De-monetising politics – disclosing party fund


  • Business
  • Saturday, 24 Jan 2009

TWO recent events have again drawn important attention to a malaise that has long afflicted Malaysia – money politics.

The first occurred when, even before the by-election campaign for the vacant Kuala Terengganu parliamentary seat had commenced, the Barisan Nasional had to deny it was using money to fish for votes. The second was when Transparency International-Malaysia announced plans for a study of the funding of politics.

The Transparency International project is entitled ‘Crinis’, which means ‘ray of light’ in Latin, and the Malaysian study is based on a similar one undertaken in Latin America. The Crinis-Malaysia project has two main objectives: to identify problems associated with political party and electoral campaign funding and to advocate reforms to increase transparency in this process.

The phenomenon of money politics in Malaysia has, however, numerous facets. Money politics is normally understood to mean the buying of votes during party and general elections, but the term is liberally used in discussions about political patronage, party ownership of business and abuse of power for corrupt purposes.

While all these issues merit thoughtful assessment, Transparency International-Malaysia’s focus is the financing of election campaigns.

This is because the Crinis project carries a worldwide comparative dimension and the Berlin-based Transparency International plans to create an index to gauge where countries stand in terms of how publicly accountable their parties are about the sources of their funds during election campaigns.

Funding parties

The way parties have been funded is seen as a contributing factor to corruption and the debasing of the practice of democracy. In most electoral democracies, as election campaigns have become increasingly sophisticated and expensive, political parties and politicians depend heavily on funds from business enterprises.

Contributions to a party by business are normally calculated in relation to the political benefit the firm can accrue in return for the funding. Politicians thus elected become indebted to the corporations that contributed to their campaigns. Or the case may be that only candidates selected to represent particular business interests are actively funded to pursue their causes through the Government.

In a number of countries, the Government has come to be captured or strongly influenced by big business through the financing of political parties or politicians, an issue that allows corporations considerable sway over public policy.

This was the case in recently democratized Thailand and the Philippines, where politicians who had secured control over government have close ties with big business or even own major enterprises. In the Philippines, President Joseph Estrada who had links with big business was eventually prosecuted for corruption while Thaksin Shinawatra, once reputedly the richest businessman in Thailand, formed the Thai Rak Thai Party and allegedly used money to buy votes during general elections to secure the premiership. Thaksin now faces serious charges of corruption.

In Malaysia, information on the sources of funds for most political parties in the Barisan Nasional and Pakatan Rakyat coalitions remains one that is difficult to come by.

One allegation persistently made by Barisan Nasional against Keadilan is that the latter is privy to large sums of money from abroad, suggesting that Malaysia’s economic interests would be deeply compromised if Pakatan Rakyat took control of the federal government.

The opposition, on the other hand, has long criticized Barisan Nasional parties of abusing their position in government to channel concessions to businesses which funnel funds back to political leaders to sustain their position in power.

Umno’s money

When Datuk Seri Abdullah Ahmad Badawi became Prime Minister in 2003, he declared his intent to eliminate corruption, but little was done during the Umno elections he oversaw in 2004 to weed out the abuse of money during the campaign period.

In that election, complaints about money politics had come from senior ministers in his cabinet. Datuk Paduka Abdul Kadir Sheikh Fadzir, for instance, described the practice of money politics in the 2004 election campaign as the worst he had witnessed in the 34 years he had occupied senior posts in Umno.

The campaign for the March 2009 Umno election is now under way and Datuk Seri Rais Yatim, a candidate for the post of vice-president, has already lamented that if “the scourge (of money politics) should take further hold in the party, it would be just better for Umno to have a tender system so that anyone who contributes the highest amount can be a leader.”

Such disparaging statements about the monetization of Umno politics suggest the limited capacity – or even willingness – of a powerful executive to stamp out a problem that has come to be seen as a rapidly spreading cancer in the body politic.

It was former Prime Minister Tun Dr Mahathir Mohamad who had first described money politics in Umno as a cancer.

Dr Mahathir was moved enough to publicly shed tears over it, in a futile attempt to stop a practice that was deeply factionalising his party. But it was also during his more than two decade-long tenure that the problem had first emerged, and history has well recorded how he allowed the practice of money politics to flourish and fester in an attempt to consolidate his position in Umno.

To his credit, Mahathir has recently publicly acknowledged responsibility for the rise of money politics, ironically even emerging as one of Malaysia’s most vocal critics of the phenomenon.

One reason why Umno has not been able to weed out the problem is probably because it has not instituted an effective enough mechanism to deal with errant members who abuse money to ascend the party hierarchy.

All Umno now has in place is a code of ethics and a disciplinary committee to handle complaints about money politics, hardly tough deterrents.

Politics reformed?

Abdullah hopes that his legacy of reform will be seen in his introduction of the Malaysian Anti-Corruption Commission (MACC) and the Judicial Appointments Commission (JAC) bills, but such legislations are inadequate to deal with money politics. Institutional reforms involving real devolution of power to help curb corruption have not transpired.

What would help check excessive use of money in elections is a law mandating political parties to publicly publish a detailed annual statement of accounts which discloses their sources of funds.

Present legislation pertains solely to the need for candidates, not parties, to detail their expenses during the election campaign period. This is grossly inadequate.

Asian countries have legislations that deal directly with the funding of parties. In Japan, the Political Funds Control Law was introduced, while in Taiwan and South Korea, the Public Officials Election and Recall Law and Political Funds Act respectively were instituted. One key aspect of such laws was the requirement that companies disclose political donations. In Singapore, the Political Donations Act was introduced partly to prevent parties from receiving foreign donations.

The pros and cons of such legislation should be studied and a similar law should be adapted and adopted to suit the Malaysian context. Transparency International-Malaysia’s Crinis study of money politics would probably lead it to put forward such a recommendation.

With parties subjected to public scrutiny, abuse of money in politics will, hopefully, be curbed.

> ·Terence Gomez is with the Faculty of Economics & Administration, University of Malaya.

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