We’ve been here before: many times, under many different governments. The latest addition to the lexicon of big money politics scandals is Peter Cruddas’s crude cash-for-access fundraising, with influence on government policy touted for £250,000 a pop. Under Labour, we witnessed the Bernie Ecclestone affair, as well as the cash-for-honours scandal.
To date this shared complicity — the “all parties are as bad as each other” mentality — has served only the interests of senior politicians in justifying the continuing scandal of how big money talks in British politics. But enough is enough. We have already had a full, independent inquiry — Sir Christopher Kelly’s report, Political Party Finance: Ending the big donor culture — into what needs to be done. A further inquiry will serve only to allow more long grass to grow up around the issue. It’s time for action.
Here are the six steps I think are most urgent to help clean up the reputation of British politics:
1. A cash limit of £10,000 per annum on all individual donations
This is the first, most important step, with £10,000 the figure favoured by The Kelly Report (it still amounts to £50k over the lifetime of a parliament). It’s no surprise that political parties listen more carefully to donors who can contribute 6- and 7-figure donations. No surprise — but it is wrong.
2. All trade union members must explicitly opt-in to the political donations made by their bosses
As The Kelly Report proposed, trade union affiliation fees could be counted as a collection of small individual payments — but only if members are required to ‘opt in’ to the fees, rather than as at present consent assumed by trade union bosses.
3. Individual donations to be eligible for Gift Aid tax relief
I give money away to charitable causes and to political causes, and believe both to be equally important in effecting change in society — yet only the former qualifies for Gift Aid relief. Those who choose to try and make a difference to society through political donations should be recognised in the same way that gifts to other worthwhile causes are.
4. A lower national cap on spending
At each general election, there is an arms race between the Tories and Labour to see who can spend most money; inevitably this ratchets up the pressure on parties to out-do each other on donations, with just the kinds of consequences we’ve seen this weekend. At the moment the national figure each party can spend is £19.5m (650 seats multiplied by £30k each). This is far too high. The Kelly Report proposed reducing it by 15% — 50% would be more like it.
5. Publication of politicians’ tax statements
In the US, candidates for the presidency disclose their earnings and tax statements: so too should cabinet ministers and the Prime Minister (the shadow cabinet should do so voluntarily). What clearer message could be given that politicians are committed to financial transparency at every level?
6. No additional state funding
In some senses, the debate over ‘state funding’ misses the point: it already exists. Opposition political parties have benefited form so-called ‘Short Money’, taxpayers’ money spent on political advisors; party election broadcasts are freely given air-time; there’s freepost election literature distributed during election times. This is rightly, in my view, seen as the ‘price of democracy’, and is a legitimate cost of ensuring those standing for election can communicate to voters. But the emphasis must now be on restricting spending by parties already subsidised by the taxpayer, not on increasing the supply of public money still further at a time of national austerity.
If some of these proposals seem familiar, that’s because they are. This is not a new issue. It is not an issue unique to the Tories or to Labour or to the Lib Dems. It’s an issue for the body politic, and the time to address it properly is long overdue.
* Stephen was Editor (and Co-Editor) of Liberal Democrat Voice from 2007 to 2015, and writes at The Collected Stephen Tall.
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31 Comments
On your last point, Stephen, we should, of course, be getting off the austerity “hook” as a party – this is no justification for making points one way or another about public party funding. Sorry to be off topic, but this has been the Lib Dems’ nemesis since May 2010, so I don’t have any compunction about raising it again.
I don’t think increased public funding of parties is incompatible with austerity. In fact, I think it’s a great way to limit wasteful spending in the form of distorted policies, outright corruption and the propping up of monopolies.
“No additional state funding”
Very much agreed.
Tim you are right and at long long last I see light at the end of the tunnel. Cable has (after much) effort to get him to look at the concept become a convert to Nominal (or Money) Gross Domestic Product tightening. This will allow looser monetyary policy and give us a distinctive economic policy from both the Conservatives and Labour.
The interview is published on LDV here https://www.libdemvoice.org/ldvideo-the-sage-of-twickenham-returns-27795.html#comment-202208 The question and the answer start at about 9 mins in.
MOney/NGDP targeting? ” I’m for it.” says Cable. It’s economic logic? “Impeccable”. This is the first British cabinet minister to support it. It won’t be the last. The question is now how quickly can it become a majority view and can it become and be seen to be the Liberal Democrat policy.
Sorry in the above commnet that should not be ‘tightening’ but targeting.
2. All trade union members must explicitly opt-in to the political donations made by their bosses
Okay, but only if every taxpayer is able to opt in to allowing profits made from public sector contracts to be funnelled to the Tory party,
4. A lower national cap on spending
Spot on.
I think the current issue gives a real opportunity for change, but only if it is not brushed under the carpet.
For me this is a Government issues not just one for the Tory Party. It is Government policy they were being given a chance to shape and the Lib Dem ministers must not let this go. Clegg should call for all guests of all Cabinet Ministers that have donated more than £50K to a political party to be made public and do so himself as a show of faith. After the recent trust issues with politics it is now a time to both be, and appear, whiter than white.
If any Minister has a long standing friendship, or there is a genuine reason for the meeting taking place they will be able to make the case.
At this point the Lib Dems are in the right, they must help keep the pressure up on the Tories if they are to remain there in in the public eye.
Surely this has NOTHING to do with party funding and everything to do with people being able to buy access to the Prime Minister and potentially changing government policy for CASH.
50% to 45% – now smells even more strongly of everything most average people thought it smelt of……. and its not pleasant.
I quite like this take on the issue – it’s a good attempt at meeting the concerns over big money that people have and also the lack of willingness for more state money to go to political parties that I and others have.
I am concerned about the big money, of course, I just don’t think state money should be used for this purpose. They’d also have to look to broaden their appeal to attract more, smaller donations.
@Tim13 “On your last point, Stephen, we should, of course, be getting off the austerity “hook” as a party – this is no justification for making points one way or another about public party funding”
Firstly we the Government borrowing £120bn this year we are very far from being able to get off the austerity hook.
But even if the economy was booming there is no excuse for taxing people in order to hand money over to political parties.
Keith, that CASH doesn’t go into the PM’s pocket – he’s not taking personal bribes. It was being used to fund the Conservative Party. That’s not NOTHING to do with party funding.
The problem is that the Conservatives get a political advantage from raising and spending more money than any other party – and the end of anonymous donations and of foreign donations is restricting their ability to do so, so they’re working harder to get money from the people they can get it from.
So, you either have to find an alternative source of party funding, or you have to reduce the amount of money the parties have.
These proposals are essentially about trying to stop parties from getting an advantage from bringing in so much money, so they don’t spend all their time fundraising, and they can make up their own minds on policies without worrying about losing a valuable funder.
The current donation scandal is extremely timely. Large sections of both Tory and Labour parties are desperately wanting the whole political funding question to go away as they are both opposed to reform because of their own vested interests. The 1.5 year investigation by the Committee on Standards in Public Life proposed a £10k cap at the end of last year and both Labour and Tory were happy to see the report to die in a corner since. Cameron’s spot of bother is an opportunity for Clegg to put the report back on the table and demand implementation *IN FULL*.
Lowe national cap gets us part of the way there. And it ought to be possible.
It does leave the gap of spending between elections. That is tougher , but we need to stop the buying of constituencies by rich donors.
Stephen – re 3.; you donate money tax-free to a political party, but you have to die first.
“The problem is that the Conservatives get a political advantage from raising and spending more money than any other party ”
The very reason i support the current system is that it starves unpopular ideologies of oxygen, campaign on a broad national platform with ideas that have broad acceptance……………………………. or find yourself with a campaign budget in the same ballpark as the SWP!
Here’s a fairly radical suggestion. How about political parties setting out their stall ahead of the election and sticking to the promises they make in their manifestos? No need to worry about money buying covert influence if it is all their in advance of the vote. Especially if the manifesto is drawn up by their party conference.
I know, I know – naive in the extreme.
Jedi: ““The problem is that the Conservatives get a political advantage from raising and spending more money than any other party ”
The very reason i support the current system is that it starves unpopular ideologies of oxygen, campaign on a broad national platform with ideas that have broad acceptance.”
Not necessarilly the same thing. Popularity and the wealth of individual donors are not linked; you could have only one supporter, but if that supporter was Bill Gates or Warren Buffet you’d outspend everyone else on the planet.
mike cobley said:
2. All trade union members must explicitly opt-in to the political donations made by their bosses
Okay, but only if every taxpayer is able to opt in to allowing profits made from public sector contracts to be funnelled to the Tory party,
I was going to say this was going too far, until I twigged that you mean company donations — in which case, it’s simply hitting the wrong target. We should be banning corporate donations outright. Nothing to do with taxpayers (profit isn’t something stolen from the customer — do you suggest that public employees should ask taxpayers’ consent before donating out of their salaries?), but unless a company is wholly owned by British-resident taxpayers, all of whom (not just a majority) consent to the donation, it is either a loophole in the ban on foreign citizens donating to British political parties, or a breach of the principle of no donation without consent, or both.
Let shareholders donate out of their private, post-tax income, like the rest of us. If companies believe that one party is better for (their) business than another they can exhort their shareholders, customers, employees to make donations. Of course, that’d be going a bit public — wonder how many would dare?
£10,000 is still a lot of money and will still give the Conservatives an advantage.
Francis Maude was a terrible, terrible choice to front this issue for the coalition. Alternated between shameless and shambolic, and just kept desperately trying to drag trade unions into it.
1. Waste of time. If anybody really wanted to donate, say, £250,000 to the Tories they could easily find 25 friends\relations to give £10,000 each.
2. I’m not sure how it works in other unions, but when I joined Unison this was certainly an “explicit opt-in” – I had to tick a box opting in to the political fund, and I knew exactly where this money was going to end up. Hence I am slightly offended when I hear soemtimes that Dave Prentice has “given” a big pile of money to the Labour Party. It’s not Prentice doing it, it’s me and the other members.
Sadly, though my wife spends half our joint salary in Marks and Spencers, I am aware of no similar opt-in (or opt-out) as regards the huge donations that company makes to the Tory party.
Wouldn’t disagree with 4 and 5. However I support the idea of state funding. The austerity argument is extremely weak because the sums involved are relatively tiny – much smaller than the amount being frittered away on the impending NHS reorganisation, for instance. State funding is the only possible way we can ever lance what will otherwise be an endlessly reocurring boil and the bottom of British politics.
This is the third piece in two days to insinuate that the Tories and Labour have some sort of duopoly on dodgy goings on in politics, with the Lib Dems pure as driven snow. Given that the Lib Dems received £2.4m from a crook, and 40% of their original cabinet members were forced to resign within 21 months of taking office in 2010, I think you are strecthing credulity to breaking point there.
@McClusky
Agree with you about Francis Maude He seems to want to throw mud at Labour, rather than deal with the problem. Not that throwing mud at Labour (or the Lib Dems or the SNP or UKIP for that matter) couldn’t be justified. It’s just that it is all too easy an excuse for doing nothing. And anyway Maude is an easy target himself, given his history of questionable expenses.
@Stephen Tall
Nice list of proposals – good starter for ten.
@Stuart Mitchell
“Sadly, though my wife spends half our joint salary in Marks and Spencers, I am aware of no similar opt-in (or opt-out) as regards the huge donations that company makes to the Tory party.”
I don’t drink at Wetherspoon’s anymore, as I got sick reading Tim Martin’s Kipper style eurorants in the pub magazine.
This is a ‘cash for access scandal’ which is being sold by the Tories as something to do with political donations. I wonder how many policy decisions were changed or influenced by those donors in their favour? I guess that Guardian reporters are trawling through the people with a fine toothed comb. I think the answers will be quite startling.
It is also obvious that this wasn’t the first time that Mr Crudd-ass had been through that ‘barrow boy’ patter. He has probably trotted out that routine hundreds of times.
Why cant the politicians, including the Lib Dems see what is blindingly obvious to ‘Joe Public’. Forget the donations its the access to policy which is where the criminality in all this lies.
Yes the cash for access is the bad thing in this particular situation but it is emphatically linked to political part funding. As the situation has arisen due to political parties need to raise money to fund expensive elections. Stephen Tall’s suggestions would dramatically reduce the amount of money the parties would need to raise and prevent them from getting large donations from individuals or companies to the chances of individuals buying access would be much less as parties would need to find far more small to medium donors instead of just a few large ones.
Why was the figure of £10,000.00 arrived at? It would be dead easy for a wealthy person to find 25 people to “donate £10,000.00” each for him? Why should someone able to spare £10,000.00 be able to have more political influence than someone who can only afford to contribute £1.00?
Paul McKeownMar 26 – 8:09 pm…………[email protected]…Agree with you about Francis Maude He seems to want to throw mud at Labour, rather than deal with the problem………….
No surprise that (really) ‘Dodgy Dave’ stayed away from the Commons yesterday and left ‘Maude’ to answer questions.
However, it’s not as if he’d even kept Maud ‘in the loop. On the ‘Today’ programme, yesterday, Maude stated that Cameron would not, under any circumstances, allow the information on his ‘private’ dinner guests to be released; yet within hours there it was.
‘Headless Chickens’ come to mind.
At the time of the MPs expenses scandal Clegg called for the resignation of the speaker Michael Martin. To be consistent shouldn’t Clegg now call for the resignation of the Prime Minister?
The issue is not so much cash, as the strings which are attached to the cash.
It is a sign of the failings of democracy that people are willing and able to use money to bypass due process to gain access to policy-makers, and it has the clear look of buying and selling favours.
This secret, closed market is damaging to society, but it completely unrealistic to expect that this most ancient trade can be stopped. It must be opened up, so that harmful practises can be neutralised.
These suggestions are an excellent starting place to bring access closer into the reach of ordinary people.
One point that seems to have been glossed over is the use of public property (10/11 Downing Street, Chequers) for overtly party political purposes. I presume Cameron and/or the Conservative Party have paid a market rate for their night hire?