Friday, July 14, 2006


Political Funding

Jack Straw, who clearly aims to be a reforming Leader of the House, recently gave a lecture to the Fabian Society on reforming the funding of political parties. This part of the political system is currently in a downward spiral: as members drift away, parties lose the subscription finance to fund activities (which currently cost around £20m a year even with no major election spending.) Consquently they look to individual donors to give or loan large sums and then both parties get caught out: Tories through dodgy donors and Labour through(alleged) loans for peerages.

Straw favours a cap on spending which sounds sensible but a number of intractable problems remain to be solved. Firstly the flow of funds to Labour from union members. Labour is maintaining these are individual contributions while Conservatives insist they are no such thing. Secondly there is the practice, used by the Tories of channelling funds from wealthy private donors- Lord Ashcroft was involved before the last election-to individual constituencies to transform the level of minimum support for sometime, maybe years before the election campaign gets under way. This was done with some success by the Tories nbeore the last election. Third there is the question of government finance for political parties, as practiced in many other democracies in Europe and the USA. Many people are against this as violating the whole idea of a voluntary democracy and as treating the symptoms of disaffection instead of its causes.

To these problems I would favour: keeping the unions as contributors to Labour; controlling the flow of money to constituencies between elections; and introducing only very gradually small amounts of public funding of the parties. This last is a necessary evil as the patient is close to dying from the symptoms which must be alleviated as a matter of urgency. My worry with this however, as indeed with all controls, is that US experience has shown that there are myriad ways of evading such rules. So we see a well funded 'independent' body springing up during the last presidential campaign to 'tell the truth' about John Kerry's role in the 'Swift Boats' incident in Vietnam on which his claims of heroism rested. In reality this was a Republican funded scam to sully the democrat contender's reputation. However sophisticated the controls clever lawyers it seems can cicumvent them. Fortunately we do not include political advertising in our political culture- and long may this continue- but I suspect if controls on spending are too stringent, we might begin to see elements of US practice emulated over here. And I believe that could only be to the detriment of our political system.

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