Overview

This bill aims to reform the funding and expenditure of political parties in the UK. Key changes include a phased reduction in the maximum donation amount from a single source, new rules on affiliation fees from membership organisations, and the introduction of public funding schemes for political parties. It also modifies rules surrounding election addresses and imposes new limits on non-election spending.

Description

The bill introduces several key changes:

Funding

• Donation Cap: A decreasing cap on total donations and loans received from any one person is introduced, reaching £10,000 annually from 2026.
• Affiliation Fees: Affiliation fees from trade unions and membership organisations will, under specific conditions, be treated as individual donations.
• Public Funding Schemes: Introduces an "amount-per-vote" scheme and matched funding for registered supporters, providing public money to parties based on votes received and registered supporters. Gift aid will also apply to donations.
• Policy Development Grants: Existing policy development grants are ended.

Expenditure

• Annual Expenditure Limit: An annual limit is placed on non-election expenses incurred by registered parties.
• Election Expenses: Amendments are made to existing legislation to control campaign expenditure. Restrictions on pre-candidacy election expenses are removed for certain general elections.
• Election Addresses: Changes the rules around free delivery of election addresses, allowing for the inclusion of candidates' addresses in a booklet sent to all voters.

Electoral Commission

• The Electoral Commission's role is expanded to oversee the implementation of the new rules.

Government Spending

The bill will lead to increased government spending to fund the new public funding schemes for political parties. Exact figures are not specified in the bill but will depend on the number of votes received and registered supporters for each party. The ending of policy development grants will offset some of this spending.

Groups Affected

• Political Parties: Face significant changes to their funding and expenditure, including stricter limits on donations and new public funding schemes.
• Trade Unions and Membership Organisations: New rules on how affiliation fees are treated could impact their financial contributions to political parties.
• Donors: Will be subject to the new donation cap.
• Electoral Commission: Takes on a greater role in regulating party funding and expenditure.
• Voters: Will receive election addresses in a new format.
• Candidates: Changes to election address delivery and nomination requirements affect candidates.

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