“But we want to set a gold standard in accountability. The public deserves officials who make declarations under oath that they didn't enrich themselves.
“Knowing full well, had they lied, they could be arrested immediately.”
That was Rafizi Ramli in a tear-jerking video released by Invoke, the non-profit he helms, just days after 30 MPs and politicians from the opposition bloc publicly declared their assets at a shopping mall.
The idea behind the declaration is to effect change in the country’s political culture, he said and the 30 are part of the first batch from marginal seats nationwide.
They also signed a legally binding agreement which, among others, required them not to renege on their vows in exchange for Invoke’s services, which include big data analyses and strategies.
Granted that such a spectacle elicits an emotive response, some lauded the move but called for improvements while others found it strange. A news portal even drew up a table and ranked the 30 in order, from richest to poorest.
On paper, a public declaration of assets or finances is believed to:
- increase transparency and the trust of citizens in public administration, ultimately showing that civil servants have nothing to hide;
- help heads of public institutions prevent conflicts of interest among their employees and to resolve such situations in order to promote integrity within their institutions;
- monitor wealth variations of individual politicians and civil servants to dissuade them from misconduct and protect them from false accusations.
The concept gained popularity after World War 2, where the US had to confront growing government and recurrent corruption scandals. But it was only after scandals such as Watergate where Congress enacted the Ethics in Government Act in 1978.
As for the UK, it adopted its Prevention of Corruption Act as early as 1889 but parliament was reluctant to impose strict disclosure rules. It was only in 1974 where the House of Commons introduced the Register of Interests, but even that law is open-ended, with some considering that it’s up to the individual MP to determine the extent of his or her disclosure.
Other countries – both matured and developing democracies – have also implemented some form of public disclosure legislation, but the transition from theory to practice has been fraught with difficulties. So, what more an organisation like Invoke?
A public declaration of assets is done for political mileage not transparency per se
There’s always political gain when a declaration system is introduced and developed, whether to boost confidence in an incoming government, to save the chances of re-election for a scandal-ridden political party or to please international donors.
For example, in central and eastern Europe, the strong motivation of many countries to join the European Union prompted adoption of various anti-corruption laws. Some of these countries thought that introducing asset declarations could be an easy way to demonstrate their determination to do something about their problems with corruption.
Some countries on the other hand publicly declare their assets due to international organisation and donor pressure e.g. from the Council of Europe, USAID, and the World Bank.
Usually, compliance with international standards or donor requirements would not be among the stated purposes of the declaration systems, but it can be constituted as a significant or decisive incentive for their adoption.
If Malaysia took a more serious approach to asset declarations, this point might explain the move, as one of the key metrics used to prove political legitimacy is economic growth, particularly validation from the likes of the World Bank and rating agencies such as Fitch and S&P.
To be fair, Invoke was upfront in stating that candidates who disclose their wealth, and upheld their pledge to bring a series of reforms, would be provided election campaign funds of RM20,000 and RM10,000 for parliament and state candidates, respectively.
Part of the package is also having the organisation help out with campaigning affairs. But the cost however doesn’t amount to much for a full-on campaign. A candidate running for a state seat will need to pay a deposit of RM5,000 while he/she will need to cough up RM10,000 to run for a parliamentary seat.
Someone like Lim Guan Eng of DAP, for example, who is Air Puteh assemblyman and Bagan MP, if he were to defend his seats in the coming general election, will need to pay upfront RM15,000.
Despite Invoke’s sales pitch that it promises cost-effect campaigning, even a state-seat contest, the amount allocated by Invoke – and this subject to its terms and conditions – is paltry.
Which raises another important point: are the candidates required to declare their extra-campaign funds and reveal their sources?
That’s the acid test right there; it’s not the values but the sources – the companies, the corporates and magnates, as well as institutions, including religious and non-religious ones.
The problem with Invoke’s declaration system – or of any new system – is the stress on such symbolic gestures naturally lead to a lack of genuine policy goals. This results in a disregard for the costs and negative side effects that may occur and recur after this declaration.
Many usually underestimate the cost of running an efficient public declarations system
It also reveals a sense of carelessness in the need to set up a truly effective implementation system. Aside from the election funding poser, such signs are obvious just by going through all 30 statements.
For example, Johari Abdul is the MP for Sungai Petani, a constituency in Kedah. But in his declaration, he is Pandan MP. Coincidentally, the Pandan MP is Rafizi, the project’s initiator.
Nothing much that can be read into this but an error on the part of Johari and his auditors and the commissioner of oaths. Such documents should be free from petty mistakes simply because it is supposed to hold an MP accountable.
One criterion for judging a declaration system is scrutinising the disclosure forms. On a country-level, there are large differences in the ability of a citizen to access both empty and filled out forms. For Invoke, the empty form is not available for download, but the filled out ones are.
The problem is the filled out ones lack consistency. Some politicians try to give an itemised breakdown of their wealth; others seem to skip the details such as Tan Yee Kew, treasurer-general for PKR.
On a grander scale, forcing to public servants to come clean with their income and assets is not cost free. First, there is the administrative burden it puts on the government. Personnel must be assigned to review and maintain disclosure forms and train filers in how to comply.
Simply put, the greater the number required to file, the greater the administrative cost. Invoke’s exercise seems to lack all these finer details and it seems to imply that asset declarations are a one-off exercise. They are not.
It matters more if the top leadership led by declaring their assets and finances
Malaysia has a framework concerning asset declarations. For example, Federal Territories Minister Tengku Adnan Mansor said he declared his assets to the prime minister every year, adding that he would not make it public for fear of being targeted by criminals.
But he is not the only one who declares assets confidentially; other ministers and senior government officials do the same, and only the Malaysian Anti-Corruption Commission (MACC), which is also under the purview of the prime minister, has access to these declarations.
Civil servants and their family members are also required to declare their assets but only to their respective managers or heads of departments. On a parliamentary level, a code of ethics was approved by cabinet but this is not legally binding.
On a state-level, Penang and Selangor, which are led by the federal opposition, have their own mechanisms, but this is done voluntarily, where members of the executive council are encouraged to declare their assets.
Both screengrabs are taken from the Selangor government’s website. Its menteri besar, Azmin Ali, has not declared his wealth while an executive councillor, Teng Chang Kim, has. That’s the problem with the system. In fact, even Teng’s declaration is dated 2014.
So while people may laud Invoke’s initiative, it only makes sense if the system required more information and imposed a higher level of public disclosure from political and senior public officials.
In this context, the first batch has to consist of disclosures from the likes of Azmin and Wan Azizah Ismail, the president of PKR.
Why such insistence on high-level disclosures? There’s a higher risk of conflict of interest where influential private parties are more interested in engaging political/senior rather than mid- or lower-level officials in their activities.
There’s also a higher risk of corruption. This is related to the above where political or senior offices usually open greater opportunities for illicit gains, hence greater risk of corruption.
It allows for the evaluation of political decisions and candidates. The character of political decisions differ from that of administrative decisions and actions, in that the former have usually a much broader scope of potential beneficiaries (or those whose interests suffer) and discretion.
So their proper evaluation can be performed if all the important interests of a political decision-maker are known. Moreover, for offices subject to popular election, it is important that voters have the broadest possible information about candidates.
There’s less relative weight of the requirement to protect privacy – it is often recognised that the public interest weighs more than the right to private or political/senior office holders compared to mid/lower-level officials.
In some countries, a line is drawn between public officials and civil servants. This is to either impose a different set of rules or to exempt civil servants altogether from declaring their assets.
Lastly, economy of resources. The confinement of the circle of persons covered to political officials reduces the administrative burden of running the system due to the smaller number of such officials.
Even on Invoke’s list, these potential conflict of interest problems arise and it is surprising such reporting is thin on this.
For example, Nik Nazmi sits on the board of trustees for Yayasan Selangor, an influential state-owned foundation. Yet his involvement with the foundation, and the possible remuneration for being a board member is not itemised.
Wong Chen, while providing a decent breakdown of his wealth, mentions that his community centre is funded part state government, part donations, part salary. He fails to mention the source of these donations.
Azmin and Wan Azizah aside, another person who should provide an itemised list – should he declare his wealth – is Subang MP Sivarasa Rasiah, who is an independent non-executive director for state-owned listed company Kumpulan Perangsang Selangor Berhad.
A Scandinavian tale
Scandinavian countries enjoy one of the lowest levels of perceived/reported corruption, according to a few surveys and studies.
The levels of transparency and public trust in the civil service and public administration are high and some form of disclosure is required of all top civil service and elected officials in all these countries, who have to submit declarations when joining public service and upon change of circumstances.
The main emphasis is placed on accountability of elected officials within legislature and appointed officials, with Sweden being the exception where senior public executives are under stricter rules than those applied to the legislature.
What’s publicly disclosed are: assets and liabilities, loans, sources and levels of income, additional employment, gifts and employment history. These are made public and available online.
Scandinavian countries also pay close attention to corruption risk sectors such as tax and customs administrations and financial and procurement services.
In some cases, selected institutions have separate rules on financial disclosure, such as the Danish Financial Supervisory Authority or the Norwegian Tax and Public Procurement offices.
Also all these countries require identification and reporting of conflict of interest in one manner or another to managers within the structure of each agency. Also, there are select institutions involved in the process, such as the Ministry of Government and Labour Administration of Norway.
Inspections to check the accuracy of declarations of interests are made but not regularly, and while disciplinary sanctions exist for violation of provisions related to conflicts of interest, they are rarely applied as it is considered to be the personal responsibility of each civil servant to prevent such situations.
This approach by Scandinavian countries represent an integrity-based ethics management system which relies on encouragement of integral behaviour rather than its enforcement through punitive measures and strict control.
Such an approach can only work in countries with an established integrity culture, a history of free access to information and a high level of confidence and trust in the public service.
Malaysia does not score high points on all three factors. The federal government aside, even the crown jewels of the opposition – Penang and Selangor – fail to shine when it comes to asset declaration.
That’s what Invoke’s policymakers – if the organisation had any in the first place – also failed to consider. Something more down to earth: culture.
Champions of the public declaration of wealth believe such a system helps to instil a fear in politicians and officials, therefore making them accountable or at least more responsible when it comes to dealing with money.
That is false. Studies show that there is no convincing evidence that even covering the broadest possible circle necessarily leads to more effective prevention of corruption. The logic is simple: corruption helps shape anti-corruption legislation.
A good example is India. There, MPs and state legislators are required to declare their assets, including that of their dependents’, on a yearly basis after winning an election. These declarations are available online for voters to scrutinise.
Also, this law is broadly applied, from candidates contesting elections to local self-governing agencies in certain states in India.
This may sound exemplary but according to the World Bank Enterprise Survey, about 22.7% of firms experienced at least one bribe payment request during six transactions dealing with utilities access, permits, licences, and taxes. The average for South Asia is 24.8%, while globally, it is 18%.
On the Corruption Perceptions Index, the country ranks 79, far below Malaysia, which lacks such strict regulations. But that’s nothing to shout about either.
On that same World Bank survey, In Malaysia, about 28.2% of firms experiencing at least one bribe payment request during six transactions dealing with utilities access, permits, licences, and taxes. The average for East Asia and Pacific is 29.4%.
But this does not mean asset declarations should be swept aside. Besides the political benefits, a public declaration of assets allow other players in a democracy such as a free press and civil society to act as a check and balance for politicians.
After all if they are crowding out the market when it comes to tenders and projects, or allowing business connections to influence their policymaking decisions such as voting down a certain bill, or even abusing taxpayer money – they should be held accountable.
That is as far as asset declarations go. It is not the answer to plug corruption neither is it a guarantee of commendable political financing, simply because corruption also plays a role in the formation of anti-corruption laws.
What it does is help citizens track spending and hold lawmakers accountable for the way they use public funds.
As for Malaysia, the starting point of this debate is to decide whether it wants its MPs to be full-time and only after this, should they devise a legal framework on public disclosure.
But studies on asset declaration point to two important lessons: that the most effective laws focus on the sources of the MP’s assets and activities, and secret disclosure, in contrast, does not do much for political accountability.
Keep us ad-free and independent. The Other is the result of hundreds of hours each month. If you love what you read, visit our Patreon page and consider being a patron with a recurring monthly donation of your choosing. Or email us at firstname.lastname@example.org to explore other funding options.