For immediate release


Kuala Lumpur, 23 May 2016 –  A paper on political financing released today by the Institute for Democracy and Economic Affairs (IDEAS) proposes five key principles to ensure a just system of political finance based on the rule of law.

“The Principles of Political Finance Regulations” was authored by international researcher Stefan Melnik based in Germany.  The paper explains the concept of political financing and its relationship with democracy. It proposes five key principles which must be adhered to in order to ensure fairness in political financing:

  1. Presence of the rule of law.  The rules must be equally enforced on everyone by an independent body and there must not be any element of arbitrariness.  The rules must also be transparent and there must be commensurate sanctions for those who break it.
  1. Fairness for all involved, namely voters and political parties.  Regardless of whether the funding is from private or public sources, the rules must be fair to all and must level the playing field.
  1. Transparency and accountability. Voters should know where their parties received money from in order to make informed choices. Party members too should have the same information.
  1. Checks and balances to prevent unlimited power. The party who wins an election must not be able to fashion a system which favours them.  This is why the body overseeing the election process and political financing must be independent and credible.
  1. Exercise of political and civil liberties by the electorates.  The system must be designed to ensure that all parties have sufficient resources to exercise their political rights, in order to allow electorates to make informed choices.

Author Stefan Melnik states that “A level playing field requires a set of clear rules which are consistently and equally applied. Where there is a massive bias towards incumbents and opportunities for the rest are limited or restricted, results will not be easily accepted by the public.  Proper competition and real choice are not possible without substantial financial resources. Securing and protecting political rights and civil liberties are not only matters of law. It is also a matter of ensuring that these rights mean something substantive”

Commenting on the paper, Wan Saiful Wan Jan, IDEAS Chief Executive Officer, stated that “Since I am a member of the government’s committee on political financing chaired by Minister Dato’ Paul Low, I will be taking these proposals to the committee.  These are principles which can create a more transparent and accountable system that will strengthen public confidence in our democratic processes.  The principles are important because our committee will soon be proposing ways to regulate political financing, including amendments to existing laws. We must ensure that all proposals are within the framework of an effective liberal democracy.”

“The country has seen some extremely questionable practices when it comes to political financing. But due to the lack of an effective set of laws, no action can be taken.  The longer this situation remains, more people will become disillusioned by the system.  We need to fix this so that our laws are realistic and up to date, and no more abuses can take place.”


The Executive Summary and Policy Paper can be downloaded here:

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IDEAS is Malaysia’s first think-tank dedicated to promoting market-based solutions to public policy challenges. We are an independent not-for-profit organisation. As a cross-partisan think tank, we work across the political spectrum. Our purpose is to advance market-based principles, and we are not bound by party politics, race or religion. Our mission is to improve the level of understanding and acceptance of public policies based on the principles of rule of law, limited government, free markets and free individuals. For more information, please visit

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