What do political parties, politicians and political campaigners spend money on?

Getting a comprehensive picture of political expenditure can be challenging, in large part because it is reported in different places depending on who is involved – be they a party HQ, their candidates, or others influencing political debates. It also does not help that some political spending is regulated while large amounts of it are not. 

You can find key details about regulated political expenditure in the following places: 

• parties’ statement of accounts
• parties’ and non-party campaigners’ election spending returns
• candidates’ election spending returns 

The Electoral Commission is responsible for monitoring and ensuring compliance with the rules that govern regulated spending.

There are limits on how much political parties and non-party campaigners can spend in the run-up to major elections. These are often called the ‘national’ spending limits, which are regulated by the Political Parties, Elections and Referendums Act 2000 (PPERA). They apply for a year before UK Parliamentary general elections. As we don’t have fixed term Parliaments and there is no certainty as to when an election will take place, these limits can be both retrospective and unexpected. There are separate rules for devolved legislatures, where spending limits apply for four months before polling day. 

The level of the limit varies depending on how many seats a political party is contesting in each part of the UK, or the geographical spread of a non-party campaign. 

For a political party standing in a general election, their limit in each part of the UK is calculated by multiplying the number of constituencies they are contesting by a monetary value – originally £30,000 per constituency then raised by the UK Government in November 2023 to £54,010. Currently, a political party contesting all 632 seats at a UK Parliamentary general election can spend up to £34 million in the year before polling day, up from £18.96 million under the previous rules. 

The spending limits for national non-party campaigns are based on a formula that is roughly 2 per cent of the total that can be spent by a political party. This means UK-wide non-party campaigns at a UK Parliamentary general election can spend up to £762,130 on regulated activity.  

There are separate constituency-level controls on how much candidates and non-party campaigns can spend on activities promoting or procuring the election of a specific candidate. These are known as the ‘local’ spending limits, which are regulated by the Representation of the People Act 1983 (RPA 1983) and the various election Orders for devolved elections. The level of the limit varies depending on whether a constituency is a borough/burgh or county, and the number of voters in the seat. 

Typically, UK Parliamentary candidates can spend up to £17,000 (borough/burgh) and £20,000 (county) in the ‘short campaign’, which begins when a person officially becomes a candidate – no earlier than when Parliament is dissolved. There is also a ‘long campaign’ spending limit, which controls expenditure before Parliament is dissolved but after it has sat for more than 55 months. There has not been a long campaign since the 2015 general election. When there is a long campaign, the spending limit is £40,220 plus a variable amount dependent on: 

• the type of constituency
• number of voters within that constituency
• how long Parliament sits beyond 55 months 

Typically, long campaign limits are between £46,000(borough/burgh) and £49,000 (county) if Parliament goes full-term.  

Collectively, candidates standing for a political party contesting all 632 seats in Great Britain at the 2024 general election would have been able to spend up to a combined £12 million during the short campaign, with no limit on their expenditure pre-dissolution. The total potential spend for a political party at the UK 2024 general election, contesting all seats was £46 million. 

The system in the UK is complex and one of the most commonly seen challenges is that the dividing line between the national and local limits is not always clear, leading to accusations that candidates and their political parties do not account for them accurately. Similarly, what is and is not regulated by the rules on non-party campaigning is not always clear-cut, which has been a major point of contention.. 

What is and is not regulated also varies depending on who is spending the money. For example, staff costs incurred by candidates and national non-party campaigners are regulated, whereas similar costs incurred by political parties at elections are not. 

There are no general limits on how much political parties or their members can spend outside of the regulated periods. However, political parties may have their own rules governing internal contests, such as leadership elections.

The purpose of spending limits varies across the different types of campaigners. 

Broadly, the original intent of national political party limits was to provide a ‘level ceiling’ on the amount being spent, with a view to prevent what the Committee on Standards in Public Life (CSPL) dubbed ‘undue concentration on fundraising’. However, when it last reviewed parties’ expenditure back in 2011, it concluded that the current controls did not provide an effective constraint on campaign costs, with only the Conservatives and Labour getting close to spending the statutory maximum. As mentioned above, since the CSPL’s review in 2011, the UK Government has increased the limits even further, despite the Electoral Commission stating there was no evidence to support this decision. 

Until recently the limits on local candidate spending, which date back to the nineteenth century, provided a rough ‘level playing field’ between those contesting polls, making elections more accessible. All of those running a credible campaign would likely be able to raise enough funds to spend close to the limit – preventing those with deep pockets from having an undue advantage. However, the recent increase to their limits risks making the rules more favourable to those with access to substantial wealth. 

The rules on non-party campaigns are intended to prevent political parties and candidates from trying to circumvent controls on their expenditure by funnelling money through other organisations, and ensure those contesting the polls are the principal actors in that election.

Campaign literature, such as leaflets and postcards to voters, is one of the largest chunks of election spending. Proportionally, this has risen from only around 10 per cent of political parties’ spend in 2001 to 40 per cent in 2019. Political parties have also dedicated a substantial chunk of their resources towards advertising – a category covering everything from billboards to advertisements in newspapers to online ads on social media. According to analysis by academics Sam Power and Kate Dommett, over half of advertising spend at the 2019 UK general election went towards ads on Facebook, Google, Twitter and Snapchat – an ‘exponential rise’ from the just under a quarter in 2015. 

Market research and canvassing, which helps target the above two categories, comes in consistently third highest in terms of regulated spend. 

Based on their annual accounts, the largest parties in Westminster spend half of their money on staff and office costs. Typically, these budget lines have accounted for between £20 million to £30 million of the Conservative’s and Labour’s yearly expenditure over the past decade. While not regulated by spending limits, staff costs can surge in the region of £4 million to £6 million in UK general election years. Office expenditure can include political activities and publishing, administration, finance and IT costs. 

Even outside of UK and devolved general election years, they still report millions spent on campaigning, though major election years can increase this by between £10 million to £20 million.
 

To reduce the pressure on political parties to raise seemingly limitless amounts of money, including from questionable sources, there should be more meaningful controls on their election expenditure. This involves reducing the current spending limit significantly and broadening its scope. 

Previously, the CSPL proposed that the limits be reduced by at least 15 per cent. However, they made their proposal before the UK Government’s substantial uplift in the existing legal maximum. To give effect to CSPL’s proposal now, we recommend more than halving the current restrictions to a ceiling of £16.1 million on election expenditure. These rules should also cover campaign staff costs, which the law currently excludes from the limits for political parties yet not those for non-party campaigns. As a minimum, Government should also legislate to return candidate limits to their pre-2023 levels. 

Political parties should also have to report their regulated expenditure far sooner than is currently the case, with the Electoral Commission making this information available as soon as reasonably practicable after receipt. As we publish this explainer, we still do not have any information about how much the larger parties spent on regulated activity for the 2024 election, which took place ten months ago. Similarly, there should be greater standardisation in how major parties report their annual accounts to help make it easier to follow money through the political system.