Money in Politics with Chinese Characteristics

The Real Hong Kong News (Summary of Multiple Articles)

5th May, 2014

Money in Politics with Chinese Characteristics

 

Apple Daily

16th April, 2014

DAB Fundraiser: Tycoon Bought Calligraphy for HKD 13 Million

民建聯籌款 富豪1,380萬買張曉明書法  何超瓊擲500萬投李剛畫作

The House News

18th April, 2014

DAB’s Income Soars Past HKD 460 Million, Community Expense over HKD 110 Million in Past 6 Years

民建聯六年吸水4.6億地區活動至少花1.1億

Post 852

18th April, 2014

DAB Demonstrates ‘Income Inequality’ Among Political Parties, Spends Thousands of Millions on Legco Election: Each Vote Worth HKD 316

民建聯示範政黨「貧富懸殊」 年花逾億選舉每票值316元 

Post 852

16th April, 2014

DAB Calligraphy Auction May Violate Xi Jinping’s ‘Eight Rules’

民建聯拍賣張曉明題字籌巨款 涉違習近平「習八條」整風原則

DAB fundraising

Possibly the wealthiest political party in Hong Kong, the Democratic Alliance for the Betterment and Progress of Hong Kong (DAB) demonstrated what a successful fundraising extravaganza looks like last month (April 15, 2014).

Apple Daily ran a story on DAB fundraising dinner:

The last DAB fundraising dinner took place in 2012, raising HK$20 million and making the DAB the number 1 political party in attracting money. Last night (April 15), the DAB hosted a fundraising dinner in the Hong Kong Convention and Exhibition Centre on a scale even larger than the one in 2012. Many Chinese government officials, including Zhang Xiaoming, Li Gang and Li Guikang, donated their works of calligraphy for auction. Among the guests were Chief Executive Leung Chun-ying, Chief Secretary Carrie Lam and most of the principal officials.

When Central government liaison office director Zhang Xiaoming took office in 2012, he promised to follow Xi Jinping’s anti-corruption drive and forbid his officers from accepting expensive gift. Yet, his very own work of calligraphy, as well as those from officers of the Hong Kong and Macau Affairs Office, were the “expensive gift” for the DAB and lured millionaires and patriots to compete in the bidding.

Macau casino mogul Stanley Ho’s daughter Pansy Ho impressed everyone by kicking off the fundraising dinner with a HK$5 million bid for an artwork by Li Gang, director of the Chinese Liaison Office in Macau.

Think that’s a lot? Not quite. Here’s the highlight of the night:

Xu Rongmao, one of China’s richest men on Forbes Billionaires List and chairman of Shimao Property, caused a scene by buying Zhang’s calligraphy work at a whopping HK$13.8 million. Each character of the 4-character calligraphy costs HK$3.45 million. Later on, patriotic organizations and tycoons including the Federation of Hongkong Guangxi Community Organizations donated a total of HK$11 million to “sponsor” Zhang in performing a song from “Journey to the West,” a popular TV series in Mainland China. In other words, Zhang himself raised HK$24.8 million for the DAB. Zhang joked that if he knew his work of calligraphy would be auctioned off at such an impressive price, he would have stayed in Hong Kong to practice calligraphy instead of working in Shanghai.

The DAB dinner raised a total of HK$68.38 million, with HK$51.38 million coming from the auction.

Labor Party lawmaker Lee Cheuk-yan said that it is a common practice for political parties in Hong Kong to host fundraising auctions. However, compared to the HK$260,000 bid for an artwork by artist Walasse Ting at the Civic Party auction, auctioning off Zhang’s work of calligraphy for HK$138 million “does not make any sense.”

Other than the DAB, the Civic Party and Democratic Party also receive donations from bigwigs. Chinese University political scientist Ivan Choy Chi-keung suggested that adopting political parties law would increase transparency of fundraising events of this kind. However, even such a law may not be able to fully address public concerns over corruption and transfer of interests. At the end of the day, political parties must maintain discipline, like the former chairperson of the Democratic Progressive Party of Taiwan Tsai Ing-wen announced that she would only accept small donations when she ran for president.

According to Post 852, Martin Lee, founder of the Democratic Party, criticized the DAB and Zhang for engaging in “outright corruption.”

It also reports that DAB Chair Tam Yiu-chung said the amount raised at the dinner only meets 70% of DAB annual budget.

What exactly is the DAB financial situation like, and what do they do with the money? The House News looked into DAB finance:

The DAB has always been wealthy and resourceful. Its main income comes from donations from “members,” membership fee, as well as the 2012 fundraiser, which provided a new source of income for the DAB. In 2013, the DAB received a total of HK$107 million, 27% increase from the previous year, including HK$67 million from members’ donations, HK$30 million from dinner fundraisers, and the rest from other fundraising events. DAB’s total income over the last 6 years is HK$460 million.

Known for its ability to mobilise local communities, the DAB is often criticised for vote buying through giving voters material rewards such as free dinners and discounted trips. According to its 2013 financial report, DAB spends the most on rent and administration every day, totaling HK$62.8 million. Its second largest expenditure is “branch events,” which is about HK$36 million, a HK$16 million increase from previous year, and 1.6 times that of 2008 expenditure. Since the 2013 annual budget covers the 2012 Legislative Council Election, it is likely that the sharp rise in events expenditure is related to the election.

Over the last 6 years, the DAB has spent HK$115 million on branch events. Assuming each table of dinner costs HK$3000, the amount is equivalent to 38,317 tables. If there are 12 people at each table, DAB would have served over 450,000 people. Since the DAB does not list the details of its branch events in the budget, how the HK$115 million was spent is kept secret. However, it is highly likely that the free-dinner/free-gift expenditure is just the tip of the iceberg. The DAB Legco members and District Council members get reimbursed for giving out gifts to local communities; DAB-affiliated groups receive government grants to fund political promotion. For instance, in 2012, the DAB received a HK$670,000 grant in the name of DAB Community Services Limited to replace LED light bulbs in elderly homes, while promoting the party to the community.

Post 852 concludes:

In the absence of political parties law, there is no transparency in political party funding. Not only does money in politics have a big impact on election results, but it also allows any one political party, backed by big money, to monopolise power. As a result, big money donors are the ultimate winner as they can set the agenda of the political party.

DAB 2

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