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Democracy campaigners have, on the whole, enthusiastically welcomed the Government’s political reforms outlined in a major new election strategy today.
As has been widely-reported, 16 and 17-year-olds will be given the right to vote in all UK elections, bringing UK-wide elections in line with Scotland and Wales.
It represents the biggest change to UK democracy in a generation and delivers a key manifesto commitment of the Labour Party.
Long-called for reforms to voter ID rules will also allow UK-issued bank cards to be accepted as valid voter ID at polling stations, to help more people exercise their democratic right.
And, in what is likely to become even more important, digital versions of accepted IDs (like digital driving licences) will be permitted when they become available. Having ID on your phone should mostly eliminate – eventually – the problem of leaving one’s identification at home.
A new digital Voter Authority Certificate will also be created for those who don’t have any of the permitted IDs. Without abolishing voter ID altogether, these changes remedy many of the problems that voter ID creates: mass disenfranchisement for those who lack it.
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We’ll also see an increasingly automated voter registration system to make it easier for people to register to vote. There are currently an estimated eight million people missing from the electoral roll, and the problem is particularly bad for renters, young people, and those from lower-income groups. Letting people register to vote when they engage with Government services – like benefits, the DVLA or the Passport Office is likely to be a welcome first step.
But it’s the measures on political funding which mostly catch anti-corruption campaigners’ eyes – and us here at Byline Times.
Amid fears of foreign funding of our political parties, the Government has pledged to close loopholes that allow foreign donors to influence UK political parties through ‘shell companies’ – in other words, registered firms which exist solely to pump money into our politics.
Unincorporated Associations are loose groupings like political dining clubs, which have traditionally been able to funnel huge sums into our parties without saying which individuals are stumping up the cash. They will face new requirements with mandatory checks on donations over £500.
As the election strategy makes clear, Unincorporated Associations (UAs) don’t currently need to disclose the source of their funding for donations under £37,270 a year. That makes them a potential route for “foreign or otherwise illegitimate money to enter electoral campaigns,” as the Electoral Commission and almost every anti-corruption group has been shouting for years.
There is therefore a move towards a ‘Know Your Donor’ policy, making clear the onus on parties to check donors are eligible, and to lower this (bizarrely high) threshold for UAs to disclose their funders. UAs will be required to “undertake checks on donations with a value of over £500, similar to the checks on donations undertaken by political parties.”
The Electoral Commission will be able to impose heavier fines of up to £500,000 on those who breach political finance rules (a massive jump up from the current £20,000 max fine, seen as the ‘cost of doing business’ for dodgy donors). As the policy doc makes clear, £20k is less than 0.5% of what many political parties (including the Tories and Labour) spent in the 2019 election. Previously you could fail to declare a multi-million pound, rule-breaking suitcase of cash and get barely a slap on the wrist.
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The Government is clear about the reasoning for reform: “Our own democracy is being threatened by misinformation, foreign donations, and unacceptable intimidation. We must act now to secure our democracy, to protect it from interference from malign actors, and to ensure the safety of all those participating.”
Part of this is stopping foreign donors pumping cash into UK-registered firms, to get around the rules which are supposed to block foreign donations.
“We will be bringing forward measures to ensure that in future, ‘shell companies’ will not be permitted to make political donations to UK political parties. To achieve this, we will require companies to have made sufficient UK (or Ireland) generated income in order to donate,” the election strategy states.
Will this be enough?
Democracy watchdog Transparency International is concerned about an ‘elephant in the room’ remaining “untouched”: the growing arms race in election spending.
It is, they argue, fuelling political parties’ “dangerous dependence on a handful of billionaire backers.”
In 2023, 66% of private political donations in 2023 came from just 19 mega donors. There’s no sign of that changing soon, and therefore “political access, influence and honours” remain at risk of being sold to the highest bidder.
Campaign group Unlock Democracy, while noting the bulk of the reforms are a “strong start”, argues the proposed changes to donation rules don’t pass ‘the Musk test’ – in that they would still allow foreign business owners to make big money donations, providing they have ‘sufficient’ income generated in the UK.
As of 2023 (the latest figures we have) Twitter UK Ltd, one of several UK vehicles for X in the UK, had £67m in assets in the UK. And as an officially ‘large’ company, it has UK turnover of at least £54million a year.
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Should Elon Musk wish to, he could chuck £54 million into any political party’s coffers he likes, even after these proposed reforms. There is no maximum cap on donations – at all. Outside of a ‘regulated election period’, parties can spend however much they like. Even within an election campaign period, the spending limits were hiked under the Conservatives – and Labour shows no sign of reversing it.
As Transparency International UK notes, a political party contesting all 632 seats at a UK Parliamentary general election can spend up to £34 million in the year before polling day, up from £18.96 million under the previous rules.
Last year, Labour came close to hitting that, according to figures out today – spending £30m. Reform spent £5.5m. There’d be little to stop Elon Musk channelling £30m to Reform at the next election to bridge the gap, even under these reforms, provided X makes that much revenue in the UK.
Those Electoral Commission stats today confirm that spending at the 2024 UK general election reached a record high of £92 million, a whopping £25 million higher than in 2019. The 38% increase is unlikely to be slowed much by these reforms.
Lib Dem spokesperson Sarah Olney MP said: “There appears to be an Elon Musk shaped hole in the Government’s proposed changes to elections. Ministers must go much further to close the door to foreign oligarchs interfering in British politics – anything less undermines our democracy.”
As Transparency International adds, going further is realistic. Australia recently responded to the growing threats of billionaire interference with donation caps of £50,000 for federal elections.
The changes this week are certainly more ambitious than many people, including anti-corruption campaigners, expected. No one expected a cap on political donations, or for ministers to end the chokehold of the super-rich on our political debate. But to truly protect our democracy from foreign interference, there’s still time to consider it.
Got a story? Get in touch in confidence on josiah@bylinetimes.com
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Josiah Mortimer also writes the On the Ground column, exclusive to the print edition of Byline Times.
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