Theme: Political Economy | Content Type: Blog

This is How to Get Dark Money Out of UK Politics

Rose Zussman


William santos

| 5 mins read

Last month the US Department of Justice published Special Counsel Robert S. Mueller’s report on his investigation into Russian interference in the country’s 2016 presidential election. What in 2017 might only have been a vague sense that the terms of a nation’s political debate had been disrupted is now clearly boiled down to a single line in his report: “The Russian government interfered in the 2016 presidential election in sweeping and systemic fashion.”

In the UK we seem preoccupied by our own affairs, but we should heed the Mueller report as the warning it is. A corrupt and repressive regime known to have recently deployed deadly chemical weapons on British soil has proven it is capable of successfully manipulating Western democratic processes to serve its own interests.

As we face the prospect of European elections and consider the likelihood of a general election in 2019, we would do well to acknowledge that our democratic defences aren’t up to the task of preventing something similar happening here. Some argue it already has: concerns about interference in the EU Referendum and revelations about the practices of Cambridge Analytica and Aggregate IQ have put this in the spotlight.

While the UK is in urgent need of a broad package of reforms – to tackle political capture by private interests, reputation laundering in parliament, conflicts of interest, major lobbying loopholes and more – if we want to keep dark money from corrupting our politicians and undermining our elections we need to raise the incredibly low bar set for companies that donate to political campaigns in the UK.

Take the company Better for the Country Ltd, which is currently under investigation by the National Crime Agency for alleged electoral fraud offences. According to the Electoral Commission, Better for the Country Ltd handled around £8 million that went towards funding campaigners at the EU referendum, which it has reasonable grounds to suspect were from sources prohibited under electoral law. £2.2 million of this was in donations to campaigners. The company was only incorporated on 27 May 2015.

The fact that a company was able to make significant political contributions so soon after being incorporated and without a history of trading raises serious questions as to the purpose and effectiveness of the current rules. What’s to stop companies being used as conduits for political donations that might otherwise have been illegal? What protections stand between our democracy and an aggressive power that would seek to undermine it?

More to the point: are we about to walk into the next election without knowing who’s paying to frame the debate?

Taking back control of politics

Our politicians are in the habit of tackling corruption risk, and other issues relating to money in politics, post hoc. It was only after allegations of cash for questions and peerages had mired the reputation of our politicians in scandal that parliament legislated for transparency over political donations and loans.

How devastating an impact must dark money have before we act? Public opinion of the British system of governing is at a 15 year low, and surveys have shown that people believe our politics and politicians are corrupt. Perhaps we won’t require our own Mueller report before we take this seriously, but our distracted politicians need to act – and quick.

Fortunately, a small but well-targeted tightening of the political finance rules could close one obvious door to dark money. To prevent companies being used to conceal illicit political donations, parliament should legislate to require companies making political donations or loans to do so from the company’s reported profits – not from non-trading cash receipts.

This in itself not a silver bullet and must be part of a broad range of campaign finance reforms, but requiring companies to prove they aren’t simply being used as agents for illicit political donations would be a significant step toward insulating our political system from undue and malign influence. It is within the powers of our elected officials to take this action, and as we brace ourselves for the next election we should demand that they do.