How to split vote-based funding in the case of multi-party electoral lists?

Question

In designing a system of public funding for political parties, I want part of this funding to reward electoral performance. In order to avoid fairly reward each party, the amount of funding is based not on the number of elected officials, but on the number of votes (to avoid losing votes for parties whose candidates are not elected).

However, I still need to find a way to fairly split the funding going to a multi-party list of candidates. Let's consider a little scenario.

For the upcoming election, small but growing centrist Party A teams up with large but slightly declining center-right Party B; the two political parties will present a single list (AB) of candidates.

Following the election, parties A and B have received votes and, therefore, a number of representatives. Ahead of the next financial year, public funding is to be allocated based on the number of votes received. How do we know how many received by the list AB were actually for Party A or Party B?

Here are a few options and comments:

• Votes are split 50-50 between parties A and B. This feels fair at first, but is likely to lead large parties to refrain from alliances with noticeably smaller parties, since they would lose out quite a bit on post-electoral funding.
• Votes are allocated to each party based on their number of elected representatives. Here we assume that each candidate is affiliated to one of the parties. This leads to problems where few candidates are elected: it does not give a solution if no candidates are elected, and would jump straight to a 100%-0% distribution if a single candidate is elected.
• Votes are allocated to each party based on their number of candidates on the list. This is likely to lead both parties to force as many candidates on the list just to pump up their numbers. This is probably just part of the coalition deal; but it normally does not have major consequences when the extra candidates are not in eligible positions. This would seriously increase the stakes.
• Votes are allocated based on parties' own agreement on a percentage. This allows parties to use objective references they trust (this or that poll) to assess their relative strength and makes funding a consequence of the coalition deal-making. However, it opens the door to arbitrary decisions, and probably shady deals and quid pro quos.

That's about it for my reflection so far. Any ideas?

Thanks in advance!

PS: I have left out, on purpose, scenarios where these questions would be internalised in the electoral system, for instance by asking voters which party they support within the list (by choice, ranking, or any other method). For complex reasons, this is not an option.

Answer 1

If the electoral system doesn't count any preference for one or the other party when you vote the coalition, then you need to look at other parameters that should suggest indirectly the weight of each party inside the coalition.

The solution

Count the weight of each party based on the number of donations (not the amount) obtained from different people and in a defined time frame (e.g.: the electoral campaign). If two parties share the same donor, this can be counted twice or ignored (is arithmetically equal for two-parties coalition). If anonymous donations are allowed, they are not counted for this purpose and anyway is mandatory that the system requires a transparent and fair declaration of donations.

Observations

Why this solution is better than count the number of candidates on the list? The number of candidates usually is influenced by weight of each party BEFORE the electoral run (a sort of dowry). Counting the donators instead identifies people that endorse that party DURING the campaign.

Why is better than a poll? Polls depends on the technique, statistical fluctuations and can have high margins of error. Donators are objective data and do (should?) not change upon references. Is easier to give a wrong or shallow opinion in a poll instead of donating an amount to a party that you do not want to vote.

Answer 2

As you note, in situations involving coalitions identifying which votes were for which party can be unclear. Not least because voters may not care. Voters may have an attitude of "I'm a centrist. I'll vote for either party, and now that they are in a formal coalition, I won't have to choose between them. It is therefore impossible to tell from the votes cast how much support the separate parties have. You can't know how many votes they would have got if they had run separately.

In countries like Germany, this can be solved by not assigning central funds based on other factors. In Germany, each vote cast is worth €0.70. This is assigned to the list. Part of a coalition agreement could be to agree on how this money is divided between the parties. Secondly, each party must submit detailed financial reports. Each "small donation" is matched €0.38 to the €1. If the two parties have separate accounts then they can file separate reports. If the parties do fundraising together and agree to divide the funds 60:40 then this element of the grant is also split 60:40. Maintaining transparency is a key goal of this scheme. It was designed with the intention of making it harder for an extremist party to get funding without making its fundraising receipts public.

Essentially parties that submit joint lists are no longer independent parties. To the extent that they present themselves as a single party, how that "single party" distributes any money it receives is an internal matter.

Answer 3

The Australian system uses majority preference instant run-off voting and awards public funding via the number of first preference votes.

The amount payable is calculated by multiplying the number of first preference (i.e., primary) votes received by the rate of payment applicable at the time. The rate is indexed every six months in line with increases in the Consumer Price Index.[10] At the time of the 1984 election the rate was 61.2 cents for the House of Representatives and 30.6 cents for the Senate. That amount was based on the cost of a standard 30¢ postage stamp per elector per year.[11] By the 1996 election, the rate was set at $1.58 per vote for both Houses. By the 2013 election the rate was $2.49. At 1 January 2014 the rate was $2.52 per vote.[12] By the 2016 election, the election funding rate from 1 July 2016 to 31 December 2016 was $2.62784 per eligible vote. [13]