The financing of the PLPN

Through a number of articles in the local press we have been repeatedly made aware that government and its authorities do not treat the parliamentary political parties (and their commercial companies) as the rest of us when it comes to outstanding bills, including those relating to taxes due.

The regulation of party-political financing should not stop at donation reports. We need to shine the spotlight on their pending bills too as these are an additional substantial financing source which in practice serves to finance the political parties through open-ended credit facilities! It is being carried out by the state, directly and by stealth.

To be clear I am referring to outstanding VAT payments and pending water and electricity bills which go back a number of years which have accumulated to millions in outstanding dues. In addition, there are also NI and PAYE contributions collected by the parliamentary political parties and their commercial companies on behalf of the Inland Revenue Department from their employees and retained unlawfully at their end. Any private employer who acts in the same manner is normally subject to legal action, in particular for failure to act on repeated reminders to conform! If you try not paying your water and electricity bills for years on end you will very soon receive a polite notice from ARMS indicating that you will soon have no more access to water and electricity!  But it is kids gloves for the PLPN. 

The amounts due run into many millions of euros and form part of the accumulated debts of the parliamentary political parties. It is difficult to quantify the precise amounts due by PLPN and their commercial companies as the authorities continuously withhold information as to the precise accumulated amount of the arrears due. The only information available in the public domain is sourced through leaks indicating that the amounts due run into millions: an upward eight digit spiral! Public knowledge of the extremely generous credit terms which public authorities grant parliamentary political parties and their companies would reveal the systemic abuses which have been shielded for too long a time.  This information should be disclosed as this is in the public interest. Good governance requires it.

This is an indirect source of political party financing which needs to be quantified and acted upon immediately. It is unfortunate that the regulator of political party financing is the Electoral Commission which is itself composed of nominees of the PLPN, who are thus regulating themselves, in addition to regulating their direct competitors, the other political parties.

It is also about time that the commercial companies belonging to the political parties are dealt with as an integral part of the political parties which they service. Stricter controls and real-time reporting time-frames are essential if we really want to ensure that these commercial companies are not used as vehicles to channel illicit funding to oil the PLPN political machinery.

As expected PLPN are in denial. The PL insists that its companies have not entered into a deal with Yorgen Fenech. The PN on the other hand insist that all is above board at its end: they proclaim that they have not issued any fake dB invoices! Yet both of them continuously fail to play by the rules. Audited accounts for their companies have not been presented for many years. As a result, there is no way to verify whether and to what extent the PLPN commercial companies are innocent of the charges that they are being continuously used to circumvent the rules regulating the funding of political parties.

Both the PL and the PN sanctimoniously proclaim their adherence to the basic principles of good governance. It is about time that they start practicing what they preach!

published in The Malta Independent on Sunday : 17 April 2022