Austrian Court of Audit (ACA) criticizes lack of transparency and control shortcomings in the funding of party academies

In its recent report on the educational institutions of the Austrian political parties, the ACA criticizes once again the unclear and deficient handling of funds provided to the political academies. The amount received by the political groups represented in the National Council for their educational institutions totals some EUR 10.5 million per year. The statutory purpose of such funding is to promote civic education. 

The ACA issued criticism with regard to the insufficient control rights of the funding bodies already in 2014

The fact that the Federal Government and the Federal Chancellery as the funding bodies did not have direct control rights – such as inspection rights concerning the financial management – was criticized by the ACA already in its report on political academies issued in 2014. Although the Federal Chancellery elaborated a draft on the amendment of the Journalism Subsidy Act (Publizistikförderungsgesetz), which governs the funding of political parties, it has not been enforced yet.

The ACA’s report also reveals that the Federal Chancellery forbore examining the reports that were submitted by the party academies annually.

Parties that ceased to be represented in the National Council keep the funding

The question of how party academies that ceased to be eligible after their political group had failed to re-enter the National Council have to deal with unused funds remained unsolved. According to the current legislation, such party academies are not subject to the annual reporting obligation vis-à-vis the ACA and the Federal Government/Federal Chancellery. Furthermore, they are not obliged to repay the remaining funds, e.g. after a determined period.

Among the parties that failed to re-enter Parliament in the audited period of 2012 to 2017 were the BZÖ (2013), the Team Stronach (2017) and the Greens (2017). Overall, their educational institutions had been granted funds of EUR 1.73 million in end-2017.

The ACA recommends to include clarifications on the use of granted funds after their last payment and a possible recovery of the funds as well as on the approach regarding fixed assets in the case that a legal entity loses its eligibility in the Journalism Subsidy Act.

Indications for unlawful use

The Journalism Subsidy Act contains provisions regarding the use of funds for their intended purpose. More detailed regulations can be found in the directives elaborated by the advisory committee established at the Federal Chancellery. If funds are used in an unlawful way or in violation of the statutes, the party academies shall repay them to the Federation. The Federal Chancellery has to initiate a corresponding legal proceeding and reclaim the funds.

The ACA’s auditors found indications for an unlawful use of the funds at the educational institutions of the FPÖ, the Greens, the Team Stronach and the BZÖ. 

The ACA therefore recommends to the Federal Government/Federal Chancellery to consider a recovery and, if need be, to reclaim the funds.

Among others, the following points were criticized:

• The Bildungsinstitut of the FPÖ concluded a contract for advisory services in 2015. Among the agreed services was the provision of advice for the FPÖ in the areas of European and foreign policy and key issues related to party politics. The payment of advisory services for the party is against the intended purpose of the funding.
• In the course of its events staged to promote international educational work, the Bildungsinstitut of the FPÖ incurred numerous expenses that were in no direct correlation with the corresponding events.
• The Grüne Bildungswerkstatt of the Greens funded projects of third parties – such as the Young Greens (Junge Grüne) – which were not based on an official cooperation. Furthermore, in six out of 80 audited cases, it funded events, of which it had not assumed the leadership as required by law.
• At many events of the Team Stronach Akademie, considerable expenses and hospitality costs were incurred that were not directly related with the educational work as required by the regulations.
• In the run-up to the elections to the National Council 2013, the Zukunftsakademie Österreich of the BZÖ financed 16,000 orange writing pads and 1,000 card games, which carried the BZÖ campaign slogans and photos of the BZÖ top candidates and which were used for the election campaign.
• The Zukunftsakademie granted an unlawful holiday compensation of some EUR 8,300 to a staff member.
• In the run-up to elections, the Zukunftsakademie commissioned surveys and candidate analyses accounting for some EUR 101,000. The results were not published and were therefore against the regulations.

Funding recipients

In the audited period of 2012 to 2017, the Dr.-Karl-Renner-Institut (Social Democratic Party of Austria), the Political Academy of the Austrian People's Party, the Bildungsinstitut of the FPÖ, the Grüne Bildungswerkstatt of the Greens, the NEOS Lab – the Liberal Forum as well as the Team Stronach Akademie and the Zukunftsakademie Österreich (BZÖ) were granted funds for civic education. The educational institution of the party “Jetzt – Liste Pilz” did not receive a corresponding funding in the audited period and therefore could not be taken into consideration for this audit.  

Presseinformation: Rechnungshof Österreich kritisiert Intransparenz und Kontrolldefizite bei Förderungen der Parteien