Transparency in political party financing
Political party funding for campaigns and all other activities need to be regulated unambiguously – with violations closely monitored and heavily penalised so as to eliminate corruption.
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A political party is defined as an organised group of people with at least roughly similar political aims and opinions, that seeks to influence public policy by getting its candidates elected to public office.
Political parties are crucial for democracy and governance. The Maldives' registered its first political party in 2005, with the Maldivian Democratic Party registered on 26 June 2005. Since then, 9 more parties have been registered.
The Elections Commission, in its 2020 Annual Report, said that two more parties had been given approval to start the process to register a party in 2020. Two more parties, the Maldives National Party and the National Solidarity Party were given approval to start the process in July and August 2021, respectively.
Political parties need funding to finance their activities and campaigns. However, if the sources and use of funds raised are not regulated, it creates the motive for corruption. It also makes it harder for voters to make uninfluenced decisions. Increased pressures to raise funds leads to increase in the power of pressure groups over the political party – instead of the public or voter interest, the party will tend to, or be, influenced to prioritise the interests of the donor; money matters and those who 'donate' more matters more.
One of the more prominent cases that involve political financing is the claim by former President Abdulla Yameen, in response to allegations, and later convicted, over USD1 million deposited into his personal account, was in fact part donation for 'political endeavours’ and all such payments were collected by former Vice President Ahmed Adeeb. Ahmed Adeeb was convicted for the embezzlement of over USD200 million from Maldives Marketing and Public Relations Corporation (MMPRC) and as per court verdict these funds were transferred from SOF Company, which was known to have laundered money from the MMPRC. Few, if any, have raised any questions as to why the funds were deposited via cheques into his personal account from the embezzled funds just after the assassination attempt on the former President and the first family or the source of funds.
This makes it critical, in the interest of the public, to regulate the sources and ways of raising money to fund political party activities. There are two ways of doing this: through regulations that impose limits and bans and require disclosure; and through the provision of financial subsidies, either through a direct contribution from state coffers or other concessions such as mandating access to state media on an equal footing for all parties.
Political financing in the Maldives is covered under various laws to include both party and campaign financing. The Political Parties Act 2013 stipulates that parties can raise financing through members or well-wishers, government subsidies, from business transactions, fund-raising campaigns, and through debt. It also requires the party to maintain a register of the donor, their address and details of the assistance provided.
It further bans accepting any funding from foreign government, organisations, institutions or any other foreign party, or anonymous donors, unless express written approval is sought from the Elections Commission.
On 7 November 2018, PSM reported that President-elect Ibrahim Mohamed Solih had departed to Saudi Arabia to perform an Umrah. They reported that he had allegedly travelled on a private jet arranged by the Saudi government, bringing into question why a foreign government will make such arrangements for a president-elect. Solih is also reported to have held discussions with Saudi government officials, although no details of the discussions have been published so far. On 2 December 2019, local English news website The Edition reported that President Ibrahim Mohamed Solih and Speaker of Parliament Mohamed Nasheed had met with the Crown Prince of Saudi Arabia, Mohammed Bin Salman, during an official visit to the United Arab Emirates. No details are available on what was discussed at this meeting either.
Interestingly Article 42 of the Act states that the income and expenditure of the party must be known to all members of the party. However, a cursory glance through the websites of the three largest parties show that none of this information is made public. There are also no limits on party financing being used for election campaigns, nor any requirements to submit reports on this to relevant authorities.
The General Elections Act stipulates caps on a political candidate's campaign expenditure, limiting it to MVR2,000 per head, based on the number of eligible voters in the constituency that the candidate is contesting in. The Act also bans candidates from accepting funding from foreign governments, institutions, organisations and individuals, and limits financing from an individual to 0.5 percent and from a legal entity to 2 percent of the total resulting from the MVR2,000 calculation above. Funding has to be deposited and expenditures made from a specific account designated specifically for the campaign.
A detailed audited report on funding and expenditure is required to be submitted to the Elections Commission within 21 days of the election. These articles are applicable to the presidential, parliamentary and local council elections.
A 2019 Transparency International report on the role of political party finance reform in the transition from dominant to competitive party systems, notes that 'the abuse of state resources confer clear benefits on incumbent politicians and parties, and creates an unfair playing field.' This remains an issue in the Maldives as well, with no regulatory framework to define and limit the use of state resources by the incumbent.
On 18 August 2021, mainstream media reported on President Ibrahim Mohamed Solih, during an official visit to Thaa Atoll, meeting with Maldivian Democratic Party members as the party's top leader. The visit was an official one made as president, and hence there is room to claim that state resources were used during the visit for the party, or the party leader's benefit.
A 2016 study carried out by Transparency Maldives in collaboration with the UK's Foreign and Commonwealth Office stated that the 'single most important step towards regulating political finance and eliminating undue influence posed by money is proper disclosure of lawful financial reports.' The study found that none of the dimensions assessed on the legal framework on political financing fell within the 'insufficient' range, but that 'in evaluating practice,' many fell within the 'insufficient' range – meaning that the laws and regulations are in place, but as is usual, practice and adherence to these are lacking or inexistent.
The onus in the current legal framework for this is placed on the Elections Commission and the Auditor General's Office, in that parties and candidates for elections are required to submit their financial reports with details of financing to them. They have so far, not published this information, and without this disclosure, there is 'no way of determining how much money is circulating in the political system,' and who is in fact controlling the purse strings.
