Who exactly is funding LabourList? That’s the question which is beginning to be asked in the wake of ‘Smeargate’, in which Gordon Brown’s chief spin-doctor, Damian McBride, conspired with the website’s founding editor Derek Draper to defame various Tory figures.

It’s a question of keen interest to us here at Lib Dem Voice. We’re an independent website run by a volunteer collective of seven party members, including one (departing) member of the party’s Cowley Street staff. Our running costs are – just about – covered through a combination of advertising revenue and those readers who are kind enough to donate to LDV.

Back in October, as we discussed inviting donations, I checked the site’s position with the Electoral Commission in order to ensure that our understanding of the law was still in line with the Commission’s:

In order to ensure that we do not run into any compliance issues either as our financial activities grow or as a general election nears, we would be grateful for guidance from the Electoral Commission:

1. Under what, if any, circumstances would donations to Liberal Democrat Voice be covered by the legislation regarding permissibility and declaration of donations?
2. Under what, if any, circumstances would our activity be regarded as campaign activity that would then be regulated either as third party activity or as part of the Liberal Democrats?
3. Are there any other issues which you wish to draw our attention to that are not covered by the previous questions?

The full reply I received from the Electoral Commission is printed at the foot of this article*, but here’s the crucial part:

Thank you for your email asking for some advice on whether or not Lib Dem Voice is covered by donation controls. From what you have said, I think that it is. This is because groups whose membership consists wholly or mainly of members of a particular registered party are ‘members associations’ under the Political Parties, Elections and Referendums Act 2000 (PPERA).

Which begs the question: does the Electoral Commission think that LabourList (an organisation mainly, if not totally, run by Labour Party members) should also be covered by these same donation controls?

Assuming the answer is yes, then we shouldn’t have long to wait to find out who the main backers are of LabourList – any donations over £5,000 in cash or in kind from the same source must be reported to the Electoral Commission within 30 days of LabourList accepting them. (In the case of several smaller donations, e.g. monthly provision of office or IT services in kind, then they become declarable when the total value in the year hits £5,000.)

Indeed, given LabourList has been going for more than 30 days, then any donations, such as initial donations of money or provision of IT services for free, should have been declared by now and one would expect them to have appeared on the Electoral Commission’s website already.

(The timescale for declaring donations to members associations is different from donations to parties. Parties have to declare their donations each quarter, and they are then published shortly afterwards by the Electoral Commission. Donations to members associations, whether cash or in kind, have to be declared and should then be published, on a much quicker timescale.)

I’ve submitted an inquiry to the Electoral Commission to confirm my understanding of the rules. Perhaps then we’ll find out who LabourList really has received largesse from?

In the interests of balance, I should add that I would assume ConservativeHome is also covered by the same Electoral Commission rules. It is a matter of public record that the site is owned by Stephan Shakespeare (though you have to search some to find this information in the About ConHome section of the site). I can, as yet, find no references to his presumably pretty hefty ongoing donations to ConservativeHome – including paying for two full-time members of staff – on the Electoral Commission’s website.

For the record, I should note that Lib Dem Voice has yet to receive a donation large enough to necessitate us to trouble the Electoral Commission. But there’s always a first time if you fancy putting our skills to the test. 🙂

* Full text of email from Electoral Commission follows:

Dear Stephen
Thank you for your email asking for some advice on whether or not Lib Dem Voice is covered by donation controls.
From what you have said, I think that it is. This is because groups whose membership consists wholly or mainly of members of a particular registered party are ‘members associations’ under the Political Parties, Elections and Referendums Act 2000 (PPERA).
So, taking your questions in order:
1. You will need to check permissibility for donations of over £200. This applies to donations in cash and in kind (for example, if someone else pays for the hosting of the site, or a marketing campaign), but not to commercial income (such as your advertising revenue, provided that it is sold at a reasonable rate). All donations over £200 must come from certain UK-based sources, and must be recorded. You have 30 days from receipt of the donation to check that the source is permissible, and to return the donation if not. If you fail to return impermissible donations within this time limit, the Commission may apply to court for forfeiture of the donation.
You only need to report donations to us where you receive over £5000 from the same source in the same calendar year. You have 30 days from the date you decide that the donation is permissible and accept it to make the report to us. If you are reporting because someone has given you some smaller donations which over the year add up to over £5000, you must report within 30 days of accepting the donation which pushes the total over the threshold.
I attach a link to the relevant guidance
http://www.electoralcommission.org.uk/document-summary?assetid=13708
2. In terms of what circumstances could give rise to Lib Dem Voice activity being regarded as campaign expenditure or third party spending, I will consider this in more detail as it is a general issue for websites such as yours, and it may be helpful if we discuss this over the phone initially so that I can get some more information from you. Potentially activity by a members association could fall into either spending category.
For information, the next definite regulated period for party and third party spending begins on 4 February 2009 (for the European parliamentary elections). As the regulated period for spending for a general election is 365 days before the date of the election, it is just possible that we are already in one, but I don’t think this need worry you unduly based on what you’ve told me.
However, it may be helpful to know that third party spending under £10,000 in England, and £5000 in each of Scotland Wales and Northern Ireland, is not regulated under PPERA (though promotion of individual candidates, as opposed to the party, has a limit of £500 under the Representation of the People Act 1983). Party campaign spending at a general election is subject to a limit based on the number of constituencies fought – if a party fights all seats in Great Britain, the limit will be £18.96 million.
3. I think you’ve identified the main issues.
I hope this is helpful, and look forward to hearing from you further on point 3.