for other services connected to campaigning – UAH 63,859. However, no matter what, even if we added these two numbers together, the total would be much less then the real cost of the billboards that were being rented by the party.
According to Oleksandr Ukhmanovskiy, parties and candidates often violate legislation by paying for advertising campaigns from a “black” budget.
“In reality this article of the law can be shamelessly violated, so that financing is used from outside sources and not from an election fund. And the parties will not be punished for that because it is almost impossible to prove,” said the expert. “At the same time, this norm allows honest candidates to absolutely transparently cover all costs from their election fund, thus doing a “white” campaign and leaving it fully open. It is a good Western norm, but unfortunately it does not work very well in our reality. It allowed for a lot of money to be brought out of the shadows, but if a candidate wanted to violate it and wanted to receive money on the side, there is no punishment that would follow,” said Oleksandr Ukhmanovskiy.
How can you not be happy with useful friends?
One more party, Renaissance, surprised with its large amount of political advertising back already in August of this year. A former Party of Regions candidate, who is now an MP, Artem Ilyuk, led this party in the city council. As it appeared, their sponsors did not spare any money on advertising the new political force. According to monitoring results, Renaissance rented on average 170 advertising spaces in the three month period. According to journalists’ calculations, it spent at minimum of UAH 640,000. Of that, about UAH 200,000 was used in October.
In its interim financial report, the party indicated that in October the placement of campaign materials on special advertising structures cost them much less – UAH 125,070,000. How can this be explained?
The director of the company where Renaissance ordered its campaign materials was a former member of the Party of Regions, Oleksandr Omelchuk, who was also a friend of Artem Ilyuk within the Party of Regions. The friendship and party connections most likely can explain the lower price for the party’s advertising materials: people with closed views can always make convenient arrangements.
Expenses for the placement of campaign materials on advertising structures according to the report from the party Renaissance
Ilyuk’s protégé, Vitaliy Voronov, current city council member, was made noticable by the large amount of political advertisement. He ran for the position of city mayor from the party Renaissance. Just like other members of his party, Vitaliy Pavlovych was pretty generous and spent a lot on his election campaign. Observers calculated that there were 107 advertising boards with advertising for this mayoral candidate. This type of campaign would cost no less than UAH 275,000, but officially in its report expenses for the placement of political advertising on outdoor advertising boards was given at only UAH 4,635. It is possible that some secret arrangements were also present here since Vitaliy Voronov was a member of the city council “with a lot of experience” and had held this position at the Mykolaiv City Council for many years.
Expenses for the political campaign of Vitaliy Vorovnov according to the financial report
Behind seven locks
About 80 advertising boards in Mykolaiv were occupied by Ihor Dyatlov, leader from the Opposition Bloc and candidate for mayor. When running in the elections, he also used the tactic – conceal everything possible. Ekateryna Kolpakova, press secretary for the Opposition Bloc, completely refused to provide journalists with information about party financing during Dyatlov’s election campaign.
“It is not public information,” she said. “We will provide a financial report to the commission, just as requested by law.”
Nevertheless, the city’s election commission did not conceal anything and provided a copy of the interim report of Ihor Dyatlov. In the document, it said that for the election campaign, including for placing political advertising on outdoor advertising objects, candidates spent UAH 157,605.
By the way, Opposition Bloc party accountants appeared to keep their financing a big secret behind seven locks since the report was not provided to journalists or to the territorial election committee, which is a serious violation of the law “On Local Elections.”
Ukrainian union Motherland placed political advertising in October on 76 advertising structures. According to our calculations, to do that, it would have had to pay about UAH 179,550. The political party in turn decided that it was unnecessary to publicize data on its expenses, regardless of official requests from journalists and the requirements of the law “On Local Elections.”
Political party Ukrrop, during the period of the election campaign, occupied 73 advertising surfaces in Mykolaiv, which cost a large amount – UAH 135,000. Nevertheless, in their financial report, which Ukrrop submitted to the central election commission, it said that this amounted to only UAH 14,800.
Ukrainian Union Freedom tried to make itself memorable to voters with 37 advertising surfaces. This “PR” for the party cost no less than UAH 70,000. It turned out to be impossible to check how much money the party decided to declare in terms of expenses on political campaigning in its financial report since Freedom party representatives ignored not only requests from journalists, but also from the city election commission and did not submit a report.
Self-Reliance Union, in its report, said that to place outdoor advertising it spent UAH 20,000. However, according to journalists’ calculations, advertising surfaces cost this political party no less than UAH 80,000, since advertising for this party and its leader, Oleksandr Senkevych, in October was on 36 advertising structures.
Oleh Lyashko’s Radical Party rented 12 billboards in October, on which it spent about UAH 28,000. It is unknown how much the party declared to have spent officially.
Regardless of the promises of Anton Alekseyev, deputy head of the regional branch of the party to provide a financial report, the election commission never received it. As an excuse, representatives of the political party told journalists that their billboards were placed before the beginning of the election campaign – before October 6 – and thus were not paid from the election fund, but by their Kyiv office.
Observers from the monitoring company also calculated that in the city there were 28 advertising spaces used by Democratic Alliance, nine by Serhiy Kaplin’s Party of Ordinary People, and one by New Country.
Such popularization should have cost these political parties UAH 34,800, UAH 24,200 and UAH 2,300, respectively. However, in an official report from Democratic Alliance in an article on expenses for the production of campaign materials, it said it spent only UAH 8,400. Serhiy Kaplin’s Party of Ordinary People decided to be more tricky and left blanks across from all expense items in its report. New Country used the old scheme of not providing a report to the election commission or to journalists at all.
It turns out that the leaders of the election race lied to voters by hiding the real expenses of their election campaigns, in addition to many other things.
Convenient tools
In this way, the election in 2015 did not differ from previous elections at all. The same large amounts of money and lots of other things were concealed by glossy election covers. Behind them, things were going on that should not be revealed to ordinary voters. Regardless of the arrival of a new government and regardless of the new law “On Local Elections,” in this election the same methods were used. Outdoor advertising, just like it was, still remains one of the most popular tools in the election process in Ukraine. And it seems this trend will remain unchanged for a long time.
“Political advertising works really well, which is why it must be taken away,” summarized Oleksandr Ukhmanovskiy, head of the Committee of Voters in Ukraine in Mykolaiv region. “It hides the real meaning. When there is a lack of normal communication with voters, ideology, principles, and publicity, advertisements allow parties to win elections.”
This investigation was conducted with the support of the International Renaissance Foundation and the Danish Association for Investigative Journalism SCOOP.