Political funding: Govt to propose recording of foreign funds, including via NGOs

Political parties may soon be required to periodically record foreign funding received, including contributions channelled through third parties.

This is among the key proposals in the government's upcoming Political Financing Bill.

“This scope is proposed to apply at both federal and state levels and throughout the entire political cycle - before, during, and after elections - to ensure that the sources and usage of political funds can be monitored effectively,” said Minister in the Prime Minister’s Department (Law and Institutional Reform) Azalina Othman Said.

In a written parliamentary reply today, Azalina (above) said the bill proposes to mandate that the receipt and utilisation of political funds go through official channels that can be recorded, tracked, and audited.

This includes periodic reporting, annual submission of audited financial reports, and public disclosure of political funding details, subject to parameters to be finalised during the drafting process.

The policy recommendations will then be presented to the Parliamentary Special Select Committee on Human Rights, Elections, and Institutional Reform for scrutiny before being submitted to the cabinet.

Azalina responded to an oral question from Idris Ahmad (PN-Bagan Serai), who asked whether the bill would include mandatory disclosure of funding sources and expenditure.

Idris (below), who is PAS vice-president, also asked about government mechanisms to prevent foreign funds from being channelled through NGOs or third parties to finance political campaigns or activities benefiting specific parties or candidates.

Huge support

Azalina also cited survey findings showing that 88.4 percent of 3,422 respondents, alongside 1,544 stakeholders involved in engagement sessions, supported the need for specific legislation on political funding.

The findings were gathered following the Political Funding Convention 2026 on Sept 8, organised in collaboration with the International Islamic University Malaysia and the Institute for Democracy and Economic Affairs.

Last month, the Legal Affairs Division was directed to obtain official written feedback from 72 political parties regarding the proposed bill before presenting it to the cabinet.

In May, Azalina, who is also an Umno minister, said her party raised no official objections to the proposal, which remains under study.

The bill aims to prevent corruption and curb foreign interference in the government.

The most high-profile case involving foreign funds centred on former prime minister Najib Abdul Razak, who claimed to have received an RM2.6 billion donation from Saudi Arabia.

However, the assertion was rejected in court.

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