Looking through AQA past paper questions, it appears that they haven't asked a question about party funding (or a few other things for that matter). Of course, that doesn't mean they will, but it does mean that is a distinct possibility. Obviously this works for Year 12 as well! So what are the key things we should know?
Breakdown of Labour income
Problems with the current system
First of all, and most obviously, there is the problem of scandal, and you have quite a few to choose from. Bernie Ecclestone famously contributed £1million to the Labour Party back in the 90s, which was seemingly linked for an exemption for Formula 1 from the ban on tobacco advertising in sport which took place at that time. There are many more examples such as:
- cash for questions, where Conservative Party MPs, such as Tim Smith and Neil Hamilton, were accused of taking money to ask questions in Parliament
- cash for honours, where Labour were accused of taking money (under Blair) to award peerages. Tony Blair was actually questioned by police for this.
- this problem has continued under the Conservatives. Several major Conservative donors and supporters have been awarded knighthoods, such as Lord Ledbedev, the owner of the 'i' newspaper, and a Sunday Times report shows 15 of the last 16 of the Conservative Party's treasurers have been offered a seat in the House of Lords having each donated more than £3m to the Tories.
- cash for access, where Peter Cruddas, the Tory chairman, was accused of soliciting donations to allow access to David Cameron, including policy input. He memorably referred to 'premier league' donations.
All of this points to a system where donations tend to impact party policy. Conservatives would argue that, while they are accused of being influenced by big business, the donations of trade unions to the Labour Party have a greater influence.
In 2019 the Conservatives received about £19m from businesses and individuals, and Labour received £7m from unions.
Attempted reforms
In 2000 and 2009 the Labour government passed PPERA and PPEA (Political Parties, Elections and Referendums). These were designed to reform our funding, by making it more transparent. All parties have to register with the Electoral Commission, and declare donations over £7,500 (though there is an obvious loophole here). They also put in place a spending limit of £30,000, and allowed the Electoral Commission to fine those who broke campaign law (such as the Vote Leave campaign being fined £70,000 in the EU referendum). The latter act increased the EC's powers, and closed the loan loophole, where certain donations were simply classified as loans.
The Lobbying Act 2014 tightened up the rules about campaigning for other groups, such as pressure groups, charities and unions in elections. It is important when comparing with the US!
Models of state funding
The Coalition Government included a commitment to party funding reform in its coalition agreement. Reports on party funding were published by the Committee on Standards in Public Life (2011) and the Electoral Commission (2013). Cross-party talks broke down in 2013. The 2011 report, known as the Kelly report proposed a donation limit of £10,000, and state funding, at an estimated cost of 50p per voter per year, where parties would receive £3 per vote in a general election - this would be estimated to cost about £23m per year. There was limited appetite for this in a time of austerity under the coalition, as well as major parties (ie Con/Lab) recognising that it would benefit them the least.
It should be said that we do already have some limited state funding, in the form of Short Money (for the Commons) and Cranbourne Money (for the Lords), which is designed to help fund opposition parties to create potential policies.
The benefits of state funding include:
- Reduces reliance on private donors or trade unions with vested interests, making parties more responsive to the public
- Creates more of a level playing field for parties, reducing the unfair advantage given by large donations
- Parties could perform more effectively without the need to spend time and effort raising funds
The drawbacks of state funding include:
- Parties would no longer need to seek financial support, so may have their links to society weakened
- If as expected funding is linked to past electoral performance, this would favour existing parties
- It may make parties less independent of the state
Defence of the current system
There is certainly little attitude for change
Public funds are limited, and most don't want that money going to politicians
The current system has already been reformed, so there is no need, or at least we could mildly modify it
Famously Tory and UKIP donor Stewart Wheeler defended the giving of money as 'freedom of speech'!
Party Lines
- Conservatives: will seek agreement on a comprehensive package of party funding reform
- Greens: introduce a system of state funding
- Labour: committed to reform party funding and would cap donations
- Liberal Democrats: wide reforms to party funding and would cap donation at £10,000 per person per year
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