Summary for Press Conference on 10/9/15, 2pm at Lake Club
Context of Statement: The Problem & Our Concerns
1. Prime Minister Najib Razak has acknowledged the existence of donations from foreign sources to run elections. His statement confirms two issues that have long been viewed as controversial aspects of the financing of Malaysian politics:
> existence of secret political funds controlled by individuals or trustees;
> access to phenomenal foreign funding, suggesting illegal political financing during elections that undermine the legitimacy of parties.
2. Our core concern is the need for an independent investigation into allegations of serious misappropriation of 1MDB funds. This investigation should be completed promptly & in a transparent & accountable manner.
3. However, given Najib’s statements, it is also imperative to immediately reform existing laws on the financing of politics to reinstitute integrity in Malaysia’s electoral system.
Reform the financing of politics
1. We believe that political funding reforms are direly needed to:
> enable fair elections in 2018;
> ensure politicians can act without fear & favour;
> empower a new breed of politicians to enter the political system; &
> ensure all parties have equal access to acceptable financing sources to promote an even playing field in Federal & State elections.
Our ultimate objective is to return to Malaysia the kind of Parliamentary democracy envisaged under the Federal Constitution, through fair elections.
We, therefore, urge the government to urgently follow-up on the following recommendations:
A. Undertake legislative reforms to legitimise political contributions under a transparent & accountable regime:
We welcome the government’s longstanding suggestion to introduce a Political Parties Act (PPA). This PPA should incorporate the following key aspects on the financing of politics:
> Regulations involving different forms of elections:
* federal & state elections &, in future, local elections; &
* internal party elections.
> Public disclosure of sources of funds on a quarterly basis during normal times & on a daily basis during electoral contests.
> Balanced public funding of all parties in Federal & State elections.
> Limits on donations by individuals & corporate bodies, & a cap on funds from anonymous donors.
> Donations channelled via fund-raising managers or foundations also must disclose the original donors’ identities rather than be treated as a single sum.
> Ban on foreign donations as it can interfere with the autonomy & sovereignty of domestic politics & the basis on which policies are promulgated.
> Ban on secret political funds held by individuals or trustees.
> Limits on expenditure during party & general elections.
> Creation of a list of permissible & non-permissible funders/donors. The latter will include GLCs & companies privy to public contracts & licenses.
> Ban on parties holding power at Federal & State levels to launch development programs during an electoral campaign, including those that involve a transfer of cash, material goods or benefits in kind that can be construed as vote-buying.
B. Undertake institutional reforms to ensure the independence of the Election Commission (EC):
1. Under the present system, the two major institutions responsible for monitoring elections & parties are the EC & Registrar of Societies (ROS). Parties are regulated by the Societies Act, which also oversees welfare & social bodies. The EC is responsible for conducting elections, keeping electoral rolls & reviewing the division of the country into parliamentary & state constituencies.
2. EC members are appointed by the Agong on the recommendation of the Prime Minister. The formation & running of parties are overseen by the ROS which falls under the jurisdiction of the Minister of Home Affairs. Under this system, the executive arm of government has direct or indirect control over the governance of parties & the running of elections, a core factor that has to be reformed
We call for the re-constitution of the EC as a National Election Commission (NEC) to:
> Ensure effective participation of all arms of Government, with the provision that one opposition Member of Parliament must serve in this institution.
> Be responsible for the running of elections, re-delineation exercises & the enforcement of legislation pertaining to the running of parties & elections.
> Be empowered to investigate & prosecute alleged breaches in election laws. Such powers are now fragmented amongst the EC, MACC & AG’s Chamber, hampering speedy & efficient conduct of investigations.
C. Undertake reforms to promote citizens’ right to information & State impartiality:
1. Political funding reforms are imperative to identify & prevent conflict-of-interest situations, patronage & corruption. The funders of parties by individuals & groups must be disclosed to ensure that they do not stand to benefit inappropriately from public decisions. For this, freedom of information legislation must be enacted at Federal & State levels.
2. A level playing field during electoral contests is not possible without State impartiality. For example, individuals & businesses financing the Opposition should not be targeted by tax, regulatory or enforcement bodies for investigation. Deliberate acts by public officials to selectively persecute or harass citizens or businesses on partisan grounds should be criminalized.