Political Donations

David Simmonds Excerpts

Monday 31st March 2025 Westminster Hall

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

This is the second time in a few weeks that we have debated this issue. I am aware that we are likely to be interrupted shortly for multiple votes, but I will do my best to make some progress in responding to the many and varied points that have been made.

The debate about political financing always feels like an equal opportunity debate: we can all find something in other political parties’ financial arrangements that we would like to criticise and call into question. However, the high degree of cross-party commitment—and the fact that Governments of all parties over the years have passed legislation to ensure a high degree of security in UK political financing—demonstrates that our politics, on the whole and by any international comparison, is pretty clean. Members have raised a number of points, however, that have been widely debated and that are worth our consideration, and that I know the Government are already looking at.

The first point that is important to highlight is that foreign donations to political parties in the UK are already illegal. It is also illegal for foreign citizens to channel their own money through UK sources. Although we have heard a great deal of political debate about donations, prompted by Mr Musk and his comments, it is clear that if a UK company acted as an agent for a donation by a foreign company, that would be an impermissible donation under current laws. If a person or an organisation makes a donation on behalf of another without disclosing who that donation is from, that is also against our laws as they currently stand. The key thing is to make sure that we have effective measures in place for the enforcement of those rules.

A number of Members referred to the role of the Electoral Commission. It is important that we reflect that more recent legislation is based on the original Political Parties, Elections and Referendums Act 2000, which was passed by a previous Labour Government. I draw the attention of Members who have criticised more recent legislative developments to the words of a then Labour Minister when that legislation passed through the House. With respect to the Committee that designed the legislation, he said:

“The Neill committee made clear its view that prosecutions in respect of breaches of the law relating to controls on donations and election expenses should be placed in the hands of the Director of Public Prosecutions and should not be the concern of the commission…the commission does not have that power... the commission will be an enforcement authority but not a prosecuting authority.”—[Official Report, House of Lords, 20 November 2000; Vol. 619, c. 631-632.]

There had clearly been some drift over time, whereby there was a lack of clarity as to who was responsible. Given, in particular, the significant civil penalties that can be levied by the commission, there was a requirement for absolute clarity that prosecutions for breaches of the law were a matter for the police and the Crown Prosecution Service, since any objection to those would likely end in a judicial review anyway. That is something that all Members should welcome in terms of bringing clarity to the process.

I have a few brief questions for the Minister, which will reflect what we debated previously on the Floor of the House. First, it is clear that, contrary to the points that have been made, taxation has never been a basis for suffrage in the UK, and a number of situations relating to that have been clarified in recent caselaw. Students, for example, are exempt from paying council tax, but none the less have a vote in local elections where they reside. There are also expats from the UK who have paid no taxes for a long time but have the right to vote, while others pay significant UK taxes on investments, pensions and other assets held in the UK and do not have a vote. As such, it is important to recognise that although those who pay taxes in the UK have a significant connection to this country, that is not the only basis on which people may exercise a vote.

The last Government, in the previous Parliament, made a commitment during the passage of the National Security Act 2023 to enhance powers so that regulators, law enforcement and security services could share information with political parties. That was, in part, designed to help avoiding a repeat of the situation in which the Labour party found itself taking £700,000 from Chinese spies. Will the Minister commit to ensuring that those commitments are delivered, so that our political parties can access that information when risks are identified?

Will the Minister close the loophole that was created by the Labour Welsh Government and the SNP Scottish Government, which for the first time allows Russian, Chinese and Iranian citizens who are resident in Wales and Scotland to donate to UK-wide political parties and campaigns, when those donations would otherwise be banned? Will she tell us why China is not to be included in the enhanced tier of the foreign influence registration scheme? I appreciate that the Government are seeking to enhance relationships with China, but that does create a significance risk of foreign interference. Will she say on record, as she previously did in the House, that she accepts that UK politicians are low risk, and that—although there are significant rules in the politically-exposed persons agenda, which has had a impact on the ability of parliamentarians from both sides of the House and their families to access financial services—no significant risk has materialised?

Finally, will the Minister commit to ensure that there will be the fullest possible consultation with all political parties and wider stakeholders on any planned changes to political finance law? There is a long-standing precedent that, when Governments of any party seek to change such law, they engage with the widest possible group of stakeholders. However, thus far, there have been no discussions with the parliamentary parties panel, no formal consultations with parties, nor any discussions on Privy Council terms about what those changes may be. It would be helpful for the Minister to confirm from the Dispatch Box whether that will happen as it always has in the past.

It is clear that to address the concerns that many Members have set out, there needs to be a reflection on not only the influence of political financial donations but the impact of benefits in kind. For example, technology companies seek to use algorithms hosted, based and written outside of the UK to influence where the eyes of UK residents and voters fall when engaging with the political system. We know that that creates a significant risk that needs to be addressed. I thank the hon. Member for North Ayrshire and Arran (Irene Campbell) for introducing this debate, and it is a pleasure, once again, to serve under your chairmanship, Mrs Harris.