Updated | Party financing loopholes tailored for PN donors, says Labour

The Labour party said it does not agree with a party financing law that will distinguish between donors who are party members and who are not, if they are to be named publicly.

"The draft which government seems to be proposing to regulate party financing consciously creates loopholes," the PL said in a statement, referring to MaltaToday's report on the draft law scrutinised by the Council of Europe.

"The Labour Party does not agree with the distinction between party and non-party members, which is clearly a strategic loophole tailored to fit particular individuals, some of which can be easily found by going through a Yellow Pages directory," the party said, in a sarcastic reference to claims by BWSC middleman Joe Mizzi to the parliamentary accounts committee, that he elected Vassallo Builders Group to BWSC agents for the Delimara power station extension by picking them out of the Yellow Pages.

The Vassallo Builders Group is owned by entrepreneur and former PN mayor Nazzareno Vassallo.

The Nationalist MP Franco Debono, who is piloting a bill on party financing, is disassociating himself completely from the draft law sent to the Council of Europe's anti-corruption watchdog, insisting that this draft is already superseded.

"I disassociate myself completely from the draft referred to GRECO," Debono told MaltaToday when contacted about its report earlier today, over a draft party financing law that distinguishes between members and non-members.

The draft law on party financing proposed by the Maltese government does not restrict donations made by party members, and sets a high €10,000 ceiling for the publication of the names of other donors.

Labour said the donation thresholds must be realistic and not simply set to pay lip service to regulating party financing.

"The Labour Party has neither seen the Justice Ministry draft nor Franco Debono's draft on party financing. The PL was not consulted and is not aware how many drafts exist and which one, if any, the Prime Minister is supporting.

"Such equivocal episodes, which have now become the order of the day of the Gonzi government, are symptomatic of the mediocrity of the present administration," the PL said.

On its part, the Council of Europe's GRECO (Group of European States against Corruption) has objected to the distinction made in the new law between party and non-party members, and described the €10,000 threshold for the publication of the names of other donors as "critically high".

Franco Debono, who was tasked with the drafting of the party financing bill, insists that he had handed the original draft of the law to the government's head justice unit, which drafts laws, back in March.

Debono insists that GRECO received a "diluted" version produced by the drafting unit, and not his draft.

Debono also told MaltaToday that he made no distinction between party and non-party members in his original draft.

He also insists that the drafting unit's version was already superseded before it was sent to GRECO and insists that the "wrong draft" was sent to GRECO.

"I had already informed them that it was too diluted before they sent it to GRECO and I subsequently made changes to the draft... I can ensure you that it is now compatible with GRECO's recommendations."

He insists that the final version of the law makes no distinction between party and non-party members, while making it clear that donations over €7,000 have to be declared and parties will have to keep record of any donation between €300 and  €7,000. He also insists that the law will make split donations aimed at circumventing the legal threshold a criminal offence.

Debono claims that it was only his determination which kept the bill on the government's agenda. "I found very little cooperation and had to make everything on my own... it was only my determination to push the law which kept things going."

According to Debono the law has been finalised and is completely different from that

presented to the Council of Europe. "I finalised the law with the assistance of two auditors after long meetings in Castille."

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