Almost one in every ten pounds donors give to political parties in the UK comes from dubious sources, research from Transparency International (TI) has found.
Highly questionable donations, from highly questionable donors
TI analysed 78,735 donations worth £1.19bn that were reported to the Electoral Commission from 2001-2024. Of that, £48.2m comes from donors that are alleged or proven to have bought political access, influence, and/or honours. Another £42m comes from donors alleged or proven to have been involved in other corruption, money laundering and/or fraud. A further £38.6 million derives from shadowy associations who have not disclosed where their income comes from, despite new transparency rules introduced in 2010.
Of the £115m total donations from dubious sources, over two-thirds went to the Conservative Party. This could partly be explained through the Labour Party relying more on trade unions and partly through former Labour leader Jeremy Corbyn moving away from big corporate donors during his leadership, instead relying on small donations and a massive increase in membership revenue, at a peak of 570,000 members in 2017. Under Keir Starmer, Labour membership has dropped to around 370,000. Huge corporate donations, meanwhile, have increased to record levels.
The government’s response
It doesn’t look like the UK government has helped matters during the period analysed. As TI notes, the government has increased spending limits by 45%, limited the independence of the Electoral Commission and banned the Electoral Commission from prosecuting criminal offenses under electoral law. Additionally, for the Tory Party’s election expenses scandal in the 2015 election, the Electoral Commission could only impose a fine of £70,000.
In 2023, the government raised the amount that parties can spend in elections from £19.5m to £35.1m. But as TI notes in the report, separate limits for individual candidates and staffing costs mean the actual ceiling is between £75m and £100m. This encourages parties to be reliant on funding from wherever they can get it. It makes donations from the super rich and dark money sources more likely, TI argues.
Solutions
TI has recommendations to curb the corrupting influence of big money in politics. The organisation, which has over 100 chapters in different countries, suggests capping donations at £10,000 per year for individuals and organisations. This would keep big money out of politics. Indeed, it would’ve prevented Labour from receiving its largest donation ever this year – £4m from an offshore hedge fund with investments in fossil fuels, private health firms, and weapons manufacturers.
TI also recommends the government repeal legislation enabling ministers to influence the Electoral Commission, thereby bringing it back towards independence.
A briefing from Spotlight on Corruption from earlier this year warned:
Our electoral finance laws are riddled with loopholes and the enforcement regime is not robust enough. The Electoral Commission has been weakened and is now subject to political direction, and there is no national law enforcement body with real responsibility for policing breaches of electoral law. This poses huge risks to our democracy.
Another recommendation from TI states that the government should raise the maximum fine the Electoral Commission can issue for parties. It should also enable the Electoral Commission to prosecute for criminal offenses, TI suggests.
Political donors: the new arms race
Rose Whiffen, of Transparency International UK, said:
We are now seeing a new arms race in political spending with parties ever more reliant on the super-rich for support. The over-reliance on a small number of wealthy donors exposes parties and their politicians to powerful interests and the risks of foreign interference and undue influence shaping our politics. Only through reforms to tighten spending rules, bring dark money out of the shadows and improve accountability for those who abuse the system can we loosen the grip of big money and improve the integrity of our political system.
Featured image via A Lady in London – YouTube
