PARTY FUNDING

State Funding

Suggestion that large money sums for party funding could come from the tax payer

However, we already pay MPs from taxes

Financial Donations

Conservatives

Labour

Big businesses such as JCB

Large sums from wealthy individuals

Hedge funds and banks

Cameron met with electorate in return for cash

Problems

Vested interest

Tories overly care for rich donors

Low income and corporation tax

Little attempt to close tax avoidance eg trust funds and offshore accounts

Anti trade union laws

Membership fees (500,000)

Proportion of union member fees go towards Laboour

Trade unions eg unite and unison

Problems

Not everyone can be in a trade union

When striking, members may have voted for it but may be opposed to gov

Striking can damage economy

Influence over Labour leadership elections and to a degree MP selection

Labour: safer on union laws

Lib Dems and smaller parties

No level playing field

Struggle to get anywhere near as much as Labour and the Tories

Arguable: lack of comparable funds has negative impacts on their ability to get elected

Large individual donations

Under Blair, Jan 1997

Mr Ecclestone (Formula 1 chief) donated £1m to Labour party yet was only declared November

After gov said F1 was exempt from tobacco ban which was a key part of their manifesto

Ecclestone had lobbied for this at meetings in No10 with Blair (16th Oct)

Funding types

Short money: available to opposition parties to help cover costs and provide proper gov scrutiny

Cranborne money: same as short money but for Hol

Policy Development Grants: £2m shared across those parties with 2+ sitting MPs with oaths of allegiance

Parties received subsidised TV and postage during GEs

2016 Trade Union Laws

Fair

Unfair

Not all members in unions want to support Labour

Union members may not have been aware of funding Labour

Labour has own memberships to gain money

Tories did this to weaken Labour

People are less likely to actively 'opt in'

Reforms

Inquiry and Report from Committee on Standards in Public Life 2011

Cap on individual donations inc. trade unions of 10,000 p/y and £23m p/y in public subsidy

Tories approved Trade Union factors

People more engaged with parties

But....

coalition gov (2013) rejected recommendations due to austerity

ignored once again

2000 PPERA

Independent electoral commission to supervise party spending

Spending capped £30,000 per constituency

Parties must publish donations regularly

£5000 national and £1000 constituency donations must be declared

Loans now subject to these rules (2010)

Donations not from electoral roll banned

PPEA 2009

But...

Doesn't remove vested interest

'Cash for peerages' scandals 2006- Labour claimed donations were loans

Cast shadow over Blair

Political Parties and Elections Act

Tighter regulations on spending in run in to elections and empowers regulation

Electoral Commission allowed to investigate cases and impose fines

Tories fined £70,000 2015 for constituency over spending (29)

Donations £7500+ declared - only UK residents

But...

Fines= affordable to parties and they can carry on contesting

Risen donation declarations

Phillip's Report 2007

Proposed to address private donations and move towards tax payer funding

Supported by Lib Dem and Labour in 2015 GE - impose limits on individual donations

eg. pence for vote / member basis

But...

Couldn't be implemented as austerity is already burdening the tax payer

Tories contradicted these limits and limited Labour with trade unions

Nothing came from report

Cash for Honours

Lords aren't elected but chosen by PM (patron)

PM may be inclined to award peerages to large donors

2006: Blair recommended several who weren't accepted by the HoL Appointment Commission - Labour donors

2016 Cameron recommended Tory donors when resigning such as Olivia Bloomfield (Former Governor of Cheltenham Ladies College) who had raised millions for Tories.