David Howarth MP writes… How to reform party political funding

This country faces a crisis of confidence in democracy just as profound as the crisis of confidence in the financial markets. Both are ultimately about trust – trust in the quality of what is being sold in the one case, trust in what political leaders say, and what their motives are, in the other.

The series of scandals about party funding – from cash for honours to the Ashcroft affair – damage democracy deeply by sending the constant message that politics is not about values and ideas, but about buying power and access, and if you are not a rich donor or a powerful interest group, politics has nothing to offer you.

There is a tendency in Parliament to play a kind of game of cards with party funding scandals – ‘I’ll trump your Michael Brown with my Lord Ashcroft’.

But this is not the point: the cumulative threat these scandals pose to democracy should concern politicians of all stripes. One might have hoped that parliament would have seized the opportunity presented by the Political Parties and Elections Bill to implement at least the measures agreed in the cross-party talks presided over by Hayden Phillips, and begin the long process of restoring trust in politics.

Instead, both Labour and the Conservatives have been busily rearranging deckchairs on the Titanic, fussing endlessly about exactly what the remit of the Electoral Commission should be while steadfastly ignoring the key issue of taking big money out of politics. The government’s excuse for failing to introduce real reform is that there is not ‘consensus’ – an astonishing claim from a government which tried to force through the universally-decried 42-day detention without charge.

As the lead Liberal Democrat on the Public Bill Committee, I tabled amendments to beef the Bill up to something resembling the Hayden Phillips package:

>> a donations cap of £50,000;
>> limits on party expenditure that apply across the electoral cycle, not just at elections;
>> rules to stop parties pouring disproportionately vast resources into marginal seats;
>> and more transparency for trade union donations.

But it was clear that the other parties were not interested. Of the vast swathe of amendments tabled – and there were in excess of 200 – only nine concerned reform of donations and spending, and they were all ours.

It is not hard to deduce from this what the reaction to our proposals would have been. But it remains conjecture: they were never discussed. The government’s insistence on pushing them to the back of the agenda and the Conservatives’ time-wasting over dozens of nitpicking alterations colluded to ensure that the Lib Dem amendments were not even reached.

So the public bill committee charged with scrutinising reform of the law on party funding spent hours upon hours considering the precise detail of the Electoral Commission’s new powers to impose fines, and not a single minute discussing the problems with party funding the Bill was ostensibly designed to address. It was a singularly frustrating experience.

We need urgently to do something to rebuild public confidence in the democratic process. Sadly, unless we see a drastic change of heart from the other two parties, the Political Parties and Elections Bill seems unlikely to be up to the task.

* David Howarth is the Liberal Democrat MP for Cambridge and the party’s shadow justice secretary and solicitor general.

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  • David Allen 11th Dec '08 - 6:19pm

    What about public financing, not “of political parties”, but “of the democratic process”? That would mean much more state money for Freepost leaflets, party political broadcasts, televised debates, anything that helps the voters assess the candidates.

    People don’t like giving state money to politicians. They’ll be a lot happier being asked to pay for a democratic system that works properly.

  • David Allen- happily agree.

  • “Just look at the monumental mistakes that have been made as a result – the invasion of Iraq and the collapse of the banking system.”

    They have been made by a government with thousands of civil servants to do it’s policy work for them though.

  • David Morton 12th Dec '08 - 12:52pm

    If you want to crack this you have to encourage small donations and make building a small donor base worth the politicans time. While i genuinely don’t like state funding of political parties and think we’d get lynched for sugesting it in a recession i wonder about

    1. Gift Aid on small donations to parties. This generates extra income bt keeps a crystal clear link with individual citizen action.

    2. Take up the Power enquiry idea of allowing voters to tick a seperate box on the ballot paper delivering a small state donation , say £3, to a party of its choice and ot necceserily the one it voted for. Again keeps the individual link and incentivises parties getting there people to the polls.

  • David Allen 12th Dec '08 - 1:22pm

    Getting funding will depend on convincing a potentially hostile public. That’s why I argued for “funding for the democratic process” rather than “state funding”.

    However I do see Geoffrey’s point that there is a case for funding other things besides just election campaigning. I think Geoffrey’s implication is that government ministers are the worst-trained senior managers in the country, and that however many civil servants they may have, they can still make a pig’s ear of the key policy decisions that they take for themselves.

    So let’s see if we can also express this request in terms that the public will accept. How about “funding for management development”? For example we should be offering all our MPs free training courses, economics lectures etc to fill up those long recesses. Maybe the state should also fund the parties to do policy research projects, subject to them involving independent people and publishing the results.

    I quite like the idea of all this being subject to the firm control of civil service bureaucrats. I’m thinking of the example of the Freepost leaflet, where we have to conform to all sorts of bureaucratic format etc requirements. We can live with the hassle, because it brings one great benefit.

    That is – It can be made evident to the public that it is not the politicians who are in control of the money pipeline! It is all being watched over by cost-conscious public accountants whose job is to keep the politicians firmly in their place. (And while they’re about it, let’s see proper receipts for all those expense claims, just like the rest of us have to produce!)

  • David Allen 12th Dec '08 - 5:07pm


    What do you propose then? Dictatorship?

  • David Allen 12th Dec '08 - 5:47pm

    Yes, but when you’ve put into place all your stacking tiers of electors who elect committees that elect superior committees (soviets?) that look like a wedding cake and eventually elect the upper tier of government – you’ll still have government ministers. Won’t they still be “twats promoted beyond their abilities”?

  • Nothing will turn the public against the political classes and off politics more than the parties conspiring to steal public money in order to finance themselves, and nothing will make the Lib Dems look more like establishment insiders than advocating such a move, no matter how it’s dressed up.

    The crisis in party funding is not a problem for democracy or for the country, it is a problem purely for the parties. Personally I welcome the idea of the big three being too skint to fund campaigns because it might just lower the democratic bar a wee bit and tilt the field in the favour of minor parties or independents.

    The democratic crisis has nothing to do with the parties being skint, it has to do with a creeking outdated and discredited electoral system that has alienated ordinary people and cannot provide the representation or accountability that they rightly expect in the 21st century, and a political class who by and large all look the same, sound the same and say broadly the same things in the same stupid language not found anywhere outside of a three mile radius around Westminster.

    Conflating those two crises is absurd and myopic.

  • Andrew Turvey 14th Dec '08 - 7:31pm

    Well done, David Howarth, for bringing this up and trying to actually pass some decent legislation. Lets hope the Lords can bring some of these proposals to the floor, at least.

    However, you miss the fundamental point about trust in politicians. If I buy a kettle from a shop and it doesn’t work, I can take it back. If I take out some insurance after being misled by the salesman, I can get a refund. If I vote in an MP who says he will do X, and he promtly does the opposite, I have no recourse until the next election.

    That is the fundamental problem, and the courts have confirmed again and again they have no power to intervene. Until electoral promises are enforceable, no-one will have any reason to trust politicians.

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