Donations to Political Parties

Lord Wallace of Saltaire Excerpts

Thursday 12th February 2026 Grand Committee

[Lord Wallace of Saltaire (LD)]

My Lords, I particularly welcome the suggestion that the noble Lord, Lord Mott, made. The ideal way to fund political parties is a large number of donations from your voters and your members. That is what my party has largely relied on. We lack large donors, except under exceptional circumstances, and we have to work very hard to get those £20, £200 and £2,000 donations.

We are all watching what happens in the United States at the moment, where money dominates politics and where a small number of ultra-wealthy people—some of whom are explicitly anti-democratic, such as Peter Thiel —are influencing the way things are going. UK sovereignty means that we need to restrict the flow of funds from abroad so far as we can. This means funds not only from foreign states but foreign citizens, foreign companies and UK expatriates who moved abroad to avoid paying UK taxes but nevertheless want to interfere in the political life of the country they have left behind.

We now know a lot about Russian penetration of the Conservative Party and about Russian interference in the Brexit campaign. We do not know whether various Middle Eastern states put money into favoured parties, lobbies and think tanks to promote their own interests. We now have the extraordinary announcement from a US State Department Under Secretary that US federal funds will be channelled into right-wing groups across Europe, including in the UK, including the bodies which in many ways are threats to constitutional democracy and open society.

Restrictions on expatriate donations are a more difficult and delicate issue. One of the largest donations in recent British politics came from a long-term UK expatriate in Thailand. There are 100,000 UK citizens in Dubai, some extremely rich and some possibly willing to act as intermediaries for foreign state actors in putting money into British politics. We agree that corporate donations should be allowed only from companies that have declared substantial profits from operations within the UK. I suggest that it should also be a condition that donations above a modest limit can come only from people who have submitted a UK tax return for the previous year or more.

Current restrictions focus mainly on donations to political parties. However, political movements, such as Tommy Robinson’s, also play a large and active political role, as do think tanks, such as the Henry Jackson Society, the Global Warming Policy Foundation and the TaxPayers’ Alliance, and lobbies, such as the Free Speech Union and Labour Together, which has not declared its funding.

There is some evidence, and many more unconfirmed reports, that foreign money flows into some of these, both from foreign Governments and from wealthy individuals, foundations and corporations. That is also foreign interference. In some cases, it is clearly hostile foreign interference and should be made more transparent and limited. The elections Bill offers us the chance to tighten controls on all these, and I look forward to making it work.