‘No tangible progress’ in party financing – Council of Europe

The Council of Europe’s Group of States against Corruption (GRECO) has concluded that Malta is some way off from implementing recommendations over political party funding, with all six recommendations remaining “partly implemented.”

Describing the situation as “globally unsatisfactory,” the council said Malta “has not made any tangible progress” in introducing party financing legislation.

Last month, government launched a white paper to regulate the financing of political parties and candidates 165 years after the first general election was held in Malta.

Malta, is the only country in Europe, alongside Albania, not to have a law regulating party financing.

While noting that Malta had made progress in introducing amendments to the Criminal Code over corruption, GRECO said that it is “deeply concerned that four years since the adoption of the Evaluation Report, a comprehensive legal framework for regulating political financing continues to be missing in Malta.”

In its latest report on Malta issued today, GRECO welcomed and “fully supports” the white paper government published on party financing, however pointed out that authorities are “encouraged to pursue their efforts vigorously and to better align their draft legislation” to the previous recommendations.

The report concluded that the draft legislation could be improved by substantially reducing the threshold for disclosing donations provided to political parties and introduce a ban on anonymous donations.

GRECO also underlined the need to develop additional rules on the presentation of annual statements of accounts to the Electoral Commission as well as their subsequent disclosure to the public.

Moreover, the council called on government to refine further the supervisory mandate of the Electoral Commission and consider the need to achieve further balance between criminal and administrative penalties provided for violation of the political funding rules.

In view of Malta’s failure to implement its previous recommendations, GRECO has formally asked Malta’s head of the delegation to provide a report on the progress made in implementing recommendations, “as soon as possible” before 30 June.

Stressing that none of the six recommendations have been implemented satisfactorily or dealt with in a satisfactory manner,

GRECO called on government to “authorise, as soon as possible, the publication of the report, to translate the report into the national language and to make this translation public.”

Under the proposed law, political parties will for the first time ever be obliged to declare and register donations above €10,000, while any donations above €50,000 emanating from the same source will be prohibited.

In recent weeks, Parliamentary Secretary for Justice Owen Bonnici Parliamentary did not rule out reducing the maximum amount that can be donated to political parties set out in the white paper launched in February.

The white paper's five sections deal with; the regulation of political parties' statutes, the registration of parties with the electoral commission, streamlining the parties' accounts, the regulation of donations by private individuals or companies and the regulation of parties' expenditure during electoral campaigns.

For the time being, state aid is being excluded, but the draft law envisages the introduction of thresholds to private donations, while it also proposes the revision of the inadequate amounts political parties and candidates are allowed to spend during campaigns.

The white paper is proposing that donations below €500 in one calendar year do not need to be registered and donators will remain anonymous while donations, sponsorships and services rendered to parties which amount to €500 or more need to be registered.

Although these proposals are still open to discussion, the draft law proposes that single donators cannot give parties or candidates more than €50,000 in 12 months. Donations between €10,000 and €50,000 need to be registered in the party's accounts and these details together with the name and address of the donator need to be passed on to the Electoral Commission.

The white paper is also proposing that the paltry amounts candidates are currently allowed to spend in an electoral campaign be revised upwards. The ceiling for general elections is set to increase from €1,400 to €25,000.

The proposed ceiling for European elections is €50,000 while that for local elections is €5,000.

The law is expected to be introduced before parliament's summer recess, following a consultation period which will include the submission of proposals by all stakeholders and the public by March and a number of meetings with Alternattiva Demokratika, Labour, PN and the electoral commission.