PN president suggests state financing of political parties

Ann Fenech hits out at Illum editor for editorial criticising role of intermediaries in Panama Papers, parliamentary secretary Ian Borg says Panama case has 'blown up in PN's face'

PN executive committee president Ann Fenech
PN executive committee president Ann Fenech

PN executive president Ann Fenech proposed that the state finance political parties, as a means of reducing the party reliance on donations for funds.  

Speaking on Monday night’s edition of Reporter, she recounted how Labour MP Charles Mangion had proposed something similar back in 2009. Back then, the PN had shot down the proposal as “unacceptable”.

“Labour have now changed their tune, because they got to sell Australia Hall,” she said.

Her proposal was instantly shot down on the programme by EU funds parliamentary secretary Ian Borg, who argued that the PN wanted taxpayers to fork out money for its debt.

Fenech refused to say how much debt the party had accumulated, bluntly telling Borg that it is “none of your business”.

The PN executive president had to fend off sharp criticism from Borg about the party’s ‘Cedoli’ loan scheme, which the parliamentary secretary insisted was “corrupt” and a means to bypass the party financing law.

The scheme allows people to anonymously donate €10,000 to the party, that will be repayable within ten years at a 4% interest rate.

“Previous PN administrations had refused to introduce a party financing law, and [Opposition leader] Simon Busuttil admitted himself that the Cedoli was introduced to bypass the new law,” he said. “Call them loans, donations or whatever you will, but the fact is that the names of the loaners will remain secret. The scheme is guarantee for corruption.”

However, Fenech retorted that a clear difference exists between donations and loans, and that loaners will not expect any future favours in return as people who give donations might.

“I can assure you that no dubious characters are involved in the Cedoli; would a criminal really choose to loan €10,000 to the PN? How is the scheme so secret when the Cedoli are issued through cheques from Maltese banks and the loaners will be repaid through cheques?

“The PN has an asset base worth millions of euro, so there’s no worry that the loaners won’t be repaid.”

She drew parallels with how Labour had introduced a similar Cedoli scheme back in the 1990s, only without any interest due on the loans.

“Some people who loaned Labour money back then are still waiting to be repaid,” she said.

‘Illum editor should be ashamed of himself’

Ann Fenech had harsh words for Illum editor Albert Gauci Cunningham, taking him to task for an editorial that criticised the role of intermediaries – including law firm Fenlex, of which she is a partner – that were named in the Panama Papers.

“If an intermediary’s job includes telling people where to invest their money, then it follows that they’d know full well about Panama’s reputation…as a place commonly used by people who want to launder dirty money,” he wrote. “If an intermediary knows that his client is hiring his services to deposit money in a dubious and dirty jurisdiction, then he is in partially guilty as well.”

“Gauci Cunningham should be ashamed of himself for comparing my work to [minister] Konrad Mizzi opening a company in Panama,” she said, noting the editorial’s accompanying cartoon of herself and Mizzi singing at the ‘Panamavision’.

Fenech insisted that slip-ups by previous PN administrations paled in comparison to the “obscenities” that have taken place under Labour.

“It started from Muscat renting his own car to himself, and it was followed by Sai Mizzi’s well-paid job, and the Café Premier, Gaffarena and Panama Papers cases,” she said. “The vast majority of the 36,000 people who handed Labour victory last election voted for them because they were fed up with the PN and had thought that Muscat would deliver on his promises of transparency and accountability. These people are now disgusted.”

Ian Borg retorted that the Panama Papers story “has blown in the face of the PN and its allies”, following revelations of intermediaries associated with the party.

“They have now changed their dictionary, and indeed Fenech avoided the subject of offshore Panamanian companies and instead chose to speak about Muscat’s car,” he said. “We still don’t know who the beneficiaries of the companies the intermediaries helped set up are, and whether they are connected to the PN.

“Unlike Muscat, Busuttil has not taken a decision on people close to the party who have been named in the Panama Papers.

Fenech hit back, arguing that a world of difference exists between a law firm offering its services to clients and a minister [Mizzi] who “started to try to open a company in Panama five days after the election”.

“Labour had stuck my face on a billboard, insinuating that I had owned a company in Panama, although they knew that financial services isn’t my field and that I never did that sort of work.”