Our politics is still for sale

Tim Picton is a senior advocacy advisor at Spotlight on Corruption.

When Steve Reed announced the government’s response to its independent review into foreign interference this week, he told Parliament “our politics is not for sale.”  But once again, the government has ducked the biggest and most important reforms that are needed to reduce the influence of mega-donors, create a level playing field at elections and rebuild public trust: donation caps and spending limits. 

To be fair, the government’s response to the Rycroft Review contains welcome measures to strengthen the UK’s political finance rules – including new powers for the Electoral Commission, its ban on cryptocurrency donations, and tighter conditions for corporate donations.

When the Rycroft report landed in April, the government immediately implemented one of his key recommendations – a cap of £100,000 for overseas donors. But Rycroft’s hands were tied by his remit which was solely on foreign interference in politics. He was clear about that and said the issue of a broader donations cap and spending limits could be “usefully debated during the passage of the Representation of the People Bill” and that they are issues for “the political class as a whole to consider if it wishes to restore confidence in the political process and to keep big money out of UK politics”. 

Immediately campaigners highlighted that only applying a donation cap to overseas donors was absurd and could be easily evaded. They were proved right when three billionaire Reform donors living overseas vowed to move back to the UK so they could continue donating. 

In the government’s final official response to the Rycroft review, however, it is playing whack-a-mole by saying  that overseas donors moving back to the UK must meet a “minimum residency test” before the cap no longer applies. That would mean that these three Reform donors would not be able to donate to Reform until they have lived here again for a year.

Ministers are playing with fire by looking like they are moving the goalposts in a way that impacts particular donors to particular parties. Perceptions of partisanship in setting the rules of the game for elections are a dangerous precedent, which governments that are serious about protecting democracy should avoid at all costs. It breeds public cynicism but it also invites future governments to reciprocate in kind when they get into power.

What the government should have done instead is introduce a universal donations cap and capped campaign spending limits on an annual basis – a policy that would of course also impact them as a ruling party, but ultimately be a much fairer way to restore trust in politics.

Nine out of 10 members of the public support donation caps. Ultimately caps and strict limits on campaign spending  are the only way to end the political funding arms race that is so corrosive to our democracy. Without them, the UK will risk drifting towards US-style politics. 

The Representation of the People Bill, which comes back to Parliament next Tuesday before heading to the Lords, is a once in a generation opportunity to introduce tighter limits on money in our elections. With several amendments to cap donations and reduce spending on the table, now is the time for the government to get serious about its commitment to restore trust in politics by capping donations and spending. 

There is an opportunity here for a new government led by Andy Burnham – who has talked big on electoral reform and accepted the need for a cap in principle – to show its mettle. Accepting a donation cap in this bill, with a commitment to a further review that looks at how state funding for parties could create an even fairer system, would really be a change of direction.

This is an opportunity for his government to be remembered as the government that finally drew a line in the sand to prevent money dictating the terms of our politics.