Labour: PN loan scheme 'secret, not guaranteed and lacks transparency’

Accusing the opposition of going against the spirit of the new party financing law which was backed by all parties, Labour today said that the PN loan scheme is secret, is not guaranteed and lacks transparency.

In a press conference by justice minister Owen Bonnici and parliamentary secretary for planning Deborah Schembri, the two Cabinet members dismissed the scheme which they said “goes against the PN’s promised politics of honesty and transparency.”

Schembri said the scheme raises a number of questions, primarily who will loan the PN money and how these laons will be repaid.
last week, the PN announced a scheme seeking financing from small loans of €10,000 on an interest rate of 4%, but the party is not obliged to publish the names of its creditors because the scheme is not a donation.

At a compound interest rate of 4%, the principal €10,000 would rise to €14,802 after 10 years.
Malta’s party financing law considers only loans granted to political parties at more favourable rates than commercial loans, as donations.

When asked whether the loan repayment was guaranteed, PN secretary general Rosette Thake said “nothing in life is guaranteed.”

Schembri said this confirmed that the PN can receive unlimited amounts of money without being obliged to reveal who the donors are.

She added that no guarantee of repayment is being provided and the PN is asking for loans without revealing the extent of its financial woes, with the party’s debts thought to be of around €8 million.

Bonnici, who piloted the party financing law, highlighted the legal requirements for parties to declare donations, capped at €25,000 from a single source, under the new law.

“All these factors have created a key law guaranteeing honesty and good governance . But now the Nationalist Party launched a secret, unsecure and non-transparent scheme,” he said.