Political parties are an essential ingredient in any country that prides itself of being a democracy. But just as important for democracy is the manner in which those parties function.

Democratic politics cannot be effective without substantial financial resources that allow them to perform their role. Yet, political parties with strings attached devalue the democratic process and undermine the people's confidence in the whole concept of democratic governance.

Which is why preventing corruption in the funding of political parties has been an ongoing debate in many countries. Should the state finance political parties as a means of preventing their dependence on, and indebtedness to, private sources?

The political parties in Malta have become large money-crunching organisations that can no longer depend on volunteers or membership fees. They have expanded and spread their wings to every sector of the mass media, despite the financial burden.

There have been some forays in commercial activities to raise revenue, but the outstretched hand for help has never been pulled back, not even when that call risked drowning out the cry for help by charitable institutions. Yet, even though fund-raising campaigns now rake in thousands of liri from individual donations, the major source of revenue the parties clearly depend on are "contributions".

Alternattiva Demokratika chairman Harry Vassallo claimed at a press conference the other day that, in order to accommodate the construction magnates and speculators who finance the parties, the government and the opposition were denying that property had become unafforable for the population, thus no action being taken to address the situation.

One could dispute Dr Vassallo's claim, but his call for strict rules on political party financing, including party financing from state coffers, does merit consideration.

Various methods have been adopted abroad to instil transparency in political party financing. In some cases, parties are required to declare how much money they use for campaign financing and the source of such funds. Others ban donations to the political parties by companies and impose a ceiling on donations by individuals or households. Anonymous donations are prohibited and the source of loans is restricted to banking institutions. The political parties then get assistance from the state to cover part of their costs, with the amount of state aid per party usually calculated on the number of parliamentary seats or election candidates.

Any decision on whether the state should dip into its coffers to help the political parties needs to be considered in the context of whether the political parties here suffer from any shortfall that is hindering their performance; whether the public perceives the parties to be conditioned by the source of the donations they receive and whether limitations on the source of funding and the imposition of disclosure requirements would be effective.

The experience abroad has been a mixed one, with the political parties finding various ways to bypass the legal impositions, such as creating companies or appointing consultants through which funding is channelled. In Malta, the situation would be complicated further by the fact that most companies are family run and donations would usually be made directly by the owners, not the companies themselves. And donations can take various forms.

To date, the only restrictions the law has tried to impose was on the expenditure by candidates at general elections. It would be difficult to find anyone who thinks it has worked. Which is, of course, no excuse to give up on attempts to instil transparency in the funding of the Maltese political system.

Public confidence demands no less.