Lib Dems’ £550k deficit, 8.5% membership drop, and other facts from the party’s annual accounts

The Electoral Commission has just published online the latest sets of financial accounts for the main parties, including the Liberal Democrats, for the year end 31 December 2008. You can read the party’s statement of accounts HERE. For those who don’t want to wade through its 28 pages, though, here are a few of the sexier snippets:

  1. The Liberal Democrats had, by some way, the largest pre-tax deficit of any of the 11 political parties whose income and expenditure figures are published – the party’s income was £5.47 million against expenditure of £6.01m, a pre-tax deficit of £540,700. The report notes, ‘As a general election must be held within the next 12 months, it is vital to build the Party’s fund raising capacity’.
  2. Donations in 2008 accounted for £1.5m of income, against £1.9m in 2007. Income from membership and subscriptions was up very slightly at £808k. Net conference income was up significantly: £558k in 2008, compared with 415k in 2007.
  3. The bulk of the party’s expenditure falls in three main areas: staff costs (£1.75m), campaigning (£1.6m) and premises and office costs (£0.68m).
  4. Taking into account the actuarial loss on the party’s pension scheme (due to poor returns on the scheme’s assets) the toal recognised loss for the party in 2008 was £670,665.
  5. The party’s deficit on Liberal Democrat News decreased slightly, from £12.6k in 2007 to £11.6k in 2008.
  6. As at 31 December 2008, the Liberal Democrats had 59,810 members, down from 65,400 in 2007 – that’s a drop of 8.5%, bigger than Labour’s 6% drop in 2008.
  7. On Michael Brown’s £2.4m donations via 5th Avenue Partners Ltd:

    The Electoral Commission and the Party’s lawyers have both subsequently confirmed that it was reasonable for the Party to have treated these [as permissible donations]. The Electoral Commission is however entitled to review the permissibility of these donations if new evidence emerges. … The Party’s lawyers have advised that it is very unlikely … any claims in respect of these donations would be successful, therefore no provision has been made in the Party’s financial statements for the repayment of such sums.

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57 Comments

  • Continuing deficits and what is becomming a very small membership list have got to have people worried about the parties long term prospects.

  • Strikes me that, assuming we don’t want to reduce the amount spent on campaigning, we really need to look at reducing our staff costs.

  • Liberal Neil 30th Jul '09 - 4:04pm

    Or put more emphasis on recruitment and fund-raising.

  • That is pretty bleak, and disappointing to see that we’ve lost 5k + members since Nick has been leader.
    I reckon it will balance out during/ after the GE if the message is shaken up as it looks is slowly happening. Stay positive! lol

  • Anders comment chimes with reports I’m hearing from people across a couple of constitutencies of mixed strength – that people are keen to join & get involved.

    @KL – a lot of staff costs are campaign related – either directly or “raising money to campaign” in the form of membership & conference office staff. The remainder are either need to administer staff & other things (ie you need some payroll etc staff). The few not covered by that (eg international projects) are I imagine funded by outside contriubutions.

    I’d be surprised if there were massive savings to be made through cutting staff costs without an impact on the campaigning side.

    I do though wonder what purpose Lib Dem News serves anymore that can’t be met with a combination of web & email.

  • JK Rowling gave a million quid to Labour last year. Let’s not count our chickens before they hatch.

  • Herbert Brown 30th Jul '09 - 8:25pm

    “… surely the distinguished children’s` author JR Rowling, would also be very welcome, as a supporter of the L/D`s.”

    No doubt J. K. Rowling would be very welcome, but only a few months ago she donated £1 million to the Labour party:
    http://www.telegraph.co.uk/news/newstopics/politics/labour/3021309/Harry-Potter-author-JK-Rowling-gives-1-million-to-Labour.html

  • If we have seen a rise in membership this year we must get that news out before the GE, july is way too late.
    The obvious explanation for last years terrible losses in particular was the way our “national” media played the London elections as though they were for the English presidency, our vote suffered across southern England. Lets hope the Euros dont have a similar effect.
    If supporters need a cheering fact they should know that Labour & Lib-dems have about the same number of members under 40, about 18K. They have got 5 times as many over 60s though.

  • Not good figures but still financial prudence compared to the other main parties .
    Labour net debts of £ 12 million membership down by 6%
    Conservatives net debts of £ 7.5 million membership down by my calculations around 5% last year and 10% the previous year .
    LibDems still have net assets of £ 0.46 million so the only major party in the black .
    SNP are also in debt but Plaid are in the black

  • John Potter 31st Jul '09 - 8:47am

    The problem is that most people won’t join a political party now without a solid local party framework who regularly put good efforts into local election campaigns. So campaigning would appear to be key, however as we all know without a decent level of members and supporters it is a struggle to develop an area properly.

    I’m as guilty as the next activist that i take my foot off the gas after an election instead of working as hard in the month after the election as the month before. At the least we should all be knocking on the doors of our D+Ps and getting them to sign up or join the local members and supporters newsletter list.

    But like i said i’m as guilty as the next man at wanting to relax after a hard month of campaigning.

  • Roger Roberts 31st Jul '09 - 9:07am

    Lib Dem News and before it Liberal News has been a vital link with members and supporters for over sixty years ! In spite of the web etc many of us welcome a printed weekly paper which does indeed keep us in touch. Our copy can then be handed on to others to create their interest.

  • Hywel, the point I was trying to quickly make was that if you’re looking at costs in any organisation (be it a council or a business) you will inevitably need to look closely at the big spending areas. If we’re saying that campaigning is sacrosanct (and I think most would agree) then you have to look at reducing staffing costs given that it’s almost 50% of the party’s expenditure. Many businesses will cut their marketing staff but not the overall spend with the view to increasing the qualty of output, for example. Could the party also look at the management structure too to save cash – particularly since we’re technically one short anyway, is this something which could continue without great detriment?

    I take the point about Lib Dem News – but if you move this to a non-subscription website, then you still have the problem of paying to maintain the site and also people to write and edit the articles, which might not necessarily reduce the overheads. Although I don’t subscribe myself – I find it a bit like “Pravda” – I can see that it serves a purpose for some people and if it could get to a point where it breaks even then fair enough.

  • Ive just noticed that while Labours membership has fallen 6%, subs have fallen 11%. Does anyone have an explanation of that, are Labour massaging their figures somehow?

  • Foregone Conclusion 31st Jul '09 - 12:59pm

    They probably have a similar system to us, with a minimum subs payment threshold but encouraging you to pay more than that. Presumably, as the credit crunch bites, people are less willing to pay above the threshold.

  • Croslandist 31st Jul '09 - 1:38pm

    Lib Dem membership income has stayed fairly high, even though the number of members has fallen – Labour’s membership income has fallen even more than their membership numbers.

  • Well, if CS actually got membership sorted out it might help. Surely we must have a huge database of former members – perhaps a survey of why they left?

  • Herbert Brown 31st Jul '09 - 3:58pm

    “Surely we must have a huge database of former members – perhaps a survey of why they left?”

    I very much doubt it. When I resigned it was a struggle to get Cowley Street even to send me an acknowledgment. I certainly wasn’t asked why I had resigned.

  • Ruth Bright 31st Jul '09 - 4:41pm

    Surveying former members is a good idea. I doubt very much if many of the membership laspes are directly the fault of Nick Clegg. The last five people I spoke to about their resignations from the party told me the following:

    Ex party member 1: Resigned from party because of its high tax image.
    Ex party member 2: Resigned from party because of its low tax image.
    Ex party member 3: Resigned in a strop because local LD councillors voted the ‘wrong way’ on a planning issue
    Ex party member 4: Resigned to join the Tories – motivated by local rather than national factors
    Ex party member 5 (aka known as my husband): Resigned from party because of the sexual discrimination I’d faced as a PPC

    Next autumn I will have been a party member for 25 years like many people I know I have really no idea why I am still a member other than the fact that resigning from the Lib Dems would be a bit like resigning from my family! It’s sheer tribalism!

  • I left the party because it didn’t bother to try to hold onto me. After reading this thread, I remembered that my renewal date was sometime in the summer, went to check my emails from a year ago, and found the ‘thank you for renewing’ mail from June 20th 2008. Since membership didn’t bother sending reminder “your membership expires next month, next week, is now overdue” notes, of course they lost me – I had no idea I’d been a lapsed member for the past 6 weeks. I remember being far from impressed when I first joined (online) five years ago and it took two months to get an acknowledgement by snail mail – this is probably the room in Cowley St. that needs a good kicking the hardest, and soonest.

  • Martin Land 31st Jul '09 - 7:40pm

    There are all sorts of reasons for membership declining. I’d cite two key ones:

    1. The endless telephone and mail appeals from Cowley Street asking for money;
    2. The simple fact that in our region at least, many local parties are concluding that recruiting members is a liability not a benefit.

  • Chris Keating 31st Jul '09 - 8:23pm

    Greg, we do make quite a lot of effort to ask or members to renew and you should have received at least one letter from us. Sounds like we might have the wrong address for you. Please email me at chris dot keating at libdems.org.uk with your name and address and I’ll have a look. Your membership doesn’t actually lapse for a little while after your renewal date, so there is still time.

    Also, while it may have taken a while to get your membership card issued 5 years ago, things are rather different now.

    Ruth – your reasons 1, 2 and 3 sound very familiar.

    Chris
    Lib Dems Membership & Fundraising

  • Ruth Bright 31st Jul '09 - 9:31pm

    Rantersparadise – thanks but I’ve been all round the houses on this already. I would urge you and everyone else for that matter to read the piece by Dr Elizabeth Evans in the current WLD magazine – it tells you all you need to know about the fate of many female candidates in our party.

  • Gareth Epps 1st Aug '09 - 4:34pm

    Ruth – having never felt the need to join WLD – is it possible for someone to email the article?

  • LibDem guru 1st Aug '09 - 4:48pm

    Let’s get rid of most of the PR and Marketing team who seem to do very little advising Nick effectively. Too expensive for what they do (or not).

    More income needed from big money supporters

  • I allowed my membership to lapse as I couldn’t see any benefit to keeping it.
    It simply resulted in a huge wave of spam asking for money and telling me about local issues and how awesome the Lib Dems are.

    Now I’d rather donate time than money, I don’t care about Local Issues and I’ll take my view from my semi-biased news sources rather than totally biased PR Spam.

    I think it boils down to the relationship between the party and members.

    I have no desire to get spam, I do not care about local issues, nor am I going to donate money, nor do I care about spin-spam saying how awesome the party is but imparting me no information.
    I also found when I joined that I had no idea what my membership actually meant other than a rather sly way of taking money. Did I have responsibilities? Did I have any rights to attend meetings or vote for things? I’ve no idea!

    So for people like me you need to ask them HOW they want to be contacted and for what reasons. Then you need to /listen/ to their response and /respect/ their choices.

    Fundamentally you need to want members for more than just their cash and their Votes, because if thats all it’s about then why not just have a paypal donate button rather than a ‘join as a member’ button.

  • Liberal Neil 1st Aug '09 - 5:43pm

    Was the decline in membership because we were losing more than usual or because we were recruiting fewer than usual? There has always been a churn. My perception is that there is very little active recruitment by local parties currently.

  • Grammar Police 1st Aug '09 - 7:35pm

    @ James S, I’m not defending your local party, but did you try to find out any of those things? If they failed to let you know, I’m sure you’re capable of asking. And if you are interested in volunteering your time, I’m sure they’d have bitten your hand off. (And you can opt out of receiving emails if you email to say so, for a start).

  • “Paid for by sacking half of the 12 press officers,”

    Does the Federal Party (as opposed to POLD) employ any press officers?

  • Ruth Bright 1st Aug '09 - 11:52pm

    Gareth – I am sure that WLD has been much the poorer without you! I’ll see what I can do about getting a wider circulation for the article on women candidates.

  • Chris Nelson 2nd Aug '09 - 9:34am

    I’d agree with Geoff Payne that there seems to have been a marked improvement in the efficiency of membership services over the past few years. Undoubtedly there are still problems with it that ought to be fixed, but I think we’ve gone beyond the point where the database is the main problem (if we were ever there).

    The simple answer to this is that local parties and individual councillors need to get out on the doorstep or on the telephone to ask people if they want to join – and then keep them up to date with newsletters, making sure that having recruited them we don’t then ignore them for the other 51 weeks of the year.

  • Martin Land 2nd Aug '09 - 10:35am

    Chris Nelson: “The simple answer to this is that local parties and individual councillors need to get out on the doorstep or on the telephone to ask people if they want to join – and then keep them up to date with newsletters, making sure that having recruited them we don’t then ignore them for the other 51 weeks of the year.?”

    Why?

    At a local party meeting the other night the Constituency Treasurer of the area confirmed that they would receive around £400 in membership fees from Cowley Street this year and that members newsletters would cost £300 and that the region had been payed £3 per member contribution to the euro campaign, a total of £645. So membership has COST them £545 this year. You might understand why most of their effort goes to recruiting deliverers!

  • Chris Keating 2nd Aug '09 - 11:27am

    Martin – no, membership”was a net income, and the European election campaign cost £645. Different regions raise funds for the Euro campaign in different ways; you would have ended up paying something even if another method was used.

    I would also point out that local parties get a big financial benefit from recruiting new members or getting people switched to Direct Debit. If a local party isn’t doing either of these things they won’t see much money in their service fee statements.

  • Grammer Police, I joined online so I didn’t really have a relationship with my local party.
    I received no personal contact from anyone in the local party so by the time I was getting a supporters news letter I just presumed it was another focus and put it in the recycling. Talked to people about all this at conference tho so its probably better now?

    ie if someone signs up caring about a particular national issue is that info forwarded to their local party with suggestion to contact them and get them involved in local campaigning to support the PPC to support the national issue?

  • On Labour again, their membership fell by 6% but their subs by 11%. Unless theres some fiddling of the figures the only explanation i can see is that the people leaving/not joining are more likely to be middle-aged or middle class ie the sort of members they recruited in the 1990s. The Labour Party of the next decade will be older & more working class, more Old Labour in every sense.

  • “that the region had been payed £3 per member contribution to the euro campaign, a total of £645.”

    The alternative would be to require each constituency to pay for it’s own election communication I suppose (which certainly in the NW would have costs seats more than the “charge” made by the region.

    Do you really get £0 return to your local party from members newsletters (I doubt it given the things you do in other campaigning areas 🙂

  • Sheila Shelton 2nd Aug '09 - 10:22pm

    There will be a saving after the next election. At the most we will only need a couple of taxis to the Commons. It was like that when I first joined the Party. . Eventually Paddy rescued us from the grave and Kennedy pushed us back.. I am daft enough to believe that we we will rise again after the likely General Election disaster and Clegg may well be the man to lead. But what has happened to Vince Cable.-The whole nation waited for his words and then there was silence. Does anyone know why ? From Ga Ga

  • Okay, here is a reason why membership might be declining. I moved into the constituency of a our beloved Deputy Leader in December 2008. I emailed the Constituency Chair saying I was an active member and was willing, time permitting, to help out. The Constituency Chair sent a welcoming email in reply, copied to six local councillors, saying that one of them would make contact. Not a squeak since, no newsletters, nothing. I work long hours so not sure, having made the initial contact, why I should do the running. Fourteen years as a member, past council candidate, I am very tempted to let my membership lapse next time the renewal letter arrives and instead spend my time pursuing charitable activities.

  • James S, in my experience I think you are the exception to most members in that, in my local party at least, membership is falling because the local party isn’t keeping in touch. The real problem is that recruitment and membership drives tend to fall in the lap of people like councillors, PPCs or constituency organisers who, frankly, have a million and one other things to do (including family lives and jobs.) It’s also something which people (including myself, I admit) genuinely don’t like doing.

    However, you should have had some sort of contact from the local party (which at least RMC has had.) I’ve been a member of four local parties, and each time I’ve been contacted by someone there pretty soon after I’ve moved, and this is something which we are doing.

    The party, though, should be trying to find out why people are leaving. This is something which any business which relies on continual payments will do, at the very least to see where their customers are going. A large percentage will simply not be renewing because they’ve forgotten, and may well renew again if asked. Some won’t agree with a particular policy – if we find out which ones, we can adjust our message if clarity is needed, or find out if we’re getting something wrong. If it’s a local matter – e.g. a planning application, or a council action – then this can be fed back to the relevant local party. And if it’s because of the constant demands for money, then surely we can sort something out to allow people to opt-out of this (any letters sent to me in this regard simply get added to the recycling without being read.)

  • Libdem Guru 4th Aug '09 - 1:32pm

    So, when are we going to get word back from Nick Clegg; as to why we are wasting so much money on so many PR consultants that are doing nothing worthwhile!!! The marketing strategy is so flawed (internal and external comms)

    Now that would get rid of most of that deficit.

    LibDem Voice……that is your job to get the answers for us.

  • Mike Falchikov 4th Aug '09 - 5:00pm

    Lot of very interesting and thought-provoking comments – certainly most local parties need to sharpen up and we’re all guilty of going off the boil from time to time.
    As to JK Rowliing – please forget all about her. She recently accepted an invitation to a fund-raising dinner, partly -in her honour, given by the Lib Dem- led council in Edinburgh. Halfway through the evening, she accepted a call from
    the PM, agreed to donate £1m. to one of Sarah’s charities and then left the dinner hurriedly without thanking her
    hosts. So please no more about her – fortunately, we do have other worthy celebs who support us and perhaps need to be politely nudged into a higher profile on our behalf.

  • Libdem Guru 7th Aug '09 - 12:34am

    maybe mark you can answer my question as to why the pr/marketing strategies are in disarray and why there are so many, and so many incompetent pr/comms personnel employed for such a small party?

  • Mark Pack, i suggest that you realise it’s not only you that has; an insight into the workings of the Party, or the facts and figures of recent polls.And more importantly; the common knowledge of what swathes of the public think of certain Libdem personalities and modes of operation are blindingly obvious.

    The Party, which I love dearly, needs a huge kick up the arse, getting rid of the dead wood and putting the likes of Charles Kennedy back on the front benches. “Slowly but steadily”, even from a ‘party insider’ (haha) will not win a general election. We both know that!!!

    So get off your high horse and get these well paid layabouts who claim they are good at PR/Comms to sort out some decent PR/Advertsing which makes us look a viable AND credible third option.

    Party members deserve it, and we’ve waited long enough to win a general election.

2 Trackbacks

  • By Top of the Blogs: The Golden Dozen #128 on Sun 2nd August 2009 at 10:02 pm.

    […] work harder on Costigan Quist’s Himmelgarten Cafe blog. Costigan tells it to us straight. 5. Lib Dems’ £550k deficit, 8.5% membership drop, and other facts from the party’s annual … by Stephen Tall on Lib Dem Voice. You guys just love the good news stories, […]

  • By Those Lib Dem donation figures in full (Q2, 2009) on Wed 26th August 2009 at 6:38 pm.

    […] Lots of familiar names on the 2009 Q1 list, with five/six-figure gifts coming from: Lord Alliance (£250k), Joseph Rowntree Reform Trust (£205k), Anthony Wilkinson (£105k), C& C Business Solutions (£50k), George Lyon (£15.5k), Christopher Nicholson (£15k), and Andrew Haisley (£10k). Incidentally, as I understand it, Lord Alliance’s gift is the conversion of a loan to a donation, which represents a big boost to the party’s balance sheet – which is no bad thing, given the party’s deficit in 2008. […]

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