Party Funding Reform

Lord Tyler Excerpts

Thursday 3rd November 2016 Lords Chamber

[Lord Tyler (LD)]

My Lords, I start with a quote:

“Whether or not clause 10 is enacted, in whatever form, the political parties should live up to their manifesto commitments and make a renewed and urgent effort to seek a comprehensive agreement on party funding reform. We urge the Government to take a decisive lead and convene talks itself, rather than waiting for them to emerge”.

That was the unanimous recommendation of a Select Committee of your Lordships’ House, chaired by the noble Lord, Lord Burns, and which represented all groups in the House—three of which are here this evening, I am delighted to say—and it was of course subsequently welcomed on all sides of the House. The report was published on 2 March of this year. The convention is that the Government respond to a Select Committee report of your Lordships’ House within two months. It is now six months later and we are still waiting for any sort of response, let alone any action to fulfil that recommendation.

The Government are clearly becoming increasingly apprehensive that the traditional role of your Lordships’ House as the impartial guardian of the constitution, semi-detached from the rather more tribal activities at the other end of this building, will prove more popular than their own narrow partisan approach. Perhaps we should remind the Government that they were elected with less than a quarter of the eligible electorate giving them their support, so they have a doubtful mandate.

The Government should also be reminded, as they were by the Select Committee of the noble Lord, Lord Burns, that the Conservative manifesto had an explicit promise, as we have been told this evening:

“We will continue to seek agreement on a comprehensive package of party funding reform”.

Since the 2015 election, further evidence has emerged of the extent to which all parties—as my noble friend Lord Wallace has said—are now reliant on a small number of large corporate bodies and individual millionaires, when we all want to step away from that and try to make sure that we have a greater number of small donations. It is extremely important, as my noble friend Lord Wrigglesworth has just said, that we should look again at giving encouragement to smaller donations through a replica of the gift aid scheme that is available to those donating to charities.

Millions of modest donors must be better than millions of pounds from a very small group of special interests, trying to buy access, influence or patronage. That includes—as I think the noble Lord, Lord Sherbourne, would accept—those who have been supporting UKIP, and indeed the SNP, which have been reliant on a small number of very big millionaire donors. His argument would also go in the same direction.

I think we are all grateful to the noble Lord, Lord Bew, for giving us some brief information about this latest poll that the Committee on Standards in Public Life has commissioned. That is really useful and we will all look at it with considerable interest. But I just remind him that the last time that there was an indication of the public’s attitude to this, 77% were saying that big donors have too much influence—that would seem to have risen. However, at the same time, 57% believe that state funding of politics is better than the present system when there is a direct comparison, which has gone up from 41% in 2014. So it is not such a clear picture about the state funding issue as has been suggested.

As my noble friend Lord Wrigglesworth has said, if you simply reallocate existing state funding—free postage being an obvious example—you could save a huge sum of money which could be better allocated to good effect. The noble Lord, Lord Bew, summarised the situation excellently after the general election when he said that:

“It is clear after the General Election that the issue of party funding remains a matter of significant public concern centred on the confluence of money, power and influence”.

I thought that his speech this evening underlined that brilliantly. Since 2015 and the CSPL report—and indeed since the general election—there have been some important changes in the relationship of the Labour Party and its main funders, but no movement on the Conservative side. The time is now really ripe for some movement there.

It is not just the donations issue that is resulting in the ever-decreasing public confidence in these aspects of our political system.

In the 12 elections that I have contested—I have won some and lost some, as we all have—I have always been reminded by my agent that every single pound spent to promote the candidature has to be carefully recorded, and, of course, it is restricted; otherwise, you could face an election court, with the potential for disqualification. My noble friend Lord Oates is absolutely right: the law that has been in place since 1883 to prevent anybody with large amounts of money seeking to buy a constituency, and thereby own the Member of Parliament, is now being circumvented by the current situation. The present rules are inadequate and simply do not meet the case.

The independent Electoral Commission said in its report on the 2015 UK parliamentary general election, published in February of this year:

“These experiences from the 2015 UKPGE reinforce our view that the relationship between regulation of candidate spending and political party spending that has been in place since PPERA was passed in 2000 needs closer examination. The law currently only requires political parties to report spending against separate limits for England, Scotland, Wales and Northern Ireland, which means it is difficult to assess whether and where political parties are choosing to target their spend, their campaign funds on a regional or constituency basis”.

Evidence to the Burns committee reinforced that. We had evidence in particular from the Minister in the coalition Government who was responsible for these matters, who told the committee that,

“the local constituency-wide spending limits were made a mockery of, first, because all this stuff was being mailed out centrally and, secondly—one has to acknowledge—because of some very ingenious, intelligent and smart, if ruthless, use of digital technology, which costs money … Some of the hired guns of the Conservatives are already on public record as saying they spent far more than they should have done, but the question beyond that is that those slightly old-fashioned constituency-level limits can be easily circumvented through central funding, or through the use of … database campaigning techniques”.

I say to the noble Lord, Lord Leigh, that Jim Messina, who claimed that the Conservatives spent £30 million, far in excess of the national limit of £18.5 million, seems not to agree with him that there was not a general increase.

The Electoral Commission has made firm recommendations on this issue. Clearly, we have to listen to it because it is the statutory body responsible for electoral law. Since then, we have had the referendum, to which my noble friend referred. I simply say that I think the time has come to move on. Indeed, the report by the noble Lord, Lord Hodgson, on third-party campaigning adds to the need for a level playing field of funding constraints between them on one side and the political parties on the other. Taken with the CSPL evidence and the Burns Select Committee and, indeed, the report and draft Bill produced by the cross-party group in 2013, there is simply no excuse now for further delaying tactics.