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Steve Goodrich
Steve leads Transparency International UK’s research and investigations team, which provides the evidence and policy thinking behind our advocacy. His brief covers both domestic corruption and the UK’s contribution towards corruption globally, with a specialism in political campaign finance. Before joining TI, Steve was a senior policy advisor at the Electoral Commission.
The new law claims to safeguard our democracy yet does little to address a longstanding and ever-present threat.
Just before MPs head off for recess, the Government has published its much-anticipated bill on democracy and elections. On first look it delivers what government set out in its election strategy statement last July, much of which is welcome. See my previous post for more details on what was already trailed back then. If you want some background reading on political finance, we also have some handy explainers and a position paper too.
But now for the gaping hole: there is nothing to stop the super-rich buying political influence through large donations. You look back at most major scandals over the past three decades, and you are likely to find this is the problem that is so corrosive for trust in politics. When polled, the public are very clear:
Not only is there a strong public consensus about what is wrong with our democracy, but they also have a solution. A majority support an annual limit on how much any individual or organisation can donate to a political party in a year. They also want it to be relatively low, with two-thirds (67 per cent) wanting it to be £50,000 or less. Considering the average person barely saves £2,700 a year, these are still enormous amounts that are way beyond the means of most voters.
Ministers may think that by ignoring the elephant in the room they can still portray the bill as a good news story. But this will not wash. The widespread anger this week about Peter Mandelson and his relationship with Jeffrey Epstein has tapped deep and longstanding frustrations with our political class. The nexus between power, wealth and impunity provides an enabling environment for a whole range of wrongs, including the appalling and systematic abuse of women. It is the cancer that is corroding public life and currently the bill does nothing to stop it from spreading further. When the next inevitable scandal breaks, we will likely be having the same conversations again, while trust in our politicians will have sunk even lower.
If Number 10 is to take anything from this week’s debacle, it is to learn from history. Peter Mandelson should never have been entrusted with high office (again), following two resignations prior and public knowledge about his relationship with Epstein post-conviction. What this week has shown is the intersection of wealth, power and influence that needs to be broken. Doing nothing about this and leaving our party funding rules unchanged will not make the issue go away.
Before the last election, the Labour Party committed to protect democracy by strengthening the rules on political donations, and pledged to put the national interest above personal or partisan concerns. This bill is an opportunity to deliver on those promises Ministers should get out in front by seizing this chance before the next crisis engulfs them entirely. To remove the corrosive influence of money in politics, MPs should back three key reforms.
Reduce campaign spending limits to a more meaningful level, stopping the escalating competition for donor money. Currently, campaign expenditure controls are too weak to stop a renewed arms race for funding, which increases the pressure for parties and politicians to engage in high-risk fundraising. The Committee on Standards in Public Life (CSPL) had proposed reducing them to around £16 million at UK general elections, and including campaign staff costs within the scope of these controls. These proposals should be the maximum allowed, with scope to reduce them further following post-implementation review. Parliament should also remove Government’s ability to unilaterally increase the limits via secondary legislation.
Cap how much donors can give annually, preventing wealth buying political access and influence. The UK is an anomaly amongst its peers for not limiting how much any individual or organisation can give in political donations. Our modelling suggests that under a reduced spending limit, an annual donation cap could be achieved by 2030 through a progressive series of yearly caps, without the parties needing additional public funds.
Require meaningful donation disclosure to ensure political funding comes from legal sources. Existing reporting thresholds are too high to be effective at helping monitor and secure compliance with the rules. They are also substantially above those in other advanced democracies. Equalising the UK’s political donation disclosure rules with the controls on foreign funding (£500) has the potential to strengthen enforcement of the law while reducing regulation.
This blog was originally posted by Transparency International UK.