Corruption, Business and PoliticsChallenges and Solutions

Dr. Fadli ZonChair, GOPAC

(Global Organization of Parliamentarians against Corruption)

Corruption, Business and Politics

Background

Current political system:

Democracy as the only game in town to enable conducive environment

for economic growth.

Creates better governance, more stable and transparent system that is needed for business expansion and nation's prosperity.

Generates a high cost political procedures that may lead to the open opportunity of corruption if there's an inadequate political financing

in democratic process.

Corruption Pervasivenessin Democratic Process – Election

Corruption experiences a massive growing in election years.

Indonesian context: Since direct Presidential elections in 2004 and local

elections in 2005, there has been an exploding campaign cost that may lead to

political corruption.

Political corruption is inherently linked to the way politicians have to raise

funds for their political campaigns and operations from business contribution.

Current Problem on Political Financing

Transparent and accountable systems of political finance that enhance the

integrity of the political process are important for emerging, consolidating,

and established democracies.

However, current problems on election and political financing are:

Deficiency of political parties’ financing

system

The high cost of democracyVS

Indonesian Context

Three main mechanisms of Indonesia’s party financing system:

1) Membership fees; 2) External donation; and 3) State subsidies

Enormous increasing cost of election forces political actors to seek external

funding from big donors to support their campaign financing. The obligation

to "pay back" or "return the favor" of big donors' contribution has gradually

led political parties a sort of vicious circle, which often leads to political

corruption.

Consequences: Biased policy-making and low-quality public services, harmful

for the country.

proposedRECOMMENDATIONS

Increase state funding for political party

Encourage innovation for alternative funding resources

Political party reform (transparency and accountability)

Engage private sector in anti-corruption efforts

Improve oversight mechanism

Increase State Subsidy

Current Regulation

- Each party is funded by Rp. 108 or equal to approximately US$ 0.0081 per vote- The subsidy can only be used for political education and operational cost

Political Party’s Dilemma

- The average needs of political parties annually range from Rp. 150 to 250 billion- Political party can not rely on membership fee and state subsidies- The political parties might seek for external contributions that may affect the

parties’ independency

The Objectives of Increasing State Subsidy

- Reducing the depedency of political parties to get financial support from big donors

- Reducing the potential corruption among the cadres of political parties because of the compulsion to get the funding

- Protect the political parties’ independency to keep fighting for public interest

Alternative ResourceCROWD-FUNDING

Bernie Sanders's Campaign asDemocratic Candidate for US Presidential Election

Sanders’ internet-based crowd-funding raisedUS$ 229.1 million in total which considered as the

second highest earning for single candidate. More than 88% of total contribution came from

small donation of less than US$ 200.

His movement has considered as one of the most successful grassroots campaign in

US Presidential Election history.

Alternative Resources

Party-Owned Business Non-Cash

Contribution

Besides internet-based crowd-funding system, other considerable alternative resources are:

Political Party Reform:Improve Financing Management

Political Party Financing

Management

Transparency

Internal Control

Mechanism

Accountability

Improving the Oversight Mechanism

Engaging Private Sectors inAnti-Corruption Efforts

- It takes two to tango when it comes to corruption, private sector is not the

victim but also the problem

- Encouraging the private sectors to take steps to avoid any corruption in

commercial companies through the implementation of appropriate prevention

procedures

- Empower the relevant institutions’ authority by not only given the task of supervision, but also given the authority to enforce the law

- Civil Society oversight: Educating and raising public’s awareness

Parliament and Anti-Corruption Effort

GOPACGlobal Organization of Parliamentarians

Against Corruption

GOPAC is an international network of

parliamentarians dedicated to combat corruption,

strengthen good governance, and uphold the rule

of law throughout the world.

The central focus of GOPAC is the development of

practical tools and training for parliamentarians, to

assist and support parliamentarians in their

advocacy and legislation to make governments

accountable and transparent. It provides peer

support to parliamentarians engaged in combating

corruption, and relevant training to promote

methods for fighting corruption.

Equipping parliamentarians with comprehensive

knowledge on anti-corruption will strengthen the

internal structure and prevent parliamentarians

from doing misconduct in their offices.

GOPAC’s Focus

GOPAC consists of

5 Regional

Chapters

and

59 National

Chapters

SEAPAC

OCEANIAAPNAC

LATIN AMERICA

ARPAC

Anti-Money Laundering

UN Convention against

Corruption

Parliamentary Oversight

Parliamentary Ethics and Conducts

Participation of Society

GOPAC’s programming model uses Global Task Forces (GTFs) to promote agendas identified by membership through a regionally representative group of parliamentarians that champion specific issues.

GOPAC

Network &

Global Task

Forces

GOPAC’s Effortin Supporting Parliamentary Ethics and Conduct

Through the Global Task Force on Parliamentary Ethics and Conduct,

GOPAC also strengthens Parliamentary ethical system to separate the

Member of Parliaments' public role from any private business interests.

Objective : Preserve the independence of the MPs and to

avoid any possibility that a private business

interest might interfere with their public duties.

Sample : We produced tools and training materials, such

as handbook for parliamentarians in 2013

collaborated with Westminster Foundation for Democracy

In partnership with the UNDP, Islamic Development Bank, and the Westminster Foundation for Democracy, GOPAC launched a project to explore the role of parliamentarians in ensuring the effectiveness of development resources towards the achievement of the SDGs.

On-going Project: Strengthening the Role of

Parliamentarians in the Implementation of SDGs

GOPAC develops a Handbook for Parliamentariansas a guideline to help parliamentarians in monitoring the development fund, as well as supervision of the implementation process of SDGs.

The project has piloted through a workshop in Jakarta (30-31 August 2016), joined by the MPs from Southeast Asia and South Asia, government institutions, civil society, and scholars.

Result : Jakarta DeclarationFocus : Achievement of development goals, particularly Goal 16 which has bottom-line in tackling corruption and promoting public accountability.

Development of SDGs Handbookfor Parliamentarians

If parties and parliaments are recognized as

part of the problem of political corruption,

they must also be recognized as part of the

solution and can no longer be excluded from

anti-corruption discourse.

Let’s collaborate and strengthen

anti-corruption movement together!

Thank YouGOPAC JAKARTA OFFICE

DPR/MPR Building, Nusantara III, 2nd Floor

Jl. Jend. Gatot Subroto, Central Jakarta,

INDONESIA 10270

gopacnetwork.org info@gopacnetwork.org /gopacnetwork @GOPAC_Eng