PARLIAMENT STANDS FIRM - GOB FAILS TO STOP

C O N F I D E N T I A L SECTION 01 OF 02 MANAMA 000615 SIPDIS DEPARTMENT FOR NEA/ARP AND DRL/PHD, DEPARTMENT PASS TO USTR: CNOVELLI AND JBUNTIN CAIRO FOR STEVE BONDY LONDON FOR ETHAN GOLDRICH E.O. 12958: DECL: 04/27/2029 TAGS: PGOV PHUM BA SUBJECT: PARLIAMENT STANDS FIRM - GOB FAILS TO STOP QUESTIONING OF MINISTERS REF: A. MANAMA 200 ¶B. MANAMA 138 Classified By: Charge d'Affaires Robert S. Ford for reasons 1.4 (b) and (d). ¶1. (C) SUMMARY. Our key FTA negotiator, Minister of Finance and National Economy Abdulla Saif, appears likely to survive a parliamentary effort to unseat him. The GOB failed in its last minute attempts to cancel the parliamentary questioning of Finance Minister Abdulla Saif, but managed to rescue Minister of State Abd al-Nabi al-Shoala from questioning in relation to the pension funds scandal (refs a and b). Many parliamentarians believe that Saif has allegedly bought off enough MPs to prevent his removal from office. The investigation and questioning has raised the parliament's credibility with the public and may induce a cabinet reshuffle. The rumors of MP vote-buying are troubling as is the emergence of Sunni extremist Shaikh Adel al-Moawda as the parliament's most influential member. END SUMMARY. -------------- --- PRIME MINISTER REQUESTS TO BLOCK THE QUESTIONING -------------- --- ¶2. (C) On April 10, the Prime Minister sent a letter to the Council of Representatives(COR) requesting that the COR honor its promise not to question the ministers if the government implemented the recommendations of the ad-hoc committee,s report. In his letter, the Prime Minister promised that "loans" from the Pension Fund Commission (PFC) and the General Organization for Social Insurance (GOSI) would be paid immediately with interest. The next day the Arabic newspaper &Akhbar Al Khaleej8 published that the GOB will give BD8.6 million (USD22.8 million) to the PCF and BD7.6 million (USD20.2 million) to GOSI. The GOB also amended the 1975 and 1976 social security laws issued by Decree number (24),restructuring the administration of both GOSI and the PFC, and appointing a consultative company to prepare an actuary study on the possibility of merging both funds. (COMMENT: The constitution requires passage by the National Assembly of all laws; perhaps the newspaper, which often gets things wrong, meant that the amendments will be sent to the legislature for approval. END COMMENT) -------------- OTHERS JOIN FIGHT TO BAR QUESTIONING -------------- ¶3. (C) On April 19 the Minister of Shura and Representative Council Affairs Abdul Aziz Al-Fadhel followed up the Prime Minister's lead by contesting the legality of the parliamentary motion to question the three ministers in a letter to the COR Chairman. Al-Fadhel argued that the questioning includes accountability for actions taken by the ministers before the existence of the COR, and therefore the actions cannot be challenged according to Article (45) of Decree for law number (15) for the year 2002. Al-Fadhel also referenced Article (146) of the Council,s bylaws that prohibits MPs to ask questions on topics previously discussed during the investigation. The Parliament conceded these constitutional points related to Minister of State and former Minister of Labor and Social Affairs Abd al-Nabi al-Shoala, so they canceled his questioning. ¶4. (U) The Government's communications emboldened COR Speaker Khalifa Al-Dhaharani to join the effort to block the questioning. In a full session of the COR, al-Dhaharani introduced two motions to stop the process. Contrary to expectations in local press reports that the government's last minute effort would divide the Parliamentary alliance, COR blocs and independent MPs expressed solidarity, easily defeating Al-Dhaharani,s motions. After the votes, MP Hamad Al-Muhannadi (a Salafi member of the Al Asala Islamic Society) insisted that replenishing the retirement funds' money was insufficient; the people responsible needed to be punished. -------------- SAIF APPEARS SAFE FOR NOW -------------- ¶5. (C) The COR's Services Committee questioned Saif for five hours on April 20 and 21. MPs differed on their assessment of the Minister,s responses in the two-day session, casting a shadow on whether the COR would proceed to a vote of no-confidence. MP Abdulhardi Marhoon in private with us charged on April 28 that Minister Saif "bought-off" several MPs. According to MP Marhoon, on April 20, Minister Saif met separately with Shaikh Mohammed Khalid, Dr. Ibrahim Al-Abdulla, Ahmed Bezhad, Abdulla Al-Alali and several others. Once proponents of unseating Saif, these MPs became virtually silent during the proceedings. On April 21 MP Mohammed Khalild said in the Bahrain Tribune that the minister surprised members with his poise and grace and produced all the documents that would stand as strong evidence in his favor. However, other MPs strongly disagreed. Deputy Abdul Nabi Salman asserted to POLFSN that Minister Saif evaded some questions and flatly refused to answer others. Fareed Ghazi told POLFSN that reports and rumors of Saif's wonderful performance during the questioning are propaganda to deter a vote of no-confidence. Many MPs expressed their doubts to PolFSN on April 28 that there will be enough votes now to remove Minister Saif. MP Shaikh Mohammed Khalid told PolFSN on April 28 that he believes MOFNE will be divided into a Ministry of Finance and a Ministry of Planning and Economy. He strongly believes that Minister Saif will be shifted to the Ministry of Planning and Economy. -------------- COMMENT -------------- ¶6. (C) Daunted by constitutional disincentives to legislate, the COR has aggressively pursued its oversight authority. The COR's investigation of allegations of GOB corruption and mismanagement and its questioning of ministers has improved the legislatures credibility with many Bahrainis, and it possibly may produce a cabinet reshuffle. The timing of the questioning also forced Minister Saif to cancel his visit to the recent IMF/World Bank meetings in the United States. Saif's apparent survival of this strong attempt to remove him from office leaves him weakened domestically but still able to act as Bahrain's lead negotiator for the Free Trade Agreement (even if he loses the Finance Ministry portfolio). On the other hand, the rumors of MP vote-buying are troubling for the near term health of Bahrain's democracy. ¶7. (C) This scandal has highlighted the COR's new movers and shakers as well as spotlighted the end of others. Some argue that Chairman Khalifa Al-Dhaharani,s blatant pro-government tendencies have weakened him. The debate has further exposed First Deputy Chairman al-Marhoon's leadership shortcomings. As a result of their troubles, Salafi Second-Deputy Chairman Shaikh Adel al-Moawda now appears to be the strongest leader in the elected house. (NOTE: Al-Moawda, described by many as a &radical Islamist,8 heads the Council,s Salafi Al Asala Bloc. END NOTE) END COMMENT. FORD