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Stabroek News

Trafigura: A case for regulation
published: Sunday | October 15, 2006


Robert Buddan, Contributor

Democracy does not just happen and government must be governed. We regulate democracy and government through laws. Regulations fail when rules are not complied with, when they are not clear, when they are not enforced, or when the laws are not there to back them up.

The resignation of Colin Campbell, a Cabinet minister, touches on all of these things. Our political order is not without regulation. We have an Opposition and civil society to act as whistleblower, a contractor-general to investigate conflicts of interests, and new ethics officers in ministries to advise on judgment. We are developing campaign finance regulations to govern money in politics.

POLITICIANS AND BIG MONEY

Campaign finance regulation has been on the political agenda, at least since 2002 when Professor Trevor Munroe raised it in the Senate. Sometime in 2004, in a newspaper article, Anthony Hylton, the present Minister of Foreign Affairs, appealed for regulations. The PNP has shown an interest in the German model and Jamaica was invited to send a delegation to Germany to study the model first-hand.

A delegation consisting of Mr. Hylton, Professor Munroe, and independent member of the Electoral Advisory Committee (EAC), Mrs. Dorothy Pine McLarty, went in June 2005. The JLP, also invited, declined to participate. The Friedrich Ebert Stiftung Foundation (FES), a German-sponsored organisation, arranged a visit to Jamaica in return. Professor Wolfgang Zeh, director of the German Bundestag (Parliament), who administers the German campaign laws, came to Jamaica, in July this year. He met party and independent members of the EAC. He spoke at a public forum as a member of a panel at which Professor Errol Miller, chairman of the EAC, and I also spoke.

The matter has gone beyond the parties and the EAC, to Parliament. In May 2003, the Senate passed a resolution for a national commission to be established to consider campaign finance issues and make recommendations to Parliament for relevant legislation. In May this year, independent Member of Parliament, Abe Dabdoub introduced a resolution in Parliament for a law on funding political parties. An Electoral Commission (Interim) Act is now being debated in the House for an electoral commission to decide which political parties would be eligible to receive public funds, powers to administer this funding, and arrangements for financial disclosure. It would also monitor election spending. In the meantime, the Representation of the People Act has relevant provisions setting limits to what candidates can spend and requires that they report this spending. The Electoral Commission would give these teeth.

THE PRIVATE SECTOR AND BIG MONEY

Bruce Golding put the issue in perspective in an article written for the Organisation of American States in 2004. He said, "There are individuals and companies the principals of which are known to be supporters of a particular political party and who benefit handsomely from government decisions (award of contracts, divestment of state assets, etc.) when that party forms the Government. But even where no quid pro quo exists, it is widely believed that governments, in formulating policies, are mindful not to offend interests on whom they depend for financial contributions.

In a small economy such as Jamaica where some of these interests may be so dominant that a particular government policy may affect them to a greater extent than others, this latent sense of obligation can be extremely pernicious."

Mr. Golding himself admitted that corporations and individuals were extremely reluctant to have their contributions disclosed. Surprisingly, he does not want automatic disclosure of private contributions, preferring that the Electoral Commission only make disclosures with the consent of the contributor or upon judicial enquiry. Otherwise, the commission should be precluded from "disclosing the source of contribution to any political party". This concedes to the very problem he identified. At a PSOJ seminar in May this year, the JLP rejected the recommendation of the MacMillan Task Force on Crime, which Mr. Golding had appointed, that the names of those who fund political parties be made public. Mr. MacMillan is now a JLP senator and that party needs to have an agreed position on this. On Tuesday, the JLP withdrew from debating Mr. Dabdoub's bill.

Senator Anthony Hylton has said that the private sector had put obstacles into the way of an agreement on campaign financing. Bobby Pickersgill alludes to the 'genetic' links between parties and members of the private sector, who, the media point out, can be political 'activists'. Yet, the PSOJ does not seem to have a consensus on campaign regulations either.

WHAT SHOULD JAMAICA DO?

The Trafigura controversy should be used as a case study to further guide us towards campaign finance regulation. There are many issues involved, some of which had not been anticipated and from which we can learn. We need to get the public involved in a discussion separate from the partisan advantages that the issue has excited in this election season. The public needs to know how these laws will affect how our Parliament works, how their bank accounts can be secure, what role the EAC, contractor-general, ethics officers, and political parties will have, and how money influences democracy and government. At the FES public forum referred to above, public interest was limited. The turnout was limited to a women's group, an NDM group, a PNP group, and at least one trade union representative. Private sector representation was either absent or silent. The media showed little interest.

It is the politicians who have taken the lead on this issue with very little moral pressure coming from society. Political parties and Citizens' Action for Free and Fair Elections (CAFFE) have now agreed on some recommendations for campaign financing. But, they alone cannot make a proper law, because it does not concern them only.

The incestuous relationships between parties and their private sector supporters mean that clear responsibilities must be apportioned. Banks too need ethics officers and stronger laws to preserve banker/client confidentiality to protect all of us from political operatives in their institutions. The Jamaica Bankers Association is beginning to respond to this and the Jamaica Manufacturers Association is firm on this.

Since Parliament serves all of us, we also need to say what House rules should apply should a member use illegally obtained information for political purposes, and what process should apply to determine if that member knowingly did so or encouraged illegal access to information.

If we should have a whistle-blowing law to protect such persons, we must also make sure that the integrity of the institution (such as banks and the public sector which hold personal and confidential information on clients and citizens) and all those who depend on them are also protected. Such laws cannot simply protect persons who breach rules without protecting the institutions whose rules are breached.

We would also need to study the rules of the Organisation of Economic Cooperation and Development (developed countries) to combat bribery of public officials and its guidelines for multinationals in order to interpret what commercial agreements are and what donations are, and to have it inspect contracts that we do not have the authority to inspect. How effective are these rules anyway when companies complicit in the UN's Oil for Food scandal are unpunished?

We would also need to bring many 'civil society' or advocacy organisations under the law since they can be conduits for illegal sources and unacceptable forms of contributions. Furthermore, we need constitutional reform to entrench the electoral commission and give it constitutional authority to impeach or impose criminal charges on members of government and Parliament who violate campaign and party laws.

If we made laws only for political parties, we might close one door while leaving many back doors open. This will happen unless we treat the issue as a matter of our democracy rather than merely a matter of political advantage.

Robert Buddan lectures in the Department of Government, UWI. Email: Robert.Buddan@uwimona.edu.jm

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