Time for state to fund parties

TODAY'S report on funding of political parties recommends a cap on donations, a reduction in spending on general election campaigns, and a vast increase in state funding of parties.

By Graham Dines

TODAY'S report on funding of political parties recommends a cap on donations, a reduction in spending on general election campaigns, and a vast increase in state funding of parties.

Commissioned by the Prime Minister following the cash-for-honours allegations, the report by Sir Hayden Phillips calls on the Government to bring together the three major parties to try to resolve remaining areas of dispute and find a consensus for a way forward.

Sir Hayden will chair the all-party talks before the summer recess, to clear the way for legislation in the next parliamentary session.


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In his report, Sir Hayden said all parties accepted the present system for funding politics was unsustainable. And he said a £50,000 limit on donations from individuals or organisations - as demanded by the Conservatives - would be both reasonable and attainable.

Acknowledging this would create considerable difficulties for Labour, which receives the bulk of its income in large donations from trade unions, he said it might be possible to treat union donations as being made up of many individual gifts from members.

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But this would be acceptable only if a transparent way was agreed of linking each gift to an individual donor. This could involve union members being asked to sign forms confirming that they want their contribution to the union's political fund to support a particular party.

Tony Blair seemed to accept the report's main conclusions, saying: “The time has come for us to find a new settlement on party funding and expenditure.”

Conservative Party chairman Francis Maude said: “We want cleaner and cheaper politics. And we believe that all political parties should work together to achieve this. The ball is now firmly in Labour's court to reform and clarify its relationship with the trade unions.

“In the interests of achieving agreement among the parties, we also accept Sir Hayden's call for caps on party spending. If there were to be local caps, those caps must not be set at a level which gives an unfair advantage to sitting MPs, who now have tens of thousands of pounds of taxpayers' money in Parliamentary allowances to spend in their constituencies.”

Liberal Democrat spokesman David Heath said: “There are serious concerns about the influence of big donors, whether individual, corporate or trade union, and a need to reverse the inexorable rise in campaign expenditure at both national and local level. The key objective must be to restore public confidence in the political system, especially following the cash-for-honours affair.”

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