Legislation regulating the financing of political parties in Malta is long overdue. Alternattiva Demokratika has been harping on about this subject since its foundation in 1989 and has referred to it in all the general election campaigns since.
Former MP Franco Debono has been a driving force over the last few years in ensuring that the financing of political parties has been an item retained on the national agenda.
The Parliamentary Committee for the consideration of Bills is currently examining the Financing of Political Parties Bill in detail. On behalf of Alternattiva Demokratika, I had the opportunity to be present at a number of sittings and also participated in the ensuing discussion after being invited to do so by the Parliamentary Committee.
While the general thrust of the Bill is reasonable, it contains three basic mistakes which, if unchecked, will impact the whole regulatory process. The first is over-regulation. The second is the retention of absolute control directly in the hands of representatives of the Parliamentary political parties which, in turn, leads to the third fault- this being a one-size-fits-all template.
I will take each in turn.
The over-regulating aspect of the Bill has been watered down, as Minister Owen Bonnici was very flexible when faced with this criticism. He accepted various amendments to the Bill, scaling down various provisions relating to the proposed regulation of political parties.
The government is proposing that the regulating authority on party political financing should be the Electoral Commission. It attempts to justify its stance by pointing out that the General Elections Act already assigns responsibility to the Electoral Commission to receive, and where necessary vet, the expenses made and donations received by candidates in general, local and European elections in Malta. However, Minister Owen Bonnici, who is piloting the Bill, was not in a position to explain why the Electoral Commission had never taken any action when faced with a blatant disregard for the rules by candidates in past elections.
The alternative proposal, initially piloted by Alternattiva Demokratika but subsequently also taken up by the PN Opposition, would see the regulatory authority on political party financing vested in the Commissioner for Standards in Public Life. This Commissioner would be a Parliamentary Official, to be elected subject to the support of two-thirds of Members of Parliament when the Standards in Public Life Bill, currently pending on Parliament’s agenda, is approved. Enjoying the support of two-thirds of MPs would signify that the person selected would enjoy widespread support and consequently his or her moral authority would be substantial and effective.
During the discussion Minister Owen Bonnici declared that the Council of Europe’s GRECO (Group of States Against Corruption) was breathing down his neck and consequently the government could not afford to await alternative institution building.
A major stumbling block is the composition of the Electoral Commission itself. This is determined in the Constitution, with four of its members being nominated by the Prime Minister and another four members being nominated by the Leader of the Opposition. The chairman of the Electoral Commission is always a civil servant nominated by the Prime Minister. This signifies that the parliamentary political parties, through their absolute control of the Electoral Commission, end up regulating themselves through their nominees. But what is even worse is the fact that they also control the regulatory process for all other political parties which may consider registering.
It seems that this rigid control of the regulatory process by the parliamentary political parties is not enough. To be sure of tightening even further the resulting control, the Financing of Political Parties Bill also adopts a one-size fits-all template. It does this by ignoring reality and makes no distinction between the political parties having seven-digit turnover and the rest. Nor does it distinguish between the political parties run by full-time professionals paid for their services, at least in part through funds arising from donations, and political parties run by volunteers with an annual turnover averaging €10,000. The one-size-fits-all approach is, however, not extended to state financing. For the past 20 years, both the Nationalist Party and the Labour Party parliamentary groups have been receiving €100,000 in public funds annually.
The proposed rigid reporting and auditing requirements that may be reasonable for political parties with seven-digit budgets are certainly quite unreasonable for a political party such as Alternattiva Demokratika, run by volunteers on a shoestring budget which averages €10,000 annually.
The limited administrative capacity of small parties is not factored in the Bill under consideration.
The end result may well be that there will be considerable administrative difficulties for political parties not presently in parliament to register as political parties once the Bill under discussion becomes law. (It has to be borne in mind that only political parties registered in terms of an eventual Financing of Political Parties Act will be able to present candidates in all elections in Malta. All other candidates will be considered as independent candidates and grouped together at the lower part of the ballot paper.)
Mixed messages have come through during the debate on this Bill. Unfortunately, however, the message at these final stages is that there is also a clear but undeclared objective of the Financing of Political Parties Bill– to squeeze out the small political parties.
In the coming months we will see whether this undeclared objective can be overcome.
published in The Malta Independent on Sunday, 5 July 2015