Foreign Financial Influence and Interference: UK Politics

Steve Reed Excerpts

Wednesday 25th March 2026 Commons Chamber

12.43 pm

[The Secretary of State for Housing, Communities and Local Government (Steve Reed)]

I would like to make a statement on foreign influence and interference.

The responsibility of protecting our democracy is a duty that every single Member of this House shares. As a Government, we are clear-eyed about the evolving threats we must contend with from those who wish to disrupt our democracy for their own gain and their own twisted purposes. We already have a strong toolkit to detect, disrupt and deter interference, and we are strengthening it through our Representation of the People Bill and counter political interference and espionage action plan. But as threats evolve, so too must our protections. For this reason, I announced in December an independent review led by the former permanent secretary, Philip Rycroft, into foreign financial interference in UK politics. I would like to place on the record my thanks to Mr Rycroft for his thorough, diligent and swift work in rigorously assessing our political finance framework and identifying where further safeguards are needed. The full report from his review has today been laid before the House, and the findings are stark. Mr Rycroft concludes that this country faces a persistent problem of foreign interests seeking to exert influence on, and to interfere in, our politics, and that the threat has become arguably more acute. While he welcomes the measures in our Bill, the report is clear that we need to go further, and I agree.

We welcome Mr Rycroft’s assessment and his wide-ranging recommendations, which cover the regulation of corporate and overseas donations, the need to close loopholes used by some non-party campaign groups, the approach to combating online threats, the importance of ensuring that enforcement agencies have the information and powers they need, and the organisation of Whitehall to ensure that we are best placed to tackle these threats.

In advance of the Commons Report stage of the Representation of the People Bill, we will provide a comprehensive, line-by-line response to all the report’s recommendations. I am clear that, wherever necessary, we will amend the Bill to ensure that our defences against foreign interference are robust. Given the gravity of the threats we face and their level of seriousness, I reassure the House that we will take immediate action on the most serious loopholes set out in the report that allow illicit foreign money into our democracy.

British citizens living overseas have the right to participate in UK parliamentary elections, and that gives them the right to donate to parties or candidates they support. However, the report raises two fundamental concerns about such donations from overseas. First, the report is clear:

“Inevitably, tracing the source of funds offered by individuals living abroad is more complex than for domestic donations.”

Secondly, it raises concerns about the “democratic fairness” of allowing people

“who have chosen to live abroad in order to have their wealth taxed abroad”

none the less to

“have the opportunity to make potentially game-changing donations into British politics.”

I will therefore take immediate steps to implement the report’s recommendation on donations from overseas electors. We will introduce an amendment to the Representation of the People Bill to place an annual cap on the total political donations that an overseas elector can make. The cap will be set at £100,000 a year. In the light of the gravity of the issues raised in the report, I am not prepared to allow any window of opportunity in which malign actors based overseas can funnel dark money into our politics. The cap will therefore apply retrospectively, so it will include all donations from overseas electors received from today and all regulated transactions entered into from today.

Once the provisions are in force, any donations by an overseas elector to any political party or regulated entity that exceed the cap for that overseas elector will be an unlawful donation. Subject to parliamentary approval of the amendment that I will table, the recipient of any unlawful donation will have 30 days to return that donation once the legislation comes into force, after which enforcement action can be taken and criminal penalties will apply.

The cap will apply to relevant donations from today in all elections in the UK, including for parties at the upcoming English local elections, Scottish Parliament elections and Senedd elections. In Scotland and Wales, donations to candidates rather than parties are devolved matters, but my intention is to seek a legislative consent motion for our amendments to ensure that there are no gaps in our safeguards. I will speak to my counterparts in the Scottish and Welsh Governments to emphasise my commitment to work together to protect our electoral system right across the United Kingdom.

The second recommendation on which I will take immediate action relates to donations made in cryptocurrencies. Following extensive consultation, Mr Rycroft sets out clearly the deep reservations that many people have about such donations, and his conclusions are clear that

“there is a risk that cryptoassets are used as the vehicle to channel foreign money into the political system in the UK…we should pause the use of cryptoassets for political donations for the time being.”

I accept Mr Rycroft’s assessment that the anonymity inherent in cryptocurrency transactions could make it easier to mask the origin of donations and to evade robust checks on the true source of funds. The clear route that that creates for illicit channelling of money into our politics is unacceptable and undermines public confidence in our electoral system.

In the light of that, I can confirm that the Government will take immediate steps to implement the recommendation made in the report, and we will introduce an amendment to the Representation of the People Bill to place a moratorium on all political donations made through cryptocurrency. I want to be crystal clear: as the report recommends, I mean crypto in any amount, including donations of a value that would ordinarily fall below the threshold for control on donations. There are specific risks posed by cryptocurrency donations, such as the risk of rapid multiple small donations being made just below our current thresholds.

The moratorium will remain in place until the Electoral Commission and this Parliament are satisfied that there is sufficient regulation in place to ensure full confidence and transparency in donations that are made in that way. Subject to parliamentary approval, the moratorium will be applied retrospectively to any crypto donations received from today by any political parties and regulated entities. Once the provisions are in force, if a political party or regulated entity has received a donation in the interim, they will have 30 days to return it, after which enforcement action can be taken and criminal penalties will apply. That will again apply to all elections in the United Kingdom. As I have set out, we will work with devolved Governments to secure legislative consent where that is required.

I would like again to express my thanks to Philip Rycroft for his comprehensive, thoughtful and well-reasoned report. It is, and always will be, an absolute priority for this Government to protect our democratic and electoral processes. The swift and decisive action being taken by this Government sends a clear message: we will do everything necessary to protect the UK’s democracy. I commend this statement to the House.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. Those Members who have come into the Chamber extremely late will not be called to participate in the statement. Members have to be here for the beginning of a statement, not for the last minute of it.

I call the shadow Secretary of State.

[Sir James Cleverly (Braintree) (Con)]

I thank the Secretary of State for advance sight of his statement. I echo his thanks to Mr Rycroft for the work that he has done on a very important report. We began work in this area through the defending democracy taskforce, and I am glad to see the Minister for Security in his place to highlight the important link between the work of this report and the work that he does.

There should be no party political divide when it comes to protecting the integrity of our democracy, and there is a great deal in the report that my party instinctively agrees with. However, the process falls far short of what this House should expect. The 50-page Rycroft review was published just 20 minutes before Prime Ministers questions, and only five minutes before one of the Secretary of State’s Ministers was hosting a meeting to which I was invited about local government reorganisation, making it very difficult for me to read the detail of the report—[Interruption.] That made it very difficult for me to read the detail of an incredibly important report which, as I said, contains much with which we instinctively agree. This is not just poor procedure; it means that it is harder for the Opposition to scrutinise the actions of the Government properly, particularly in light of the fact that many of the proposals in the report are being initiated immediately.

Sadly, this follows a pattern of behaviour by this Government. The Representation of the People Bill has already been through Second Reading and is in Committee, yet today is the first time we are seeing important elements of a report that goes to the heart of that legislation. Foreign interference is growing and it demands a coherent response—a cross-party response—and yet this Government choose to legislate first and make announcements later. They brought forward the Representation of the People Bill before the Rycroft review had reported; they asked the House to scrutinise legislation that was full of holes, as the Secretary of State is now announcing from the Dispatch Box. This is not good process.

My comments are not about process for process’s sake, but about ensuring that unforeseen or bad outcomes are avoided, while protecting what needs to be protected. Now we are told that major changes—fundamental changes—on donations, enforcement and transparency are being rushed into a Bill late in its passage, without proper consultation, scrutiny or time. That is not the way to ensure that cross-party policy is successfully implemented.

It is right that the Secretary of State and the Government want to send a clear message that they take this issue seriously, and we echo that desire, but this is not the way to do it. Announcing Government action by press release, then filling in the details later, undermines the important work at the heart of the report. Russia’s aggression, Iran’s hostile activity on British soil, cyber-attacks on our institutions and Chinese state-based activity against us here in the UK make it incredibly important that we fight this fight together. Having these things bumped on the House, in the way that this report has been, does not help.

The Secretary of State knows that the Conservatives are very much on the same side in relation to these matters, so I have a number of questions for him, which I will rattle through now. Why did he not wait for the Rycroft report before introducing the Representation of the People Bill in the House? Which of the review’s recommendations will require primary legislation and what time will be provided for that primary legislation? Will he commit to a full consultation with political parties and regulators before making any substantive amendments to the Bill going through the House?

From an initial reading, the proposals on company donations will have a significant effect on legitimate domestic donations, so why are the Government proposing to treat domestic philanthropy as if it were something distasteful? Will the Secretary of State confirm that these changes will not be brought forward without proper consultation and consideration on the effects of legitimate domestic funding?

Foreign interference is not the only threat to the integrity of our elections. We have seen evidence of breaches of electoral law, so what steps will the Secretary of State take to ensure that current legislation is enforced?

Will the Secretary of State tighten the rules on foreign donations? He talked about devolved franchise changes in Wales and Scotland. What will he do to make sure that the forthcoming elections are protected? Finally, does he now accept that a very short pause to enable good faith interventions from my party and others would make this legislation stronger and send the signal that we are united as a democracy in this endeavour?

[Steve Reed]

May I thank the shadow Secretary of State for his support for the purpose and intent of this legislation, and, indeed, for his and his party’s engagement with Philip Rycroft and his review? He lists the reasons that this is important to all of us and I agree with him. Certainly, I want to see both proper engagement with the Opposition and the opportunity for proper scrutiny, because that will strengthen the legislation. It is important that the legislation has cross-party support given the nature of the issue.

We had to act quickly to bring forward the provisions, because we could not allow a window of opportunity to open that would enable evasion by malign and hostile actors. Beyond that, the proposals will proceed in the usual way through the parliamentary processes and Members from all parts of the House will have the opportunity to comment and be engaged. It was necessary to act at speed because of the gravity of the threat that Philip Rycroft’s review outlined very clearly.

None of wants to allow foreign interference to continue. All of us believe that it is the right of the British people—and the British people alone—to freely choose their own Government. We will engage with Governments across the United Kingdom and parties across this Parliament to ensure that is the outcome.

[Mr Speaker]

I call the Chair of the Housing, Communities and Local Government Committee.

[Florence Eshalomi (Vauxhall and Camberwell Green) (Lab/Co-op)]

May I start by echoing the comments of the Secretary of State and the shadow Secretary of State, paying tribute to Sir Philip Rycroft for his tireless work? I also thank the Joint Committee on the National Security Strategy for its work on cryptocurrency?

We have to be honest and say that there is a lot of mistrust in our politics and democracy. I am proud to stand here as someone who was supported by two trade unions and local members in the funding of my campaign. We cannot say in one breath that we want to defend this country from foreign threats and then allow fundamentally opaque payment methods into our democracy. That is not on. It is therefore right that the Government put in place this moratorium on cryptocurrency donations. I welcome the Secretary of State’s pledge, as well as the cap on donations by overseas electors following the extension of their enfranchisement in the Elections Act 2022.

As is stated in the Rycroft review, one problem is the fact that no less than five Departments cover the responsibility for protecting our democracy. If we want to get this right, we need to continue with leadership at the heart of Government, so will the Secretary of State accept recommendation 17 and allocate a permanent secretary with lead responsibility for sustaining our democracy and co-ordinating the response to the threats at the heart of Government?

Will the Secretary of State also commit to ensuring that any amendments to the Representation of the People Bill as a result of the recommendations are tabled before Commons Report stage, so that Parliament can have adequate time to scrutinise the proposals?

[Steve Reed]

I thank the Chair of the Select Committee for her questions and for her support for this work. The intention is to bring the amendments forward on Report. In advance of those amendments being laid, we will provide a detailed response to each of the 17 recommendations, including the one to which she has just referred.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the Liberal Democrat spokesperson.

--- Later in debate ---

[Lisa Smart (Hazel Grove) (LD)]

I thank the Secretary of State for advance sight of his statement. I was grateful to meet Philip Rycroft as part of this important and urgent work.

The threat that we face is not new. Back in 2020, the Intelligence and Security Committee said that Russian influence in the UK is the “new normal” and that the Government then were not doing enough. Since then, we have seen Reform’s former leader in Wales being convicted for accepting pro-Russian bribes.

We have said before that the Representation of the People Bill is not nearly ambitious enough, so I very much look forward to working as part of the Bill Committee to incorporate the recommendations. Will the Secretary of State clarify whether the Government intend to accept just the two recommendations that he has focused on in his statement, or all of them?

On overseas donations, a cap is welcome, but does the Secretary of State accept that if this reform is made without wider changes, a malign actor could get around it simply by donating via a UK company? We strongly support the moratorium on all political donations made through cryptocurrency, but much more is needed to really seize this opportunity to clean up our politics. We should ban anyone who has served a foreign Administration from donating to UK political parties, think-tanks or campaign groups A significant opportunity remains for those who have been political appointees in hostile Governments to funnel donations into the UK.

We should also ban politicians from receiving payment for participating in the propaganda of foreign adversaries, on broadcasters like Russia Today and Iran’s PressTV. Will he also address why calls from the Liberal Democrats for Donald Trump’s Administration, and their explicit policy of interference in our democracy, to be included in this review were ignored? Will he order a stand-alone probe into that?

[Steve Reed]

Let me thank the hon. Member for her and her party’s engagement with Philip Rycroft’s review. She is right to point to the growing threat; it has been evolving over recent years. She mentions the case of Nathan Gill, which underscores the nature and the gravity of that risk. Today I am accepting the report in general. We are bringing forward two provisions now, because had I not done so, a window for evasion would have been left open. We will provide a detailed response to all 17 recommendations. The amendments that we table will be open for parliamentary scrutiny and debate in the usual way. I look forward to her and her party making their views clear as we go through the process.

[Emily Darlington (Milton Keynes Central) (Lab)]

I welcome the Rycroft review and I very much enjoyed speaking to Philip Rycroft during the process. Beyond crypto and other financial donations, he says we need to tackle deepfakes, bots and disinformation; create a political ad library; and put in place greater investigatory powers for the Electoral Commission and an incident protocol should there be a major election incident. My amendments deal with all those points. Will the Secretary of State undertake to urgently meet me to see how we can take my currently named amendments and make them Government amendments at the Bill’s next stage?

--- Later in debate ---

[Steve Reed]

I thank my hon. Friend for her support and her active interest in making sure that the legislation that follows is as robust as possible. I would be more than happy to make sure that she has a meeting with me or the relevant Minister to discuss her amendments. The report and its recommendations cover some of her concerns, and it is our intention to amend the legislation to deal with those concerns.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the Chair of the Public Administration and Constitutional Affairs Committee.

[Simon Hoare (North Dorset) (Con)]

As a former elections policy Minister and member of the defending democracy taskforce, may I thank the Secretary of State for launching this inquiry? I also thank Philip Rycroft for his work; it was a pleasure to give evidence to him during that process.

I welcome the spirit in which the Secretary of State has brought forward with urgency the changes that are so demonstrably required. May I ask him two direct questions? If amendments to reflect the Rycroft report are not to be tabled at Committee stage but on Report, will he ensure through the usual channels that the length of time devoted to Report stage reflects the fact that the House will be debating for the first time amendments to the legislation, which were not included on Second Reading? That speaks to the process point made by the shadow Secretary of State, my right hon. Friend the Member for Braintree (Sir James Cleverly).

If these important new rules are to be policed effectively and properly, there will clearly be additional demands on the Electoral Commission both in terms of power and resource. What assessment has the Secretary of State made of those needs and how will they be delivered in speedy time to mirror the urgency that is required?

[Steve Reed]

I thank the hon. Member for his support, for his work with the defending democracy taskforce and for contributing to Sir Philip Rycroft’s review. He is quite right that we want to make sure that there is adequate time on Report for Members to make their points, and I am sure that the business managers will ensure that that happens. Regarding resources for the Electoral Commission, we will need to ensure that the resources are adequate to meet any new demands placed on them or other regulators. That will be part of the process of ensuring that the legislation goes through and can be followed through on.

[Peter Swallow (Bracknell) (Lab)]

I thank Sir Philip Rycroft for his important work. In his review, he notes:

“The online environment has created a cheap and relatively simple means of getting anonymised content in front of ordinary people in a way that seeks to undermine their trust in the political process.”

He notes that this activity is “strategic, long-term and patient”, and that

“dissonance is its own reward.”

Does the Secretary of State agree with those findings? What can we do to address the challenge of misinformation and disinformation on social media and in online spaces?

[Steve Reed]

My hon. Friend makes a very important point. We have to maintain confidence and trust of the British electorate in the integrity of our elections and election processes. This legislation, and the amendments we will table as a result of the Rycroft review, are intended to achieve precisely that.

[Several hon. Members rose—]

[Dr Andrew Murrison (South West Wiltshire) (Con)]

Mr Rycroft’s wide-ranging review makes the non-inclusion of China—or, failing that, its constituent entities—in the foreign influence registration scheme look increasingly bizarre. Will the Government look at this again as a matter of urgency? If it is the case that the FIRS is inadequate to include the state entity or its constituent parts in the meaning of the scheme, will he look to review it and perhaps replace it with something that will achieve the same end?

[Steve Reed]

The right hon. Member raises a very important point. The Government are keeping precisely that concern under very close review so that we stand ready to make changes as and when they are required. The Security Minister is on the Front Bench with me today because he would lead much of that work.

[Rachel Hopkins (Luton South and South Bedfordshire) (Lab)]

I declare that I am a member of the Speaker’s Committee on the Electoral Commission. I welcome the Secretary of State’s comments on the Rycroft review. He says that he will be responding to the many wide-ranging recommendations that the review contains, but can I press him further on what actions the Government are taking to give the Electoral Commission not only resources but the powers needed to both deter and punish breaches of political financial rules?

[Steve Reed]

I am grateful for my hon. Friend’s question; it is a very important one. We will respond in detail to the recommendations and bring forward any new powers or resources that the Electoral Commission requires. We will ensure that it can carry out any new responsibilities that we place on them.

[Stephen Gethins (Arbroath and Broughty Ferry) (SNP)]

Can I put on record my thanks to Sir Philip Rycroft for his public service? The Secretary of State referenced devolved Administrations. The Scottish Parliament is going into the pre-election period this afternoon, so how will this work in terms of the elections? How will this legislation impact the extraordinary number of political donors who happen to find themselves as Members of the House of Lords, should they be seen to have broken any rules here?

[Steve Reed]

I hope to speak with the relevant Minister in the Scottish Government today. There will, of course, be engagement between officials during the pre-election period. Any legislative change would come after the elections in Scotland and in Wales.

[Matt Western (Warwick and Leamington) (Lab)]

I very much welcome Sir Philip Rycroft’s review. It is long overdue when we think about how much money has been flooding in from Russia and elsewhere. There are questions about association, and certain individuals who have been donating significant amounts of money while living for 21 years not here but in Thailand. The Joint Committee on the National Security Strategy, which I chair, made many recommendations in our political finance report, which we published last week. I have tabled 11 amendments, which I hope the Secretary of State will very much view as constructive.

I welcome the connection tests that the Secretary of State has mentioned to do with the individual and on a corporate level, and the moratorium on cryptocurrencies is extremely welcome. California banned them back in 2018, so it just goes to show how much could have been done in recent years. The capacity of the enforcement agencies is a real concern. The higher penalties will be very much welcomed by them, I am sure, but I reiterate that there needs to be greater capacity and expertise across the Electoral Commission and the enforcement agencies.

[Steve Reed]

I thank my hon. Friend for his question, and I recognise his concerns. I have addressed them in answer to previous questions, and I will not repeat those responses.

[Mims Davies (East Grinstead and Uckfield) (Con)]

I am grateful to the Secretary of State for coming to the House to talk about the importance of integrity in politics. However, as purdah arrives, in Sussex we are seeing a mess of dithering and delay and, frankly, blatant disregard of the original process for the changes in local government in Sussex. That is affecting my constituents, and indeed yours, Madam Deputy Speaker. Decisions are apparently taken on a case-by-case basis, but can I point out to the Secretary of State that people are saying that exactly this kind of political gerrymandering is happening in Sussex, which is exactly what he is seeking to prevent? Can he explain to the House how my constituents, and people more widely in Sussex, can have confidence in this process?

[Steve Reed]

Of the original proposals that we had for Sussex, none were considered financially viable, ultimately. We are reopening the consultation, and the hon. Member and her constituents will be able to comment on the new proposals.

[Rushanara Ali (Bethnal Green and Stepney) (Lab)]

I welcome the Rycroft review and, in particular, the Secretary of State’s commitment to take action on crypto donations and to cap foreign donations from overseas donors. I want to draw his attention to the comment in the report that the debate on social media

“seeks to exacerbate division and increase polarisation with a view to simply destroying the capacity of the UK to function as a well-governed state.”

This is chilling. Alongside the proposals that he has spoken about, we need action to tackle deepfakes and disinformation, which are making it more and more dangerous for electoral candidates to operate in our democracy. Will he take action to empower our regulators, including Ofcom and the Electoral Commission, to take action rapidly, without delay?

--- Later in debate ---

[Steve Reed]

I thank my hon. Friend for that important question. Many people who care deeply about democracy have raised similar concerns. The review makes proposals on deepfakes and transparency about the origins of any content that appears online, which is needed. We will provide a detailed response to the recommendations, at which point she and other Members will have the opportunity to scrutinise and debate and scrutiny them as we work through the legislation.

[Bobby Dean (Carshalton and Wallington) (LD)]

I thank the Secretary of State for his statement and the action he is taking on cryptocurrency, but can I urge him to go further on corporate donations? A report this week by CenTax revealed that as many as one in four donations from corporate entities are essentially opaque. It put this down to the reliance on persons with significant control rules, and it made a series of recommendations. Will he commit to looking at the recommendations in that report and ensuring that we tighten up the system so that people cannot simply circumvent the rules by donating via British companies?

[Steve Reed]

The Bill and the Rycroft review already propose actions on that. I recognise the concerns. We need to act on shell companies, for instance, which can be used to funnel in dark money. We have no idea where that is coming from. There are legitimate concerns that the money could be coming from hostile states seeking to weaken and undermine our country by undermining our democracy. We will not tolerate that.

[Dame Chi Onwurah (Newcastle upon Tyne Central and West) (Lab)]

In his excellent report, Sir Philip Rycroft specifically references the amplification of divisive content on social media. Yesterday my Committee heard from TikTok, Meta and X how in each case the design of their algorithm is determined by a foreign billionaire with a political agenda. Certainly when it comes to Mr Musk, that agenda does not reflect our democratic values—he has called for civil war in the UK. Unlike traditional press, social media algorithms are hidden, inaccessible and use personal data to target content, as Rycroft observes. Will the Secretary of State consider whether political bias in algorithms constitutes a donation in kind, and will he work with colleagues to address the algorithmic, advertising research and transparency failures that our Committee gave detailed proposals about in our report last July?

[Steve Reed]

I listened carefully, and with great interest, to part of the Select Committee’s proceedings yesterday. We are grateful for the contribution that my hon. Friend and her Committee are making to the debate. This legislation is not intended to target any one individual or state; it is about putting in place safeguards against growing threats, wherever they may arise.

[Sir Julian Lewis (New Forest East) (Con)]

I think the Government are very wise to try to close the potential loophole that somebody might make a giant donation between today and the conclusion of the legislative process, but I can think of at least one other rather glaring loophole, which hopefully the Secretary of State has also considered. If somebody is an elector living abroad, he will be limited to £100,000 per donation, but what about other members of his close family to whom he could channel indefinite numbers of packages of £100,000 apiece? What is to stop them from making similar donations? Has the Secretary of State considered how the limit will work in practice?

[Steve Reed]

Any attempt to bypass existing laws or the provisions that I have announced today would themselves be illegal. We would seek to identify the ultimate source and, if any behaviours of that kind had been carried out, there would be necessary enforcement action to follow.

[Neil Duncan-Jordan (Poole) (Lab)]

I welcome the measures announced today to tackle foreign interference in our elections. Will the Secretary of State go a step further and support my proposal to break the link between wealthy donors and the parties they help to elect by banning their firms from subsequently holding Government contracts?

[Steve Reed]

The report is focused on stopping money coming in from hostile states or other hostile individuals who seek to undermine our democracy. That is the extent of the measures that I am announcing today.

[Adam Dance (Yeovil) (LD)]

Constituents like Andrew from Crewkerne have told me how worried they are about funding from the United States for right-wing UK think-tanks and political parties. Recommendations 4 and 16 of the review would strengthen transparency and reporting around donations to think-tanks and lobbying groups, which can advance foreign influence. Will the Secretary of State tell my constituents whether the Government will implement those recommendations, and when that will be?

[Steve Reed]

I thank the hon. Member and his constituents for their interest in this important matter. Philip Rycroft makes 17 detailed recommendations in his review. We will respond to all of them line by line, and at that point the hon. Member and his constituents will have our clear view.

[Chris Vince (Harlow) (Lab/Co-op)]

I thank the Secretary of State for making this important statement. Like the hon. Member for Carshalton and Wallington (Bobby Dean), I am concerned about the ability of shell companies to make political donations. Clearly that is not transparent, and that is rightly recognised in the Rycroft review. What steps will the Government take to close that loophole? Crucially, what will the Government do to strengthen the monitoring of donations?

[Steve Reed]

That is an important point, because the ability of shell companies to exist as funnels for dark, dirty money entering and polluting UK politics is real. That is why we are taking the recommendations seriously, and we will come forward with amendments to the legislation intended to close those doors so that we can keep British elections free for British people.

[Suella Braverman (Fareham and Waterlooville) (Reform)]

I am going to mention the elephant in the room. Earlier this month, the husband of a sitting Labour MP—the hon. Member for East Kilbride and Strathaven (Joani Reid)—was arrested on suspicion of spying for China. The hon. Member was subsequently suspended from the Labour party. It has been reported that she received a donation from her husband’s firm, which presumably would be covered by the Government’s plans. I do not expect any comment on that live investigation, but in the light of that and the historic case of Christine Lee, Labour MPs and the Chinese Communist party, will the Secretary of State confirm that the measures he has announced will apply equally to members of his own party who find themselves compromised by the Chinese Communist party?

--- Later in debate ---

[Madam Deputy Speaker]

She is saying that she has done so. We obviously do not mention live cases either.

[Steve Reed]

The right hon. and learned Member, as a former Home Secretary, will of course know that I cannot comment on ongoing investigations. The provisions of the legislation that we will bring forward—as with all legislation—will apply without fear and favour to members of all parties, as indeed does the bribery legislation that applied to Nathan Gill, a traitor who was the leader of Reform in Wales.

[John Slinger (Rugby) (Lab)]

At the time of the Boston tea party, the American colonists demanded, “No taxation without representation.” Does my right hon. Friend agree that we should instil the principle that there should be no ability, in a game-changing way, to influence representation without taxation? Will he elaborate a little on the principles in his statement?

[Steve Reed]

Philip Rycroft has recognised the concern and proposed what I think is a proportionate approach to dealing with it. I have accepted the figure of a £100,000 cap, which I think most reasonably minded people would agree is a very generous level of funding, for donations from British nationals who are living and paying their taxes overseas.

[Zöe Franklin (Guildford) (LD)]

I am grateful to the Secretary of State for his comments. The Rycroft report has come at a really important time. As a member of the Bill Committee, I look forward to working with the Government to ensure that all the recommendations are brought through, because they are incredibly important. I return to the comment of my hon. Friend the Member for Hazel Grove (Lisa Smart) about the importance of a report relating to US interference in our democracy. What steps are the Government and the defending democracy taskforce taking to protect our democracy from foreign interference more generally before the Representation of the People Bill passes through the House?

[Steve Reed]

The US, of course, is our closest ally. The provisions that we are making in this legislation do not target any one country, or indeed any one individual; they are intended to be a proportionate response to a growing threat, wherever that threat may arise.

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

I strongly welcome the report and the Government’s speedy and decisive response to it. Evidence from Germany and from Moldova shows how online attempts at foreign interference can combine with real-life attempts at foreign interference in the run-up to elections. First, was I right in hearing that the Government will look at a transparent protocol for dealing with information emergencies related to foreign actors in the run-up to elections? Secondly, is the Secretary of State aware that in countries where crypto interests have unfairly influenced elections, donations have often been given in domestic currency? Will he look at that broader context?

[Steve Reed]

There are recommendations covering precisely the points that my right hon. Friend raised. I have accepted the report, in general terms, in full. We will respond in detail to each of the 17 recommendations, which I hope will address her concerns.

[Dr Ellie Chowns (North Herefordshire) (Green)]

I warmly welcome the Rycroft review and the Government’s swift action set out today on crypto and on overseas donations, although I would like to see them go much further. The Secretary of State said that he will amend the Representation of the People Bill wherever necessary. As a member of the Bill Committee, I would love to see those amendments tabled while we are still in Committee so that we can give them the line-by-line scrutiny that, as he referred to, is the normal practice of this House. Will he please pull out all the stops to ensure that happens?

On stopping the spread of disinformation on social media, Philip Rycroft refers on page 47 of the report to the significant benefits that could come from having a real-time online library of social media adverts so that we get that transparency and that light shone on how all sorts of actors are influencing people below the surface. Does the Secretary of State support Philip Rycroft’s view on that? Will he table an amendment to deal with that problem?

[Steve Reed]

I thank the hon. Lady for her and her party’s support for the review. I also thank her for her work on the Bill Committee. She is quite right; we need to make sure that when the amendments come forward, the Bill Committee has sufficient time—and, indeed, that the House has sufficient time—to go through them in detail. I and the Government will respond to each of the 17 recommendations in detail, and I think that that will be the most appropriate time to respond to the question she has raised.

[Phil Brickell (Bolton West) (Lab)]

As an individual who has dedicated my life to tackling corruption in all its forms and as the chair of the all-party parliamentary group on anti-corruption and responsible tax, I thank the Secretary of State and the Minister for Security, my hon. and gallant Friend the Member for Barnsley North (Dan Jarvis), for their commitment to addressing foreign interference in our politics, as well as thanking Philip Rycroft for his review. I am grateful for the immediate measures that the Government have announced today on crypto donations and the size of donations made by British nationals abroad. They are very welcome and very much needed.

May I press the Secretary of State on three particular questions? First, to what extent can he assure the House that the Electoral Commission is sufficiently supported to monitor and police the perimeter of the new announcements that have been made today? Secondly, will he confirm that, contrary to the remarks of the shadow Secretary of State, there was ample opportunity for political parties of all stripes to feed into the review? Thirdly, on “know your donor” checks and the risk factors that will be introduced through the Bill, there is a recommendation in the report that they should be more aligned with the anti-money laundering requirements that have been in place for quite some time for banks and other financial services firms. Will the Secretary of State commit to working with other regulators—for instance, the Financial Conduct Authority—to understand how those would best be implemented, working with parties?

[Steve Reed]

I thank my hon. Friend for his personal engagement on this issue and for the work of the APPG that he chairs. It has made some significant contributions and we are grateful for that. We will, of course, ensure that the Electoral Commission has the resources it requires to enforce changes as we bring them forward. On his final point, the defending democracy taskforce exists to make sure that there is proper alignment across all the necessary regulators to ensure that we are keeping our democracy in this country free and safe.

[Freddie van Mierlo (Henley and Thame) (LD)]

I welcome the Secretary of State’s reference to the rights of British overseas electors and the cap on donations as a proportionate response, yet their right to cast their vote is constantly stymied by late arrivals of the post. While the Secretary of State is considering amendments to the Representation of the People Bill, will he meet me to consider my amendments that would address that issue and seek to secure the voting rights of overseas citizens?

[Steve Reed]

I am aware of that important concern. I am happy to make sure that he gets an appropriate meeting to discuss it.

[Joe Powell (Kensington and Bayswater) (Lab)]

I welcome the report; it is game changing. I agree with the Secretary of State’s logic that leaving a window open for dodgy money to flood into this country would have been totally irresponsible, so I welcome the swift action. My specific question is about recommendation 2 on company donations. We have learned from the Premier League’s attempt to enforce financial fair play that, unfortunately, revenue can be manipulated very easily—for example, sponsorship can allow clubs to buy players that they otherwise would not be able to afford. I welcome Rycroft’s recommendation that we switch to profit to ensure that only genuine companies that make a profit in this country can give donations. As the Government respond in full to the report, will the Secretary of State take a close look at that recommendation?

[Steve Reed]

I thank my hon. Friend for his support. He is quite right; Philip Rycroft was very clear in his reasoning on that point. The objective is to prevent shell companies from being set up to funnel dark money into British politics. It is not to prevent British companies that are just going through a difficult year or two from making donations themselves.

[Mr Gregory Campbell (East Londonderry) (DUP)]

I welcome the review, the Minister’s response and the general thrust of it. I am glad to see the list of people who responded at the back of the review. We responded on behalf of the Unionist community, and it is a good job that we did as no others seem to have done so.

On political donations in Northern Ireland, the Minister will be aware of Sinn Féin being able to funnel money from the United States into the Republic and then into Northern Ireland. That is an issue that we raised and it is itemised on page 25. It is a concern that many people have. Sinn Féin already gets millions of pounds of taxpayers’ money in representative money for not coming here, and in addition to that, it is now getting several millions from the USA via Dublin and into Northern Ireland.

[Steve Reed]

I thank the hon. Gentleman for his and his party’s engagement with the review. I hear his concerns. It is important that we continue to engage so that those concerns can be heard and, where appropriate, addressed.

[Dame Nia Griffith (Llanelli) (Lab)]

I thank the Secretary of State for his prompt action in banning cryptoasset donations and capping foreign donations. The Rycroft review also recommends that foreign-funded adverts be banned and that all online adverts should have imprints to show who has paid for them. Will the Secretary of State explain when and how the Government will take those recommendations forward?

[Steve Reed]

Philip Rycroft makes some really important points on that, which of course other Members across the House have made previously. As I said earlier, we will respond in detail to all the recommendations, including those covering the points that my hon. Friend has just raised.

[Mike Martin (Tunbridge Wells) (LD)]

I thank Philip Rycroft for his review and the Secretary of State for the announcement today. I am particularly happy that we have this idea about it being retrospective and applying the measures from today because we do not know when the Bill will come through. May I encourage the Secretary of State to consider, both for crypto and for foreign donations, extending the period of retrospectivity back to the previous general election?

[Steve Reed]

I am not so sure there is much precedent for that level of retrospectivity.

[Alex Sobel (Leeds Central and Headingley) (Lab/Co-op)]

I thank Philip Rycroft for meeting me in my position as chair of the fair elections APPG and for including some of my points and evidence in this excellent review. I also thank the Secretary of State for including the donations cap—an issue that I raised with the Minister for Democracy, my hon. Friend the Member for Chester North and Neston (Samantha Dixon), when we met.

My question relates to page 45 of the review, which talks about international best practice, and the point I raised with Philip Rycroft about VIGINUM in France, which monitors foreign online interference. That is the most pressing issue in UK politics today. It is about not just identifying it and publishing it, but attributing and exposing it, and in some cases even getting it removed. Are we considering the same modalities, capabilities and powers when implementing that recommendation in the UK?

[Steve Reed]

We will respond in detail to each of the 17 recommendations, including the one that my hon. Friend references. However, he is absolutely right: we can and should learn from best practice in other democracies to make our democracy as robust and safe as it can be.

[Ben Lake (Ceredigion Preseli) (PC)]

I, too, welcome Sir Philip Rycroft’s work and the Secretary of State’s announcement today. I strongly support the idea of applying the donations cap and the moratorium on cryptocurrency donations to the devolved elections. Will the Secretary of State just clarify, to reassure me, that for those changes to take effect for the upcoming elections, we will not have to have a legislative consent motion from the devolved legislatures before the elections because, as others have mentioned, there is very little time for that to happen?

[Steve Reed]

No; to reassure the hon. Gentleman, the provisions I have announced today apply to the entire United Kingdom, with immediate effect.

[Rachel Blake (Cities of London and Westminster) (Lab/Co-op)]

I strongly welcome the review and I thank the Secretary of State for commissioning it. I have heard what he has said about considering the recommendations in detail. I draw his attention to paragraph 75, which states:

“there are no reporting requirements for campaign spending outside regulated periods for either non-party campaigners or candidates. This means that there is no transparency around what is spent, or around the donations being used to fund this spending, outside of regulated periods.”

We go out of the regulated period again in six weeks’ time. Will the Secretary of State consider the urgency of that particular recommendation for dealing with the regulated period? More broadly, does he agree that it is our democratic duty to take the report seriously, and that political parties that do not take the report, and transparency and democracy, seriously have no role in this Parliament and no decency in representing their constituents?

[Steve Reed]

There are clear recommendations about non-party campaigns and candidates, and we will be making our response to those recommendations in due course. The only recommendations I am bringing into force immediately are those that I referred to in my statement.

[Shockat Adam (Leicester South) (Ind)]

I welcome the recommendations of the Rycroft report, particularly the cap on donations from overseas voters, but we all know that our domestic politics is still prey to big money influencing all the parties in this House, which warps our politics and moves it away from public discourse in favour of the interests of the wealthy. In fact, the last election saw one of the highest ever levels of spending in a general election, at close to £70 million. That is extremely unfair for the smaller parties and independents, so can I ask the Minister how we can promote fairer representation and a move away from domestic big-money politics?

--- Later in debate ---

[Steve Reed]

The purpose of the review, and therefore of my statement, is to address growing concerns about foreign influence on our elections, particularly the attempts by hostile states to get control of our elections and influence them in ways that will favour them rather than the British people.

[Samantha Niblett (South Derbyshire) (Lab)]

I welcome the Rycroft report, especially the focus it puts on the threat of social media upturning our democracy. It was astonishing in the Science, Innovation and Technology Committee yesterday that the representative from X repeatedly stated that X was not politically biased and appeared to decouple himself from Elon Musk and the platform itself. Elon Musk has incited hatred in this country and backed very right-wing candidates and parties on his platform. Will the Secretary of State confirm that the recommendations on foreign financial influence extend to any Member of this House receiving any income from X or any other social media platform?

[Steve Reed]

The recommendations are very clear in their scope. I hope my hon. Friend will allow the Government to take the necessary time to respond to those recommendations in detail—there is a lot in them—and then to bring forward amendments to the legislation and take that through both Houses in the usual way.

[Ayoub Khan (Birmingham Perry Barr) (Ind)]

A former high-ranking member of Reform UK was convicted and sentenced to 10 and a half years in prison for accepting bribes to promote pro-Russian narratives, while some Members across the House have had direct foreign interference in their work in Parliament. Given that the Rycroft report highlights the fact that foreign interference in our politics is real and persistent, what additional steps can be taken to strengthen our democracy against foreign interference in political parties?

[Steve Reed]

The hon. Member is right to highlight the very high profile case of Nathan Gill, who was accepting bribes on behalf of Russia, a hostile foreign state, and effectively kowtowing to it rather than responding to the wishes of the British public. We cannot allow that to happen. That is why we are bringing forward the provisions in the Representation of the People Bill, and we will be bringing forward further amendments based on Philip Rycroft’s review that is before the House today.

[Ben Goldsborough (South Norfolk) (Lab)]

I thank Philip Rycroft for his review and for meeting me to discuss his report. I also thank the Government for the quick action that they are taking. On cryptocurrencies, what further action will the Government be taking to ensure that the influence does not move from politics into lobbying or, even worse, into think-tank organisations?

[Steve Reed]

My hon. Friend makes an important point. There are recommendations in the review about precisely that, and we will come forward with our detailed response. I have accepted the review in general terms, but we will bring forward detailed responses to the individual recommendations and then amendments to the legislation so that we can put in place the necessary protections to ensure that it is the British people who take the decisions about who governs them, not people sitting in the Kremlin or in seats of government in other countries.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister very much for his positive statement and for the clear direction from the Government. Some four or five weeks ago, I asked him a question about Sinn Féin moneys. At that time, he said that he would come back to me, but he did not—this is not a criticism, by the way—and I now understand that the reason he did not was that this statement was coming today.

In the light of the statement, can I ask for some clarification? Accountability and transparency are tenets that have to go hand in hand with elections, and those ideals must become realities. Given that Sinn Féin has historically received millions in US-placed donations and maintains a unique cross-border structure, will the Minister ensure that the Rycroft review specifically examines the adequacy of safeguards against political funding originating from the Republic of Ireland and the United States of America, to ensure a level playing field for all parties within this United Kingdom of Great Britain and Northern Ireland?

[Steve Reed]

I thank the hon. Gentleman for his question and for his deep interest in this entire matter. Our intention is to ensure that the safeguards we put in place are robust enough to ensure that no dirty or dark money can enter British politics in any way or from any source. I am always more than happy to continue to engage with him about any specific concerns he may have.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I am completely disappointed with myself for not wishing the hon. Member for Strangford (Jim Shannon) a happy birthday today. [Hon. Members: “Hear, hear!”] That is why his question was allowed to be a little bit longer than usual, but hopefully it will not be next time.

[Chris Hinchliff (North East Hertfordshire) (Lab)]

I welcome this statement. The public must have confidence that political decisions are made in their interests, not those of wealthy donors. Nowhere is that more important than in relation to the housing crisis, where there are also significant concerns that vested interests are seeking to exert significant influence on policy making. Will the Secretary of State meet me to discuss my proposed amendment to the Representation of the People Bill to ban developers from donating to politics and restore trust in our planning system?

[Steve Reed]

I am more than happy to make sure that my hon. Friend gets an appropriate meeting. I also belatedly wish the hon. Member for Strangford (Jim Shannon) a happy birthday.

[Markus Campbell-Savours (Penrith and Solway) (Lab)]

Section 10 of the Political Parties and Elections Act 2009 amended the Political Parties, Elections and Referendums Act 2000 so that, in addition to already needing to be on the electoral register, a donor would need to be domiciled in the UK for tax purposes. However, section 10 required a statutory instrument to activate it, but no such statutory instrument was ever laid before this House. Will the Secretary of State look at belatedly activating this measure to ensure that only those that live and pay tax in the UK can influence our democracy with their money?

[Steve Reed]

I thank my hon. Friend for raising that point, and of course I am more than happy to look at that.

[Mark Sewards (Leeds South West and Morley) (Lab)]

The Secretary of State’s announcement of a cap on donations from overseas electors and a moratorium on cryptocurrency donations from today is extremely welcome. What criminal penalties will be incurred for breaking these rules? After all, we need an effective deterrent to dissuade those who might seek to circumvent them.

[Steve Reed]

We will lay the details before the House so that Members on both sides have access to the relevant information. It was important that the provisions in these two circumstances were brought forward to today, because of the risk of a window for evasion had we not done that. That retrospective change will be subject to the legislation going through Parliament successfully.