Transparency matters

  • Economy
  • Wednesday, 19 Oct 2016

SINCE the inception of the National Transformation Programme in 2009, one of the National Key Result Areas (NKRAs) that received particular public attention as a critical area that required reform was the Anti-Corruption NKRA. Among the proposed initiatives and building blocks in institutionalising anti-corruption enforcement was the governance of political financing.

The roadmap basically called for increased transparency and accountability in the political financing process. The following broad recommendations were derived from global best practices:

1. Financial donations to political parties should be made under the names of party accounts rather than individual accounts to ensure transparency and individual integrity

2. Donations must be receipted so it is clear who are the donors

3. The accounts of the political parties and the donors must be audited and made available for public disclosure

In 2012, additional recommendations were put forward towards institutionalising clearer guidelines and audit processes of all party accounts to increase transparency in the utilisation of the political fund; as well as enhancing our legislations to regulate and govern political parties’ funds, especially during election campaign season.

However, despite the well intent nature of these proposals, and despite support from the Prime Minister and Deputy Prime Minister, we were not able to garner the unequivocal support from all political parties towards the proposed recommendations to ensure measured success.

To lend further weight to the agenda, the Prime Minister had in August 2015 announced the formation of the National Consultative Committee on Political Funding (JKNMPP) to advocate constructive regulation structure to resolve issues surrounding political financing.

A year on, the JKNMPP announced 32 recommendations, which encompasses three main areas:

1. the implementation process,

2. the need for a new law and its content, and

3. wider and longer-term issues.

A critical anchor in this set of recommendations is a new statute called the Political Donations and Expenditure Act (PDEA). The PDEA proposed will cover all aspects on political donations and its administration; their expenditures; state funding of political activities and regulating the relationship between politics and business.

The statute includes a provision to set-up the Office of the Controller of Political Donations and Expenditure, as the internal governance mechanism. It also assumes the Registrar of Societies’ function in receiving annual accounts of political parties as well as Electoral Committee’s responsibility in regulating election spending.

The committee has ensured that the office will have in place the necessary check and balances to ensure transparency and impartiality in its function. A board comprising credible figures who are non-active politicians is mandated to oversee the operations of the office. The committee also proposed for a Parliamentary Standing Committee on Political Financing to be created, comprising representatives from all political parties, to scrutinise the work of the Controller on behalf of Parliament.

Transparency and accountability measures in the act is further emphasised by the committee’s recommendation that stipulates donations to political parties and individuals must be robustly regulated, and specific designated organisational bank account must be used to receive all forms of donations. Political parties will be held responsible to keep detailed records and documentation of all income and expenditure, to allow for regular auditing purposes.

One of the recommendations made by the committee that received some significant critic was on the removal of candidate or party funding limit, including during campaign period. The concern raised was that the removal of a ceiling expenditure will not allow a level playing field between political parties.

Let me be clear, the mandate of the JKNMPP is to address reform in political funding regulations. The measures and recommendation proposed under this act enforces greater transparency and accountability, addressing systemic governance issues in political financing. Enforcing funding limit clearly does not address this.

The ability of the respective parties and/or individuals to raise the amount of funds needed for campaigning should be done on the back of the respective party/politician’s manifesto and ability to garner such funds through legitimate means.

In fact, to encourage the civic participation to actively participate in the political landscape, the recommendations also proposed that donations to political parties are to be declared tax-deductible.

To my mind, the recommendations made by the JKNMPP is comprehensive enough, as it addresses the basic systemic issues in establishing a fundamental governance structure that is missing and needed to regulate political financing.

The key recommendation of having the PDEA to be implemented as a legal instrument embodies the extent of political will we are pushing for. The PDEA aims to provide a robust regulatory framework from which political party donations and expenditure will be governed, with measures, check and balances which are enforceable by law in place.

My column in August 2015 stirred the hornet’s nest. I say here again what I said then – The implementation of reforms should not be based on requisites. It merely has to be done! So, let us just get this done.

The first step is for all the political parties to wholeheartedly embrace these recommendations, the act and process it governs and vote for immediate implementation. The path ahead may still be a cobbled one but we must take this first step, in order to bring back the integrity and improve the trust deficit in the overall governance that is lost in the eye of the public.

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