Of state funding and public trust

Justice Minister Owen Bonnici has apparently ruled out any discussion on State financing of political parties in the ongoing debate on a party financing law.

“Let’s first make sure that we set our houses in order by enacting a law which increases accountability before introducing state funding for parties,” Bonnici said, adding that the law aims to bolster the credibility of the political parties concerned.

At face value Bonnici is correct, although it is debatable whether his official reason for shooting down the State financing model is the true one. There are weighty political motivations for the government to oppose such an idea. Polls reveal that an overwhelming majority disapprove of the proposal, and that the Labour Party would almost certainly stand accused of passing legislation to favour itself – in direct contrast to its electoral manifesto.

Elsewhere, the Nationalist opposition’s sudden insistence on State-funding, when it had resisted the suggestion when still in government, has clearly been linked in the popular imagination to the same PN’s widely-known financial crisis. The public would no doubt interpret such a move as a State bail-out – something the same public was denied when it came to the energy surcharge – and in any case, the Labour Party has an obvious interest in withholding any such lifeline to its political opponents.

But at the same time, one cannot reject the idea of State funding out of hand for the simple reason that it is unpopular. Bonnici has a point when he argues that there are other more urgent priorities to tackle first: and the key observation is the lack of trust in political parties.

From this perspective, there is a vital step that should have been taken even before kick-starting the Parliamentary debate on party financing. Proper diagnosis has to take place before a cure is determined: and to date there has not been enough soul-searching among political parties as to why they are such an untrusted category.

The answer is too complex to go into in detail here; but it involves a string of corruption scandals, and factors such as the two million in accumulated debt owed by the two parties to Enemalta… among other examples of ‘some animals being more equal than others’.

All this has contributed to a widespread loss of trust, and accounts for the strong negative public reaction to a proposed law which would only add to the existing imbalance by financing political parties directly through taxes.

The reaction is entirely understandable, but at the same time it is arguably misplaced. In an ideal scenario, having State-funded political parties would be a powerful tool in the fight against corruption.

The present laissez-faire attitude towards political parties stems also from general recognition that parties do need funding to enact their primary mission (i.e., as Chris Said described it, “to be a voice for the people”). There are also strong arguments in favour of having stable and functional political parties, especially in a scenario where the party in government enjoys such an unassailable majority.

For these and other reasons, the public has almost resigned itself to the perception that both parties are deep in the pockets of the commercial class: and the lack of checks and balances with regard to legislation also means that the party in government has infinitely more leverage and bargaining power when it comes to attracting such donations.

What is at issue, therefore, is not the access of political parties to funding – we all agree that this is necessary for the sake of democracy – but the source of this funding, and the possibility of governments becoming obligated to their secret donors. State funding would go some distance towards addressing this problem: unlike commercial entities, the State cannot place demands on government in return for its investment.

But eliminating the threat altogether would require more than State funding. Bonnici talked of the need for checks and balances and for political parties to be transparent and accountable. But while the white paper focuses on such issues as maximum caps for private donations and a revision of electoral spending laws (among others), it is vague on the subject of penalties for parties which fall foul of the law.

More controversially, the bill proposes transferring responsibility for discipline to the Electoral Commission… ignoring the fact that the commission is composed of nominees by both parties, which would therefore be sitting in judgment upon themselves.

On another level, this also overlooks the fact that financial crimes are elsewhere subject to criminal sanctions. Technically, the act of accepting an unsourced donation over a certain amount is already in breach of the Money Laundering Act. There is no need to empower the Electoral Commission to investigate cases and take disciplinary action. There are the police and the law courts for that purpose.

In brief, the discussion on party financing should focus less on the possible benefits to the parties, and more on bolstering the parties’ credibility by making them subject to as rigorous a set of checks and balances as applies to everyone else.

Only after a proper disciplinary framework is in place should the possible benefits of state funding be discussed.