Game over for party funding?

Greece?s political parties received more than 550 million euros in state funding over the past decade, Interior Minister Tassos Yiannitsis revealed on Tuesday as he invited MPs to make proposals about how the groupings could become less of a drain on the public coffers.

Speaking to Parliament?s institutions and transparency committee, Yiannitsis explained how political parties had actually benefited from the economic crisis because the level of funding they receive is set as a fixed percentage of projected government revenues. Over the last two years, the government has budgeted for greater revenues as a result of tax hikes despite the fact that there was hardly any change in the amounts that the state actually collected, which was about 50 billion euros for the past two years.

As a result, 2010 was the only year over the last 10 that public funding for parties decreased. The parties received 54 million euros last year compared to 48.8 million in 2010.

The issue of how much taxpayers are forking out for political parties has become a growing issue over the last few months, given the drastic spending cuts in a number of areas, including healthcare, defense and education. Yiannitsis suggested that the funding rules need to be changed. ?It is an issue of principles and ethics,? he told MPs.

The minister said that parties received a total of almost 521 million euros over the last 10 years plus another 42 million in special funding for election campaigns. It is also thought that the parties owe a combined total of 245 million euros to banks. Some MPs have questioned whether banks should be lending money to heavily indebted political parties.

Yiannitsis proposed that a new rule be drawn up that directly links the level of party funding to the state of the Greek economy. He said that there should be greater transparency over party donations and the loans they receive from banks.

It was decided that each party should submit their proposals on possible changes to the funding system next week.

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