by Tricia Yeoh. First published in The Sun 11 June 2015

In our ‘A’ Level English literature classes, we used to describe Shakespearean comedy as ‘someone else’s tragedy’. Such is the case of the most recent public relations disaster to have befallen our Prime Minister – the #Nothing2Hide forum a week ago that turned disastrous after he failed to show up as scheduled. It could have been a prime opportunity for him to explain his side of the story of what is now an ever-growing 1MDB monster.

Why 1MDB has captured the imagination of at least middle-class Malaysia is not surprising: it has an impact on country ratings, foreign investment and ultimately our domestic economy.

Minister in the Prime Minister’s Department Abdul Wahid Omar may be right in saying “there is no systemic risk to the financial system”, but this is because even if 1MDB fails to pay back its owed debt to local and international banks from whom they have borrowed, it is the Malaysian government (i.e. government coffers and taxpayers’ money) that will have to cough up these sums as the final guarantor. Sure, the financial system is protected, but government funds would be depleted, funds that otherwise would have been spent on public goods like education and health services.

But the second and probably more powerful reason it frustrates and angers Malaysians is because the “lost” funds (and as mentioned in a previous column, money is never “lost”, it is just always “somewhere else”) are speculated to have enriched certain pockets.

It was the New York Times that highlighted the wealth of businessman Jho Low, his connection with 1MDB and raised questions of Prime Minister Najib Razak’s family members’ wealth. The Prime Minister’s Office has previously said, “neither any money spent on travel, nor any jewellery purchases, nor the alleged contents of any safes are unusual for a person of the prime minister’s position, responsibilities and legacy family assets” (New York Times, 8 February 2015).

Now, it would be almost impossible to verify the veracity of any statements made by any leader, embattled or otherwise, without the necessary system to capture such information with.

Civil society has long called for a mandatory asset declaration system, compulsory for those holding public office. As civil servants or elected representatives, they have immediate control over public assets and funds, manage the award of government contracts, and are at the highest risk of enriching themselves at the cost of public benefit.

IDEAS released a policy brief last week that details what Malaysia should do in adopting an asset declaration system, which can be found on our website. Fundamentally, our senior researcher Shaza Onn states that: “Ministers and their aides, top government officials, civil servants, members of Parliament, and state governments’ (executive councillors)” ought to declare their assets. The only two state governments to have implemented asset declaration for their exco members (without necessarily having a law to instruct as such) are Selangor and Penang.

And although there is no one set of best practices that can be equally applied around the world, there are certainly some features that must be included (if the government decides it wants to be a truly transparent administration): First, an asset declaration system should be able to detect both conflict of interest and illicit enrichment. Second, there should be a legal framework to back the system up. Third, the declaration should apply to all branches of government annually and to a large scope of assets. Fourth, the system must have an effective monitoring and verification mechanism. Fifth, its sanctions mechanism should be equally effective and enforced, so those failing to do so would be charged as criminals or given disciplinary sanctions. Finally, the system should allow for such assets to be publicly available.

Critics of asset declaration have pointed to the need to protect privacy. But the rule is to ask which is more important: whether officials’ right to privacy outweighs public interest resulting from disclosure, or vice versa. And to that, one could say that individuals are free to choose whether to enter public service or not. If you choose to be a politician or civil servant, you essentially give up your right to privacy, as a custodian of public assets.

In Malaysia, Ministers do declare their assets at present, but only to the Prime Minister. It is unclear if there is any requirement for the Prime Minister to declare his assets, or to whom, if any. Civil servants also do declare their assets, but this is just internally verified.

Our paper proposes that the Malaysian Anti-Corruption Commission (MACC) is brought in to verify declarations made by politicians to a Parliamentary Committee, and by civil servants to their respective ministries. One could argue that politicians would circumvent such a system by appointing proxies. But an effective system is a starting point in getting the basics right, which could later be improved to detect other anomalies.

In short, an effective asset declaration system if enforced properly would prevent conflict of interest amongst Ministers and public officials, and can be used to detect abuse. Governments can use asset declaration to build trust with citizens since they have the opportunity to clarify the origins of their personal wealth. And goodness knows the trust gap is huge right now.

In the case of Slovenia, both the Prime Minister and Opposition Leader were demanded to resign after they hid high-value assets and did not declare conflicts of interest in business deals (Transparency International, 2013). Back home, our own leaders can pre-empt this happening to them by having their (and their family members’) assets publicly declared.

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Tricia Yeoh is the Chief Operating Officer of IDEAS

Clip from The Sun Daily 11 June 2015

Clip from The Sun Daily 11 June 2015

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