Press release 07th Jul 2021

Long-overdue reforms to UK politics financing essential to protecting integrity of elections

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7 July, 2021 - Transparency International UK welcomes the conclusion by England’s standards watchdog that many of the rules designed to ensure probity in the financing of UK politics should be modernised to address concerns of foreign interference and make existing controls more effective.

The Committee on Standards in Public Life today published findings from its review of electoral regulation.

 

Daniel Bruce, Chief Executive of Transparency International UK, said:

“We back some of the key recommendations in this important report, which are long overdue. There is a clear and growing consensus that the current rules controlling the money in British politics are out-of-date and in need of urgent reform. It is important for trust in our democratic system that significant changes to the rules are taken forward on a cross-party basis.

“MPs should recognise that this report is being presented to them not by a campaign group, but by a former head of the Security Service, MI5. There are too many avenues for funds of unknown provenance to influence our democratic politics, which gives comfort and cover to those seeking to sow discord in society or ingratiate themselves with a political elite. Ignoring this problem would provide an open door to malign foreign forces. If government wants to protect the integrity of our elections, then it must start by addressing the gaping holes in the rules governing how they are financed.

“Critical to safeguarding the integrity of these rules is an independent body with the powers and resources necessary to undertake its public function. While it is entirely right and proper that the Electoral Commission is subject to parliamentary oversight, it would be highly inappropriate for the government of the day to dictate its regulatory priorities, which would provide an open door to undue political interference. Parliament should provide rigorous scrutiny to provisions in the government’s Elections Bill that would give ministers the power to direct the strategic priorities of the Electoral Commission.”

 “Although necessary therefore, rules alone are not sufficient to also tackle the corrupting influence of money in UK politics. Some parties still remain unhealthily dependent on a relatively small number of big donors, which opens up the risk of cash for access and even favours. Three-quarters of UK respondents to Transparency International’s Global Corruption Barometer survey strongly believed that wealthy individuals exert undue influence on governments and action needs to be taken to stop this – we agree.”

 

 

Notes to editors:

The Committee’s findings cover several areas where Transparency International UK has previously called for reform, including:

Companies only being able to donate from profits they generate in the UK

The Committee has recommended that companies can only make political donations over £500 if they can prove that they are earning sufficient income here to fund any contribution they make.

Transparency International UK has called for this change since 2016.

Controls on political party spending at elections

The Committee has recommended that the costs of directly employed staff working on election and referendum campaigns should be included in the spending limits for political parties and referendum campaigners.

Transparency International UK has called for this change since 2016 alongside annual caps on the donations of no more than £10,000 and a reduction of the national spending limit by 15% to help remove the corrupting influence of big money in UK politics.

Enforcement

The Committee recommends that the maximum fine the Electoral Commission may impose should be increased to 4% of a campaign’s total spend or £500,000, whichever is higher.

Transparency International UK and the Select Committee on Democracy and Digital Technologies also agree with this proposal.

Unincorporated associations

The Committee recognised that despite reforms in 2010, there is still far too little information about the sources of funding of Unincorporated Associations (UAs) – donor clubs who have made over £48 million in political donations since records began in 2001. Since 2010, if a UA donates over £25,000 in a year to a political party or other regulated campaigners, they must disclose the source of any ‘political gift’ over £7,500 they receive from a single source. However, despite making over £30 million political contributions since then, UAs have only reported the source of funds for £27,500 (0.09 per cent) of these donations.

To help protect against funds of unknown provenance entering the political system, Transparency International UK recommended reducing the level at which unincorporated associations report political gifts to £500. There is also a strong case for subjecting these contributions to permissibility controls, as is the case for any donations over £500 to political parties or other political campaigners subject to political finance laws.