Friday, March 17, 2006

Is it Time for State Funding of Political Parties?

The row over Labour's finances and 'loans for lordships' rumbles on. I'm told the Sunday newspapers are crawling all over the issue. Sky News has just reported that £13,500,000 has been lent! Jesus. What on earth was that spent on? Surely Jack Dromey would have noticed that sum of money going through Labour accounts? I did an interview with Good Morning Scotland on the subject earlier, and my 'co-pundit' was former Labour advisor Scarlett McGwire. She intimated that state funding of political parties would be the only way to solve the problem of transparency in political funding. Patricia Hewitt on the Today programme blamed the media for insinuating that all political donations are sleazy and thus the public become brainwashed into thinking that all politicians and businesspeople are on the make, when the truth is that 99% of politicians are honest and most people who donate money expect nothing in return. Up to a point. I believe that we are reaching a point when we will have to decide on state funding. It is anathema to me to even consider it as I do not believe the State should be involving itself in political funding beyond what it already does in providing HM Opposition with so-called Short Money. However, we are getting to a point where no one in their right mind will consider giving money to political parties if they are automatically accused of some sort of 'honour buying'. Gone are the days when political parties could raise a high proportion of their income from a mass membership. So if they are denied the opportunity of raising funds from elsewhere we may have to bow to the inevitable. But if we do, it will not be a simple matter. How would such a system work? Would money be allocated by votes cast, number of MPs, should there be some mechanism to reward to recruitment of new members? Would state funding only be given to political parties with parliamentary representation? Would there be a vote hurdle which you would have to jump in order to be eligible for state funding? How high should that be? High enough to exclude the BNP, perhaps? This is a complete hornet's nest and I imagine it would be up to the Electoral Commission to come up with a proposal. Another excuse for this burgeoning quango to expand its huge staff and budget, no doubt. As you will have gathered, my heart tells me to oppose state funding, but my head tells me that we're getting to the point where it is going to be inevitable. If that's the case, Ken Clarke's Democracy Commission had better startb thinking about how the Conservative Party believes it should work.


bebopper said...

"High enough to exclude the BNP perhaps?"
I didn't have you for a PC merchant Iain.

Iain Dale said...

You have misinterpreted what I said. I didn't ask that question as a suggestion - but you can bet your bottom dollar that most people on the left will want to ensure that the BNP receive no state funding. I have to say it would make me profundly uncomfortable too, but I recognise there has to be a level playing field.

malcolm said...

Is it time for state funding and will this prevent sleaze from politicians?No and no.
No one prevents politicians from raising money from anywhere all they have to do is be open and transparent about it.
In Germany they have state funding and this didn't prevent Kohl trying to get his grubby hands on more money.
We should be kicking Blair to kingdom come about his corrupt practices, sadly all we've heard from the Tories is a deafening silence.What have we got to hide?

Guido Fawkes Esq. said...

Sunshine kills bacteria.

We just need transparency, if we know who is paying, we will know where we stand.

Politicians getting their hands on more taxpayer funds is a nightmare.

It is also UnConservative.

Guido Fawkes Esq. said...

Sunshine kills bacteria.

We just need transparency, if we know who is paying, we will know where we stand.

Politicians getting their hands on more taxpayer funds is a nightmare.

It is also UnConservative.

Serf said...

If the people don't care enough to dip their hands in their pockets voluntarily, it seems wrong to force them.

Can you imagine the pressure that would be brought to bear each budget to increase the funds.

Alexander Drake said...

Why is public funding "un-Conservative", Guido? In any case, if it helps Tories while in Opposition get more resources to campaign better, and in turn knock Labour off, where's the problem? If more public money is spent, I'd rather it was spent on the Conservative Party than some trendy, bleeding-heart lefty cause.

The moment Labour thinks public funding will be to its advantage to a sufficient extent to help it retain office, they will introduce it. Let's not kid ourselves.

James said...

UnConservative? No UK political party in history has received more in state funding than the Conservative Party, and I don't see it being turned down or handed back.

In terms of state funding, I don't think the argument is as simple as for or against. Personally, I think that grants would achieve little and create a culture of dependency that is dangerous in a democracy (what would happen if the plug was pulled or the goalposts were suddenly changed).

On the other hand, tax relief and even pound-for-pound matched funding on small donations has a lot going for it on the basis that it is an individual choosing to use a portion of their taxes to invest in British democracy. A registered supporter or voucher system, where £x is given to each party because an individual has requested it, would mean that people who normally are excluded (or exclude themselves) from participating in politics due to their financial situation would no longer be barred.

Fundamentally, both systems force political parties to engage with the public in order to get funding. It would change the economics of politics: raising £10 from 1,000 individuals is so much more expensive than raising £10,000 from 1 individual and such systems would change that calculation.

Without capping donations, such systems would have a limited effect however - you can't have the carrot without the stick. And that emphatically must include trade unions (there would be nothing wrong with a system whereby unions acted as intermediaries to raise money for parties, but it should be up to individual members to decide how their fee is spent, and not be used as a bargaining chip by National Secretaries).

mark adams said...

"Gone are the days when political parties could raise a high proportion of their income from a mass membership."

Or perhaps if no other source of funds is available parties will have to engage with their membership.

Bishop Hill said...

Or perhaps if no other source of funds is available parties will have to engage with their membership.

Or perhaps they could spend less?

Edward said...

State funding? Bringing politics and democracy into the state sector? That sounds like a dose of "modernisation" too far...

If political parties no longer be it. They should not be legislated for.

Ed said...

We use state funding for radio and TV broadcasts down here, here's the rationale of the allocation last year, I thought it might help to offer a framework for general allocation.

In making the allocation the Electoral Commission must have regard to a series of criteria which cover results of the last election as well as consideration of more recent measures of parties' public support. It also requires that eligible parties be provided a fair opportunity to convey their policies to the public (details in appendix, on, Broadcasting Act 75(2)).

This fairness criterion was the basis upon which the Electoral Commission decided to allocate a minimum to all eligible parties and also to cross-subsidise from the allocation to the two largest parties to that to smaller parties. Thus, the allocation is not an exact arithmetic reflection of share of votes, seats, membership or support in opinion polls.

Starting from the basis of a minimum, all parties were entitled to that basic allocation and then the Commission considered which parties should be raised to a grouping which would receive a higher allocation. This process of elevating parties into a higher group produced the divisions shown in the table. The public support criteria were used to distinguish between parties in this process. The table indicates which criteria were of particular significance in separating each category from the one below. For example the four parties in the second to bottom group were distinguished from those in the group below because each had recorded at least 0.5% in at least one opinion poll of the party vote in the last 12 months whereas none of the parties in the bottom group had reached that level in an opinion poll. Likewise, ACT and the other three parties in that group are separated from Maori Party because each has more MPs, and has done better in opinion polls. In general, the Commission thought of parties as being in groups of similar levels of support and in any case placed a party in a group by itself only when there was a clear differentiation from the parties immediately below and above that party.

The Commission welcomed the notification of an increase in available funds from $2,081,000 to $3,212,000 which reflected increases in media costs. Whilst Labour and National between them are preferred by over 80% of respondents in opinion polls, we used the fairness criterion to impose some cross-subsidisation. Consequently these two parties together receive $2 million. The remaining Parliamentary parties were allocated $1 million and the non-parliamentary parties share the final $212 000.

Groups were collapsed into three broad groups for the allocation of time. All eligible parties were allocated some time for opening addresses, reflecting the fairness criteria. However only Parliamentary parties were allocated time for closing addresses as the shorter time made available precluded a wider allocation.

The order of opening addresses is Labour Party, National Party, Green Party, New Zealand First, United Future, ACT, Progressive, Maori Party, Patriot Party, Christian Heritage, Democrats, Destiny NZ, National Front, Libertarianz, Alliance, 99 MP Party, The Republic of New Zealand, Beneficiaries Party, Republic Aotearoa New Zealand Party, New Zealand F.R.P.P. This order was determined by following the groups used for time allocation and using random selection within each group, except that in line with past practice the main government party has the first address and the second largest party has the first closing address.

The order for closing addresses is the reverse within each group: National Party, Labour Party, ACT, United Future, New Zealand First, Green Party, Maori Party, Progressive.

Each of the 12 parties that has been allocated one minute for an opening address also has access to a production package that has been organised with TVNZ. The package will provide production that would otherwise cost over $7 000 for each party. This package has been organised primarily to ensure both the accessibility of TV to these smaller parties, in consideration of the 'fairness of access' criteria and a basic standard of professional production. Details of the production package will be sent to the political parties concerned.

Here's the decision in full. The lower limit here is submitting a party list though most of the parties without parliamentary representation don't use their allocation.

Pulsar said...

Surely the ultimate gravy train-and the best reason for withholding a portion of tax-can you imagine the reaction to flip or flops spin doc getting £23k per month from the taxpayer-and those are just the Conservatives!