Referendum refers to a process of direct democracy in which voters can approve or reject binding documents and laws, proposals and broader course of action. Depending on the legal framework, referenda may be called for by specific provisions of law or in response to a petition from citizens, and can also overturn existing laws or government constitutions. There are three main types of referendum: plebiscites, constitutional referendums and citizen initiated referendums.
A financial referendum (or budget referendum) is a specific type of referendum which allows voters to vote on individual aspects of a country’s public budget. The ballot answers are typically “Yes” or “No”. Referendums can also be multiple choice, although this is less common than the single binary options.
Some support the use of referendums to counteract voter apathy and disenchantment with traditional political processes. They can help re-engage voters in politics by offering them a sense of direct control over policy and politics, and they can allow politicians to resolve problems without dividing their own parties, as was the case with the 1975 UK referendum on EU membership which resolved an issue within the Labour Party.
There are also concerns that referendums may lead to poor policy-making, by undermining the role and status of elected representatives and enabling the use of misleading or inaccurate information in campaigns. The risks can be greater for complex issues which require expert knowledge and technical understanding, or for which voters have only limited or partial information. These risks can be compounded by the tendency of voters to be influenced by media coverage, propaganda and strong personalities or by their own preconceived ideas about the issue at hand.
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