Deceptive declarations

Reviewing the declarations, it is revealed they are not even filled in line with the legal requirements

The Election Commission of Pakistan (ECP) has set September 30, 2016 as the deadline for the submission of declarations of assets and liabilities by members of parliament and the provincial assemblies. These declarations are required under Section 42A of the Representation of the People Act of 1976 (ROPA) and 25A of the Senate (Elections) Act of 1975 and have been in vogue since 2002 when the amendment to the law was made by the military-led government of General (retd) Pervez Musharraf.

On the face of it, the amended law appears to be a positive step in the spirit of transparency that should be instrumental in deterring political corruption by elected members. However, digging deeper, the measure is nothing but cosmetic and has yet to achieve its objectives. The declarations are submitted to the ECP which publishes them in an official gazette for public information and that is where it ends. The ECP neither has powers to scrutinise these declarations nor does it have authority to question members on their submissions. The ECP merely acts as a post office with no powers to check the post.



Although the ECP can exercise discretionary powers vested in it under Sections 103AA and 104 of ROPA to scrutinise the declarations at least of MNAs and MPAs, it has yet to exercise them. Therefore, the more pertinent option are the legal amendments to expand the purview of Section 42A and Section 25A in order to reinforce the ECP’s powers to review, scrutinise, question, inquire and investigate these declarations of assets and liabilities.

Reviewing the declarations, it is revealed that in many instances they are not even filled in line with the legal requirements. For example, many elected members merely describe the assets such as ‘X’ tolas of gold jewellery without documenting its actual and fair value or current market value. Similarly, they would only describe the investments such as the number of shares, the quantum of land held and the number of buildings, and not their financial value. In other instances, the members would only document the actual purchase value of an asset and avoid documenting its current market value, suggesting that the value of asset has remained unchanged over the years, which is plausibly impossible. In addition, in most cases the current value is mostly reported way below the actual market value of an asset. The ECP must ensure that all declarations contain the actual value as well as actual current market value of all assets declared.

Another issue with these declarations is the way several members document the value of their assets held outside Pakistan. The valuation is done in foreign currency without documenting its fair value in Pakistani rupees, which is required by the law. The arbitrary conversion rate may therefore be applied, which escalates or de-escalates the value of the asset. All values must be ensured to be documented in Pakistani rupees.

The treatment of jointly held properties is also problematic. Instead of documenting their share in a jointly held property, several members report complete value of the asset under their ownership. This simply overstates the value of assets members or their dependants own without giving a correct picture of the proportion in which a property is held. For example, if there are five equal proportionate interest holders in a jointly owned building whose value is Rs100 million, the member should report Rs20 million against each of his dependants and not Rs100 million against each of them.

These declarations also do not bind the members to submit an asset reconciliation statement. This is a simple statement in which members must be required to state their net assets at the start and end of the financial year. Any increase in the assets must be reconciled with the income acquired during the year after deducting the expenditures. This statement will also help explain the decrease in any liability in comparison with the income or an asset disposed of. Any acquisition of asset or disposal of a liability that does not correspond with the income must be scrutinised.

Currently, ROPA does not require members to declare their income, expenditure and income and wealth tax paid during a financial year. It is, therefore, impossible to reconcile the changes in net assets of members without appropriate disclosure of their income and expenditure. A more appropriate measure will be to make it binding on all members to declare their annual income tax and wealth tax returns as submitted to the Federal Board of Revenue. The members must be bound to declare all sources of income along with the amounts earned from each source and proper headwise expenses through the year.

In addition, members must also be required to disclose their National Tax Number, contingencies, commitments and agreements, and designations and positions held in the interest of transparency so that conflict of interest situations are minimised. Moreover, the ECP must seek proper documentation of assets declared as inherited or gifted. Gifted properties must especially be looked into as they may be a result of gratification or bribes.

The definition of dependants under the law also needs to be expanded to include all spouses, sons and daughters irrespective of their marital or financial status. It should not be left to the interpretation of a member who decides who his dependant is. This will ensure documentation of the family assets and liabilities and further the objective of the law i.e., to act as a detriment against political corruption.

Under the existing law, if a statement of assets and liabilities submitted by a member is found to be false in material particulars, action could be taken for committing the offence of corrupt practice, which carries a punishment of imprisonment for up to three years and a fine which may extend to Rs5,000. The amount of fine needs to be enhanced in proportion to the nature of the offence committed.

With these measures and greater and definitive powers given to the ECP, this otherwise cosmetic measure has the potential of becoming the strongest instrument to deter political corruption. The only problem is why would parliamentarians legislate to tighten the noose around their necks. Nevertheless political honesty warrants righteous steps that could enhance the writ of the ECP and other state institutions in dealing with corruption of all types.

Published in The Express Tribune, September 3^rd, 2016.

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