Party funding: an imagined consensus?

18th Mar 2010

In Prime Minister's Question Time yesterday Liberal Democrat leader Nick Clegg accused both Labour and the Conservatives of being guilty of blocking a deal on political party funding.

Mr Clegg said donations from a single individual or organisation needed to be capped. Such a move would seriously limit the money Labour could receive from unions like Unite or the funding Conservatives could rely on from wealthy backers such as Lord Ashcroft.

Gordon Brown however deflected fire towards the Tories. He said: "We and the Liberal party agreed changes in political party funding in the summer, more than a year ago. It was the Conservative party that rejected the deal."

But that did not satisfy Mr Clegg who accused the Prime Minister of "rewriting history".

Mr Clegg insisted: "They both [Labour and the Conservatives] blocked the Hayden Phillips agreement. Both other party leaders blocked amendments to cap donations that we tabled to the Political Parties and Elections Bill just last year."

Are the Liberal Democrats right to accuse the Prime Minister of historical revision?

Hayden Phillips review

Sir Hayden Phillips was asked in 2006 to conduct an independent review of the funding of political parties and to make recommendations to the Government.

Over the summer of 2007 cross-party talks were held to try and agree a deal on the basis of the Hayden Phillips recommendations.

One of the central recommendations was to introduce an annual cap of £50,000 cap on donations from a single individual or organisation. Despite the talks, no agreement between the parties could be reached.

Labour and Conservatives both blamed each other for the failure. The Liberal Democrats called for the recommendations to be adopted in full, although they also claim to want the measures to be extended even further.

Political Parties and Elections Act

If the Prime Minister is referring to the Political Parties and Elections Act the voting record in Parliament undermines his claim.

In both the House of Commons and the House of Lords, the Liberal Democrats introduced amendments to try and introduce the £50,000 cap on donations.

In June last year a proposed amendment by Lib Dem Lord Tyler was defeated by a majority of 139 votes (118 Labour and 68 Tory peers opposed it).

The Lib Dems earlier made the same attempt in the House of Commons to introduce the £50,000 cap, but both the Government and the Conservatives failed to support the proposal. 298 Labour MPs turned out to reject the cap and defeat 58 Liberal Democrats MPs in the Commons lobbies. The Tories were almost totally absent, with only four MPs turning out to vote.

Summary

Contrary to Mr Brown's claim, there was no Labour-Lib Dem consensus during the passage of the Act. There were 18 parliamentary votes on the measure. With the exception of individual dissenters, the two parties were consistently on opposite sides of the debate.

Mr Clegg's claim that the Lib Dems supported the Hayden-Phillips recommendations on party funding is vindicated by their efforts to change the law when party funding legislation was introduced last year.

Labour staunchly opposed the efforts. The Conservatives offered no support either. In this controversial area, Mr Brown appears guilty of rewriting history.