Party Funding

Everybody is in favour of democracy – but you can’t have democracy without political parties through which citizens come together to develop ideas and policies. That costs money in terms of organisation and the sheer cost of a modern election campaign. So it’s not surprising that there is an on-going debate about party funding. All three major parties accept that there needs to be a change. But as each party has a different history of fund-raising, it’s difficult to get agreement on a programme of change that is both workable and fair. Ed Miliband entered the fray this week with two significant proposals. One is to put a cap on spending because if you limit how much each party can spend on an election it lessens the need for cash and helps to make a level playing field. The other is a £5000 cap on individual, business and union donations and a lower cap on election spending, and to make that election cap spend stretch across the whole term of a Parliament.

The election spending cap is currently at £19 million, which no party has hit yet. In the last election, the Conservative Party spent £16.6 million; Labour spent £8 million and the Liberal Democrats £4.7 million. The way to avoid a sense that you can ‘buy elections’ – as in the USA – is to both deal with the income and the expenditure, as Ed Miliband has proposed.

It has always puzzled me that people want individual members of a trade union to have control over their contributions whereas the same doesn’t apply to shareholders of a company when their money is used to make political donations.

One other possible solution is to have state funding for parties, as in many other countries, but leaders of all three main parties have dismissed this for now saying that the public wouldn’t want it. It’s an issue that we need to resolve with a good old British compromise because our reputation for democracy will be totally crushed if parties are scared for an election or a by-election because they can’t afford it, and no party should have to worry about raising money in ways that are unprincipled or which distort policies, as all have done at one time or another.


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