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Home / News and Insights / Insights / Political donations

David Mundy
Partner & Parliamentary Agent

The framework regulating political donations in the UK demands transparency in the form of recording relevant information about the donation and the donor, and where certain thresholds are exceeded, reporting this information to the Electoral Commission. Donors should therefore be aware that while the law does not place a technical limit on any donation, they may lose anonymity.

Who can give donations in the UK?

Any individual and organisation can give an unlimited amount to a registered political party, whether as a donation or loan, if they are a ‘permissible donor’. This is defined in the Political Parties, Elections and Referendums Act 2000 as:

  • an individual registered on the electoral register;
  • a company or limited liability partnership registered in the UK which carries out business in the UK;
  • political parties registered in the UK;
  • trade unions registered in the UK;
  • building societies or friendly societies registered in the UK; and
  • UK-based unincorporated associations that carry on business in the UK.

A donation is money, goods or services given to a party without charge (or on non-commercial terms) with a value of over £500. If this limit is exceeded, the recipient must record the donor’s name and address, (if a company) the company number, the amount or nature and value of the donation, the date it was received and the date it was accepted.

The same recording requirements apply if the donation is given to an individual candidate, except that the limit is £50 unless they are a ‘regulated donee’. These are members of political parties and holders of elected office. If the individual candidate is a regulated donee, the limit is £500.

If the donation or loan is given by someone who is not a permissible donor, a registered political party must return the donation. There are particular rules that apply when returning a donation to an unidentifiable donor. In the situation where the recipient is unsure whether to refuse the donation, it must take all reasonable steps to verify the identity of the donor to determine whether it is permissible.

disclosure obligations

Political parties must report the following to the Electoral Commission:

  • all donations from impermissible sources;
  • all permissible donations over £7,500;
  • all permissible donations and loans from the same source that aggregate to over £7,500 in the same calendar year; and
  • if a source has already been reported to the Electoral Commission in a calendar year (ie because it has already donated £7,500 or more), all subsequent permissible donations from the same source that are, or aggregate to over, £1,500.

These donations must be reported quarterly, unless when a general election is called, in which case reports must be made every week. These rules concern donations to political parties; where donations are given to the candidate, these (along with the spending figures) must be reported to the appropriate Returning Officer after the relevant election. If a regulated donee accepts a donation of more than £1,500, it must be reported to the Electoral Commission in any event.

Campaigning during COVID-19

The Minister for Constitution and Devolution had previously said that door-to-door campaigning or leafletting by individual party activists is not considered essential or necessary for the purposes of the lockdown restrictions. This is no longer the case – the government’s new guidance for England changed on 8 March 2021, and then on 29 March 2021, to allow for covid-secure campaigning as the lockdown restrictions are eased. The guidance states that:

‘Ministers have said that democracy should not be cancelled because of COVID-19. For this reason, May’s elections will take place, and in a COVID Secure way. It is essential that campaigning be allowed in the run up to the polls on 6 May. An informed electorate is vital to ensure that voters can make a reasoned choice for whom to vote. The UK government proposes to allow for two months of outdoor campaigning in the run up to May’s polls, to support free and fair elections’.

Case law update

Two recent cases are of interest. First, in Rothery v Evans the court refused to grant an injunction to a councillor who sought to stop the Labour Party selection process following her de-selection from the shortlist of candidates. The court held that the Labour Party were permitted to restart the selection process and had not acted unreasonably. Moreover, even if the claimant had shown a sufficiently arguable case that there was a breach of contract, the court would have been reluctant to intervene in political decisions taken by political parties.

Second, in Stefan Voloseniuc & Anor v Mansoor Akram & Sors, two losing candidates brought a petition questioning the propriety of a local council by-election and requested a recount. The High Court ordered a recount which led to an extra vote for one of the petitioners, but the petition was not withdrawn. The court subsequently held that the result had been declared correctly, the petition should be dismissed, and that the petitioners were liable to pay the costs of the successful candidates and those of the returning – there were no special circumstances to rule otherwise.

Next time

In the next entry, we will consider the framework regulating the control of campaign spending.

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