General Elections: Party-political Spending

Baroness Penn Excerpts

Wednesday 29th November 2023 Lords Chamber

[Lord Rennard]

To ask His Majesty’s Government what assessment they have made of the case for increasing the maximum limit for political parties to spend at general elections.

[The Parliamentary Under-Secretary of State, Department for Levelling Up, Housing & Communities (Baroness Penn) (Con)]

It has been a long time since campaign spending limits were last adjusted for inflation—some have not changed since 2000. This means that as prices rise over time the limits are, in effect, reduced. Parliament anticipated this when the limits were set, which is why the legislation allows for them to be adjusted to account for inflation. The Government have now begun making these adjustments to ensure spending limits are restored in real terms.

[Lord Rennard (LD)]

My Lords, none of the last five Governments has seen fit to increase these spending limits for political parties, so I wonder what was different about this Government? In the last five elections, only one party—the Conservative Party—has come close to spending towards the election expense limit, so why does it now have to be increased by 80%? Which party will benefit? Boris Johnson managed to win the last general election spending £16 million, so why do this Government seem to think that they need to spend up to £36 million to try to be re-elected? What will their donors expect in return for this cash?

[Baroness Penn (Con)]

My Lords, this is not an unusual exercise. In fact, uprating has been done under successive Administrations of all political colours and is done regularly for other matters too. It is provided for in the original legislation passed by this Parliament. By using those powers, we are simply restoring the levels of spending limits that were provided for by Parliament.

[Lord Swire (Con)]

What is the view of the Government about the allegations that some political parties or political operatives are seeking to lure away existing elected Members of the other place with promises of money? Is that something that the Government will be looking at?

[Baroness Penn (Con)]

I am not sure of exactly what my noble friend refers to. None the less, it sounds like a serious matter that I would want to speak to him about after this Question.

[Lord Watts (Lab)]

Given the past scandals of money going into the Tory party over the last few years and influence that has been given to those people as a result, should we not reduce, and not increase, this amount of money?

[Baroness Penn (Con)]

Perhaps the noble Lord will be reassured that a process of consultation went on in regard to uprating these spending limits. Members of the Parliamentary Parties Panel were first consulted by the Cabinet Office in 2020. Since then, we have uprated the limits for local government elections, which I believe has passed without problem. In September 2022, the Government again wrote to members of the panel. There is a need for change; some of these limits have not changed for over 20 years. We are simply restoring the levels that were previously set out in law by Parliament.

[Lord Hayward (Con)]

My Lords, in relation to the last question, the accusations of providing money in dubious circumstances have applied to all political parties, unfortunately, at one point in recent years or another. I refer my noble friend back to the answer that she gave. She identified that the limits have changed in local government; we are now looking at limits in national elections. Does that not confirm that it is about time that we looked at consolidating all election law so that we do not have to deal with these things in different stages? I am not asking my noble friend to make a commitment to do so, but I ask her to acknowledge and take the message back.

[Baroness Penn (Con)]

My noble friend is absolutely right that the procedure for uprating spending limits has to be done through multiple statutory instruments because different procedures are attached to different limits for different elections. I know that he has been a great advocate for simplifying and consolidating electoral law. I am sure that he will continue to advocate that, and I very much look forward to engaging with him on it.

[Baroness Taylor of Stevenage (Lab)]

My Lords, the Government’s rejection of amendments to the National Security Act means that foreign donations can still be made to political parties here in the UK. If the department is going to consider reviewing political financing, does the Minister agree that it is time to end this security loophole to prevent covert foreign donations to political parties?

[Baroness Penn (Con)]

My Lords, I believe that as a result of the debates on that Act the Government took forward a commitment to ensure information sharing between the police and other relevant authorities with a view to finding a way to improve that process. The sharing of information could improve the ability of relevant authorities to identify any individuals making or facilitating donations from foreign powers and sanction them. We have a commitment to report back to Parliament next year on that work.

[Lord Harries of Pentregarth (CB)]

In recent elections there has been concern on the part of non-political campaigning organisations about the limits on their expenditure. Have the Government reviewed what non-political campaigning groups are able to spend at election time?

[Baroness Penn (Con)]

I believe that the rules regarding third-party campaigning organisations will also be uprated as part of this work.

[Lord Wallace of Saltaire (LD)]

My Lords, there are a number of proposals for limiting the size of donations. Have the Government taken any issue with that? I have looked at the reports on donations for the first six months of this year, and the three largest donations to the Conservative Party were two individual donations of £5 million and one of £2 million. One was from a British-Egyptian national who was a Minister in a previous Egyptian Government and whose interests appear to be based primarily in Dubai. Another was from someone listed with Companies House as an Indian national— I assume therefore resident in London—whose interests are primarily in Thailand and Indonesia. Is it not time that the Government became much stricter on the size as well as the origins of individual donations?

[Baroness Penn (Con)]

My Lords, the Government have no plans to limit the size of donations made. We have procedures in place to ensure that there is transparency over those donations and, as we are discussing today, spending limits for candidates and parties in elections. That is how we govern the use of money in our political system.

[Lord Blunkett (Lab)]

My Lords, I hope that the House and the Minister will forgive me for asking a tangential question. Is it not time that the Government restored the special fund that put those with disabilities on an equal footing in campaigning in a general election?

[Baroness Penn (Con)]

I hope that the noble Lord will forgive me for acknowledging that it is a slightly tangential question; I may need to write to him with a fuller answer. I remember the establishment of the fund; it was established for very good reasons, so I am happy to take that away and look at it further.

[Lord Forsyth of Drumlean (Con)]

My Lords, further to the questions from the Liberal Benches, would they not carry more credibility if their party had not taken £3.5 million from a fraudster who is a fugitive from justice? Any respectable political party would have paid that money back.

[Baroness Penn (Con)]

My Lords, all political parties should seek to abide by the rules and, if they have not, they should definitely return the money that they owe.

[Lord Sikka (Lab)]

My Lords, general election spending is funded by big corporations and the rich. They do not actually donate money; they invest—they expect a return. In the interests of transparency, would the Minister consider introducing a law to require political parties to state what returns they have promised and to whom?

[Baroness Penn (Con)]

I completely reject the premise of the noble Lord’s question. We have transparency in our system so that people can see who donates to political parties. The alternative to donations to political parties is government funding of political parties and campaigning. That is not something that we on these Benches wish to see.

[Lord Cormack (Con)]

My Lords, in view of the influence that the press very often has on elections, will my noble friend the Minister read the admirable article by my noble friend Lord Hague in yesterday’s Times, which indicated that it would not be a service to democracy for one of our notable daily papers and one of our notable weekly magazines to be bought by foreigners?

[Baroness Penn (Con)]

I always enjoy reading articles by my noble friend and I will undertake to read that one.

[Lord Anderson of Swansea (Lab)]

My Lords, to prove the honesty of the intention of donors and the lack of any self-interest, would it not be a good idea to ask any donors of that sort to disentitle themselves from honours?

[Baroness Penn (Con)]

My Lords, that is an interesting question for all sides of this House. Donors to political parties of all colours make huge contributions to our society—not only to our political parties but to many other good causes. They are often leaders in their fields. We should encourage participation in our democracy and not discourage it.