Written evidence from the Electoral Commission (LAN0010)
Introduction
1.1. The Electoral Commission is the independent body which oversees elections and regulates political finance in the UK. We work to promote public confidence in the democratic process and ensure its integrity. A key part of our role is to provide advice to the UK’s parliaments on matters relating to elections and political finance.
1.2. We have commented below on the aspects of the Commons standards landscape in which the Commission is directly involved. In general terms, the standards landscape encompasses a wide variety of aspects, including but not limited to financial probity and transparency. As the Committee notes, scrutiny, regulation (where it exists), and enforcement are spread across a significant number of bodies. That situation, of itself, creates a degree of uncertainty or confusion for those who operate within the landscape, and those who may wish to make complaints. Whilst there are good reasons for some of this diversity, we welcome the Committee’s consideration of areas where the landscape could be simplified.
Public perceptions
2.1. Since 2007, we have conducted research tracking public attitudes about elections and democracy in the UK. This research has found a long-term decline in confidence in the political finance system, with 58% of people now saying that political party and campaigner funding is not transparent, up from 36% in 2019. The proportion of people who believe that if a political party or campaigner is caught breaking the rules, the authorities will take appropriate action has also declined, from 57% in 2018 to 30% in this year’s research. While we have not asked specifically about regulation of MPs, the findings are likely to apply to the political finance system as a whole.
Reporting donations to MPs
3.1. The Political Parties, Elections and Referendums Act 2000 (PPERA) requires certain elected office holders, including MPs, to report to the Commission donations and loans they receive in connection with their political activities as an office holder. This requirement was intended to operate alongside the Commons’ own reporting requirements. This reflects the different scope of the two regimes. The purpose of the PPERA regime is to regulate and provide transparency about political donations, while that of the Register of Members’ Financial Interests (RMFI) is to provide information about interests – including political donations – which could be perceived to influence MPs’ actions.
3.2. The overlap between these two regimes has been streamlined to reduce the division of responsibilities and the administrative burden on MPs. Since 2009, to avoid the need for dual reporting, the PPERA reporting requirements have been incorporated into the Code of Conduct for MPs. A similar arrangement is in place for the Scottish Parliament. MPs no longer need to report donations separately to the Commission, in addition to reporting these to the Commons authorities for publication in the RMFI. Sanctions for failure to register interests are purely a matter for the Commons authorities.
3.3. For this arrangement to function, the rules for registering interests must be consistent with PPERA so that the Parliamentary Commissioner for Standards is providing us with the information required by PPERA. This sets some limits on further consolidation of the RMFI rules. During the recent review of the Code of Conduct, there were proposals to combine some categories of interest in the register, such as putting UK and non-UK visits in one category. As we highlighted in our response to the consultation on the Code, these changes would not have allowed us to obtain the information required, as these types of donation are treated differently under the PPERA regime.
3.4. However, there are areas which could be further clarified. Because of the differences between the rules for the RMFI and the List of Ministers’ Interests and the political finance regime, there can be uncertainty as to whether any given donation is in fact made to an MP or to a party. Similarly, donations can be made to local parties with the express intention of funding a particular candidate’s campaign, and the funds are placed in a ‘campaign account’ held by the local party, to which the candidate or their agent may or may not have direct access. This also creates uncertainty around the correct approach to reporting the donation in relation to the political finance regimes. We work with the RMFI and we have created policy positions to mitigate these types of issues, but a simplified framework would alleviate the need for this.
3.5. The Commission retains the role of regulating the permissibility of donations to MPs. MPs are still required to check the permissibility of donors and notify the Commission directly within 30 days of receiving any impermissible donation. We provide advice to MPs on permissibility and, in some instances, on the definition of political activities, through our regulatory support advice service. We have also provided support to the Parliamentary Commissioner for Standards on developing advice notes for MPs relating to permissibility. We are well placed to provide advice and conduct checks on permissibility for donations to MPs, given our expertise in electoral law and responsibility for regulating permissibility of donations elsewhere in the political finance system.
3.6. We are required to maintain a register of donations and loans to regulated individuals. We include MPs on this register using information collated by the House of Commons and published in the RMFI. As the reporting requirements for the RMFI are broader than those under PPERA, we must decide on a case-by-case basis whether a donation is reportable to us and therefore we can publish it. While this duplicates some data available from the RMFI, it is important for transparency and accountability that this information is available in an accessible and searchable format. We support the Committee’s previous recommendations for improvements to the digital accessibility of the RMFI.
3.7. The threshold for reporting donations in RMFI is linked to the threshold for MPs to report donations to the Commission in PPERA. The Government announced in July 2023 that it intends to increase (in line with inflation) certain reporting thresholds in PPERA. We understand that these may include the thresholds for donations made to MPs, in connection with their political activities as an MP (published both in the RMFI and by the Commission), and donations to political parties (some of which are published in the RMFI, for example, when a donation to a constituency party is identified as intended for an MP’s election campaign). The reporting threshold for these donations is currently £1,500. Given the rate of inflation and the length of time since these thresholds were last set in 2009, an increase in line with inflation is likely to be substantial. As it stands, any increase would automatically be reflected in the RMFI threshold. The threshold at which a donation must be checked to ensure the donor is permissible will remain at the same level (£500).
3.8. Any changes to reporting thresholds need to strike a balance between transparency and proportionality. We have encouraged the Government to seek evidence that reporting thresholds are imposing disproportionate administrative burdens. We have also highlighted that increases to reporting thresholds which would reduce the number of donations which are declared and published are very likely to have a detrimental impact on transparency and voter confidence.
3.9. It is for Parliament to decide on the appropriate reporting thresholds in its rules for registering interests. There are already some lower thresholds in place, for example for visits, where the RMFI reporting threshold is £300, but the PPERA threshold for publication is £1,500, as for donations. However, there may be administrative challenges from maintaining different thresholds, for example, if constituency parties were required to apply a different reporting threshold to donations which have a clear link to an MP.
Recall petition process
4.1. While the conditions for triggering a recall petition are a matter for Parliament, we have a statutory responsibility to review the administration of recall petitions and make recommendations for improvements.
4.2. There are some areas where applying electoral rules to a process which is not an election has led to administrative challenges and issues with transparency and secrecy. Following the first three recall petitions in 2018 and 2019, we made recommendations for changes to the rules and processes for running future petitions, which are set out below. We are analysing data from the most recent recall petition for the Rutherglen and Hamilton West constituency and will publish findings later this year.
Length of signing period
4.3. Data from previous recall petitions shows that the majority of people who signed the petition did so early in the six-week signing period. In Peterborough (2019) 79% of those who signed did so within the first two weeks; in Brecon and Radnorshire (2019) this figure was 70%. In both cases the threshold for recall was met within the first two weeks, but the full duration of the petition process had to run before the outcome could be counted and announced. This suggests that there is scope to reduce the length of the signing period without significantly reducing access for people who want to sign. Feedback from administrators highlighted concerns about the cost and impact on local authority capacity of providing signing locations and staff for a six-week period.
Transparency and secrecy
4.4. Restrictions on transparency and secrecy are more significant for a recall petition, compared with an election, because it is obvious what position someone signing a petition is taking: they have made an active choice in favour of the proposal to recall the current MP. By contrast, polling station observation or inspection of the marked register after an election shows only that a ballot paper was issued to an individual voter and does not indicate whether they cast a vote for a particular candidate or party.
4.5. The Government could consider whether all eligible voters should be given the chance to complete an equivalent to the signing sheet to indicate they oppose the petition. This could reduce the risk of compromising secrecy for individuals, particularly if access to independent observation of the process in signing places were to be extended.
4.6. Only Electoral Commission representatives can observe the petition process in signing places. Individual accredited electoral observers can attend the final counting of signatures, while accredited organisations are not permitted to observe any stage of the process. Limiting observation in this way helps to ensure secrecy for those signing a recall petition and prevents others from estimating whether the 10% threshold has been reached before the end of the petition period. However, it does also mean that transparency and scrutiny of the signing process are limited.
4.7. In Northern Ireland, there is no provision in law to allow the marked register to be inspected in cases of suspected fraud, or for the Petitions Officer to supply it to the police, the Commission or anyone who requests it. We recommend that the UK Government should review the recall petition regulations for Northern Ireland to ensure there is appropriate access to inspect the marked register if there are well-founded concerns about fraud at future recall petitions.
4.8. The legislation does not set out some key timings for petitions, including the time signing places should close on the last day, the deadline for receiving postal signing papers, and timings for the count. It also makes no provision for how the Speaker should be notified of the result before it is announced.
Campaigning
4.9. At elections and referendums, the Commission is responsible for registering political parties and non-party campaigners wishing to spend over a certain amount. At recall petitions, the registration of campaigners is instead done by the Petition Officer, who also receives donation and spending returns from registered campaigners. We receive copies of these spending returns but have no power to check that these comply with the law. The lack of statutory scrutiny means that there could be significant spending on activity intended to influence voters at recall petitions which is not fully monitored.
For further information, please email publicaffairsteam@electoralcommission.org.uk
September 2023