Transparency International (TI) last week reported that the Maldives police arrested former President Abdulla Yameen for alleged bribes and kickbacks in a massive corruption scandal estimated at US$80 million involving leasing islands and reefs. Yameen is alleged to have siphoned off government money through a private company that has been implicated in the corrupt real estate deals. Investigators found illegal payments totalling around US$1 million in Yameen’s bank account. The court has frozen the ex-president’s local bank accounts. However, it is believed that he might have deposited millions of dollars in foreign accounts.
TI noted that several governments have been elected mainly because of their promise to investigate corruption under their predecessors and to have in place a corruption-free administration. However, according to the international anti-corruption watchdog, they failed to do so, citing Jordan, India, and the United States which lost four points on the Corruption Perceptions Index. TI referred to the importance of the work of independent watchdog groups around the world seeking to hold governments accountable and noted the huge risks investigative journalists are facing in trying to bring to light corrupt deals. It cited the most recent case where a young Slovakian journalist and his wife were murdered apparently out of revenge for reporting on such deals.
Today’s article in a continuation of our coverage of events taking place since the 21 December 2018 since the no confidence vote was passed in the National Assembly and as a consequence the requirement to hold elections within three months.
GECOM’s Budgetary Allocation for 2019
Last week, we referred to GECOM’s 2019 budgetary allocation is $5.371 billion, compared with $2.257 billion for the previous year. This significant increase is mainly due to plans to conduct a house-to-house registration of voters in order to produce a new voters’ list. However, given the requirement of Article 106(7) of the Constitution that elections be held within three months following a successful vote of no confidence in the Government, it has become necessary for GECOM to adjust its work plans to comply with this requirement. In view of the configuration of the National Assembly where one vote can make a difference, GECOM should have been in a state of readiness to hold elections within three months. In fact, it was reported that immediately after the vote of no confidence, staff of the Commission met to discuss plans for doing so.
What happens thereafter is unclear. With less than a month left to hold the elections, it is evident that this is no longer possible and therefore an extension is necessary with the approval of two-thirds of all the elected members of the Assembly. We had suggested that a compromise could be agreed on whereby the deadline be extended to July 2019. This is in keeping with GECOM’s statement that it needs 148 days to prepare for the elections if there is an agreement to forego the house-to-house registration and use the claims and objections period to sanitize the voters’ list. Regrettably, no effort has been made so far to convene such a meeting, thereby precipitating the possibility of a constitutional crisis, come 22 March. The Government’s position is that business continues as normal until its appeal of the Chief Justice’s ruling is fully exhausted. This may take several months, considering the strong possibility that the matter may have to be settled at the level of the Caribbean Court of Justice.
The current voters’ list expires on 30 April, and according to the Commission, the list needs to be sanitized not only by removing persons who have died or migrated but also to include those who have reached the age of 18 years. The main issue is whether the current voters’ list, amended during a period of claims and objections, can be used to conduct the elections. If so, can GECOM’s 2019 budgetary allocation be used for this purpose?
Funding for the Elections
We had stated that it is not difficult to reallocate funds earmarked for house-to-house registration since, as a constitutional agency, GECOM has wide discretion in the use of its budgetary allocation. Article 222A of the Constitution states that, in order to secure the independence of a constitutional agency, the expenditure of that agency shall be a direct charge on the Consolidated Fund determined as a lump sum by way of an annual subvention [emphasis added]. The subvention is to be managed in such a manner as the agency deems fit for the efficient discharge of its functions, subject only to conformity with the financial practices and procedures approved by the National Assembly [emphasis added]. Article 162(1) identifies two main functions of the Commission, namely, the registration of electors; and conducting elections as provided for by the Constitution or an Act of Parliament.
Statutory Expenditure versus Appropriation Expenditure
A direct charge on the Consolidated Fund, also known as Statutory Expenditure, is expenditure that is not voted on by the National Assembly and is not included in an Appropriation Act. Examples include the repayment and servicing of the Public Debt; and the remuneration of holders of constitutional offices. Article 222A extends such a charge to include the expenditures of all constitutional agencies.
An examination of the 2019 approved Estimates of Revenue and Expenditure shows that, of the amount of $231.440 billion to be drawn from the Consolidated Fund to meet current expenditure, sums totalling $208.153 billion relate to appropriation expenditure. The difference of $23.287 billion represents a direct charge on the Consolidated Fund, comprising: (i) repayment and servicing of the public Debt – $18.339 billion; (ii) remuneration of holders of constitutional offices – $4.705 billon; and (iii) payments to the Dependants’ Pension Fund – $243.6 million.
According to the budget documents:
The Estimates are divided into two categories: appropriated and statutory. Appropriated authorities are those for which the Government must seek approval from the National Assembly on an annual basis. Statutory authorities, e.g., public debt, are those for which the National Assembly has already provided on an ongoing basis, through the approval granted by specific legislation containing an appropriation authority. These are included in the Estimates for information only.
Despite the provision of Article 222A, the expenditure of constitutional agencies is shown as appropriation expenditure as subventions. Neither the Constitution nor the FMA Act defines the term. However, it is a form of subsidy to meet shortfalls between the anticipated revenue and budgeted expenditure. Since GECOM does not earn revenue, its entire budget is financed by way of a subvention. Therefore, there appears to be a contradiction in that on the one hand the expenditure of a constitutional agency is a direct charge on the Consolidated Fund while on the other it is reflected as a subvention and hence included in the Appropriation Act.
Ministry of Finance’s Advice to GECOM
Notwithstanding the above-cited constitutional requirement, GECOM wrote to the Ministry of Finance seeking advice on whether it could use funds from this year’s allocation to hold elections, to which the latter responded that the National Assem-bly’s approval must be sought. Reference was made to the Fiscal Management and Accountability (Amendment) Act 2015 (Act No. 4 of 2015) which amends Section 80 of the Principal Act by requiring, among others, the approval of the National Assembly for any alteration in the annual budget of a constitutional agency. Again, there appears to be a conflict between the FMA (Amendment) Act and Article 222A of the Constitution. Needless to mention, where there is a conflict between the law and the Constitution, the latter prevails.
Following the advice given by the Ministry, the GECOM Commissioners voted in favour of house-to-house registration and of informing the President that it is not possible to hold elections with the three-month period stipulated by Article 106(7) of the Constitution. However, by Article 162(2), if the Commission is satisfied that holding elections on the appointed day is likely to pose a danger or create serious hardships, it may, after consultations with the Prime Minister and the Opposition Leader, postpone the holding of the elections to a date specified in a notice in the Gazette. The Constitution does not mention the President, and it is not clear whether the Prime Minister and the Opposition Leader were consulted.
We had hoped that a compromise would have been agreed on to have elections in July 2019 using the current voters’ list amended through a period of claims and objections. However, this is not to be, and GECOM has indicated that it would need additional funds for the holding of elections, assuming that they are held this year. GECOM had earlier indicated that house-to-house registration would take nine months.
Latest Developments
The Opposition Leader has indicated that he would not initiate a meeting with the President to resolve the impasse surrounding the holding of elections as he claimed he had done on the last occasion. He insisted that it is for the President to take the initiative, and that he would only participate if he is given the assurance that there will be good faith negotiations. The President, for his part, has shown no inclination to have such meeting, no doubt preferring to await the outcome of the appeal of the Chief Justice’s ruling which can run into next year.
Last Wednesday, the Court of Appeal was to have heard arguments for a stay of the effects of the Chief Justice’s ruling and a Conservatory Order for the President and the Cabinet to remain in office under the matter is finally determined. However, there were errors in the filing of the court documents, resulting in a postponement of the hearing to a later date.
Meanwhile, Compton Reid, who had asked the court to pronounce on the validity of the vote of confidence, has filed an appeal against the Chief Justice’s ruling. He had challenged the vote of a Member of Parliament who had dual citizenship, despite the fact that Article 165(2) of the Constitution provides for the following:
The Assembly may act notwithstanding any vacancy in its membership (including
any vacancy not filled when the Assembly first meets after the commencement of this Constitution or after any dissolution of Parliament) and the presence or participation of any person not entitled to be present at or to participate in the proceedings of the Assembly shall not invalidate those proceedings.
