Political Donations: Cap

Question

11:39:00

Asked by

To ask His Majesty’s Government what plans they have to cap donations to political parties.

My Lords, the Government have committed to reforming political finance rules. We are considering changes that will help protect our system from foreign interference, such as tighter controls on donations. For example, the Electoral Commission has pointed to a need to consider the rules on company donations. Details of these proposals will be brought forward in due course.

My Lords, people are absolutely astonished when they discover that there is absolutely no limit whatsoever to how much money can be given by one individual to a political party. This week, Transparency International has produced analysis showing how dark money from dodgy sources can infect British politics, and Unlock Democracy has produced an excellent Democratic Integrity white paper. Will the Minister undertake to ensure that his department properly considers these reports? Is it not high time that the Government accepted the recommendation of the Committee on Standards in Public Life that there should be a £10,000 maximum cap on the sum any individual can give to a party?

My Lords, let me first address the noble Lord’s question about reports, in particular that of Transparency International. The Government are committed to safeguarding the integrity of our democratic processes and, as I am making clear today, we will be taking steps to strengthen protections against foreign interference in our elections. We are seeking and remain open to evidence from stakeholders, particularly on threats to our democracy. Our primary concern is reducing the threat of foreign interference. Political parties play a vital role in our democracy, and it is important that they be able to fundraise effectively and communicate with the electorate. My department is currently developing proposals to give effect to these commitments. We are engaging with key stakeholders such as the Electoral Commission and the Committee on Standards, and we will update the House in due course.

My Lords, does the Minister agree that it is vital that the new Government take every step to clean up our politics—on political donations and beyond? Does he agree that, as well as a cap, we need greater transparency in respect of political donations? For example, for all donations over £200, we should know the identity of the donor. Does he also agree that we need to ban all foreign donations, cutting off the infiltration of Russia and China into our politics, and that we need to strengthen the remit and powers of the Electoral Commission to ensure both the integrity and legitimacy of our donations?

My noble friend makes a number of excellent points. To summarise, I agree that there is a lot more we have to do as a Government. We committed in our manifesto to protecting democracy by strengthening the rules on donations to political parties. While it is clear that foreign donations to political parties are not permitted, the Government recognise the risk posed by malign actors who seek to interfere with and undermine our democratic processes. We will take the necessary steps to make sure that effective controls are in place, in order to ensure that democratic processes are safeguarded.

Further to the Question from the noble Lord, Lord Rennard, the largest ever donation to the Liberal party was made by a convicted fraudster, Michael Brown. In looking at any changes in the law, will the Government consider forcing political parties that, like the Liberal party, have received money from fraudulent sources to return it to the victims of the fraud?

My Lords, the noble Lord makes an interesting point; however, it is not for me, as a Minister, to consider, but for other parties. This is a decision for political parties on how they operate.

My Lords, does the Minister agree that a key point in a democracy is that donations and the sources of them are transparent? Therefore, I urge him to look at unincorporated associations and change the rules. This has been used by the Conservative Party on an industrial scale to make it very difficult to know where large sums of public money affecting our elections are coming from.

My noble friend makes a very interesting point. I reassure him that we are going to look at the whole issue of electoral reform, and we will bring legislation forward. There is nothing timetabled in this Session, but it is difficult to specify a particular date. We will take away the issues my noble friend raises and consider them when we bring legislation forward, looking at not just political donations but wider electoral reform.

My Lords, if His Majesty’s Government intend to cap donations to political parties, can the Minister confirm that this cap will also extend to clothes and glasses?

My Lords, all I can say is that the point the noble Baroness makes is not relevant to the Question asked by the noble Lord, Lord Rennard.

My Lords, will the Minister look again at the backdoor loophole whereby foreign donations to political parties find their way to Northern Ireland through the Irish Republic? In 2022, over $1 million was raised by Sinn Fein, and before the Northern Ireland Assembly elections in May 2022, money from that source found its way to Sinn Fein in Northern Ireland. Will the Minister undertake to look again at that issue—it was raised in the other House many years ago—and take action?

I thank the noble Lord for making that point. I assure him that I will contact colleagues in the Northern Ireland team, and we will revert back to him.

My Lords, I think the Minister accepts that there is an urgent need to tackle foreign donations, malign actors and donations funnelled through companies that may not, in reality, actually operate in the UK. This is an extremely serious issue, notwithstanding comments from the Conservative Party. The secondary issue, however, is the one raised by my noble friend: the substantial donations made within the UK. Limiting donations in the UK to small figures would not just democratise the process but would get parties to focus again on membership, which has been in spectacular decline in the UK as parties focus their efforts on just a handful of seats and very major donors. That is not healthy for democracy. Incidentally, if we were to cap that, it might make an interesting change to the representative nature of this Chamber, too.

My Lords, the noble Lord makes a number of points. I reassure him that we want to ensure that the Government’s focus is on our manifesto commitment to strengthen integrity in our democratic process. Democracy is precious, and we want to make sure that no malign actors can contribute to it and that any foreign interference is stopped. However, it is for political parties themselves, under law, to ensure the nature of the donation and the background of the company or individual making it.

My Lords, the Minister is aware of my long-standing concern about the use of anonymous opinion polls and other forms of campaigning, either in a general election or prior to one. Will the Minister please ensure that he talks to the excellent new chief executive of the Electoral Commission to establish that it uses all the powers it currently has available to check on the issues I have identified, and, if it does not have the necessary powers, that it is given them through changes in legislation where necessary?

My Lords, the noble Lord and I met the new chief executive of the Electoral Commission, and we will continue to have those conversations—together, if need be, given the noble Lord’s expertise in this area. The noble Lord is quite right: the Electoral Commission plays an important part in the UK’s democratic system, promoting public confidence in democratic processes and ensuring their integrity. On his question about anonymous donations, I will take it away and ensure that we come back to him with some more facts and information.

Does my noble friend recall that the last Government thought it wise, and legislated accordingly, to ensure that people who had lived abroad for more than 15 years and had no intention of ever living in the United Kingdom again should be enfranchised? Can he tell us, in the light of material gathered since the last election, precisely how many more people were given the franchise as a result of that? I have heard estimates of around 2.5 million. What have been the costs involved in ensuring that these people are identified and known to be bona fides residents at whatever residence they last lived at in the United Kingdom? Finally, can he tell us what proportion of the 2.5 million actually exercised their right to vote? He will not be able to answer all of that right now, but will he please send me an extended reply?

To the noble Lord’s surprise, I can answer his question. The total number of overseas voters registered was 191,338, according to the Electoral Commission’s recent report on the 2024 general election. The noble Lord made a very interesting point. Overseas voters have the right to participate in UK parliamentary elections, including the right to donate to the parties or candidates they support. However, foreign money is not permitted, and it is a criminal offence to facilitate an impermissible donation. Political parties can accept donations only from registered electors. Overseas electors are subject to the same counter-fraud measures as domestic electors, including having their identity confirmed as part of the registration process. On his other questions, I will write to him.