The government’s White Paper on the financing of political parties is a step in the right direction and offers a good basis for the enactment of a law to regulate this area.
Malta is one of the very few Western industrialised democracies not to have a party financing law and the launch of the government’s proposals last week to address this anomaly is therefore a welcome move.
The last time an attempt was made to regularise party financing was in the mid-1990s when a commission chaired by the late Anthony Galdes, a former governor of the Central Bank, drew up a report on the subject. Unfortunately, no consensus was ever reached over the report; party financing was then placed on the backburner.
The lack of any legislation on party financing over the years has without doubt come at a high cost: a lack of transparency by the political parties, public perceptions of corruption and an unacceptably cosy relationship between the parties and certain big donors.
Perhaps the most unfortunate consequence has been the exaggerated influence of the developers’ lobby over public policy, the construction industry being a major source for the financing of the two main political parties.
Under the proposals political parties will have to register with the Electoral Commission donors who give more than €500 a year, and contributions larger than €50,000 in one year will be banned. Furthermore, donations exceeding €10,000 a year will have to be registered separately with the Electoral Commission and made public.
These proposals are welcome, but the upper limit of a €50,000 yearly donation does seem somewhat excessive; the government should consider lowering this. Surely somebody making such a huge donation will expect something in return? Also, why is it that only donations over €10,000 a year will be made public? Surely, in the interest of transparency, the public has a right to know more about exactly who is financing the political parties.
The government is also proposing that the Electoral Commission be given additional powers and resources to enforce the new law, including the establishment of a register for political parties. Considering that the members of the Electoral Commission are nominated by the two main political parties, and their primary role is to defend their party’s interests, this does raise some questions about whether this authority is the best choice to implement a law on such a sensitive subject as party financing.
The government has for the moment refrained from looking at the possibility of State funding for political parties, because it was felt that the first step should be to regularise the situation regarding the private financing of parties. This is sensible, but does not mean that some form of limited State funding should not be considered sometime in the future.
After all, if we want to move away from a situation where parties rely so heavily on large private donors for their finance – and the consequent influence which this inevitably leads to – then some form of State funding might be inevitable.
The White Paper also addresses campaign expenditure by individual candidates; it is being proposed that prospective MPs will be allowed to spend €25,000 on their campaign as opposed to the current limit of €1,400; while those running for a seat in the European Parliament will have their threshold increased from €18,000 to €50,000. This makes sense, as the current limits are without doubt outdated.
The regulation of party financing has been ignored for far too long; hopefully the government and Opposition will be able reach a consensus on the way forward in the interest of greater transparency.