An Echelon Media Company
Saturday May 18th, 2024

Who’s afraid of election campaign finance regulations?

UNREGULATED CAMPAIGN FINANCES AND MEDIA BIASES THREATEN ELECTION INTEGRITY

Sri Lanka’s 8th presidential election held on November 16, 2019, saw a record turnout of 83.72% of the nearly 16 million total registered voters. Barring a few incidents, the election—known online by its hashtag #PresPoll2019—was considered free, fair and (mostly) peaceful by both local and international election observers. The European Union’s Election Observation Mission (EU-EOM) noted in its preliminary report on November 18 that the election was “largely free of violence and technically well-managed”.

The Asian Network for Free Elections (ANFREL), a regional alliance of international election observation organisations, in its initial assessment said the success of election was marked by the acceptance of its outcome by all contesting parties, “in a welcome demonstration of democratic maturity, yielding a swift transfer of power”. This was the first key national-level election conducted by the independent Election Commission (EC) since it succeeded the former Department of Elections in November 2015. The EC’s greater powers evidently ensured this election’s integrity in physical terms. However, much more needs to be done on how election campaigns are implemented, monitored and regulated.

NO LEVEL PLAYING FIELD

While commending the EC for conducting the election in a credible and professional manner, the EU observes pointed out that there was ‘no level playing field for all candidates’. They attributed it to three factors: unregulated campaign spending; abuse of state resources; and media bias. Mass media biases as well as social media manipulation are not entirely new in Sri Lanka and not limited to election times either. But these were more pronounced during #PresPoll2019 and, if trends continue unchecked, they can undermine voters’ ability to make informed choices.

The EC has been trying to persuade all media to abide by election rules. On September 21 2019, the EC gazetted election media guidelines that asked all print, broadcast and web media outlets to “provide accurate, balanced and impartial information in broadcasting or televising or publishing their news bulletins and any other programme relating to political matters”. The EC’s media guidelines covered all news and current affairs reporting as well as political commentary (including editorials and political cartoons). But they were mandatory only on the state media whose managers and journalists risked legal action for violations.

MICRO-TARGETING VOTERS NEEDS GREATER SCRUTINY, TRANSPARENCY AND POSSIBLE REGULATION

The private media—which has a more significant audience share—was expected to adhere to them too, but many outlets chose to ignore and supported their chosen candidate instead. Announcing the election outcome the day after, EC chair Mahinda Deshapriya highlighted the Commission’s lack of legal powers to regulate the private media. “Private TV and radio use airwaves that are public property to distribute their content, so [they too] have an obligation to act with greater responsibility,” he argued. In frustration he added: “If we can’t get more legal powers to ensure both state and private media abide by election media rules, we might as well ask the media owners to select winning candidates in the future—and save billions of public funds spent on conducting elections!”

BIG SPENDERS

According to EU-EOM, the two highest-profile candidates Sajith Premadasa (of New Democratic Front, NDF) and Gotabaya Rajapaksa (of Sri Lanka Podujana Peramuna, SLPP) both made “extensive use” of traditional media, with a substantial presence in paid advertising in television and the print media. Their campaigns also used “cross-platform electioneering tactics online, with official promotion pages adjoining third-party sites that frequently served to discredit the rival. The volume of hostile commentary was higher on SLPP-leaning sites.” (Full text: http://bit.ly/EOMSL19) Two local sources gave an indication of how much money was spent by the leading candidates. The Centre for Monitoring Election Violence (CMEV) estimated that a total of Rs3,108 million was spent by five presidential candidates between October 14 and November 10. Of this, SLPP’s share was Rs1,518 or 49% of the total estimate, while NDF spent an estimated Rs1,422 million, or 46%. According to CMEV’s data, both campaigns spent significantly (SLPP 61% and NDF 50.5%) on print and broadcast media advertising compared to other activities like public rallies and promotional materials.

Data is not available on how much each campaign spent on targeted advertising on key global tech platforms like Facebook, YouTube, Instagram or Google. Meanwhile, a study by Verite Research thinktank found that many Lankan television, radio and newspaper companies had charged premium rates (between 150% to 300% of standard prices) for carrying election advertising (see details at: http://bit. ly/2QHZ6ue).

Assuming these data collations are reasonably accurate, they bring up several concerns. The high cost of mass media buying rules out paid advertising for most election campaigns. Given the lack of regulations on campaign financing, the richest campaigns have a distinct advantage over all others.

Accessing social media platforms is cheaper but reaching out to one-third of the population who are online is not sufficient by itself. Also, the surge of sponsored or boosted content on social media closer to the election date added to the already high cacophony there.

DISINFORMATION OVERLOAD

While somewhat levelling the field for less well-endowed campaigns, social media presented a new layer of challenges for the election authority and voters. After the election was announced, politically motivated disinformation and racially charged hate speech increased in volume and intensity. However, such negative content flowed also through many mainstream media outlets notwithstanding their editors and publishers claiming to adhere to media ethics. As EU-EOM noted: “A peaceful and calm campaign on the ground contrasted with divisive rhetoric,hate speech and disinformation in traditional and social media.

Only a few of the 35 registered candidates were visible throughout the campaign period.” Elsewhere in their report, EU-EOM said, “The SLPP conducted a highly organised grassroots campaign and a sophisticated political messaging strategy online, including the use of mobile phone applications. While these applications were used primarily to promote the SLPP candidate, they also obtained voters’ personal information, essential for automated micro-targeted canvassing.”

The EU observers noted how the Premadasa campaign also used social media heavily, but with “markedly less investment in micro-targeting”.

Micro-targeting individual voters on social media (enabled by their behavioural profile already with the tech platforms) is an aspect of campaigning that needs greater scrutiny, transparency and possible regulation. Facebook—with 6.5 million users in Sri Lanka by October 2019 —was singled out by EU observers as the prime contributor to the crafting of political narratives in the public space and to setting the electoral agenda.

Ahead of the election, Facebook had claimed in op-eds in English newspapers that they were “absolutely committed to maintaining the integrity of the elections in Sri Lanka.” Yet election observers found that the company did not walk their talk. “The EC had only an informal understanding with Facebook on the removal of hate speech and disinformation. Citizen observers also reported harmful content online to the EC and Facebook. However, Facebook’s reluctance to take action, coupled to high levels of anonymous, sponsored content, enabled a mushrooming of hateful commentary and trumped-up stories that capitalised on long-standing ethnic, religious and sectarian tensions,” EU EOM said.

Disinformation and hate speech on Facebook continued even during the 48-hour cooling period before the election day, “when Facebook removed only a small proportion of such paid content. This was detrimental to the election and at odds with international standards.”

ADVOCATING STATUTORY REGULATION OF MEDIA IS HAZARDOUS IN IMMATURE DEMOCRACIES LIKE OURS

Since EC did not have a written agreement with Facebook, it was left entirely to the company’s discretion on whether—and how fast—it acted on any specific content flagged by the Commission or election monitoring bodies.

The number of removed Facebook posts or pages was not made public. Adding to these concerns is the fact that Facebook did not consider the EC’s media guidelines applicable to it. (Social media is mentioned twice among the 34 clauses of these guidelines, admittedly not in very precise or clear terms.)

URGENT ACTION NEEDED

So what is to be done? Advocating statutory regulation of media is hazardous in immature democracies like ours. Yet #PresPoll2019 has highlighted the need to empower the EC vis-à-vis all mainstream media, at least during election times, to guard against media biases. Regulating campaign finances could be a more effective way forward. EC has been calling for campaign finance regulations for a long time, pointing out that such scrutiny was mandatory in the past, until the Parliamentary Elections Act No. 1 of 1981 repealed that requirement.

The current law enables EC only to monitor if a candidate is exploiting state resources. There are no upper limits or accounting requirements for private funding received by campaigns. An Election Campaign Finance Bill requiring candidates to reveal sources of funds and expenditure has been with the Legal Draftsman’s department for some months. Once campaign finance regulations are in place, EC chair Deshapriya says, the private media’s bias in favour of a chosen candidate can be checked.

“If a candidate is given extra airtime on the news or in other programming, we can calculate that as if that airtime is paid for, and add it to the particular candidate’s campaign costs. If the cumulative total exceeds what is allowed by law, the candidate risks being disqualified.” Will the current Parliament pass the campaign finance regulation law before its term ends in early 2020?

Media companies whose advertising revenue goes up massively during election times are unlikely to advocate campaign transparency or spending limits. Voters and civil society have to raise their voice—and fast.

Science writer Nalaka Gunawardene is on Twitter @NalakaG and blogs at http://nalakagunawardene.com

(Colombo/Feb08/2020)

Leave a Comment

Your email address will not be published. Required fields are marked *

Leave a Comment

Leave a Comment

Cancel reply

Your email address will not be published. Required fields are marked *

Sri Lanka suffers over $138mn foreign outflow from govt bonds in 2024 after rate cuts

ECONOMYNEXT – Foreign investors have dumped 41.6 billion-rupee ($138.6 million) worth of Sri Lanka government securities in the first 20 weeks of 2024, the central bank data showed, after reduction in the key policy interest rates.

The foreign holding in Sri Lanka’s treasury bills and treasury bonds fell to 75.9 billion rupees on the week ended on Friday (17), May 2024, from 117.4 billion rupees on the week ended on December 29.

The central bank rate has reduced the key policy rates by 50 basis points so far in 2024, extending the rates cut by 700 basis points since June last year.

The rupee appreciated 9.1 percent in the first four months, but the gain failed to attract foreign investors amid a dragged debt restructuring negotiation with external private creditors.

Currency dealers said lackluster demand for dollars due to dampened imports with heavy controls, boom in both tourism revenue and remittances have helped to increase the dollar liquidity in the market, leading to the appreciation of the local currency.

The dealers said foreign investors can earn capital gain if they had bought government securities before the appreciation and now the offshore investors might be selling their bonds.

“They are also discouraged by policy rate cut because that will reduce their returns from the rupee bond investments,” a currency dealer said.

The yield in 12-month T-bills has fallen 336 basis points in the first four months of this year, the central bank data showed.

The central bank also reduced the Statutory Reserve Ratio (SRR) of commercial banks by 200 basis points in August last year to boost liquidity in the market with an aim to reduce market interest rates.

Under tough International Monetary Fund (IMF) conditions for its $3 billion loan program, the central bank raised key monetary policy rates in 2022 and last year to bring down inflation which hit over 70 percent in 2022. The inflation has fallen to the lower single digit now.

The rupee has appreciated to around 300 against the US dollar this week from around 330 level early in November. The local currency was at 365 rupees against the US dollar in early 2022. Depreciation causes capital loss for foreign investors. (Colombo/May 18/2024)

Continue Reading

Sri Lanka’s ‘Sancharaka Udawa’ tourist fair seeks to involve universities

ECONOMYNEXT – Sri Lanka’s ‘Sancharaka Udawa’ tourism fair kicked off this week to promote interaction between industry stakeholders and relevant Government bodies, including the Tourist Police, and also universities.

“Several universities, including Colombo, Uva Wellasa, Kelaniya, Sabaragamuwa and Rajarata were given free stalls to facilitate student interaction with industry professionals,” Chairman of the Sancharaka Udawa Organising Committee, Charith De De Alwis said in a statement.

The event takes place today (18) at the BMICH and houses stalls for hoteliers, tour and transport services, with a goal of attracting 10,000 visitors.

Organized by the Sri Lanka Association of Inbound Tour Operators (SLAITO) and the Sri Lanka Tourism Promotion Bureau (SLTPB), the 11th edition of Sancharaka Udawa offers a platform for both B2B and B2C sectors.

“Sancharaka Udawa houses over 170 exhibitors and a footfall of more than 10,000 visitors,” De Alwis said.

This year’s edition will include participants from outbound tourism sectors to facilitate capacity building. The event provides networking opportunities for industry newcomers and veterans.

“The networking platform offers opportunity for small and medium-sized service providers integrating them into the broader tourism landscape. The anticipated outcome is a substantial increase in bookings particularly for regional small-scale tourism service providers.” (Colombo/May18/2024)

Continue Reading

Sri Lanka’s CEB sells LTL shares to West Coast IPP for Rs26bn

ECONOMYNEXT – Sri Lanka’s state-run Ceylon Electricity Board has sold shares of an affiliate to West Coast Power Company Limited, an independent power producer giving profits of 25.9 billion rupees in the March 2024 quarter, interim accounts showed.

The sale has been carried out as a transfer.

“Twenty-eight percent (28-pct) of share ownership of CEB within LTL Holding’s equity capital has been transferred to West Coast Power Company Ltd for a total consideration of Rs 26 billion as part of a partial settlement of outstanding dues…” the March interim accounts said.

“This transaction resulted in a net gain of Rs25.9 billion rupees which has been recognized and reflected in the ‘Gain from Share Disposal’ in the individual financial statement in CEB.”

LTL Holdings is a former transformer making unit of the CEB set up with ABB where the foreign holding was sold to its management.

The firm has since set up several IPPs.

West Coast Power operates a 300MW combined cycle IPP in Kerawalapitiya promoted by LTL group liked firms in which both the Treasury and Employees Provident Fund also have shares.

Its operational and maintenance contract is with Lakdhanavi, another private IPP. The firm has been paying dividends.

The capital gain from the transfer of shares helped the CEB post profits to 84 billion rupees for the March 2024 quarter.

CEB reported gross profits of 62.7 billion rupees from energy sales and 30.6 billion rupees in other income and gains in the March 2024 quarter. Other income was only 3.1 billion rupees in last year. (Colombo/May18/2024)

Continue Reading