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Editorial Never too late for transparency and accountability
On Simon Busuttil's transparency
The PN is finding it very hard to break away from the tradition it has built over the years through the JS list
Evarist Bartolo 6 April 2016, 8:16am
What is legality and illegality for a lawyer? A donation of €10,000 to a political party is illegal if the donor's name is kept secret. A loan of €10,000 (unsecured) at low interest is legal and the names of those who loan the money are entitled to anonymity. Although this new PN scheme might border on legality, it is intended to circumvent the party financing law which came into effect this January.
Last week, the Nationalist Party launched a re-financing scheme which it has called 'Cedoli 2016'. According to opposition spokespersons, it is part of a 15-year restructuring plan meant to "stop the haemorrhage" which was highlighted in a report commissioned after the election result of 2013.
However, though the method is different to the way the PN obtained its finances when in power, the secrecy and dependence on what could be termed as a new "JS List" remains. Transparency and accountability are being side stepped in what could be deemed 'legal', but there is no doubt that this scheme is definitely outside the spirit of the law.
Donors or what is now being called 'lenders' will offer the PN voluntary loans of €10,000 at an interest rate of 4 per cent. These loans will be repayable within 10 years. But what happens if they are not? These loans are unsecured and when asked about the capital stability of these so-called loans, PN secretary-general Rosette Thake said that "nothing in life is guaranteed".
This scheme allows the Nationalist Party to withhold the names of these financers. On the other hand those persons lending this money to the PN are not subject to any declaration of source, something which is now very common when depositing funds in local banks. This could give rise to abuse both by the individual and by the party.
The PN leader speaks of transparency but launches a scheme which is as opaque as can be. These are the double standards that were prevalent in the past and which are now being used as a stepping-stone for the future.
A few years ago the PN had built a list of donors known as the 'JS list'. This was made up of individuals and companies that had been awarded contracts by the government and public sector companies during the Nationalist administrations. In previous years, and even during the days when Eddie Fenech Adami was PN leader, these donors were contacted days earlier and told to go to the PN HQ with money that they then hand over to a person accompanying the PN leader.
Funds were collected during the fund raising activities but the majority was collected days earlier in meetings between the PN leadership and owners of companies and other individuals awarded public contracts.
It is now clear that the PN has not shown any political will to change this way of collecting millions of euros. European anti-corruption watchdog GRECO had criticized as being very inadequate the PN government's bill on party financing. GRECO said that the bill was so full of loopholes that it was meaningless as a tool to bring about transparency of political funding so that donors do not buy parties and their decision making and shape policies to suit the interest of those who fund them.
The PN is finding it very hard to break away from the tradition it has built over the years through the JS list. With this new scheme, it means to keep the JS list funding mechanism intact.
Dr Ann Fenech, president of the PN Executive Committee, explained that the idea came about after a number of persons approached the party, wanting to assist by offering the party a voluntary loan of €10,000. She claimed that "this is already happening…" and that "today we have arrangements with the major financial institutions of the country which we have maintained and honoured, and so there is a track record".
However she never gave any assurances that ensure that such a scheme would not be used for money laundering. Neither did she give any explanation on the due diligence process of those offering funds to the PN and neither did she give any explanation on audit procedures for this fund.
In the run-up to the 2013 election, the Nationalist party used scaremongering tactics by claiming that a Labour government would lead to the need of an EU bailout. This scheme launched by the PN is intended to try and bailout the opposition from a history of bad management which has already led to the selling off of a party district club. With this financial savvy, can the PN be trusted with the country's finances?
Simon Busuttil claims transparency but his party has repeatedly refused to divulge the extent of the debt of the Nationalist Party. Maltese law prohibits the acceptance by political parties of anonymous donations as a matter of principle, and the Opposition Leader has launched a scheme that obscures the source of funds that will be used to bring the PN back to its feet.
Simon Busuttil's transparency does not extend far enough to publish the report commissioned after the election on the state of his party's finances, which was prepared by a commission headed by Raymond Bugeja, a former PN leadership contender. The Nationalist Party has so far refused to publish its accounts.
And the Opposition Leader and other party spokespersons have refused to divulge the amount of debt the PN had accumulated, nor give details on the position of the €250,000 loan advanced by construction magnate Nazzareno Vassallo to one of the PN companies prior to the last election.
So much for the PN's transparency.
Evarist Bartolo is minister for education and employment
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