Friday, 30 March 2012

Funding political parties

The latest cash-for-access scandal has attracted renewed interest to the report on party-political finance published in November by the Committee on Standards in Public Life, subtitled "ending the big donor culture".  The report makes 24 recommendations, the most important being to ban donations to a party from any one source of more than £10,000 a year,  and to replace at least part of the lost income with a subsidy from the public purse proportional to votes received in the last general election, to be awarded to any party qualifying for Policy Development Grants: currently this means with at least two sitting MPs, but the report recommends extending to grants to parties with significant representation in the devolved legislatures.  The report recommends that parties not qualifying for state subsidy should be exempt from the cap on donations.

I think the case for public funding is overwhelming.  The estimated cost would be £23m per year.  UK government spending is expected to be about £683bn.  I think it would be extraordinary if the need to encourage donations didn't induce a government to make inefficient spending decisions amounting to much more than 0.0034% of its budget.

Opponents are concerned that restrictions on donations would inhibit the emergence of new parties.  They may have overlooked that recommendation 23 in the report is that "The donation cap should not apply to political parties without enough representation to qualify for Policy Development Grants, or the equivalent we have proposed in the devolved legislatures."  I would extend that to allow any party to opt out of the cap, in return for renouncing state funding and renouncing the possibility of any of its MPs holding ministerial office until after the next general election but one.

The other objection is that politicians don't deserve the money.  But this is not a question of what the politicians deserve; it's a question of what sort of government we all want.  I want one that can make decisions without consulting the party treasurer first.

1 comment:

  1. I am personally not convinced that state funding of political parties is necessarily going to clean the stables. Just to pick up your point about donations influencing policy, patronage can work in many different ways. I am sure you can recall past instances where, for example, a former Minister of Defence has gone on to employment with a weapons' manufacturer.

    Another consideration is that MPs are currently state-funded but that does not seem to stop them from abusing expenses' policies.

    I think there are fundamental issues that need to be resolved - such as separacy of the legislature from the executive, the party whipping system, political patronage (eg vote with the whip or you will never get a ministerial job). The way that parties are funded seems relatively trivial but I do agree that greater transparency nis required.