Campaign Finances

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By Marc Urbatsch and Albert Eckert (with thanks to Dietmar Strehl, the treasurer of the German Green Party, for his useful tips)

Learning from the past
Some people consider that you need a miracle to finance a campaign for a small party. Most of them do not even want to start planning because they are convinced that there will never be enough money. Of course, writing figures on a page, counting and calculating does not increase the budget, but it is the first step towards doing so.

The treasurer of a campaign should always be a well respected person. He or she does not necessarily have to be old, but should have the trust of all parts, regions or factions of your party.

First of all, you should get an overview of what you need and what you have. The best way to start a new budget plan is to look for an old one. What did you spend in your last campaign? What happened then? Where did you get your money from?

If you have never before run a campaign in your town or country you should try to find out how much other parties on your level spent. The more information you can gather about their finances, the better. You don’t have access to your competitors’ data? Then ask Greens in other towns or countries of comparable size and with a similar financial situation. If your party has a big bank account, the situation is different from that of a poor party with no assets, even if the size of the town is comparable. Look for best practices of budgeting campaigns in a comparable party and learn from them. The most effective way of learning is by copying – try to copy from the budget plan of others, adjusting it as required.

Search for colleagues. Try to find experienced Green treasurers who can assist you. They can have a look at the draft of your budget at a very early stage and provide you with useful information.

First the income
Initially, you should concentrate on the income part. How many assets do you have? How many donations do you expect? How much will you be able to raise from your members?  Will there be a certain amount of government (re-)funding? Will you be able to get money from corporate sponsors (if you accept them)?  How much money did your party receive for the last elections? In which election and at what level did you raise the most? Will it be possible to get this amount again? Try to make at least a rough estimate based on past experiences and recent developments. You then have to decide whether you want to use only your reserve funds that you have built up for the campaign or if you want to invest parts of your monetary assets.

Should you borrow money for the campaign? There is no easy answer. You first have to assess your chances of winning the elections and of perhaps having the money refunded. Look at the polls and try to predict how much money you would receive in a normal term. You should always be able to pay back a loan within one legislative period. Of course, there is always the risk of snap elections. Be aware of this risk and calculate carefully.

You do not always have to borrow money from a bank. In some countries certain branches of the party have enough cash to lend money without any interest rates to those who need it for their campaign. Don’t hesitate to ask your Green relatives (parties) from within or outside your country to lend you money. To finance successful campaigns, it is much better to circulate the money within Green parties than to store it in a bank.

Then the expenses
After having planned the income and set a rough financial frame for the size of the campaign, your focus should shift to the expenses. Start a brainstorming phase that involves the most important people and several parts of the party.

Look again for best practices: what was successful in your most recent campaigns? How do the other parties plan and spend their expenses?

For the brainstorming phase it is very helpful if the treasurer can already present a relatively complete list of ideas and budgets. Then, new ideas can be added and the whole budget can be modified over the course of the discussion. Always try to use the experiences of past campaigns when you deal with new ideas. Where did you waste money last time? What was successful? Keep a critical eye on ‘big events’ – money is often wasted on them.

After brainstorming, the decision making starts. You should first consider the opinions of experts, and then launch a democratic decision making process in the campaign team. Those parts that you have to cut can perhaps be financed later if lots of donations come in. Everything that you can’t finance at the beginning should remain an option for later additional measures. You do not need a new additional budget for large donations if you can rely on the additional options that you already included during the planning process.

When setting the budget, please note that you should reserve lots of money (20-50%!) for the last days. A growing number of voters don’t decide until very late on, so your ads, TV spots, posters and leaflets are extremely important during the final days of the campaign.

Unfortunately, donations are unpredictable and large donations arrive late in the campaign, sometimes even once it is over. This may save your budget – but you shouldn’t count on that!

Structuring the budget
Here is an example of the structure of a campaign budget:

Proceeds from the sale of material
(Plus perhaps a part of the party’s assets)

Posters (including image rights, graphic costs)
Agency (online + offline, possibly separated)
Media advertising: ads, cinema, radio, TV, television in the underground, etc.
Photo session with candidates
Reserve for final phase
Fundraising investment
Campaign material, give-aways
Campaign newspapers
Personal publicity (mailings)
Production of give-aways,
Production of cinema spots, etc.
Committee meetings (Election Campaign Convention)

Permanent staff
Employees on temporary contracts (usually persons at the beginning of their careers)
Experts with higher wages or as external advisers
Online agency

Keep your paid staff small. More personnel also means more effort to steer your campaign – this also needs to be taken into account. Without a working structure and clear leadership tasks, you will waste money on chaotic activities.

During the campaign you should always know precisely how much has already been assigned to specific activities – and how much remains. For a smooth running campaign, it is crucial to be able to monitor and control your budget effectively. The structure of the budget has to be clear so that all expenses can be easily be allocated. Never lose the overview, watch your budget closely!

The processes of decision making and spending have to be well defined. Who is allowed to place orders? Who has to agree? Be precise when defining responsibilities but don’t forget that decisions sometimes have to be made quickly during a campaign. Somebody who is allowed to sign should always be available.

After the campaign you should always evaluate the financing of the campaign. Write down how your decision making and spending processes worked. What turned out well, where did you experience difficulties? Which parts of the budget had to be adjusted? Which ones were easy to plan and control? These notes will be of enormous help when you plan your next campaign budget… Good luck!

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