- By Ravi Kathuria
It may be hard to imagine now from quarantine, but just a few months ago, thousands of protestors were out on the streets in Malta — a huge number of people for such a small country. Its people were angry with the involvement of the prime minister in a cover-up of Daphne Caruana Galizia’s murder. They wanted to storm the parliament because they could not bear to see elected criminals occupying it. Hundreds of police officers were ordered to kettle them, and in response, groups formed to kettle the parliamentarians themselves, blocking the roads to stop them leaving Malta’s capital. Citizens’ lives were turned upside down because of the government’s corruption and some of Malta’s parliamentarians’ abdication of public duty. The people returned the favour by making their lives just as impossible.
Without the ability to protest, how can Malta have accountability? Public gatherings of more than three people are now banned in the country. There’s no debating that reduced physical contact stops physical contagion, but enforcing that behaviour at macro-scale has different implications. Governments must respect democratic rights and freedoms while managing an emergency response. Their ability to walk this tightrope depends on the quality of their respective country’s democracy. Countries with good systems of governance can cope with some reasonable restrictions and recover quickly when the restrictions are lifted. In countries with weak or malign systems, where the threat of public protest is really the last available check on power, democratic life cannot cope, let alone recover. The threat their governments pose to their own people and to others will only worsen.
There’s another problem, which is that a lot of work done by civil society and the European Commission to put rules in place around public spending – and actually have them enforced – is being undone. Again, some member states can cope with a temporary relaxation of regulations to be agile in an emergency. Others can’t. For an aspiring kleptocrat or crony capitalist in an already weakened democracy, a public emergency is an excellent time to accelerate theft. In Romania, a country without a healthcare system, a former civil servant secured an untendered deal to provide the protective masks and suits urgently needed by hospitals. Their company bought the gear from a Turkish supplier and flipped it to the government the next day, raking in a huge profit. The masks turned out to be unusable.
In Slovenia, where gatherings are also restricted, the government is abusing emergency measures to break its own contracting rules. In one week alone it signed away €80mn in “opaque one-day bids”. Almost half of that money went to one person: the boss of a gambling empire. Much like the ‘Karen’ of memedom becoming an expert virologist thanks to Facebook, overnight he had become a supplier of protective suits to the state. Another contract for hospital gear went to a peddler of mangosteen juice.
The for-profit hospitals have no space for COVID-19 patients and insufficient healthcare staff
In Latvia, independent anti-corruption and procurement monitoring authorities are criticising the government for loosening contracting rules. The director of the Corruption Prevention and Combating Bureau told journalists that he fears a “lack of transparency” will undermine public trust in government.
Before the pandemic struck, Malta’s government transferred ownership of three out of four state hospitals to shell companies in the British Virgin Islands and Jersey. The gang controlling those offshore companies then flipped them to an aggressive US private equity firm whose primary concern is profit, not public healthcare. The for-profit hospitals have no space for COVID-19 patients and insufficient healthcare staff, so patients in the geriatric wing of one of the hospitals have been moved out to a hotel — where two have already died — whose owners, including a government crony, are being paid millions of euros for a service that shouldn’t even be necessary.
Anyone wanting to stop this rot will have a hard time. Malta has only one police officer specialised in financial crime and his backlog includes investigations into almost every action taken by Malta’s former prime minister, including an astounding corruption and murder scandal with its origins in a state funding deal approved by the Commission.
In Italy, the government ordered €12mn worth of protective masks from a farm that specialises in growing aromatic herbs. The owner of the company, now being prosecuted for trading in influence, transferred the shareholding to a director of the company the day before the public tender was awarded. The order was cancelled after journalists reported on it, only for a new one to be placed with a fictitious ‘migrant cooperative’ run by a man indicted for defrauding the EU out of funds intended to promote the employment of women.
Corruption is correlated with a lack of appreciation for the common good
In places where corruption is so endemic, it seems impossible to have an emergency response without creating more opportunities for the theft of public goods. Many leaders in Europe seem almost resigned to the inevitability of a governance die-off. The decision to flood Hungary with even more EU funds on the same day that Orban was granted the right to rule by decree indefinitely, and even after the multi-billion euro EU farm subsidies fraud was exposed, is extremely concerning. It feels like a cruel joke. Gerald Knaus, who runs a policy think tank funded by several European governments, told the Financial Times, “If this doesn’t lead to a wake-up call, then the EU is suicidal.” He’s pushing for a mechanism that will tie funding to respect for treaty values and to the verdicts of the ECJ.
Together with Transparency International and many other organisations and MEPs, The Daphne Caruana Galizia Foundation signed a letter calling on Commission President von der Leyen and EU Council President Michel to “unequivocally condemn the Hungarian government’s misuse of the coronavirus crisis to erode democratic values” and to “more strictly control the spending of EU funds”.
But strengthening controls and getting authorities to grow fangs is only half the work that needs doing. In fact, it is perhaps the unwritten rules that most need to change, because they are applied more reliably than the written rules. Claudia Baez Camargo at the Basel Institute on Governance rightly noted that corruption is correlated with a lack of appreciation for the common good. That phenomenon is not going to be changed by any law, but it should be contained via external vigilance and the support for organisations, including independent media, who help keep corruption in check.
COVID-19 will eventually be overcome. In the meantime, the European Union has to decide whether it wants member states to remain places of routinecriminality exacerbated by emergency measures, or to become improved democracies built around the common good. The outcome of that decision should not be left to chance.
- By Stefano Manservisi, Angelino Alfano, Laura Frigenti & Paolo Lembo
- By Jamie Shea
- Frankly Speaking
- By Giles Merritt
Next event online
- Area of Expertise