Democratic Political Activity (Funding and Expenditure) Bill
There is widespread agreement that our representative democracy in the UK is vulnerable to the influence of well-financed interest groups and wealthy individuals. Successive scandals led to the commitment in the 2010 Coalition Agreement to “take big money out of politics”.
However, a series of investigations of the increasingly unsatisfactory situation, culminating in the examination and recommendations of the Committee on Standards in Public Life (“Political Party Finance”, November 2011), have not led to any remedial action.
This deadlock has yet to be broken by any “official” negotiations between the three major parties.
A backbench cross-party initiative, firmly rooted in the work of the CSPL and previous analysis in the Hayden Phillips Review, has resulted in the attached Draft Bill. The purpose is to bring the practical issues out into the open again, and to seek consensus on the timetable and priorities for incremental reform. The Draft Bill by its very presence shows that reform “can be done”, and shows a potential blueprint for how.
The Bill would introduce a donations cap, applicable to all donors including trade unions. However, affiliation fees would be treated as “bundled” individual donations, providing trade unions (and, for that matter, any similar membership organisation) meet certain conditions set out by the Committee on Standards in Public Life in their report. Existing spending limits would be reduced by 15%. We believe there is broad agreement about this approach.
There were, however, two key objections to the CSPL’s report. First, that no more public money could be spent on politics when the public themselves are feeling such a tight squeeze on household finances. Secondly, that the impact of a cap on the parties would be too dramatic, too fast. The Bill seeks to deal with these problems, both by including a cap on the total public spend on political parties – which could be set for the timebeing at current levels – and by introducing the donations cap over a period of ten years. This will restrain any additional call on the public purse until the donations cap has been reduced, and until the public finances are in a healthier position. It will also enable parties to change their donations profile over time. We hope that this twin-track response to the key criticisms of the CSPL’s report will enable the otherwise very sound architecture they proposed for party political finance to progress towards implementation.
The issues this Draft Bill seeks to deal with cannot wait for the next scandal. Equally, Parliament cannot wash its hands of responsibility. Without strengthened legislation, the independent Electoral Commission cannot secure adequate defences against disproportionate political influence for those with disproportionate sums of money to spend. In particular, the current regime is woefully inadequate to deal with the possibility of massive investment in “third-party” political campaigning, which could fall largely outside the current restrictions. The Draft Bill shows how it may be possible to learn the lessons of recent US “super PAC” campaigning, by anticipating and limiting possible displacement of donations from the parties themselves into external campaigning organisations.
The Draft Bill is an opportunity for Parliament to reconsider the recommendations both of the CSPL and of the Hayden Phillips review. Our intention in producing a draft Bill is then to move from consideration to conclusions, so that a long chapter of negotiations, talks and deadlock on this issue may finally be brought to an end.